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IRPT 2020 Conference: April 20-22 in Little Rock, Arkansas

Dear Congress: We Matter Too

Dear Congress: We Matter Too

Dear Congress,

A few words from the inland ports and terminals, and the smaller coastal ports, all of whom serve the 12,000 miles of navigable waterways of the United States.

First, let us say that we are indeed grateful for all that you have done and continue to do to support our nation’s inland and coastal waterways: returning to a two-year cycle of enacting Waterways Resources and Development Acts with strong bipartisan support, restoring the Harbor Maintenance Trust Fund to its intended use,  and regularly disregarding the inadequate funding requests from the Office of Management and Budget when you appropriate funds for the maintenance and improvement of the inland waterways infrastructure.

WE MATTER, TOO

We also understand that you have many weighty matters to deal with every day, and that dollar amounts that are not sufficiently large have a hard time getting your attention.  So, we hope that we do not seem ungrateful or unappreciative if we say that we feel that in some ways we have been overlooked. Our nation’s freight transportation backbone, its ability to survive and thrive and compete globally heavily depends as much on America’s inland ports and terminals as on its large coastal ports and harbors. Inland port and terminal facilities are nationally significant assets of great value that need to be recognized as important regional supply chain nodes and merit one or more dedicated sources of discretionary funding. The many inland ports and terminals that carry our great nation’s freight urgently request your immediate attention.  We matter, too.

We matter to our customers whose freight we carry from origination to destination and for import and export, encompassing a vast array of commodities and a wide variety of industries that they serve, especially for transporting bulk commodities, such as coal, petroleum, chemicals and grain.

We matter to our employees, sustaining nearly 500,000 jobs nationally, who contribute both to their local economies and to our nation’s economy overall.

We matter to our communities which we serve, transporting commerce to and from 38 states throughout the nation’s heartland via the river system, thus decreasing truck traffic. Did you know that if our waterborne cargo were diverted to highways, two inches of asphalt would be needed to increase the pavement thickness of 126,000 lane-miles of interstate highways?

Failure to address the rehabilitation and maintenance and operational needs of not only the waterways themselves, but also of the ports and terminals that are the connections to those waterways, have led, and will continue to lead, to supply-chain disruptions and negatively impact the nation’s competitiveness in the global market.

BUT WE JUST DON’T FIT

Over the past year, Inland Rivers, Ports and Terminals, Inc. (IRPT) has gained much support from many members of Congress to form an infrastructure investment platform for inland ports, terminals and smaller coastal ports. What we have found, however, is that we do not fit well within any of the existing programs directed toward freight transportation on our nation’s waterways.

Federal assistance to the inland river ports and terminals has historically been provided through the Maritime Administration in the U.S. Department of Transportation (MarAd).  Two programs in particular offer funding support for ports: America’s Marine Highway Program and Port Infrastructure Development Grants, but each of these offers only limited help to inland ports and terminals and smaller coastal ports.

The primary purpose of America’s Marine Highway Program is to relieve congested landside routes serving freight and passenger movement.  Consistent with this purpose, in order to be eligible for funding under this program a project must be either a new service, or the expansion of an existing service, for transporting passengers or either container or wheeled freight.  While this is a laudable objective, by its terms it excludes both liquid and dry bulk cargoes, which comprise a very large portion of the freight handled by inland ports and terminals and by smaller coastal ports.  Even within the narrow scope of the projects eligible for support under the program, the amount of funding is extremely limited.  The Consolidated Appropriations Act of 2019, which was enacted in February of this year, provided more than $1 billion in funding for various programs and operations of MarAd, but only $7 million of this total was designated for the Marine Highway Program.

In the same Act, Congress also authorized nearly $293 million for Port Infrastructure Development Program grants for a broad range of improvements within, or around, coastal seaports to improve safety, reliability, or efficiency.  No inland ports are eligible for this program at all, and approximately $93 million, or almost a third of the total amount, is reserved for grants to the 15 coastal seaports that handled the greatest number of loaded foreign and domestic twenty-foot equivalent units (TEU) of containerized cargo in 2016, as identified by the U.S. Army Corps of Engineers.

Although on its face the statute extends eligibility to coastal ports of all sizes for the Port Infrastructure Development Program, the regulations issued by MarAd to implement the program effectively place smaller coastal ports at a disadvantage.  MarAd’s regulations require that a port include in its grant application a benefit-cost analysis to provide present value estimates of a project’s benefits and costs relative to a no-build baseline.  As a practical matter, a larger seaport that handles a greater volume of cargo will get more use out of a new piece of equipment or a new facility than would a smaller seaport with the same piece of equipment or facility.  As a result, a larger seaport will likely be able to present a more favorable benefit-cost analysis than will a smaller seaport.

Inland ports, terminals and smaller coastal port projects often do not qualify for the BUILD (Better Utilizing Investments to Leverage Development, formerly known as TIGER) or INFRA (Infrastructure for Rebuilding America) programs because of the minimum amounts required for grant awards. Although both programs are intended to include port infrastructure projects, the projects for which grants are sought by inland and small coastal facilities are often far less costly than the minimum award amounts required for those programs.

Inland ports, terminals and smaller coastal port projects also do not typically benefit from the funding provided by the Water Resources and Development Acts because what we are often investing in is landside infrastructure, not river or channel improvements.

Simply stated, despite the good intentions behind these many programs, inland and smaller coastal ports and terminals are not on a level-playing field with larger coastal seaports in terms of federal funding opportunities.

THERE IS A WAY THAT WOULD FIT FOR US

IRPT is advocating a solution that meets the need head-on:  it specifically dedicates funding for the many private and public inland and smaller coastal port and terminal facilities that serve the nation’s freight transportation needs and in amounts that are more likely to meet their actual needs. Therefore, IRPT has proposed that Congress establish a new discretionary grants program that:

  • extends eligibility to public and private ports and terminals;
  • includes inland ports of all sizes (to help offset the Ports Infrastructure Development Program’s restriction to coastal seaports)
  • limits eligible coastal ports to those handling not more than 8 million tons (to help offset the practical disadvantage of such ports in a benefit-cost analysis relative to larger coastal ports);
  • can be used for projects inside facility boundaries for river (non-channel), road and rail projects; and
  • proposes a 50/50 cost share (in order to increase the amount of non-federal infrastructure investments beyond what would be generated by a lower percentage required for non-federal investment, such as 20% or 25%).

And so, dear Congress, please give speedy consideration and passage to the inland ports and terminals and smaller coastal ports grants program proposed by IRPT.

And for those of you, dear readers, who might not be members of Congress, please urge your representatives in Congress to consider and enact this proposal quickly.  They need to hear from you.

 

(Aimee Andres is the Executive Director of Inland Rivers Ports & Terminals, Inc., a non-profit trade association with nearly 300 members nationwide. IRPT advocates for the inland waterways, industries and companies that serve and utilize our inland rivers, ports and terminals. IRPT and its Members welcome Congressional partnership and pledges to offer its support, organizational resources, and network to aid Congress in achieving long-term sustainability through infrastructure investment.)