Much like the tows waiting to traverse the locks on the Mississippi River, a strategic plan to improve the inland waterways has seen serious delays.
The plan to boost construction dollars and speed up projects — created by the barge industry and shippers with the Army Corps of Engineers — now has a shot at adoption more than two years after being created. The plan is at the core of the House bill Waterways Are Vital for the Economy, Energy, Efficiency and Environment, or WAVE 4. The Senate began work late last month on the long-delayed Water Resources Development Act, the key vehicle for navigational project authorization, but it’s unclear when the House will join it on crafting its own version. The last WRDA was passed in 2007.
Inland waterways legislation, a less-than-sexy issue on the Hill, appeared to gain momentum after barge delays exacerbated by the summer drought grabbed national headlines. The attention, along with the push to boost U.S. agriculture exports, framed a favorable reception of the plan at a Senate committee last month.
“If nothing is done, this infrastructure will soon be on the brink of collapse. Moreover, these important projects are not built in a day — or a week — or months. They take years — even decades — to construct,” Rick Calhoun, president of Cargo Carriers, a subsidiary of major shipper Cargill, told the Senate Environment and Public Works Committee on Sept. 20.
Fifty-six percent of the locks are more than 50 years old and past their design life, while 34 locks are more than 80 years old, he said. A lack of funding for lock repairs adds extra costs to shipping the roughly 624 million tons of cargo through 12,000 miles of channels each year. The U.S. needs to spend nearly $13 billion on the system by 2020, and another $28 billion by 2040, according to a recent American Society of Civil Engineers report.
The Inland Waterways Trust Fund, which is driven by fuel taxes, expends about $84 million annually, and with federal assistance, the annual budget for the system comes to about $175 million. That’s about $205 million short of what the Waterways Council, a river operators trade group, says is needed to maintain the system.
To help get to the $380 million mark, the industry aims to raise its fuel tax by 30 percent to 45 percent, or between 6 and 9 cents per gallon. The industry objects to lock fees, because some shippers and carriers that move in areas with more prevalent locks, particularly near Pittsburgh, would unfairly take the brunt of the costs, said Debra Colbert, senior vice president of the Waterways Council.
Just as crucial as increasing IWTF’s coffers is stopping the flow of money to the Olmsted Locks and Dam project. Roughly $150 million from the fund goes toward the project, which has dragged on since 1998 and isn’t expected to be finished for another 12 years.
“When you authorize Olmsted in 1998 and it’s still not complete, and the price tag is up to $3.1 billion, (the current business model) is not working,” said Steve Little, president and CEO of Crounse Corp., an inland waterways carrier. The Ohio River project was first estimated to cost $775 million.
By shifting the project burden completely to the federal government, the IWTF could pay for up to 25 navigational projects during the next 20 years. Roughly $748 million in IWTF dollars were spent on the project last fiscal year, and the fund is on track to pay out another $72 million toward Olmsted-related work in fiscal 2013.
Under WAVE 4, federal funding would pay for all dam construction and major rehabilitation, along with smaller lock repair programs. But shifting project funding away from the trust fund will be a steep request unless Congress can find a way to offset the lost dollars amid a tightening fiscal climate with fewer available “pay-fors.”
Language within the bill to prioritize the corps’ navigational projects and speed up work by cutting bureaucracy will likely gain more traction, considering Congress and the Obama administration’s broader efforts to do the same. The recently passed surface transport bill took a similar approach to highway project construction, and port supporters want corps reform in WRDA, too.
It’s still unclear, however, when Congress will fully dive into creating a new bill. Inland waterway supporters thought WRDA was moving forward back in July 2010, only to have to wait more than two years before Congress resumed its effort. If the Senate Environment and Public Works Committee begins marking up WRDA during the lame-duck session, as proposed by its chair, Sen. Barbara Boxer, D-Calif., the House could be spurred to action.
Key legislation has come out of lame-duck sessions, including the superfund act, but often the path to a bill has more delays than even barge operators encounter on the river.