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IRPT 2020 Conference: Cancelled

National Freight Strategic Plan

Department of Transportation: Request for Information

Department of Transportation (DOT) issued a request for information on December 27th (with comments due on February 10th) requesting stakeholder input on the National Freight Strategic Plan (NFSP). The Fast Act required DOT to develop a NFSP that included a multimodal freight network (MFN). You will find the following links useful:

For informational purposes, you can find the full request for information here

Link to full 143-page NFSP here.

State MFN Maps here.

IRPT's Response to Request for Information

In the above-referenced Request for Information (RFI), the U.S. Department of Transportation (DOT) has requested information directly from the public and stakeholders, including industry trade groups, to inform the development of the National Freight Strategic Plan as required by the Fixing America’s Surface Transportation (FAST) Act in 49 U.S.C. 70102.

Inland Rivers Ports & Terminals, Inc. (IRPT) is a non-profit trade association with over 300 members nationwide. IRPT advocates for our nation’s inland waterways and the industries and companies that serve and utilize our inland rivers, ports and terminals.

As discussed in further detail below, IRPT offers the following recommendations for the NFSP currently being developed by DOT:

  1. The NFSP should include all of the public inland ports and small coastal ports.
  2. The NFSP should include river segment ton-miles as a metric for freight movement.
  3. The NFSP should encourage discretionary funding opportunities for inland and smaller coastal ports and private terminal facilities.

 

  1. The NFSP should include all of the public inland ports and small coastal ports.

America’s maritime transportation system is comprised of a multitude of ports and terminals along approximately 24,000 commercially navigable miles of inland and intracoastal waterways and channels that moves domestic and international cargo. Even more, for every public port, there are many private terminals located within river transportation communities as well.  It is these ports and terminals that transform those thousands of miles of waterways into a freight transportation system.

The ability of our nation’s freight transportation backbone to function effectively and to compete globally depends as heavily on America’s inland and small coastal ports and terminals as on its large coastal ports and harbors. Maintaining the maritime transportation system so that its performance is safe, reliable, cost-effective, and environmentally sustainable, is a major challenge within the priorities that compete for limited federal resources.

The primary focus of our inland and small coastal ports is to grow our nation’s economy by providing access points for multimodal and intermodal transport via river, rail and road. An efficient intermodal freight network is vital to both domestic and international commerce of the U.S. and its contributions to the integrated freight network. Many of the nation’s exports are generated along the inland river system and many imports are destined for locations that are on the inland river system or that are connected to it via road or rail.

The existing draft of the National Freight Strategic Plan was issued by DOT in October 2015 in response to a requirement for such a plan in the Moving Ahead for Progress in the 21st Century Act (MAP-21) that had been enacted in 2012. However, the National Freight Strategic Plan that was called for in MAP-21 was only for highways. DOT concluded that a plan limited to only one freight mode could not adequately represent the nation’s entire freight system, and so DOT expanded the scope of the October 15 draft NFSP to include all freight modes. This draft NFSP incorporated a draft “Multimodal Freight Network” map that DOT had assembled to include what it believed to be the highest volume freight routes and facilities of the nation’s various freight modes.

Shortly after DOT’s issuance of the draft NFSP, the FAST Act was enacted in December 2015.  The FAST Act continues the requirement that DOT develop a National Freight Strategic Plan, but the NFSP required under the FAST Act is to be multimodal. A separate requirement under the FAST Act is for DOT to establish a new National Multimodal Freight Network (NMFN). Although the FAST Act requires the development of the NSFP and the NMFN under separate provisions, the Act contemplates that the NMFN is to play a key role in the NSFP. For example, the first element that that the Act requires the NFSP to include is an assessment of the condition and performance of the NMFN. The Act also requires NFSP to identify bottlenecks on the NMFN and best practices for improving the performance of the NMFN.

