Michael Shuman, left, author of a report on the “hidden costs” of Naval Air Station Whidbey Island, visits Island County Economic Development Office in Coupeville on Tuesday. Larry Morrell, right, is with the citizen group, Sustainable Economy Collaborative, that hired Shuman for the economic impact investigation. Photo by Patricia Guthrie/Whidbey News-Times

Report contends $122 million hidden Navy price tag

Federal compensation for lost taxes and health harm advised by private citizen group

Island County should ask the U.S. Navy to compensate local residents for lost tax revenue, declining property values and adverse health effects, says a report released by a group of Whidbey Island citizens called the Sustainable Economy Collaborative.

The 56-page report claims there is an “invisible” $122-million price tag for the Navy’s presence on the island.

The Navy, some elected officials and others in the community, however, question the accuracy of the data and conclusions in the report.

THE REPORT reviews what it calls the “hidden costs” of the presence of Naval Air Station Whidbey Island, such as military families who live on base and shop at the Navy Exchange and Commissary, tax-free stores that are open only to military personnel, their dependents and veterans.

“The county is losing an estimated $5.7 million a year in sales and property taxes that it would otherwise collect from employees of an equivalently-sized private industry,” the report’s author, Michael Shuman, said during the first of five presentations he made this week in Coupeville and Langley to government leaders and the public.

Shuman is a Washington D.C.-area attorney, economist and author/editor of nine books.

A GROUP of 40 Whidbey Island residents hired Shuman last year for $30,000 to evaluate how “Navy dollars flow through Island County’s economy and identify what steps could lead to a more robust, sustainable economy.”

“We are a group from North and South Whidbey, civilian and military,” Langley resident Vickie Robin told Island County Board of Commissioners Tuesday morning. “We’ve all heard about the benefits of the Navy, but we wanted the costs quantified.”

Emphasizing a need to diversify the local economy was another reason for commissioning the report, said Langley resident Larry Morrell, who accompanied Shuman during his two-day visit.

THE REPORT mostly analyzes a dozen years, from 2010, when Growlers started flying, to 2021, which is the year the Navy projects Growler activity in its draft Environmental Impact Statement.

Among the hidden costs, according to Shuman, are the loss of $9.8 million in private property value between 2010 and 2015; at least $2.8 million in costs per year from adverse health effects and sleep disturbance; and $142 million in state and local taxes that would be collected if military jobs were converted to civilian jobs.

“Ask the Navy to pay the costs,” Shuman told an audience of invited public officials and others Tuesday. “President Trump wants to increase the military budget by $54 billion, why not ask for some it?”

IN RESPONSE,Navy public affairs officer Mike Welding said Shuman failed to contact the Navy and obtain the latest information “about the well-known socioeconomic benefits from the presence of the sea service on Whidbey Island.”

Welding cited numerous studies, from the 2004 Washington state study showing direct and indirect impacts exceeding 85 percent of all economic activity across Island County, to the most recent 2013 study sought by Island County’s Economic Development Council, as proof of the substantial economic impact from the air naval base.

He also cited less obvious benefits.

“Some benefits that go beyond the continued economic stability our island enjoys include tens of thousands of hours of volunteer service in the community; our environmental and cultural restoration projects; the recovery, medical and lifesaving capabilities of the command’s Search and Rescue unit; and the Navy’s contributions to community safety through mutual aid agreements,” Welding said.

ERIC MITTEN with Windermere Real Estate criticized the report for reviewing real estate only in terms of assessed property values and not including information from market sales data.

Oak Harbor city Councilman Rick Almberg also criticized the report for not containing complete information.

County Commissioner Helen Price Johnson attended the Langley presentation, which drew more than 150 people.

“Though I could argue some of the conclusions in the report, I see it as a positive thing to have so many islanders focusing on how we can keep our economy strong,” Price Johnson said.

ISLAND COUNTYCommissioner Jill Johnson questions motives behind creation of the report.

The fact remains that the Navy is the economic driver of the island and brings much more good than bad to the table, she said.

“I don’t know what they hope to accomplish by putting this out there,” Johnson said. “What’s the purpose of pointing out the negative? To create more divisions in the community?”

Johnson said the report doesn’t seem to contain any new information and makes assumptions that she believes are inaccurate, including overestimating the number of Navy people who live in base housing.

“IT’S Avery political issue and it’s very difficult to have an intellectual conversation about it,” said Grethe Cammermeyer, who sits on the Island County Board of Health and Whidbey Island Public Hospital District Board of Commissioners.

“We need to have a dialogue,” she told Shuman Tuesday when he met with invited public officials and others at the Coupeville Library. “But it won’t happen if we can’t get our public officials to allow a conversation to happen.”

Cammermeyer said she meets “a wall of resistance” anytime she brooches the topic about possible health effects associated with Navy activities during health board meetings.

“You have to balance things in such a way so those who love the Navy and those who love the noise of jets can stop long enough to hear the data,” she said.

THE ISLANDCounty Economic Development Council strongly supports economic diversification, said Director Ron Nelson, particularly in businesses which create living wage jobs. Having more high-paying employment opportunities benefits all residents of the county.

Leakage — when money doesn’t stay in the local economy — occurs in many forms, Nelson said, pointing out that many island residents don’t buy local. He cited a 2015 Washington State Department of Revenue report that estimated Island County residents spent $28 million in online shopping.

Lori Taylor, who started Coupeville Community Allies, said it’s difficult for homeowners such as herself to make decisions on selling without knowing the Navy’s decision on expanding Growler flights, the development of accident protection zones and the extent of ground water contamination.

“Most of my wealth is tied up in my home,” she said. “With this new data, it makes me less likely to stay on Whidbey Island.”

AFTER PORT of Coupeville Commissioner John Mishasek met with Shuman for two hours, he said he came away feeling more positive about the ongoing debate that has caused deep rifts among local government entities.

New technology in warfare, such as drones and unmanned aircraft systems, may be the driving force of change, Mishasek said.

“I think it will be a win-win-win solution that could happen in the next five years in the whole debate in terms of jet noise, real estate prices, local tax revenue and health effects,” Mishasek said.

Report author Michael Shuman helps the local economy by purchasing a T-shirt at Coupeville’s Jet Java in Coupeville. Photo by Patricia Guthrie/Whidbey News-Times

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