The effort to deepen Charleston Harbor so it can handle heavier cargo ships could get more money in future years now that the Army Corps of Engineers has recalculated a mathematical formula used in the federal budget process.

The project's formula — called a benefit-to-cost ratio — has been revised upward to 6.4, Jim Newsome, CEO of the State Ports Authority, announced Monday during his annual "State of the Port" speech in North Charleston.

That number — up from its previous 3.9 — puts the Port of Charleston's $558 million dredging project above the threshold needed to be included in President Donald Trump's annual budget.

Until now, the lower figure meant the initiative only qualified for annual funding in the Army Corps' work plan. The higher number means it now qualifies for two budget appropriations.

"Some projects get two bites at the apple — now we are eligible for both of those bites," said Barbara Melvin, the authority's senior vice president for terminals and operations. "We're happy to bite twice now."

The Army Corps started work this year dredging the harbor's navigation channel to much as 52 feet to accommodate the growing fleet of supersized container ships that can carry as many as 14,000 containers.

Newsome also reaffirmed the SPA's commitment to investing in key infrastructure — including a new container terminal in North Charleston and new cranes — while stressing the need to diversify the port's cargo base, which is heavily dependent on manufacturing.

"Seventy percent of the U.S. economy is consumer related, and we need to make some progress on retail," Newsome said, adding that roughly 750 acres of land the authority bought this year in Ridgeville could become a distribution hub for e-commerce and brick-and-mortar stores.

But news of the ratio revision drew the biggest reaction from hundreds of maritime and business leaders who attended the event sponsored by the Charleston Propeller Club.

"We knew that our volumes had gone up and we knew the cost of our project had not gone up, so we thought our benefits would increase, and they actually increased very significantly," Newsome said. 

The ratio calculates the return the federal government can expect for every dollar it spends on a project. With its new return of $6.40 for every $1 spent, the harbor deepening ranks among the best values among federal maritime projects.

The Georgia Ports Authority's Savannah Harbor expansion has a ratio of 7.3 — the highest to date for a navigation project. Charleston, Savannah and a project in Boston are the nation's only current harbor deepening initiatives with ratios high enough to qualify for the president's budget.

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"Harbor deepening has been a top priority for me and this latest development is a very big deal for the Port of Charlston," said U.S. Sen. Lindsey Graham, R-S.C. "This is a major project — one of the most important in the history of our state — and something that will pay dividends for the next 50 to 100 years."

The previous ratio was determined in 2012 — long before bigger container ships started sailing through the expanded Panama Canal to bring record amounts of cargo to the Port of Charleston. The authority asked the Army Corps earlier this year to recalculate it, something the federal agency does on a regular basis with projects nationwide.

"We thought it was a good idea given our strong volume performances of late," said Melvin, who has overseen the harbor deepening project for the authority.

The Port of Charleston set a record for containerized cargo in fiscal 2018 with 2.2 million cargo boxes moving through its terminals. Much of that increase is coming from Asia, where ships capable of hauling up to 14,000 containers at a time are making weekly visits to the port's Wando Welch Terminal in Mount Pleasant.

To date, work to deepen Charleston Harbor from its current 45 feet has been largely funded by $300 million the General Assembly set aside in 2012 and a $50 million loan it made to the authority this year. The Army Corps has contributed $66 million from its budget.

The project’s next contract — to dig the harbor from its entrance channel to the Wando Welch Terminal — will be awarded in the next few weeks. That will include widening the turn basin by about 200 feet — to 1,650 feet — so large container ships can more easily navigate the terminal.

The Port of Charleston is the nation's ninth-largest seaport in terms of containerized cargo volume and has grown at a faster rate — 8 percent annually — since 2009. 

Reach David Wren at 843-937-5550 or on Twitter at @David_Wren_