Marine Transportation System

Archive for November 17th, 2009|Daily archive page

California Trailblazing to a Miami Tunnel

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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The Connective Tissue of a Nation

In Federal Government, Infrastructure on November 17, 2009 at 4:13 pm

You can’t thrive as a nation while New Orleans is drowning…and cities in upstate New York and the Rust Belt are rotting from lack of employment opportunities, and so on.   Imagine, instead, an America with rebuilt, healthy, dynamic metropolitan areas, and gleaming new port facilities, and networks of high-speed rail, an America with electric vehicles and a smart grid and energy generated by the power of the sun and wind and water and the ocean’s waves. (“What the Future May Hold”, November 17, 2009)

Bob Herbert of the New York Times has penned several columns about our crumbling infrastructure. How many times can writers like Herbert belabor the point?  Not enough.

Eugene Robinson of the WPost:  It’s unrealistic to think this disaster is going to spur the nation to seriously address all its infrastructure problems. We’ll talk about the issue for a while, then go out and buy another TV. But we can—and should—at least do a more rigorous inventory and identify the structures that pose the most peril. Yes, it’s boring stuff to even think about. But just look at the alternative. (“Back to Basics”, August 2, 2007)

David Brooks of the NYT:    In times like these, the best a sensible leader can do is to take the short-term panic and channel it into a program that is good on its own merits even if it does nothing to stimulate the economy over the next year. That’s why I’m hoping the next president takes the general resolve to spend gobs of money, and channels it into a National Mobility Project, a long-term investment in the country’s infrastructure. (“A National Mobility Project”, October 31, 2008)

Thomas Friedman of the NYT:  Look in the mirror: G.M. is us.  That’s why we don’t just need a bailout. We need a reboot. We need a build out. We need a buildup. We need a national makeover. That is why the next few months are among the most important in U.S. history. (“Time to Reboot America”, December 23, 2008)

Brooks and Friedman wrote on the eve of the new Administration and the writing of a stimulus bill by Congress.  Some small part of the “recovery” package  signed by the president was in the spirit of rebooting, as Friedman suggested, but it was too little.  The Obama Administration talked in vision terms but didn’t press for vision-scale action by Congress.

At this point–nearly a year into Democratic control of Washington and millions of  job losses later–an infrastructure policy is being talked about only in oblique terms, as “Stimulus II” or, by those who are fearful of  the spender label, the non-stimulus stimulus.  And as helpful as that may be for purposes of creating some jobs  it doesn’t substitute for an infrastructure policy.

So shall we primly, safely wait for Federal accounts to come into balance, saying we can’t afford it, while developing and developed nations on other continents propel themselves into economic vitality with steel, wind turbines, and fiber optics?  Consider what can be accomplished by putting money–yes, borrowed money–into real, decades-lasting, efficiency-producing, capacity-building, economy-stimulating, pride-inducing public works and critical infrastructure.

For all their faults the Civilian Conservation Corps and the Works Progress Administration of the 1930s strengthened our nation in lasting public works, a strong sense of conservation, and nation-building spirit.  As if to prod us into action some of the glorious thirties era infrastructure that has not been well maintained is visibly deteriorating.

Bob Herbert: Consider transportation. As Brookings tells us, “Other nations around the globe have continued to act on the calculus that state-of-the art transportation infrastructure — the connective tissue of a nation — is critical to moving goods, ideas and workers quickly and efficiently. In the United States, however, we seem to have forgotten.”

Pbea