The FAST Act specifies that that the NMFN is to be developed using a two-stage process. The first stage is an Interim NMFN having certain specific components that are listed in the statute. Among the specific components to be included in the Interim NMFN are the public ports of the U.S. that have total annual foreign and domestic trade of at least 2,000,000 short tons, as identified by the Waterborne Commerce Statistics Center (WCSC) of the Army Corps of Engineers, using the data for the latest year for which such data is available.

The Interim NMFN is to be followed by a Final NMFN. The FAST Act does not list specific components for the Final NMFN, as it does for the Interim NMFN, but instead takes a much broader approach. The Final NMFN is to be developed by DOT by considering the following factors in 49 U.S.C. section 70103(c), and then only after soliciting input from a wide spectrum of stakeholders through a public process that includes notice and an opportunity to comment on a draft system:

  • origins and destinations of freight movement within, to, and from the United States;
  • volume, value, tonnage, and strategic importance of freight;
  • access to border crossings, airports, seaports, and pipelines;
  • economic factors, including the balance of trade;
  • access to major areas for manufacturing, agriculture, or natural resources;
  • access to energy exploration, development, installation, and production areas;
  • intermodal links and intersections that promote connectivity;
  • freight choke points and other impediments contributing to significant measurable congestion, delay in freight movement, or inefficient modal connections;
  • impacts on all freight transportation modes and modes that share significant freight infrastructure;
  • facilities and transportation corridors identified by a multi-State coalition, a State, a State freight advisory committee, or a metropolitan planning organization, using national or local data, as having critical freight importance to the region;
  • major distribution centers, inland intermodal facilities, and first- and last-mile facilities; and
  • The significance of goods movement, including consideration of global and domestic supply chains.

The factors would result in the inclusion in the Final NMFN of many more public inland and coastal ports than the ports that meet the threshold of 2,000,000 tons in annual trade prescribed for inclusion in the Interim NMFN. However, only the Interim NMFN is currently in effect, and, as was pointed out in the Federal Register notice of June 6, 2016 announcing the Interim NMFN, the latest data that was then available from the WCSC was for 2014, and this data identified only 113 U.S. ports that satisfied the 2,000,000 short tons threshold.

In contrast, the WCSC itself lists no less than 150 ports as “Principal Ports of the United States” on its website, many of which have annual foreign and domestic trade less than 2,000,000 short tons.

Further, attached to this letter as Appendix A is an annual comparison over the past four years of tonnage data provided to IRPT by the WCSC for more than 300 ports.[1] This data shows that there are many more than 113 ports that have a substantial amount of annual trade. This data also shows that, according to the more current data for 2018, there would be 116 ports, rather than 113, that meet the 2,000,000 tons threshold.  The annual comparisons show that ports which are near the 2,000,000 tons threshold often move above or below it from year to year, suggesting that locking in a list of ports at a fixed tonnage level with outdated data does not accurately reflect the actual freight transportation that is taking place at the nation’s ports as the country’s transportation of freight grows.

According to website of the U.S. Maritime Administration (MarAd): “Ports are a vital part of a nation's maritime transportation system.The United States has more than 300 – operated by states, counties, municipalities, and private corporations. Many of our ports, including the waterways and facilities connecting them, are complicated elements that integrate water, rail, road, and even airborne transportation modes.”  (Emphasis added.)

MarAd’s January 2009 report, America’s Ports and Intermodal Transportation System, provides further detail:

Small and medium sized ports have an essential role in the development of our marine highway system. The Nation’s small and medium sized ports play a vital role by serving specific market niches, communities, or regions and, in many cases, are the sole source of commodities for isolated communities. They are the key to expanding the overall efficiency of America’s Marine Highways, and ultimately the entire transportation system. (Page 9.)

The Nation’s port system is made up of thousands of large, medium, and small terminals and intermodal facilities in approximately 360 commercial sea and river ports. More than just facilities for loading and off-loading cargo, they are a great engine of economic growth. (Page 21.)

