Posts Tagged ‘freight’
barge, congestion, freight, LaHood, marine highways, Oakland, Ports, rail, taxes, TIGER grants, USDOT
In Marine Highway, Surface Transportation Policy on February 23, 2010 at 12:39 pm
No, not that Tiger.
The eagerly awaited TIGER grants were announced last week. An experiment in government. Against their better judgment members of the House and Senate gave $1.5 billion to the Administration and left it to the discretion of USDOT program managers, modal administrators, the Secretary (and perhaps the White House, just in case) to decide what projects were worthy. (Egads! The bureaucrats!)
The multimodal discretionary grants program—later assigned a name and acronym at USDOT—was created a year ago in the cauldron in which Congress cooked up the economic recovery package. The context was job creation in a failing economy. But the genius of TIGER’s tenacious sponsors—most visibly Sen. Patty Murray (D-WA)—was that it also was a good time to try something different. Politics would always be lurking in the background (if not in the foreground) when doling out tax revenue for public works but this was not a time for the earmarking norm.
Also lurking was the thought: if this works it could set the example for a change in transportation policy.
Lisa Caruso of the National Journal asks in her transportation “experts” blog if TIGER should be replicated in the surface transportation authorization bill. Can it serve as a model for the revised policy and programs that many of us look for in the bill?
So far the respondents (scroll thru the page) generally agree there is benefit in the approach. What’s not to like? Livable community folks liked the selection of street car and pedestrian path projects. Goods movement was given a strong boost with around $300 million going to rail projects. And it was good to see that at least one of the promising marine highway initiatives was granted $30 million. (The first of many one hopes.) That award illustrates how TIGER–and Secretary Ray LaHood–was open to more than the usual road, transit and bike path projects.
By and large, very good projects were selected. But the question posed by Caruso is whether TIGER represents a policy approach worth continuing.
Some of the respondents think TIGER is a good starting point but that it is important to change the underlying policy. In particular Steve Heminger notes it is not enough to create a grants program that is mode neutral. An improved Federal policy and program should have a clearer, focused national perspective e.g., goods movement and metropolitan mobility. It is a view I share.
Bob Poole raises an important policy question worth debating by suggesting an underlying weakness of a multimodal approach if a highway tax is the sole source of support.
One person’s response I would be interested to see is that of Sen. Barbara Boxer (D-CA). In January 2009 the chair of EPW, which is to produce highway and other portions of the next authorization bill, flatly opposed the multimodal discretionary grants provision in the draft Senate stimulus bill, even as Heminger and other Californians welcomed the idea of a mode-neutral program and projects judged on their merits. Boxer and others in the transportation leadership of Capitol Hill will decide whether the TIGER approach is just a brief detour from projects as usual. Pbea
change, freight, MARAD, marine highways, MTS, Ports, USDOT
In Federal Government, Leadership, MTS Policy, Surface Transportation Policy on February 15, 2010 at 1:07 pm
Sitting the USDOT leadership in front of an audience has become a bit of a tradition each January. Most of the brass, sans Secretary LaHood, appeared en panel at the recent TRB annual convention. The policy and modal chiefs offered brief overviews as to what is on their plates. Here are notes from two that have particular relevance to MTS related policy.
Under Secretary for Policy Roy Kienitz covered the big item — the next surface transportation authorization bill. This year the Secretary’s office will pull together recommendations for the Obama White House to consider in preparing a package for Congress.
Roy stated the vision: A renewed sense of strong federal leadership in transportation centered on meeting national needs.
He defined national needs: safety, state of good repair, economic competitiveness, livability, and environ sustainability.
The department’s priorities: organizing programs around those needs and recommending ideas to congress.
The challenges he described: getting Americans excited about the vision and finding a politically acceptable way to pay for it.
David Matsuda, the Maritime Administration’s acting Administrator, is awaiting Senate confirmation. He offered his take on what is what is driving the need to develop a vision for the marine transportation system as it applies to nation’s economic competitiveness.
The Panama Canal widening has the potential to significantly alter land and water routes. Add to that potential changes relating to the use of the Suez, an Artic route, etc. In short, we’re facing a whole new freight delivery market.
The Federal government must play an active role such as help “coordinate” investments in port access and intermodal connectors. Few studies and data are available. MARAD is commissioning a study to fully explore the impacts of a widened canal on our transportation system.
David said the study outcome is expected to shape national policies and help assess the capacity of channels, connections, etc. He spoke of the need to factor in the capacity of port terminals and landside connections, the ingenuity of port authorities and terminal operators, and the competitive measures Canada and Mexico ports will take. To understand how fuel prices affect freight economics. And to identify marine highways to relieve surface congestion and move goods in a more energy efficient manner on the water.
There’s work to be done at the Department of Transportation. And plenty reason for the freight community to plug into it. Pbea
AMH, freight, LaHood, MARAD, marine highways, MTS, USDOT
In Federal Government, Leadership on January 27, 2010 at 11:50 pm
David Matsuda –the President’s pick to serve as Maritime Administrator–is ready to serve.
He returned to familiar turf this week when he appeared at his nomination hearing. He worked for the same committee that will be voting on his nomination. His work in the Senate had to do with railroads, ports, transit, trucking and aviation. He worked for a senator whose state’s second largest employment sector is logistics and which is host to the New York Harbor and Delaware River gateways.
Since mid 2009 David Matsuda has been running the Maritime Administration as the top political appointee at the modal agency. He has the confidence of Transportation Secretary Ray LaHood who first knew him as Deputy Assistant Secretary for Policy.
Importantly for MARAD–and for the marine transportation system–he has knowledge and experience to help shape a new transportation policy for the administration to recommend to Congress. That transportation policy has to include, for the first time, a national freight policy. And by rights it should put the marine transportation system squarely in that policy.
