Newsome offers principles for funding ports
Tuesday, June 25, 2013
By Eric Kulisch
Similar concerns about underinvestment and lengthy approval procedures for port and inland waterway infrastructure, including dredging to maintain current depths or deepen harbor channels, are top of mind for the maritime industry.
Congress must give the go-ahead to deepen and widen ports, provide funding, and set aside money from the excise tax on imported and coastal waterborne trade to maintain existing harbor dimensions.
But Congress has only allowed about half of the $1.5 billion to $1.7 billion collected each year in the Harbor Maintenance Trust Fund to be used for its intended purpose, holding the remainder in reserve to make the federal deficit appear smaller. The trust fund has a surplus of more than $7 billion.
Since 2000, Congress has authorized deepening of three commercial harbors, only one of which is a container port, and appropriated just over $2 billion, with most of that amount for the dredging of the Port of New York and New Jersey. Feasibility studies and permit reviews typically snake through the Army Corps of Engineers’ bureaucracy for years.
The Senate passed a Water Resources Development Act bill in May and the House is expected to take up the matter after the summer recess. The last WRDA law was enacted in 2007 and before that in 2000, after traditionally being renewed every two or three years.
The draft issue has taken on added importance in recent years with the advent of ultra-large container vessels and the expansion of the Panama Canal in 2015 that will enable vessels triple the current maximum size to cut through the isthmus on routes between Asia and the U.S. East Coast.
The Corps has taken some welcome steps in the past year to improve its project review process, but James Newsome, chief executive officer of the South Carolina Ports Authority, told a House panel looking at freight issues that the federal government needs to adopt a capital budget so that investments are treated differently from general spending and can be planned over multiple years, a point he has repeatedly made in the past.
He also said port investments need to be ranked in terms of costs and benefits and whether 50-foot depths can be achieved, which means not all ports should receive federal support despite the push by many port authorities to become big-ship ready.
“To do this effectively, we need a network way of thinking for our ports in terms of deepening. We have traditionally looked at harbors as individual projects without relationship to each other, and that’s really a flawed way of viewing things,” he said at the April 24 hearing.
“There’s no port on the East Coast of the United States that can succeed without the raising of the Bayonne Bridge in New Jersey because 40 million people live (around) New Jersey and the East Coast services have to go to New Jersey or New York to be successful. So we’ve got to really develop a strategic plan for our port system, put a capital budget aside, identify the size of the problem and then really rack and stack with some prioritization of harbor projects.
“We will not deepen all harbors in this country today at federal government expense.”
Congress should allow the Corps to set cost-benefit rules that would automatically trigger authorization instead of having to wait for Congress to authorize individual projects based on the Corps’ findings, Newsome added.
He suggested a new user fee to cover the cost of deepening projects similar to the one collected for harbor maintenance and eligible uses of trust fund money be expanded to related harbor improvements besides dredging.