Prospects Look Good for Strong Spending for Ports, Harbors and Waterways
Last year, ILTA, working with other interested trade associations including the American Association of Port Authorities, the Waterways Operators, the Waterways Council, Inc. and the Maritime Coalition, a broad industry group, successfully advocated for increased federal spending on the nation’s harbors, ports and waterways. Congress passed, and President Trump signed into law, a generous Fiscal Year 2020 Energy and Water Development and Related Agencies Appropriations Act.
This year, ILTA and the industry coalition are working to support passage of the biennial Water Resources Development Act legislation. WRDA is passed by Congress every two years and authorizes work on America’s ports, harbors and inland waterways. One of the few bills with genuine bipartisan support, WRDA will allow the Army Corps of Engineers to continue dredging the ports and constructing the locks and dams that are critical to water transportation, both to domestic and international markets.
The House the last week of August unanimously passed a new WRDA bill that will authorize close to the record amounts appropriated in 2010, weeks after the House Transportation and Infrastructure Committee approved the bill. The Senate Environment and Public Works Committee has passed a very similar bipartisan WRDA bill that we expect the full Senate to pass before it leaves for the year.
The WRDA bill includes both the Harbor Maintenance Tax and the Inland Waterways Tax, both of which are used to generate revenue from port and waterway users for maintenance conducted by the U.S. Army Corps of Engineers. Harbor Maintenance Tax receipts are placed in the Harbor Maintenance Trust Fund, which serves as a source of revenue for the Corps’ dredging budget. Tax collections are determined by the volume of trade, which has generally grown over the last two decades.
Expenditures from the HMTF have been constrained by the Congressional appropriations process. As of January 2020, the HMT Trust Fund held an unappropriated surplus of more than $9 billion. After years of effort, ILTA and the industry coalition were recently successful as part of this WRDA bill in persuading Congress, for the first time, to direct all money raised by the HMTF each year to dredging projects in the following year. That will result in more dredging and prevent the surplus from growing further. ILTA and the coalition are now pushing for Congress to spend down the surplus.
The Inland Waterways Tax goes into the Inland Waterways Trust Fund to keep the nation’s waterways operational by maintaining the nation’s system of locks and dams. While Congress spends all the money collected each year, it has traditionally required that all projects funded by the IWTF maintain a 50/50 cost share between the IWTF and general revenue. With this formula, there is simply not enough money in the IWTF to fund the construction needs in a timely manner. ILTA and the Maritime Coalition, in this WRDA bill, asked Congress to reduce the trust fund’s share, and both the House and Senate bills reduce the cost share to 65/35. This will ensure that more projects can be completed faster and more economically.
ILTA touted the Congressional achievement in moving the legislation in a press release in July