U.S. Maritime Gets No Money from DOT or MARAD in 2012 Budgets

It’s “MARCH MADNESS” as Administration slights the U.S. Maritime Industry Again

By Tony Munoz, Editor-in-Chief of the Maritime Executive Magazine and MarEx Newsletter

Secretary LaHood and Administrator Masuda went before Congress this March with their respective DOT and MARAD budgets for 2012. And, as usual, the U.S maritime was left out of America’s plans for cleaner, safer, and more fuel efficient modes of transportation for domestic commerce. DOT-MARAD essentially shelved the marine highways program and job creation for waterfront and shipyard workers till later in the decade.

On March 1st, the administrator for MARAD went before the House Subcommittee on Coast Guard and Maritime Transportation to deliver its $357.8 million budget request, which is $5 million less than the 2010 budget. While eighty-six percent of the 2012 budget is to be allocated for defense mobilization, MARAD wants $3.7 million to administer compliance of the Title XI program pursuant to the Federal Credit Reform Act. Matsuda also proposed the cancellation of $54.1 million of the $76.6 million currently available in Title XI guarantees, because the maritime industry must share in the national sacrifice during these challenging economic times.

Matsuda’s justification for U.S. shipyards getting ZERO funds in the 2012 is based on the fact that shipyards got its ‘pockets-lined’ with $15 million in 2010 and another $117.5 million from the Omnibus and Recovery Act funding schemes in 2009. Additionally, the Transportation Investment Generating Economic Recovery (TIGER I), which got $120 million for seven port and maritime related projects in 2010 and another $84 million for another six projects, will also get ZERO bucks, because planes, trains, and trucks are the modern tools that will deliver DOT’s vision of future, which is built on innovation.

The One, Two Punch – No Bucks for U.S. Maritime

LaHood presented the president’s budget to the Senate Appropriates Subcommittee on March 10th, and asked for $129 billion in 2012, including the first-year of a new six-year $556 billion reauthorization proposal, which will ‘transform surface transportation for the future.’ DOT theme for 2012 is to a) build for the future b) spur innovation c) ensure safety and d) reform government responsibility, but LaHood’s budget fell like a tree in a forest for maritime interest. The Secretary touted a $50 billion “up-front” economic boost to jump start job creation, which will spent  $53 billion over six-years on a national high-speed rail network, allocate $336 billion over six-years, a 48 percent increase, for road and bridge improvements, and $119 billion over six-years, a 128 percent increase, to rebuild and rehabilitate existing transit systems.

Furthermore, LaHood claims the president’s budget is filled with innovation and modern business tools because the U.S. can no longer operate like it did 50-years ago. Meanwhile, the agency hopes to spend $30 billion over the next six years creating a new “National Infrastructure Bank,” which will be housed within the department, fund $32 billion over the next six-years for a grant program called “Transportation Leadership Awards,” which gives lots of money to state and local governments to perform multi-modal planning and to do more studies on fuel-efficient and safe modes of transportation, and gives $4.9 billion to the Federal Motor Carrier Safety Administration to develop tougher safety standards for truckers.

Much to Do About Nothing

The DOT and MARAD budgets are extremely short-sighted and lack leadership because their funding schemes have totally eliminated coastwise and inland transportation as viable solutions to U.S energy and urban congestions problems. Last week, API reported the national average for gas was $3.621 per gallon, up 118.6 percent from its December 2008 low of $1.670. And, last week’s crude oil prices hit a 2011 high of $114.93 per barrel on fears of Middle East instability and limited oil and gas production activity in the U.S. Gulf of Mexico.

Today, there are 15.5 million trucks on U.S. highways and they log about 432.9 billion miles while consuming 54 billion gallons of fuel each year. Now add an estimated 136 million registered cars and about one million buses to the highway equation and you have a horrific traffic jam 152.2 million motorized, fuel burning vehicles bogging down freedom of the highways and polluting the populace.

America’s natural transportation resources are exceptional. Millions of tons of domestic cargoes could be transported through the renewable marine highways consisting of 95,000 miles of coastline and 25,000 miles of navigable inland waterways and lakes. But, the DOT-MARAD budgets lack forward thinking agendas about this nation’s energy dependence on foreign oil, atmospheric pollution from green-house gases, and urban congestion. Instead of initiating marine highway programs, the administration opted to continue throwing billions of dollars to keep fixing broken roadways and bridges and for less efficient modes of transportation.

Surely, the government knows analysts have crunched the numbers showing waterborne transportation to be more fuel-efficient, safer, and less obtrusive on the general population and a viable alternative to trucks and trains. Trains claim to be able to move a ton of freight 435 miles on a single gallon of fuel. But, it takes thousands of gallons to get it moving just 10-feet in its beginning inertia down the track. Trucks, which is the dirtiest form of transportation, are  less fuel efficient than marine vessels and are responsible as an industry for increasing  emissions by 77 percent over the last decade.

The maritime industry has been under regulatory scrutiny by the IMO and U.S Coast Guard and has been compliant with STCW-95 standards in recent years. Now, it is addressing smoke-stack emissions, ballast water treatment investments, and gray water discharge regulations from vessels. The maritime industry is one of the best- trained and most environmentally compliant modes of transportation in the world. While Rome burns, I am disheartened by the apparent lack of leadership and foresight of this government.