David Matsuda’s prepared statement for the hearing was brief and straightforward. He reminded the committee that the “impacts of our nation’s maritime industry are not limited to coastal states.”
“Items brought in by ship make their way to store shelves and factory lines throughout the nation. Some raw materials we mine, goods we produce, and agricultural products we grow for export leave through our seaports or travel down rivers or across great lakes to distant markets. In all, 36 states have a maritime port—whether it’s on a river, lake, gulf, or ocean. Merchant mariners live in just about every state in the Union, and midshipmen nominated by you and your colleagues to study at the U.S. Merchant Marine Academy can claim home to all but one state. Some states have shipyards or marine manufacturers which can be the largest sources of jobs in an entire community or region.”
He noted acknowledged the challenges.
“Today’s industry is struggling with many tough challenges: a lagging economy, climate change, the threats of invasive species, piracy and other security issues, a greatly expanded Panama Canal opening in 2014, and an aging workforce, to name a few.”
One of the challenges facing the next Administrator is to make something of the marine highway program. It is just getting started. With no assurance of a reliable funding stream for the program, MARAD–hopefully with strong support from the Secretary’s office–will have to make the most of its modest resources to develop a credible and creative program that will be central to MARAD’s mission for many years to come.
“I feel my experience working within the federal government, and especially working in the Senate, has allowed me a broad understanding of how these challenges can be approached successfully: by working with all stakeholders in good faith and with transparency in decision-making.”
We wish him well. Pbea
AMH, freight, marine highways
In Marine Highway on January 14, 2010 at 1:47 am
Jim Kruse and colleagues at the Texas Transportation Institute (TTI) completed a study that identifies obstacles to marine highway development. It’s a good report. At least I can say that the presentation I saw last evening outlined a lot of useful information. The report itself is not yet available.
I can’t wait to read about the failed domestic shipping services that the TTI team examined. (They looked at successes, too.)
Clearly there are obstacles. There are the perceptions. The operational issues. The insufficient demand, particularly during tough economic times. The potential customer expectations…assuming you can him to the point of talking about expectations.
There are the governmental hindrances. The ingrained logistical practices. The costs of multiple handling of cargo. The scarcity of financing for start-ups.
But wait! There is good news. Folks don’t see the Jones Act as much of a problem. (Seriously, that’s in the report.)
“North American Marine Highway Operations” is a useful study, commissioned by TRB–the Transportation Research Board of The National Academies–as part of the federally funded National Cooperative Freight Research Program. And it appears that more will be done on this subject.
Are we surprised there are many of these obstacles? No. A number of them have been well known. Prime Example: the Harbor Maintenance Tax as applied to non-bulk cargo clearly needs to be addressed.
Can we learn from this study. Yes, indeed.
Truth is, we have a lot to learn. A lot to address.
At the TRB Annual Meeting (as if thousands of people can “meet”) some other things caught my attention.
- In the foreseeable future trucking will no longer be at a disadvantage when compared to marine transportation emissions on a ton-mile basis.
- When this decade the U.S. implements its self imposed Emission Control Area (ECA or “ee-ka”) limiting emissions within two hundred miles of the coastline vessels will have to adopt use of cleaner fuels, which will put vessels at a complete economic disadvantage vis a vis trucking.
Accepting these at face value, marine highway advocates also will have to address some fact of life environmental obstacles. But then we knew that, too.
The I-95 Corridor Coalition long term “vision” for the 16-state members see marine corridor services as part of the multi-mode capacity solution to the Atlantic states’ growing system problem.
Marine highway services are operating in the U.S. now. Ten years hence marine highways will be more a part of the national transportation system. How much of a part of the system will depend on how well government and industry transition marine transport to meet commercial and public needs and do so in a changing environment.
The obstacles in front of us are not fortress walls. The obstacles just show us where we need to get to work. Pbea
change, freight, LaHood, marine highways, rail, SAFETEA-LU, supply chain, trucking, USDOT
In Efficiency, Intermodal, Surface Transportation Policy on December 1, 2009 at 1:32 pm
Federal Railroad Administration (FRA) released a study in November comparing truck and rail fuel efficiency. It’s an update of a 1991 FRA report.
The new study identifies rail as more efficient. No surprise there.
The report, Comparative Evaluation of Rail and Truck Fuel Efficiency on Competitive Corridors (November 19, 2009), should be useful to Secretary Ray LaHood in developing a new freight policy. But he should not leave it at road and rail. Marine transport–the wet surface transportation–should be in the mix.
The Secretary has spoken about the need to understand how marine transportation can be better integrated with the surface transportation system. He has identified marine highway development–and the capacity it would bring to domestic freight transportation system–as an administration objective.
The MARAD-funded TTI modal comparison report is very helpful in understanding how barge transportation compares to rail and road. Does that tell us all we need to know? After all, there’s more to domestic marine freight movement than tugs and barges. More to the point, there’s more in store for coastwise and inland services than what is on the water today. How would the planned, new Ro-Ro and container vessels compare to rail and truck? Policy makers need complete 3-mode data to make complete policy decisions.
The freight logistics industry has pointed to the lack of a national freight policy. The Freight Stakeholders Coalition announced in May its suggested “platform” for a freight policy. As the platform suggests the policy should “foster operational and environmental efficiencies in goods movement.” The platform also calls for the establishment of a “multi-modal freight office” in the Office of the Secretary (OST) in the interest of advancing freight mobility.
A multi-modal view that is not hampered by an old view of how transportation works is what is called for today. Greater fuel efficiency isn’t an ideological issue. It’s very much an economic matter to business and a bi-partisan policy matter as we understand the country’s interest in energy security. Likewise we see environmental issues–emissions, particularly–becoming more of a business and policy concern.