Using the Mississippi River as an example, the Interim NMFN includes only 13 inland ports on the river.  However, using the membership of the Port Authority Associations of all of the States along the Mississippi River, there are at least 40 inland ports on the river.

As another example, the difference between the number of inland ports included in the Interim NMFN in a representative sample of States, compared with the actual number of inland ports in those States, and noting the many private terminals in those States that also carry the nation’s freight, is shown in the following table:

 

State

Number of Ports in Interim NMFN  

Actual Number of Ports

Actual Number of Terminals
Arkansas 3 9 25
Illinois 3 19 200+
Kentucky 3 8 50+
Missouri 2 15 200+
Mississippi 5 16 200+
Louisiana 9 32 500+

By several measures, therefore, if DOT were to use only the 113 ports currently designated in the Interim NMFN to inform its development of a national freight strategy, the maritime sector of that strategy would suffer from a significantly inaccurate and understated representation of the nation’s ports – particularly many of the public inland ports and smaller coastal ports.  Therefore, even though the Final NMFN has not yet been designated, IRPT urges that DOT use the broad factors prescribed by Congress in 49 U.S.C. section 70103(c) in determining which ports to include in its development of the maritime elements of the NFSP.

The October 2015 draft NSFP noted the following with regard to the draft MFN that DOT had developed for that plan:

Many important freight opportunities, however, will occur off of the MFN routes, including in first- and last-mile links in urban and rural areas. As such, U.S. DOT does not intend that a project’s placement on an MFN route or facility would provide it exclusive or preferred access to freight funding, or that a project not on an MFN route would be ineligible for freight funding. Eligibility of a freight project for funding assistance should be based on its ability to improve freight flows across the network in a cost-effective manner.

Presumably DOT would similarly intend that whether or not a port is included in the Interim NMFN or the Final NMFN would not affect its eligibility for federal grants or other support.  While such a stated intention in the October 2015 draft NSFP is encouraging in view of the limited roster of ports included in the Interim NMFN, there is no guarantee that Congress, other federal agencies, or even DOT itself will not in the future make eligibility or preference for grants or other assistance contingent upon a port’s inclusion in the Interim NMFN, the Final NMFN, or the NSFP that DOT is currently developing.  Including all of the public inland ports and small coastal ports in the NSFP will reduce the risk for many of these ports of being excluded from eligibility or preference by future decisions of this kind.

  1. The NFSP should include river segment ton-miles as a metric for freight movement.

In addition to considering tonnage at U.S. ports, DOT should also include river segment ton-miles as a metric for freight movement. Maritime freight corridors, i.e. navigable rivers and intracoastal waterways, carry a substantial portion of the nation’s freight and should inform DOT’s development of a national freight strategy. Tonnage on the navigable waterways of the United States includes more than what is moving into and out of public ports. Much freight is moved by private terminals that operate outside of public ports. Because private terminals are required by law to report tonnage, the tonnage moved by private entities not associated with a public port is captured by the WCSC and river mile tonnage data, titled “River Segment Ton-Miles”, is available on the WCSC website.

This would be consistent with the way in which the October 2015 draft NSFP describes the role of highways in transporting our nation’s freight: “In 2013, approximately 10 million trucks moved nearly 14 billion tons of freight across America’s highways” (page 27, first paragraph). The October 2015 draft NFSP does not use a comparable metric for America’s marine highways as it does for America’s road highways. A comparable metric can be made to the waterways by using river segment ton-miles.

An example is provided by the two images below. Image 1 with the shaded area shows how the WCSC recognizes a “port” for the collection of tonnage data for the freight moving into and out of that port, in this case Central Louisiana Port and Natchitoches Parish Port in Louisiana. Image 2 shows the area of Mississippi County, Missouri, along the Mississippi River. There is no shaded area indicating a port that is recognized by the WCSC. Therefore, no tonnage data is published by the WCSC for the freight moving on to, or off of, the Mississippi River in this area.

