Senate Passes Increase to Barge Diesel Fuel User Fee

Towboat and Barge on Chicago River

By MarEx 2014-12-17 11:38:41

Waterways Council, Inc. (WCI) and its members and stakeholders applauded the Senate’s passage, by a vote of 76 to 16, of a 9-cent increase to the barge diesel fuel user fee.  The provision was a part of tax extenders legislation that was combined with the “Achieving a Better Life Experience (ABLE)” Act that establishes tax-favored savings accounts for individuals with disabilities.  The ABLE Act that included the provision to increase the user fee by 9 cents passed the House on December 3 by a vote of 404-17.

The user fee – currently 20-cents-per-gallon of fuel used while operating on the inland system –will be increased to 29-cents-per-gallon, effective April 1, 2015.   Deposited into the Inland Waterways Trust Fund (IWTF), this amount is matched by General Treasury Funds and is dedicated to new construction and major rehabilitation of the inland system.  The 9-cent-increase will add around $80 million annually to the IWTF.  It is supported by those who pay it – just 300 commercial operators – while the entire nation benefits, from hydropower, municipal water supply, recreational boating and fishing, flood control, national security, and waterfront property development. 

The user fee increase was introduced in the Senate by Senator Bob Casey (D-PA) as “A Bill to Revise the Inland Waterways Trust Fund Financing Rate” (S. 2955), with co-sponsors Senators Lamar Alexander (R-TN), Tom Harkin (D-IA), and Amy Klobuchar and Al Franken (D-MN). Senator David Vitter (R-LA) has also been a strong supporter of a user fee increase, as well as House Members Reps. Pat Tiberi (R-OH), Chuck Fleischmann (R-TN), Daniel Lipinski (D-IL) and Ed Whitfield (R-KY).

The inland waterways provide the most cost-competitive transportation option for our bulk commodities used in America and exported to marketplaces worldwide:

60% of the nation’s export-bound grain is transported on the inland waterways.

An effective and efficient water transport system is essential to supply American farmers with fertilizer for planting seasons.

Farmers depend on our waterways’ infrastructure to compete and win against producers outside the USA.  

The soon to be completed Panama Canal expansion will create opportunities for increased American trade, but not if our channels and ports are not dredged and our locks and dams are not functioning. 

541,000 jobs depend on the inland waterways.

The waterways are vital to our manufacturing sectors and to the construction industry. 

American consumers benefit from transportation cost-savings made possible by the inland waterways; for every $1 invested in our inland waterways, $10 is returned in national benefits.

Most of America’s locks and dams were built in the 1920s and 1930s, yet are used to transport 21st century cargoes that fuel our modern economy.  This critical component of the transportation supply chain needs reinvestment and this industry-sought user fee increase is fiscally responsible.    

The user fee increase is the last key recommendation of the Capital Development Plan (CDP) to be adopted into law, with four of the CDP’s elements adopted through the passage of WRRDA.

“Waterways Council is grateful for the House and Senate passage of the increase to the barge industry’s fuel user fee.   Additional money flowing to priority navigation projects could result in earlier completion and delivery of more than $82 billion in related economic activity for the nation over 20 years,” said Michael J. Toohey, President/CEO of Waterways Council, Inc.

“We thank our many Congressional champions for recognizing the great return on investment of our nation’s waterways and for their enduring support of the user fee increase: Senators Vitter, Casey, Alexander, Harkin, Klobuchar, Franken, and all the supporters of the RIVER Act (2013).  We thank Congressmen Whitfield, Lipinski, Tiberi, Fleischmann, and the WAVE 4 (2013) sponsors for their commitment,” Toohey said.