That’s why the developers of the GIFT model are attracting interest. Dr. James Corbett of the University of Delaware and Dr. James Winebrake of the Rochester Institute of Technology–with the support of USDOT, MARAD and others–are developing the Geospatial Intermodal Freight Transportation (GIFT) model. GIFT enables the fuel and emission comparison of modes for specific freight routes. In other words, logistics planners soon will have a tool that goes beyond the one-sided “carbon calculator” analysis available on some rail and marine transportation company websites.
Corbett and Winebrake add further value with their IF-TOLD Mitigation Framework that they describe as “A Context for Mode Shifting Discussions.”
Some good work is being done to provide more information for making modal decisions and enable the development of smarter freight policy. With any luck the policy makers will determine what multi-modal information is available as well as what additional information is needed before deciding on a long overdue national freight policy and the successor to SAFETEA-LU. Pbea
freight, LaHood, Obama, rail, USDOT
In Federal Government, Leadership, Surface Transportation Policy on November 28, 2009 at 8:19 pm
Thinking of George H. W. Bush can conger up a few unfortunate (for him), lasting images. For me it’s the former president’s food judgments (pork rinds good/broccoli bad), his unfamiliarity with the price of milk, and Dana Carvey’s exaggerated but dead-on impersonation. Then there was, “oh, the vision thing.” It sounded like he thought it a useless factor in governing–perhaps more so than he may have intended–but it stuck.
As a practical matter civil servants and political appointees often aren’t given the time to engage in “visioning”. Sometimes when it is done it can amount to little more than a facilitated exercise. But what may seem like a luxury, or a waste, arguably is essential for a new administration and even newly sworn congressional leadership.
At USDOT some part of a vision is in place, though I don’t know how much is the result of planning or predisposition.
The two elements of an Obama transportation vision that I can identify are high speed passenger rail and livable communities. The first is courtesy of President Obama himself. In an out-of-the-blue moment earlier this year the White House said the economic stimulus package being written in Congress must include billions to start a high speed rail program. (It was one of a few Obama “musts” in a measure that was mostly dismissed by Republicans as a “Pelosi” bill.) The rail piece was the president’s vision, and an inspired one to be sure.
The second quickly became a regularly voiced theme by Secretary Ray LaHood and his policy staff. It suits an administration that is oriented toward energy conservation, the urban environment and, not to be forgotten, the voting pedestrian/commuter. Does it qualify as vision? I think so. It’s more than a policy view because a livable community objective could transform urban and town landscapes and it entails a broad range of policy solutions.
Meanwhile a more complete administration surface transportation policy is still in the cooker. Congressional committees are wondering what and when policy recommendations for a successor to SAFETEA-LU will emerge from USDOT headquarters. Perhaps no sooner than mid 2010.
Vision and policy are not synonymous. One can have a new vision, and implementing policy, for passenger rail while maintaining a decades-old freight policy. Somehow that doesn’t sound like this administration.
It’s one thing for the recent Bush administration and Secretary Mary Peters to articulate a scant administration view about transportation that amounted to little more than less Federal government, more State responsibility, and greater private sector financing and management. It made for a transportation policy only a Cato could appreciate.
But we might reasonably expect more from Messrs Obama and LaHood given the administration’s expansive environmental and energy view. Transportation’s role in addressing those issues is significant and goes beyond putting passengers on trains and encouraging transit use and bicycling.
So here’s the question: What is the total vision that will steer administration action and guidance to congress over the next three, maybe seven, years? Will it be more than passenger rail and livable communities? Pbea
congestion, freight, Ports, rail, SAFETEA-LU, USDOT
In Intermodal, Ports, Surface Transportation Policy on November 17, 2009 at 11:04 pm
When earth was turned in 1997 for the Alameda Corridor project in the San Pedro Bay port region more than one kind of ground breaking was occurring. The Port of Miami is a beneficiary.
In freight transportation policy circles the Alameda Corridor project one day may be legend. The ports of Los Angeles and Long Beach were the gaping end of a freight funnel that emptied import boxes onto the exit rails and streets. In essence the solution was to eliminate grade crossings by building a blow-grade rail way out of town. A big project with a $2.4B price tag. A key to the financing was Federal credit assistance. The project and two others in California were the first to benefit by this innovation. A paper on the FHWA website tells the story.
Due to Federal budgetary constraints, however, the grant was not deemed to be a fiscally or politically viable option. An alternative form of Federal support for this project was needed, and by 1997 the answer was clear: Federal credit enhancement in the form of a junior-lien loan to ACTA.
The fiscal year 1997 Omnibus Consolidated Appropriations Act (Public Law 104-208) provided $58.7 million for DOT to cover the capital reserve charges associated with making a direct loan of up to $400 million to ACTA for the Alameda Corridor Project. This represents an actual budgetary cost of 14.7 percent of the face value of credit assistance. The legislation also provided that the loan be repaid within 30 years from the date of project completion and that the interest rate on the loan not exceed the 30-year Treasury rate.
Inspired by the success of leveraging non-Federal investment for large infrastructure project, particularly private financing, Congress in 1998 fashioned a fully articulated TIFIA program. It was adjusted in SAFETEA-LU with a lowered threshold to make more projects eligible.
Nearly $7 billion in projects in 13 states have benefited since TIFIA was created by Congress. The Port of Miami’s rail freight tunnel had an uncertain future but with the October announcement the financing is in place and a $607 million construction project soon will be underway. Not bad. Pbea
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freight, LaHood, marine highways, MTS, Ports, USDOT
In Federal Government, MTS Policy on November 8, 2009 at 11:49 pm
The DOT Secretary’s blog–Fast Lane–noted this past Thursday that “port managers have a difficult dual mission to fulfill-–providing the critical interface between water and surface transportation, while handling both commercial and military cargo.” The prior day he met with the National Port Readiness Network, including some port representatives.