Note that there are a number of blue dots on both images. Blue dots represent any dock, private or public, that is transporting freight. If a port is indicated by a shaded area and a blue dot is inside the shaded area, then tonnage moving on or off that dock is assigned by the WCSC to that port and is included in the tonnage data for that port and is included in the WCSC’s annual publication of “Tonnage by Ports”. If the port is likewise included in the NFSP, whether by virtue of inclusion in the Interim NMFN, the Final NMFN, or otherwise, then the tonnage from that dock—even if the dock is privately owned or operated—will be taken into account in the NFSP.

However, if a blue dot is outside of a shaded area, this means that the tonnage moved on or off that dock is not assigned to a port, and thus is not included in the WCSC’s annual publication of “Tonnage by Ports” and will not be taken into account in the NFSP if the plan uses only tonnage data for ports as reported by the WCSC.  Including river segment ton-miles will reflect the tonnage moving to or from such docks.

According to the draft NFSP on page 38 paragraph 2: “State and local agencies generally do not have access to sufficient freight data, freight travel demand models, and “freight planning personnel to identify freight problems and plan investments to address them effectively.” Incorporating the data from annual river segment ton-miles is one step closer to sufficient freight data.

  1. The NFSP should encourage discretionary funding opportunities dedicated inland and smaller coastal ports and private terminal facilities.

Inland and small coastal ports and private terminals are critically important for domestic uses and export of agriculture, mining, chemical, and energy commodities.  However, inland and small coastal ports and private terminals face unique challenges in safety, infrastructure condition, and usage. Commonly acknowledged challenges include:

  • Inland and small coastal ports and private terminals have been, and continue to be, neglected in terms of discretionary funding opportunities, especially when compared to other transportation modes.
  • Until very recently, as discussed below, there have been only limited funding opportunities, such as the BUILD and INFRA programs, for which inland and small coastal port infrastructure projects have even been eligible, and only a very small percentage of total funding from those programs typically support port-type projects. Inland and small coastal port and terminal facilities cannot compete effectively against larger projects for funding, and often their projects cannot meet the $5 million project minimum required by those programs. It is something of an irony that infrastructure projects for which funding is sought by inland and small coastal port and terminal facilities are typically far less costly than the minimum required for those programs.
  • Even within the limited funding opportunities, inland and small coastal port and terminal facilities are often forced to compete for the same funding resources against other transportation modes, against coastal seaports, and against each other.

Inland and small coastal port and terminal facilities are nationally significant assets of great value that need to be recognized as important regional supply chain modes, especially when considering the commerce and economic development provided by the aggregate, and merit one or more dedicated sources of discretionary funding.

Addressing Unmet Needs Through DOT Discretionary Grant Programs:

  1. Historically, any federal assistance to the inland river ports and terminals has been appropriated through MarAd. In the Further Consolidated Appropriations Act of 2020 (Appropriations Act) signed on December 20, 2019, MarAd’s budget was funded at over $1 billion, with only $9,775,000 directed to spending for inland ports through the Marine Highways Program. A significant limitation from the perspective of inland and small coastal ports and terminals is that the $9,775,000 does not generally extend to bulk commodities (liquid or bulk).

The Port Infrastructure Development Program included in the Appropriations Act makes $225 million available to fund projects for coastal seaports, inland river ports, and Great Lakes ports, but reserves $200 million of this total amount, or nearly 90%, for coastal seaports and Great Lakes ports, in effect limiting the funding available for inland river ports to $25 million.  However, it is important to note that this $25 million is not reserved for inland river ports, so the inland river ports must still compete with the coastal seaports and the Great Lakes ports even for the relatively small portion of the Program’s funds for which they are even eligible to apply.   A grant made under the Program can be used to cover up to 80% of a project’s cost.

