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The Land-Sea Economic Link

Kurt Nagle,
President and CEO,
American Association of Port Authorities


U.S. global competitiveness depends on America’s seaports, including access to them from both water and land.

In 2013, more than 2 billion tons of international cargo moved through America’s seaports. Port-related infrastructure connects American farmers, manufacturers and consumers to the world marketplace and facilitates greater U.S. exports to sustain economic growth.

Port activity is responsible for more than 13 million jobs in the U.S., and more than $200 billion in federal, state and local tax revenues nationwide. Efficient freight movement is crucial to every state economy, and affects the pocketbooks of every American.

With this in mind, the American Association of Port Authorities (AAPA) developed its “Hit the HMT Target!” campaign to urge federal appropriators to meet the dredging funding commitments made in the 2014 Water Resources Reform & Development Act (WRRDA).

The Harbor Maintenance Tax (HMT) is collected from shippers to fund navigation channel maintenance, enabling freight movement to and from the global marketplace. WRRDA established a new funds distribution approach for increased HMT-related appropriations, including funding for expanded uses at donor and energy transfer ports, emerging harbors, and underserved and Great Lakes ports. It established incrementally increasing funding targets over 10 years, culminating with full use of HMT revenues beginning in fiscal year 2025.

Although Congress was close to hitting WRRDA’s first year target of $1.166 billion in the fiscal 2015 “Cromnibus” appropriation bill, it fell $66 million short. AAPA is now looking ahead to Congress’s next appropriations bill to hit the HMT target.

Despite their economic importance, investments in freight infrastructure are also disadvantaged on the land side. Federally, port-related infrastructure projects are lumped in with nonfreight projects vying for limited resources. There’s also a lack of coordination among various government entities and freight stakeholders.

At AAPA’s Annual Convention in November 2014, Vice President Joe Biden reiterated the Obama Administration’s desire to grow the economy and create more jobs by making critical investments in the nation’s infrastructure, including the roads, rails and navigation channels that connect with America’s ports.

Also at that convention, AAPA announced the release of the first module of the “Port Planning and Investment Toolkit” manual to help U.S. port authorities plan and pay for critical infrastructure projects. Developed in collaboration with the U.S. Department of Transportation (DOT), Maritime Administration, PFM Group of Orlando, Florida, and port industry experts, the Funding Strategy guide module shows how to identify best practices and ways to finance major port capital improvements with public and private investment.

As the nation begins to make strategic investments in its freight network, we must look at improving our navigation channels and the intermodal connectors between surface transportation networks and ports that are a critical link in the efficient movement of freight. We must also prioritize access points and address choke points.

A strong national freight policy must include: direct funding for port connectors; dedicated funding for freight projects; eligibility for port authorities to apply directly for project funds through federal and state freight programs; inclusion of intermodal connectors on the DOT’s Primary Freight Network; development of a national freight conditions and performance report; and increased maritime expertise at state DOTs.

We must urge Congress and the administration to hit the annual HMT target authorized in WRRDA and pass a robust surface transportation authorization bill that prioritizes freight mobility and intermodal access to seaports. Our global economic standing depends on it.

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