Secretary Ray LaHood acknowledged in his blog that that dual mission “is much easier said than done. “ “And I get that only the commercial side of their mission provides the ports compensation.” He said “DOT wants to do all we can to help them meet these obligations.”
Back in March when Secretary LaHood addressed the spring meeting of the American Association of Port Authorities he was asked from the floor what the new administration was thinking in the way of a freight policy. The cabinet member said his department had yet to give it attention, that implementation of the stimulus package was USDOT’s immediate focus, and toward the end of the year he may convene stakeholders to start to develop a perspective on freight.
It sounds like he is ready to act on that idea. In recent weeks he indicated to Kurt Nagle of the AAPA that USDOT will call port directors together for purposes that include an examination of freight issues. The plan is to have a meeting–perhaps in New Orleans–this coming January.
He noted in this blog of November 5th two action items–a “port summit” and “a Presidential initiative to integrate planning” with DHS.
The former appears to be focused on the port authorities–the public agencies with port jurisdiction. A government to government conversation makes sense. But will the Secretary at some point also enlist the private sector side of the ports–the terminal and vessel operators–in a confab to examine freight issues? And will this be the start of a concerted effort in the Secretary’s office to develop an overdue Federal freight policy?
The latter is a reference to a $15M item in the current year budget–also in the Senate version of the DOT appropriations bill. “This will help develop and modernize the freight infrastructure that links coastal and inland ports to highway and rail networks,” LaHood said in the blog. We’ll have to wait and see how that intention will materialize in actual projects. Earlier this year MARAD folks said that some or all of it may be applied to marine highway initiatives.
We’ll see how these two items on the Secretary’s to-do list develop. In the mean time it’s good to know that Secretary LaHood wants to listen to the ports and focus some resources on the MTS. Pbea
freight, marine highways, rail, trucking
In Intermodal, Marine Highway on November 6, 2009 at 6:39 pm
It’s been talked about for a while but the talking is over. J.B. Hunt Transport Services did a major deal with Norfolk Southern Railway. According to the Journal of Commerce (November 6, 2009):
Hunt said the accord “will further establish the parties as the leading providers of transcontinental and local intermodal service in the eastern half of the United States.”
***********
The new deal with NS, the trucker said, gives both partners “a platform to accelerate the conversion of traditional truck traffic to cost effective, environmentally friendly intermodal transportation with service that is competitive with truckload moves.”
It makes great sense (not that the folks at the two companies need affirmation from this quarter). But if one thinks in total system terms, they are only making use of two-thirds of the surface system capability. They are using only one-half of the available high capacity, high efficiency modes.
If the maritime stakeholders make the effort to fix Federal policy and put the U.S. Flag in fighting trim it’s only a matter of time before a Hunt or a Schneider–or, yes, a CSX–will do a deal with, or acquire, a “Blue Water Transport”. The press release will tout…
“a new deal that gives partners a platform to accelerate the transition of traditional land mode traffic to cost effective, environmentally friendly intermodal transportation with service that is competitive with coastal corridor moves along the congested interstate highway.”
It will be the starting shot. Pbea
AMH, congestion, freight, HMT, trucking
In Marine Highway, Surface Transportation Policy on October 18, 2009 at 11:09 pm
The Harbor Maintenance Tax (HMT) discourages new customers for the marine highway. It may not be the only number in the logistics calculus but it tops most to-fix lists. Why?
Vessel operators, maritime labor, ports, and others agree that the HMT is most in need of a policy fix. But the diversity of perspective sometimes means the prescriptions for a fix will vary…as will the way of explaining the issue.
If you ask someone to explain the HMT issue the response may be: “It’s a double tax on cargo.” I have heard that lone, simple statement made many times including by an industry witness at a committee hearing. It is how others are coming to know the issue. A key Member of Congress recently explained the issue that same way. Double taxation, period.
The double hit of the ad valorem tax is a valid reason. Imported cargo pays on entering a U.S. port, and then, when transshipped by coastal service to another American port, pays again. But that explanation leaves out an equally important reason for Congress to approve legislation such as the Cummings bill in the House (H.R. 638) or the Lautenberg bill in the Senate (S. 551).
The single hit of the HMT on domestic cargo–much of which moves in trailers–is the other principal reason. Domestic freight represents the greater percentage of goods moving on the roads today…far more than international boxes. When the Port Authority of New York & New Jersey studied trucking in that congested metro region less than 5 percent of the trucks on the road were carrying containers to or from the port. This is hardly surprising.
So whether the cargo is riding in a 53′ trailer, or is a vehicle itself, that is the freight we need to attract to the marine highway. Unlike the imports the domestic freight would pay only once. That also is too much.
If the marine highway is to fulfill our expectation to enhance the surface transportation system and mitigate the interstate burden the J.B. Hunts, the FedExs and other companies should participate in blue and brown water services.
Exempting both international and domestic non-bulk cargo moving in the American domestic trade, and among Great Lakes ports, is the objective. It is a low-cost way to remove a disincentive for the use of efficient marine transportation and signal a policy change to the logistics industry where the business decisions are made.
That says it all. Pbea
freight, marine highways, SAFETEA-LU
In MTS Policy, Marine Highway, Surface Transportation Policy on October 5, 2009 at 5:33 pm
Some things are worth repeating. Especially on the subject of putting our waterways and waterfront to greater productive use.
Here’s a for-instance — excerpts from a recent statement by Rep. John Mica (R-FL), the ranking minority member of the House Transportation & Infrastructure Committee, as submitted to the America’s Marine Highways website.
