Mississippi won’t have to repay a $570 million Community Development Block grant given to the state after Hurricane Katrina, but most of the jobs created at the Port of Gulfport were low income and employment actually shrunk at the port itself compared with pre-Katrina levels.
Gov. Phil Bryant’s office recently announced that the U.S. Department Housing and Urban Development had closed its review of the Mississippi Development Authority and jobs created at the Port of Gulfport after Hurricane Katrina in 2005.
HUD provided a $570 million Community Development Block grant to the MDA for the port for repairs and upgrades such as wharf crane rail upgrades, ship channel dredging and delivery and installation of three ship to shore rail mounted container cranes, a project that wasn’t completed until 2018.
Under the conditions of the grant, the port was supposed to maintain 1,300 jobs and add 1,300 more workers once renovations were complete in 2016, 11 years after the storm. Fifty one percent were to be made available for those with low or moderate incomes.
Of those jobs, 1,167 came from a casino hotel that leases land from the port authority. HUD allowed the MDA to count jobs added at the Island View as part of its requirements under the CDBG grant. The agency also assisted the MDA in recalculating hours worked by the employees so they could be counted as full time under the conditions of the grant.
The state said that the port had 2,085 maritime employees prior to Hurricane Katrina and that number shrank to 1,286 by 2007. A study by the Stennis Institute that was attached to the governor’s news release said that the port and its tenants directly employed 1,121 personnel and generated $425 million for the local economy.
“HUD’s $570-million investment after Hurricane Katrina was invaluable to Mississippi,” Bryant said in a news release. “I’m proud to say that we’ve met the low and moderate income national objective for CDBG funds. This would not be possible without the effort from our federal and local partners.”
The Stennis study also blamed the Great Recession from 2007 to 2009 and the 2010 Deepwater Horizon oil spill for the downturn in economic activity for having an effect on the Port of Gulfport’s operations after Katrina.
In August 2013, HUD issued a finding on the port reconstruction that criticized the state for inadequate recordkeeping in complying with the low- and moderate-income job requirements.
A report issued in September 2013 by the Joint Legislative Committee on Performance Evaluation and Expenditure Review (PEER Committee) predicted that the port would be unable to meet its job creation requirements by the deadline.
In 2017, the MDA told HUD officials that additional jobs had been created in the expansion of the Island View Resort. HUD examined records and found that 18 percent of the 112 new hires sampled were duplicative or employees had been rehired and counted twice and 25 percent of them never worked full time.
HUD met with MDA and port officials in August 2018 to discuss progress with complying with the job creation requirements. HUD found that only 588 jobs had been created, far short of the 1,200 jobs that were supposed to be added according to the state’s plan.
MDA also used a new methodology for counting full-time jobs at Island View toward the goal, converting part-time positions using hours worked into full-time equivalent positions.
The port has added some new tenants, such as McDermott International, Sea One and Chemours, and brought back fruit company Chiquita in 2016, which relocated in 2014 to New Orleans.
Edison Chouest subsidiary Top Ship was supposed to receive $36 million in state funds to open a shipyard on property on the Industrial Canal owned by the port and employ 1,000 workers that would count toward the HUD total. The deal was scuttled in December after Top Ship wasn’t able to meet the investment or job creation requirements.