The push by U.S. ports for more federal dredging dollars is finally beginning to make waves in Congress.
Language that would require all funds collected through the Harbor Maintenance Tax to be used for navigation projects is likely to be included in the final surface transportation bill. That’s a major breakthrough for maritime advocates who argue it’s unfair that roughly one-third of the collected taxes are used to plug other budget gaps. The Harbor Maintenance Trust Fund collects roughly $1.5 billion annually from importers, who pay a rate of 0.125 percent of the value of their cargo. The HMTF is expected to have a surplus of nearly $7 billion by the end of fiscal 2013, according to the Association of American Port Authorities.
The ports’ argument that more money needs to be spent on dredging to create jobs and boost trade also is gaining traction on the front line of congressional funding allocations. Under the latest House energy and water appropriations bill, ports in fiscal 2013 would get $1 billion for maintenance dredging. That’s the largest single annual federal award for dredging and about $170 million more than the U.S. Army Corps of Engineers received last time around.
“This is a significant development. It wasn’t so long ago that (the corps) only received $750 million,” said Paul Bea, principal of PHB Public Affairs, a maritime consulting firm.
Ports will actually get less dredging help in the next fiscal year than in fiscal 2012, however, said Barry Holliday, executive director of Dredging Contractors of America. Funding tied to military project dredging and disaster relief pushed total maintenance dollars to about $1.1 billion in fiscal 2012. The latest appropriation shows a congressional willingness to spend more, even if the full allocation of HMTF dollars would fall short in tackling port needs, Holliday said.
The Realize America’s Maritime Promise Act, or RAMP Act, has been the major driver in convincing Congress the HMTF needs reform and more spending is needed. The legislation was included in the House’s 90-day extension, which paved the way for the chamber to begin conferencing with the Senate on the surface transportation bill. The Senate has similar but less forceful language in its two-year, $109 billion plan.
This boosts the chances that HMTF reform language will make it in the final version of the transportation bill, but it’s just the first step in blocking appropriators from shifting money out of the fund for non-dredging purposes. Even if the RAMP Act language is adopted, it’s not a mandate. Supporters would have to call a point of order in appropriation committees to slap the hands of would-be siphoners, Bea said.
Despite the positive signs for ports, they are still stifled in getting authorization and funding for new major navigation projects. Historically, the Water Resources Development Act has been the vehicle for ports to get authorization for such projects, and funding is granted separately through the annual appropriations process. The last WRDA was in 2007, and there is no new version on the horizon. Even if there were, it’s unclear how it would proceed under the House’s ban on earmarks and the Senate’s similar stance. Not only do the earmarks allow legislators to include language relating to their home ports, but they also provide impetus for representatives and senators to back the bill.
The federal uncertainty hits the East Coast particularly hard, because only a few ports have the funding and approval necessary to deepen their channels. Ports such as Savannah, Ga., and Charleston, S.C, need deeper harbors to handle larger ships able to pass through the expanded Panama Canal in 2015. That supporters of Charleston and Savannah are preparing to take on the deepening expenses themselves reflects just how little optimism there is for federal help.
Bea said maritime advocates and legislators are attempting to figure out how they can get projects funded and authorized in new ways. One such approach is by Sen. Lindsay Graham, R-S.C., to create a national assessment of which ports should be deepened. Plans to create a program for prioritization in authorization and funding come with their own set of problems, however, Holliday said. “When you start prioritizing ports, you begin picking winners and losers,” he said.
Aside from skepticism of the government’s ability to discern champions from laggards, prioritization sidesteps the issue that most, if not all, ports need funding to maintain their infrastructure and grow. Such a prioritization process could dampen efforts to boost overall port spending. That could, unfortunately, fit too well with Congress’s history of favoring easy short-term fixes over harder, more meaningful long-term decisions.