- “As construction costs rise, and as the resources to address our growing infrastructure needs become stretched thinner by the day, it is…important that we use all of our transportation assets more wisely and effectively.
- “I have advocated for the development of a national strategic transportation plan that considers our various modes of transportation as components of one comprehensive system, drawing on the strengths of each mode, rather than as separate unrelated transportation systems.
- “The nation would clearly benefit from the greater use of coastwise trade on our nation’s marine highways as part of a national transportation strategy” …. “Marine highways are energy efficient and can yield positive environmental benefits.
- “If waterborne routes are to be fully used, industry must develop new options that are better suited for moving higher value and more time-sensitive goods.
- “However, there are still roadblocks that may limit the establishment of new waterborne transportation routes. Chief among these is the imposition of the Harbor Maintenance Tax on cargo carried by vessel between U.S. ports.
- “Of course, all proposals to better use our transportation system faces challenges…. Financing ships without the commitment of cargo is not easy. Obtaining a commitment for cargo without existing ships and an established schedule is not easy. Financing and permitting for the expansion of port facilities is never a simple or easy task…. However, these are challenges we can and must overcome.”
John Mica is an influential Member of Congress who is playing a key role in the crafting of the replacement for SAFETEA-LU, along with his counterpart Chairman Jim Oberstar, another supporter of the marine highway. Mica is one of a small number of legislators who has spoken in terms of national strategic transportation planning, modal components being of a single transportation system, and the importance of developing the marine highway…all in the context of surface transportation policy.
That’s worth repeating…and reading in full. With any luck his colleagues of the House and Senate will listen. Pbea
freight, marine highways, MTS, SAFETEA-LU, supply chain, USDOT
In Infrastructure, Surface Transportation Policy on September 25, 2009 at 7:44 am
Governor Ed Rendell, a leading figure in the call for infrastructure reform and investment in the U.S., said that any surface transportation bill that Congress could pass this year would be a “very mediocre bill in terms of the needs of the country.”
In a story yesterday by Bob Edmonson of the Journal of Commerce the governor acknowledged, “In one sense a delay is hurtful, but in another sense the delay would give us a chance to look at new ideas, and build new concepts, and try to get a bill that will really revolutionize.” Rendell spoke at a American Road and Transportation Builders Association conference.
The governor apparently assumes that the Senate and Administration will succeed in getting an 18 month extension of the expiring SAFETEA-LU. Chairman Jim Oberstar (D-MN) on the House side doesn’t want to put off major revenue and policy decisions that long.
On September 23rd when the House debated, and passed, a three month extension, through December, Steven LaTourette (R-OH) agreed that action is needed now. His House Republican leadership opted to object to a prospective gas tax hike, which was not even on the table, rather than identify themselves with the need to maintain highway and transit programs. LaTourette stood in the well–exasperated, looking at his own party members–and said, “I am constantly amazed at how both parties are able to snatch defeat from the jaws of victory.” He foresees his party in the months ahead fighting a major transportation bill in the cause for low taxes.
In a recession the desire to improve the economic environment for employment is genuine and politically vital. It’s easy to understand the impatience. Oberstar and others want to move as quickly as possible to produce a 5-year, $450 Bn transportation bill. Then again, there is that knotty problem of how to pay for it, as noted in this prior posting.
Whatever other thinking may be behind Governor Rendell’s frank remarks to the “road builders” he makes an important point. On the surface is this one: Jim Oberstar may be ready to move a bill but the Senate and administration are not. But Rendell seems to go deeper than that. Crafting a major bill, with its inherently difficult revenue issues and bearing the weight of expectations that this one must break new policy ground, will take more time.
Rendell is right. After reaching the pinnacle that is SAFETEA-LU we don’t need another “mediocre” bill. The hearing record of recent years is loaded with testimony calling on Congress to not repeat past mistakes and, as the governor put it, to produce “a bill that will really revolutionize.” Freight policy, high-speed rail, transportation policy in a new energy/environment policy framework, performance measures, marine highways, livable communities, and the broader question raised by the Secretary as to how to integrate the MTS more fully into surface transportation policy. These are just some of the policy challenges.
The Oberstar bill is a clear step in that direction. And while the Senate committees have been plotting their TEA contributions the administration can’t say the same. The White House and the Department of Transportation, which remains immersed in implementing the economic stimulus package with its multi-billion dollar new programs, are nowhere near ready to be a full participant in the crucial dialogue on next generation surface transportation program and policy. It will take more time. Pbea
freight, Obama, opinion, SAFETEA-LU, taxes, USDOT
In Leadership, Surface Transportation Policy on September 21, 2009 at 12:26 pm
“Funding is the key,” said former DOT Secretary Norman Mineta. He should know.
Mineta spoke to an estimable eighty invited to UVA’s Miller Center of Public Affairs to discuss how significant reform in surface transportation policy might be achieved. He told them that funding is the prerequisite for the kind of major investment measure that all agreed is needed.
Noting the particular challenge, Mineta recalled how he brought to the Bush (43) White House a proposal to add two cents to the Federal fuel tax. The intent was to elevate road and transit program funding to level closer to actual system need. The Commander-in-Chief said no.
Pop Quiz:
- On what bill did George W. Bush first exercise his power of the veto? (Softball.)
- Aside from a $8 Bn game-changing plan to jump-start high-speed passenger rail, which president ruled out any immediate action on a major transportation infrastructure program because he (that’s a hint) was not inclined toward a tax hike or other revenue measure? (But why just pick on presidents?)
- Is there a snowball’s chance in Haiti that Congress will pass the next full-fledged TEA bill anytime soon?