Three provisions of the Port Infrastructure Development Program in the Appropriations Act that are helpful to inland river ports and smaller coastal ports are: first, the minimum grant size is $1 million; second, for grant awards of less than $10 million, DOT is to give priority to ports that handled less than 10 million short tons in 2017, as identified by the Army Corps of Engineers; and third, for grant awards of less than $10 million, DOT may increase the federal share of project costs above 80%.

The fact remains, however, that the inland and small coastal ports and terminals will not be on a level-playing field in terms of federal funding opportunities until there is specific dedicated funding for them by way of either a reserved percentage of existing program funding (INFRA, TIGER, BUILD, etc.) or a standalone discretionary grant program dedicated to the many inland private and public facilities that serve the nation’s freight transportation needs. For far too long, appropriation bills such as INFRA and BUILD programs and authorizing legislation like the FAST Act and WRDA have underfunded inland facilities. Infrastructure projects sought by inland facilities are far less costly than the minimum required for those programs, but the composite result provided by potentially funding these projects could be exponentially beneficial to the nation’s transportation network.

IRPT has undertaken a legislative initiative of proposing to Congress an Inland Port and Terminal Grant Program to level the competitive playing field. This program would be similar to MarAd’s small shipyard grant program, in that the program would:

  • be administered by Maritime Administration;
  • adhere to 60-day submission and 120-day award distribution; and
  • include both private and public facilities.

At the same time, the Inland Port and Terminal Grant Program would differ from small shipyard grant program in that:

  • funds could be used to construct buildings, physical facilities, purchase equipment, etc.; and
  • funds could be used for fixed landside infrastructure projects, such as docks, wharves, piers,  and road and rail improvements.

Unlike the Marine Highways program, the Inland Port and Terminal Grant Program would:

  • extend to both private and public entities;
  • available for fixed landside infrastructure projects such as those mentioned above; and
  • extend to bulk (liquid and dry) commodities.
  1. Most of the discretionary grant programs for federal funding assistance currently require a public sponsor, yet many of the facilities moving the nation’s freight are not located within a public port or they are located with rural areas in which the local public entities have very limited staff and resources. In such situations it is difficult and challenging at best for private terminals to secure a public sponsor in order to be eligible for federal funding assistance, since securing a public sponsor often means that the sponsor must spend time and resources to administer the grant, perform audits, etc.

If the nation’s private terminal facilities are not able to make the necessary infrastructure investments in the absence federal funding opportunities, the diversion of waterborne cargo that would take place would cause truck traffic to nearly double. Two inches of asphalt would be needed to increase the pavement thickness on 126,000 lane-miles to the intercity Interstate Highway System. Increased truck traffic would significantly increase fuel consumption and emissions and would increase maintenance costs on surface transportation.

It is therefore, a benefit to the general public in terms of safety, environment and cost savings to allow private terminal facilities to be eligible for federal funding assistance. Federal funding assistance has historically extended to private facilities (without a public sponsor) in the following programs:

  • Railroad Rehabilitation & Improvement Financing (RRIF)
  • Clean Diesel National Grants
  • Consolidated Rail Infrastructure and Safety Improvements (CRISI)
  • Small Shipyard Grant Program

The NFSP should address the imbalances and obstacles faced by inland and small coastal ports and private terminals in the current federal funding programs, and should propose specific dedicated funding for them by way of either a reserved percentage of existing program funding (INFRA, TIGER, BUILD, etc.) or a standalone discretionary grant program dedicated to them.

The October 2015 draft NFSP and the Interim NMFN do not adequately recognize the importance of our inland and small coastal port and private terminals in helping to move our country’s freight. We offer the comments in this letter as steps to correct this.

IRPT believes that this list remains incomplete.  IRTP and the WCSC have been working together for the past several years to make the list of ports for which the WCSC collects and provides data a more accurate and comprehensive reflection of the inland waterways freight transportation system.

Please access Exhibit A here.