Cabotage and the Jones Act: A bipartisan group of Senators and Congressman sent a strong statement to Secretaries Napolitano (DHS) and LaHood (DOT) reminding them of their obligations under the law to ensure the participation of the domestic maritime industry should a 2012 Strategic Petroleum Reserve drawdown be necessary. During a 2011 draw down, over 40 Jones Act waivers were granted to foreign flagged vessels. In the 2012 Appropriations bill, Congress instructed the Administration to either strictly follow the Jones Act in draw downs or provide written reports on why following the Jones Act was against the federal interest.
Inside Corps Baseball: “Upon the enactment of the Consolidated Appropriations Act of 2012 on December 23rd 2011, USACE Headquarters began working with Institute for Water Resources on scoping [a study of] the U.S. Port and Inland Waterways Modernization Strategy. The strategy will explore the impacts of the Panama Canal expansion to accommodate larger “post-Panamax” ships on future marine transportation system needs. The strategy development process will incorporate the perspectives of shippers, carriers, ports, environmental interests, state and federal agencies, and other interested parties. Because of the six-month time frame directed by Congress, the study will rely heavily on existing data, reports and studies and leveraging other ongoing assessment studies.” Source: Corps study brief website
We attended an industry listening session at Ft Belvoir on this study. In response to a question by a caller from the Izaak Walton League, Corps officials said their report will reflect that if barge freight increased only for grain but not for other commodities, the 600-foot locks on the Upper Miss and IL Waterways will be adequate until at least 2020. We think the Corps has stated otherwise elsewhere.
Coast Guard: We saw Rear Admiral Nash, the Coast Guard’s 8th District commander, at a regulatory event in St Louis. We encouraged him to move promptly to support having CG cadets spend time on inland river vessels. The CG Academy recently announced an agreement with AWO to facilitate this training initiative in ways similar to the recent inland vessel bridging program.
DC Events: The main development from the February 14 – 16 WCI events was a better appreciation for the scale of the newest Olmsted cost overruns. At $2.9B (read on!), the project will really starve the rest on the inland system for construction funding. Hill visits we attended, and reports from other visits, indicate that many legislators are interested in proposals on how to bring the Corps’ systems back to reality. The Capital Development Plan was the prime topic at Hill meetings. In some sessions, that was the only topic. We didn’t hear any reports that were optimistic of getting a WRDA this session. Still, it is important to work the issues because pending language often sets markers for future measures, even after changes in control of a legislative chamber.
In subsequent Congressional testimony, the Corps’ senior leaders announced that Olmsted is now a $3.1 billion project. This number now includes an inflation margin of about $200 million for the period between now and the 2020s. Even $200mm seems low over such a long period. Corps Assistant Secretary of the Army for Civil Works Darcy said in the same hearing that the Administration is not wedded to their current user fee proposal. She did not offer specifics about elements to which the Corps would welcome counter-proposals or industry parties with whom the agency has discussed any such revisions. One observer noted that the statement more likely signals a willingness at the OMB and at the Corps to listen to its stakeholders. If so, this acknowledges the political realities of our successful, multi-year resistance to the lockage fee.
Transportation Legislation: The US House transportation bill has a maritime title for the first time but the issue is unsettled both in that chamber and in the Senate. The House title only includes the RAMP Act, which calls for full use of collected Harbor Maintenance Trust Funds. In addition to innate controversy about requiring full HMTF utilization (and identifying the agency that loses the corresponding funds—likely the Dept of Energy), the maritime title clouds the prospects for a House WRDA. In parallel, the emerging measure from Rep Whitfield that formalizes the IWUB Capital Development Plan dilutes a House WRDA if Whitfield moves as stand-alone legislation. Some House voices (particularly in the committees-of-jurisdiction) call for RAMP and Whitfield to roll into a WRDA. The corresponding Senate committee leaders agree those are WRDA issues, not stand-alone measures. A major question is how a RAMP and/or Whitfield measure would fare in the Democratic Senate. The Senate will exclude both measures if they follow the Democratic Administration’s lead.
Congressman Jerry Costello (D-IL) signed on to co-sponsor Rep Whitfield’s WAVE4 bill, which would codify the Inland Waterway Users Board’s Capital Development Plan. Costello is a senior Dem on the House Transportation and Infrastructure Committee. Unfortunately, he is retiring at the end of this Congress. His seat is likely to remain in Dem hands due to redistricting discipline on the part of the Democratically-controlled Illinois legislature. The unknown is whether Costello’s successor will be interested in the inland marine freight industry.
Does the election moot all this? Likely so but some of the measures may take on independent life with the staffs of the committees-of-jurisdiction. In addition, Louisiana Republican Party officials told us that the redistricting-forced House match-up between sitting Republicans Boustany, RAMP’s author, and Rep Jeff Landry means that Dr Boustany returns to his medical practice after Landry, a tougher campaigner, prevails in Southwestern Louisiana.
Environment: The Administration is putting $50m from the current budget into carp work at Chicago. The funds will go to netting and other physical prevention acts, not permanent watershed separation.