(Answers: SAFETEA-LU, Obama, Not likely.)
It’s not a stretch to suggest that it may take years for official Washington to approve a costly multi-year surface transportation bill. Certainly one that includes substantial reform (such as sustainable transportation and livable communities), new attention to freight gateways and corridors, and overall higher levels of capital investment in our declining public works. Hundreds of billions are needed over and above what is required to maintain what we already have. And a declining highway trust fund makes even maintaining the status quo a pressing challenge.
Josh Vorhees of Energy & Environment News wrote a good story carried by the NYT. The conferees at UVA know the timidity of the Electeds when it comes to approving new revenue increments to support this or that. When it comes to the partisan battlefield there is no distinguishing a user fee from a tax.
Some time ago, when a toll increase was being contemplated by staff of a public authority, the subject was referred to as “The Banana. “ The T-word was not uttered in internal discussions–lest others outside the agency get wind of it before the numbers were fully crunched and the rationale fully developed. “The Banana” was a calculated, albeit humorous, way to manage in the hyper-sensitive political world.
A some point–much sooner than later–the million reasons why a tax payer or system user should not be charged must be faced by our Electeds. At some point the fact will sink in that America’s competitiveness is declining as other nations are using this lousy global recession as reason to engage in major infrastructure improvements.
Mort Downey recounted last week at a freight-related event how over the years Washington has managed to extend or raise the vehicle fuel tax even when the economy was in distress. Somehow we survived. Pbea
climate change, energy, freight, MTS, Ports, rail
In Environment, Ports on September 15, 2009 at 5:14 pm
Will U.S. ports, especially those on the Atlantic and Gulf coasts, be ready to operate in the changing domestic and international commercial environment? With major shifts on the way the ports that adequately prepare will be the ones to maintain and gain market share. The change in environment—at local, national and global levels—will be a constant factor not easily addressed.
Environmental Concerns
From 2002 to 2007 many ports found it necessary to have a proactive environmental policy to get community approval to operate and expand. Most major ports experienced double digit volume increases that resulted in problems with surrounding communities over increasing road congestion, noxious air emissions, and safety concerns. In the San Pedro Bay ports communities voiced their anger to local politicians and in short order port projects were put on hold.
With the collapse of global trade, the pressure subsided as the number of containers and trucks decreased. However, all indications suggest that world trade will rebound and cargo volumes will double by 2040. Community concerns and political problems will re-emerge as well. Other environmental issues may also emerge to affect port business practices—consumption of non-renewable resources, bio-hazards, and concerns about species redistribution that may persist even with ballast water regulation. A proactive policy may again be a necessity for certain major ports if their environmental performance is seen as problematic for their neighbors.
Green house gases (GHG) are probably going to be the biggest environmental game changer for businesses as climate change policy is put in place and businesses calculate the added expense. The U.S. contributes 20 percent of the world’s emissions from burning fossil fuels; India contributes 4 percent. Will there be a carbon tax or cap and trade policy established worldwide? What will be the cost penalty for oceanborne cargo here or worldwide? How fast will engine room and terminal equipment technology adapt? Those questions await answers and clarification.
As climate change concerns and political acceptance addressing those concerns increase, the pressures to aggressively address GHG will be enormous. (That is likely notwithstanding the relative environmental and energy per-ton/mile efficiency of the marine and rail elements of MTS related transportation.) These issues will have even greater impacts on the cost of ports, particularly if dealt with retroactively.
Next: Consumer demand and the bottom line.
T. H. Wakeman
9/11, airports, freight, NY/NJ
In Leadership on September 14, 2009 at 1:03 pm
Bill DeCota (source: www.bigapplegreeter.org)
Bill DeCota was not someone you would have met in the MTS world. He didn’t know ships, but he appreciated that there could be a role for marine transportation at his facilities. He didn’t know freight rail, but he knew that rail is an essential component in intermodal transportation. He may have never set foot on a container terminal, but he understood the importance of efficient goods movement.
Bill DeCota knew airports and aviation.
On September 11th, as his colleagues at the Port Authority of New York & New Jersey were re-living the tragedy of eight years before, Bill passed away at age 51.
For nearly ten years Bill DeCota headed the agency’s Aviation Department. LaGuardia, Newark, Kennedy, Teterboro, and now Stewart. He joined the Port Authority in 1982 as a financial analyst and well before his untimely death he had earned the respect of his staff and industry leaders.
Like other highly competent persons Bill could have left public service for greater financial reward in the private sector. Instead he close to work to improve the country’s busiest and highly complex passenger and freight airport system in the high-pressure, floodlit New York metro region. The region and his employer were prime beneficiaries of his talent. Anyone who didn’t fully appreciate that fact when he was alive surely will come understand it in his absence.
He had impressive intellectual capacity, lived his work 24/7, had great integrity, demanded no less of himself as he did of his staff. He was a national leader in the industry. He probably was without peer in his command of the statistical and financial minutiae. He was a man of good humor and enjoyed his own, frequent quips. And as an added gift Bill was a genuinely good guy. He was friend and colleague to people, myself included, regardless of rank. Patty Clark of his staff said of Bill: “He had as much concern for the busboy at his dinner, as he did for his long term friends. The caring and concern which were the hallmark of his life, he eschewed when directed at himself.”
It is the transportation world’s loss that he is gone. Pbea
congestion, freight, Panama Canal, Ports
In Infrastructure, Ports on September 13, 2009 at 10:15 pm
Will U.S. ports, especially those on the Atlantic and the Gulf coasts, be ready to operate in the changing domestic and international commercial environment? With major shifts on the way the ports that adequately prepare will be the ones to maintain and gain market share. Cargo flow volumes will shift in a big way. This is the first of a three-part observation by our new contributor Thomas H. Wakeman III, Eng.Sc.D.
