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White House Budget Includes Cuts for Waterways, Ports, Shipbuilders

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By The Maritime Executive 02-10-2020 10:04:00

The White House released its FY2021 budget proposal on Monday, and it suggests an across-the-board spending reduction for most discretionary programs. In addition to a 26 percent cut at the Environmental Protection Agency and a 21 percent cut for foreign aid and diplomacy, the plan contains surprises for maritime stakeholders. 

Cuts for inland waterways

The Waterways Council, Inc. (WCI) noted that the proposal provides no funding for ongoing projects funded by the Inland Waterways Trust Fund (IWTF). Last year, Congress appropriated $335 million for IWTF-funded projects at the Kentucky Lock, Chickamauga Lock and the Olmsted Locks and Dam, along with the Lower Mon Project in Pennsylvania. If the president's current budget were to be accepted, WCI said, these construction projects would shut down for at least one fiscal year and workers would be laid off.

The proposal also cuts funding for the U.S. Army Corps of Engineers (USACE) civil works program by $1.7 billion, or about 22 percent. It also proposes a new user fee for commercial waterways operators that would raise $1.8 billion over 10 years. 

“No president has ever proposed zero infrastructure investment.  Are we to lay off the workers constructing the projects now underway? Where is the 29-cents-per-gallon fuel tax money that users pay going, while the administration seeks $180 million in additional annual fees with no plans to spend it? Where is the shame?” said WCI president and CEO Mike Toohey. "The budget will hopefully be considered dead on arrival in Congress, and I will offer to members of the House and Senate to provide the shovel and the preacher."

Cuts for seaports

The American Association of Port Authorities (AAPA) also noted several cuts to port programs in the president's budget. First, the proposal would eliminate the USDOT’s Port Intermodal Infrastructure Program (PIIP), which began as the Port Infrastructure Development Grants program in FY2019. By the end of this fiscal year, the PIIP will have awarded more than $500 million in grants to improve multimodal movement through seaports. 

The Department of Homeland Security’s Port Security Grants Program (PSGP), which Congress last funded at $100 million, would also be eliminated if the president’s budget were implemented.

Additionally, the cuts to the EPA's budget would mean a 90 percent reduction in Diesel Emissions Reduction Act (DERA) grants. These grants have assisted port operators to reduce diesel emissions in and around terminal areas. 

In addition, the president's proposal for the USACE's coastal navigation program is 40 percent lower than last year's appropriated budget level.

“Federal investments into port-related infrastructure, security and environmental programs pay huge dividends in terms of economic growth, good American jobs and supporting activities that generate sizable tax revenues. AAPA will be working with Congress on behalf of its members to meet and exceed FY'20 appropriation levels for fiscal 2021 funding of all port-related federal programs," said Chris Connor, AAPA president and CEO

Cuts to naval shipbuilding

The new White House budget proposes $700 billion for defense, about the same as the enacted level for FY2020. For the Navy, the president's $207 billion budget calls for a $2.5 billion cut to aircraft procurement and a $4.1 billion cut for shipbuilding, among other adjustments. If enacted, it would be the smallest naval shipbuilding budget in six years: $19.9 billion for six combatants and two tugboats, including the first round of funding for the lead Columbia-class submarine. 

The shipbuilding cuts for FY2021 include one less Virginia-class sub and one less future frigate (FFG(X)) - the new small surface combatant that is replacing the Littoral Combat Ship (LCS) in future production. 

In addition, the plan proposes decommissioning the first four LCSs. The first two vessels in each of the two LCS classes have already been off front-line duty since 2016, when the program was restructured. 

“The Department of Defense budget request makes it clear that the current budget agreement is insufficient to ensure that our military can implement the National Defense Strategy and make the investments it needs to outpace our adversaries," said Sen. Roger Wicker (R-MS), a senior member of the Senate Armed Services committee. “I am especially concerned that the budget proposal released today does not provide adequate funding to the Navy for shipbuilding, which is necessary to reach our statutory national policy of 355 ships and ensure that our fleet remains unrivaled at sea . . . As the defense appropriations process progresses, I will take every opportunity to ensure our military service members across the armed forces receive the tools, equipment, training, and innovation they need to keep us safe.”