U.S. Port Crisis

OP-ED By Mike Leone, the Chairman of the American Association of Port Authorities (AAPA) 2009-2010 and Port Director for the Massachusetts Port Authority.

Our nation’s ports are vital economic engines ensuring the global logistics chain remains strong. In order to facilitate the continuous flow of goods through our ports, regular maintenance and deepening of federal navigation channels is imperative.

Unfortunately, most of our nation’s ports don’t have naturally deep harbors. A U.S. Army Corps of Engineers report states almost 30% of the roughly 95,550 vessel calls at U.S. ports are constrained due to inadequate channel depths. This is of grave concern to the future of the public seaport industry and all those dependent upon the cargo flowing through them.

In early March, Congress held hearings to examine the progress of the 2007 Water Resources Development Act (WRDA). The Act required that the U.S. Army Corps of Engineers implement a number of measures aimed at improving efficiency, reliability, and responsiveness in its analysis of deep-draft navigation projects. As the current chairman of the American Association of Port Authorities (AAPA) Board, I had the opportunity to speak on behalf of our nation’s member ports.

Specifically, the industry is concerned that the House Committee on Transportation and Infrastructure should give additional consideration to the project development process and the timing of when project reviews occur. There should be no surprises at the end of a multi-year, multi-million dollar study effort. I have been impacted by the inability of the Corps of Engineers to efficiently review and approve a deepening project. So far, the Massachusetts Port Authority has invested 10 years and more than $3 million dollars towards a feasibility study to deepen Boston Harbor. But the study has been rejected twice by Corps Headquarters staff when late-stage reviews revealed differences of opinion on the economic study parameters and proper methodologies. There seems to be no end in sight, and in the meantime, Boston is losing significant business and jobs.

Boston is not alone. There are many channel deepening studies underway across the country. Those projects are absolutely necessary to handle the increasingly larger vessels being used in all trade lanes. Some of these studies have been stalled for years and are not advancing because of technical or policy conflicts among reviewers, the study teams, and the project sponsor. In order to meet the demands of a global economy, these projects must advance to the construction stage or our national economy will suffer.

Another critical need that can expedite the processing of feasibility studies is to establish a deep-draft center of expertise with a dedicated full-time cadre of subject matter specialists. This is a crucial missing link that would streamline the project delivery process and improve the quality of planning and review. This center would pay dividends in providing the most technically competent, efficient and cost effective project delivery system in a central location. For example, the Army Corps Planning Center of Expertise for Inland Navigation has been fully operational since 1981 and provides world-class products to Corps districts and the navigation industry.

Ports are now strongly focused on the Harbor Maintenance Trust Fund, first authorized in the 1986 WRDA. An authorization of full expenditure of this fund is absolutely necessary to maintain our nation’s critical navigation channels. The fund is maintained by the revenues it receives from the Harbor Maintenance Tax which is currently imposed on import and domestic cargo.

As it now stands, port and harbor users are paying for full maintenance but only getting half in return. The tax revenue of about $1.4 billion annually would be adequate to maintain federal channels if fully applied.

It is essential that Congress work together with the Army Corps of Engineers, Office of Management and Budget, and other federal agencies to make sure that there is a thorough and reliable process for the review and approval of feasibility studies. The essential dredging of our federal channels must also be adequately funded so that US consumers and workers can continue to reap the benefits of our global economy.