Panama Canal
The one approaching shift that escapes no port’s attention is the Panama Canal. The Panama Canal Authority is investing $5.3 billion to widen and expand the canal’s capacity to service the current generation of 8000+ TEU container ships. When the new locks open in 2014, a new era will begin. It could change global trading patterns just as the initial canal opening did in 1914.
As much as 25 percent of today’s West Coast cargo base could be transferred to East and Gulf Coast ports as global trade picks up again. There will only be one chance to gain control of the initial surge. It will be the deepest East and Gulf Coast ports with corresponding intermodal connections and warehousing capacity that will capture this shift in market share.
Economies of Scale/Scope
Achieving economies of scale and scope will determine the mega-players. It started with increasing ship size first among the bulk carriers and then emerged with the container carriers in the latter part of last century to secure economies of scale. Because margins are razor thin only ports and their supporting infrastructure systems (whether as import or export corridors) with sufficient capacity and efficiency effectively will compete and perform in the global marketplace among the major “port poles”, forming as collaborative networks in Asia, India, and Europe to achieve economies of scope.
These port poles, which combine the infrastructure and business services of more than one port into a mega-region logistics platform, have the ability to be agile, cost-effective and resilient when shocks occur. They are seen as reliable routes by shippers – giving them agile and flexible networks.
Infrastructure
Time and reliability are the watch words for global business. As goods flow across the world’s oceans, through our ports, and connect to domestic corridors, they face time delays in route and uncertainty about ultimate delivery schedules because of infrastructure capacity constraints. Freight must flow seamlessly or there is a time, cost and reliability penalty.
India plans to increase infrastructure spending to 9% of GDP (an estimated $500 billion) by 2014, up from the current 4%, on roads, ports and airports. In China, according to the Asian Development Bank, the figure is close to 10% GDP for 2008-2009.
The US has been living on its past construction accomplishments. According to the Congressional Budget Office, between 1984 and 2004, the U.S. capital investments (including federal, state, and local) averaged less than 1.2% GDP. Our growth of demand and lack of investment was unsustainable. Without the recession, we would have been overwhelmed by traffic, much less prepared for what is going to be demanded in the next decade. Our infrastructure systems can not deliver what business is going to require for maintaining global competitiveness without significant investments.
Next: Environmental Concerns
T. H. Wakeman
congestion, freight, marine highways, NY/NJ, rail, SAFETEA-LU, taxes, trucking
In Infrastructure, Surface Transportation Policy on September 9, 2009 at 5:21 pm
PBS "Blueprint America" Documentary: "Keep on Trucking?"
Blueprint America is the PBS infrastructure series. The series is one of the best I have seen on the subject, not that there is much competition on TV in this category. Keep on Trucking? has the virtue of being taped in my Garden State, where men are men and women are truck drivers who train the men.
The segment reported by Miles O’Brien covers our reliance on trucking and the 50+ year old interstate highway model. He reports on the benefits and limitations of the rail freight system. He covers how trucking and rail compete and cooperate (“the term of art is intermodal”). He introduces community concerns via New Jersey’s Ironbound, which is adjacent to the Newark container terminals. And O’Brien overlays the fact that Congress will have to replace SAFETEA-LU and face the political conundrum of taxes, with Jim Oberstar’s (D-MN) foot on the House accelerator.
Part of the value of this particular “…Trucking?” segment, as one individual awkwardly said, is the need “to look at the network of this nation as a whole” and “how these two modes can be interfaced in the most efficient way”. “A freight relay if you will,” Miles O’Brien added, “… trains and trucks each doing the part of the job they do most economically, then passing the baton.”
Of course that topic deserves a 24-minute segment of its own…but not one limited only to two surface modes.
Predictably marine transportation was not mentioned. Considering the key points made in the piece the marine highway should have been included in the “network of this nation.” The water mode applies to the ideas of intermodal operation, efficiency, congestion mitigation, and the need to think outside the 1950s highway model. As one voice noted, “it’s about retooling the freight infrastructure so American business can compete in the global marketplace.” Not about maintaining the primacy of road and rail, one might add.
Miles O’Brien alluded to the fact that arriving at a new policy will not be easy. “There is no love lost in the fight over infrastructure dollars.” Bill Graves of the American Trucking Association asserted that the public shouldn’t be “deluded” that rail is “the answer”…the Association of American Railroads‘ ad campaign notwithstanding.
O’Brien expressed no particular confidence that Congress will adopt a new model. He spoke of an American consumer trait, taking things for granted–”plentiful, high quality goods, delivered fast and cheap”–and made possible seemingly “like magic.” Not willing to make it easy on voter or legislator, he said “it is actually about planning ahead and making big investments.” The generation that built the interstate system did it. “Now it may be our turn to pay the freight.” Pbea
congestion, freight, marine highways, rail
In MTS Policy on September 3, 2009 at 8:27 am
Closing image from a CSX commercial
This is a compelling image but not necessarily in the way intended by the folks at CSX.
For good reason I’ve heard many people credit CSX for the quality of its television commercials. Norfolk Southern and the collective Class I industry also have put up very effective ads that have been running for a few years. The message is exceedingly simple. On a ton-for-ton basis rail is a fuel efficient and low carbon-footprint way to move lots of freight now traveling on the highways.
The ads are shown repeatedly in this D.C. market because this is where policy makers and influencers are. The railroads want Congress to approve a targeted 25% tax credit for their infrastructure investments. They also know that new climate and energy policies could affect their bottom line. So the industry is investing millions to instill a favorable public image. It is working. Green groups are lobbying for more freight trains and fewer trucks.
As an admirer of the ad campaign I use this image in presentations about the need for marine highway policy. The ad accomplishes two things for those of us who think that the even greater efficiency of marine transportation deserves equal attention.
First, it graphically reveals the availability of waterside capacity for the surface transportation system. It is hidden capacity, metaphorically speaking, when early in the commercial the focus is on containers lifted from the congested roadway to the nearby train. Then our last view is of a waterway so uncongested as to be empty of vessels.
Second, it serves as a challenge to the maritime industry, which can top the railroad claims about fuel efficiency. The tug and tow companies have undertaken a modest general ad campaign to carry that message. However that AWO effort is the only one. The present and future marine highway–including the capacity of ships to carry trucks themselves–remains a hidden asset because the larger industry isn’t telling the story.
There is no comparing the resources of the rail and barge industries. So don’t look anytime soon for a comparable televised promotional effort by vessel operators. Nor have I seen signs that the broader maritime sector is ready to pool resources to promote the marine highway to Washington.
If the public and the policy makers are to learn about the advantages of marine transportation and the potential for addressing some of the nation’s growing transportation challenges it will happen when the maritime sector comes together to carry that message. The railroads can’t be counted on to place more subliminal maritime messages on TV. Pbea
freight, Ports, TIGER grants, USDOT
In Federal Government, Infrastructure on September 2, 2009 at 4:50 pm
The TRB has a new report that is worth a look: Funding Options for Freight Transportation Projects. The study committee was charged with examining the rationale for public investment, evaluating financing strategies for “freight transportation projects of national significance,” assessing the ability to use criteria in project selection, and evaluating and comparing “generic financing options…based upon the greatest net benefit and least cost per public dollar invested.” Here is a summary of the broad categories of recommendations along with a sampling of specifics:
- Federal freight infrastructure assistance programs should adhere to certain guidelines. Project earmarking “weakens the effectiveness” of programs; any program should be structured to address freight projects on a case-by-case basis and be “flexible to address diverse assistance needs.”
- Create a new discretionary assistance program to support freight projects, starting with a “test of the need for and value of a responsible and flexible federal program…” The “test” would be $1.8bn over 4-6 years and an independent evaluation to determine the program’s worth. Note: the program outlined in the report is in many ways similar to the multimodal “TIGER” grants USDOT was charged with administering in the economic stimulus bill enacted last February. Applications are due Sep15 and selected projects announced in Feb.
- Make credit assistance more accessible and attractive to freight projects that merit Federal support. Includes revisions to TIFIA; encourage private sector participation by changing tax laws to be “neutral with respect to private versus public management” and finance “the kinds of facilities that commonly are built by the public sector.”
- Reduce barriers to the development of local and facility-specific revenue sources to pay for freight infrastructure capital costs and provide incentives to encourage use of such sources. Enable port authorities to impose cargo charges “for purposes of providing revenue for construction and operation of port facilities and access routes…”; reduce barriers to foreign ownership, operation and investment in the transportation industry, “particularly maritime and aviation…”
- Expand the capability for freight system planning, project evaluation and data collection. Establish a “discrete…home for the functions of project evaluation, performance monitoring and technical assistance to state and local governments;” develop a “continuing, comprehensive, and systematic program to monitory performance of the national freight transportation system…”
appropriations, freight, LaHood, Ports, SAFETEA-LU, TIGER grants, USDOT
In Federal Government on August 4, 2009 at 11:29 pm
Interesting. When in February Congress sent the huge economic recovery package a.k.a. ARRA, to the White House for signature many folks were pleased that it contained a new $1.5bn multimodal discretionary grant program for the Transportation Secretary to allocate. House and Senate appropriators are not known for giving department chiefs large sums of money to spend on this or that. Nor has Congress been in the habit of allowing the Office of the Secretary (OST) the discretion to grant funds outside the tightly prescribed modal grant programs and, for that matter, for projects not already earmarked. So, when the authority to spend $1.5bn was sent to Secretary Ray LaHood observers knew much was at stake. Might this open the door to additional multimodal appropriations or to a new program that would be included in the eventual successor to SAFETEA-LU?
Just a few months later we have a partial answer. Senate Appropriators included in the FY 2010 DOT spending bill (HR 3288) yet another, but not identical, multimodal discretionary grant program. This time it is $1.1bn for National Infrastructure Investments (NII). It seems to resemble the $1.5bn pot that Secretary LaHood has dubbed TIGER grants–applications for which are due at USDOT September 15th. The Senate committee summary indicates the grants are “to support significant transportation projects in a wide variety of modes, including highways and bridges, public transportation, passenger and freight railroads, and port infrastructure.” But according to Jeff Davis of the very reliable Transportation Weekly the intent is not to support certain port and freight related projects that are outside of the Title 23 (highways, etc) and Title 49 (transit) eligible project categories. Jeff says it does not include this TIGER grant language from the stimulus bill that opened the door to “port infrastructure investments, including projects that connect ports to other modes of transportation and improve the efficiency of freight movement.”
Wading in more deeply…here is where it is a bit confusing. Title 23 eligible projects do include some freight related projects such as “intermodal transfer” and “public freight rail” facilities. As for ports Title 23 even includes (but limit eligibility to) certain projects within a port terminal’s gate that facilitate the “direct intermodal interchange, transfer and access” in and out of the port. So how does that differ from the underlined above? Maybe the answer is somewhere in this supplemental description of the TIGER grant program that would invite, for example, vessel projects that otherwise meet TIGER grant criteria.
So, why NII and not TIGER II? Could this represent some disapproval of the Secretary’s recent encouraging words to the effect that TIGER grants enable a change in policy that to date has offered port/maritime related infrastructure little or no Federal program assistance? Let’s hope not. More to learn.
