Freight interests gear up for ‘combat service’ on Capitol Hill in rush to fund bill
Freight movement needs a coordinated national freight strategic plan and dedicated source of funds in the next surface transportation bill, and major industry players need to be aggressive in selling that message to legislators obsessed with cutting federal transportation spending. That’s the word from the annual conference of Coalition for America’s Gateways and Trade Corridors, a ten-year-old Washington coalition of freight interests that includes shippers, builders, ports, intermodal interests, and other stakeholders.
in the NewsState of Logistics 2016: Pursue mutual benefit Panjiva reports strong December and full-year 2016 U.S.-bound import levels POLA and POLB see strong 2016 volumes over all 7 Warehouse E-commerce Best Practices for 2017 Double Up on Labor Efficiencies More News
Freight movement needs a coordinated national freight strategic plan and dedicated source of funds in the next surface transportation bill, and major industry players need to be aggressive in selling that message to legislators obsessed with cutting federal transportation spending.
That’s the word from the annual conference of Coalition for America’s Gateways and Trade Corridors (CAGTC), a ten-year-old Washington coalition of freight interests that includes shippers, builders, ports, intermodal interests, and other stakeholders.
Leslie Blakey, CAGTC’s executive director, said her group is still pushing for a “dedicated” freight fund within the upcoming transportation bill to help pay for critical freight multimodal projects of national importance to the freight sector.
A dedicated freight fund for infrastructure funding would help freight projects compete for funding on their merit and would eliminate freight’s perennial fights for funds that currently can be diverted to non-highway interests such as bicycle paths, museums and other uses.
“There are so many critical freight transportation needs for our nation and for our system,” Blakey said, adding that the general public does not appreciate freight’s importance to their quality of life and economic growth.
“I think some people think when they buy a new TV from a big box store, that (the store) gets refilled by some giant vending machine,” Blakey said, only half seriously.
“Very few people out there associate congestion on the roads and railroads with all the goods they (buy) inexpensively.”
CAGTC Chairman Mort Downey, former deputy Transportation Secretary under President Clinton and veteran Washington transport hand with 53 years of government and industry experience, said he was confident freight interests would get their word out. The group’s members met with more than 50 members of Congress during their annual spring meeting.
“This is combat service,” Downey quipped of CAGTC’s members’ fly-in on Congress.
Seriously, Downey said “there is still more to do.” The next transportation bill could actually be result in a per-year reduction for money spent on freight goods movement unless Congress hears freight’s argument. The old joke is “Freight doesn’t vote,” which still rings true.
“We have to make the case that federal interest is freight interest,” Downey said. “So many people are worried about jobs and exports. If we want to export anything, we have to have ports and connections. We need more transportation capacity if we are to achieve greater exports. We have to keep pounding away at our message.”
Downey said freight interests must be ready to explain how growth of freight movement can improve the nation’s economic well-being. “We can get there but only if we have a strong message—and deliver it with a strong voice,” Downey said.
JayEtta Hecker of the Bipartisan Policy Center, a Washington think tank formed by former senators Tom Daschle and Bob Dole, has produced a national transportation freight policy program that emphasizes a national freight plan. That report, due out in June, will propose specific reforms scaled to existing revenue.
The plan emphasizes economic growth, environmental sustainability and safety as core national interests for freight transportation.
“We have to align resources with goals,” Hecker said. “It’s time to face up to the political and economic realities of the fiscal realities. There are no more smoke and mirrors. We have to live within our means.”
Hecker’s group is proposing a specific recommendation for a new consolidated and expanded freight transportation improvement program funded at about $2.3 billion annually. It also is recommending a plan that more than 80 percent of $40 billion be dedicated to core freight programs focusing on system preservation and metropolitan accessibility.
Currently the nation’s ground freight infrastructure needs are being funded by a series of stopgap funding measures at the same level as the $286 billion, five-year surface transportation authorization that expired on Sept. 30, 2009. The latest six-month extension of that law expires this Sept. 30.
Ideally, Washington will produce a replacement for that bill before that extension expires. President Barack Obama’s fiscal 2012 budget request to Congress calls for investing as much as $556 billion in highway, transit and rail projects over the next six years, or nearly twice the current investment.
Whether that amount actually gets authorized by Washington’s split political climate is a popular parlor game among capital transportation experts—and is completely unknown. Recently a new “draft” legislation began circulating among media and congressional types, purportedly reflecting the Obama administration’s goals in the new bill.
It included, among other bombshells, the desire to start a pilot program evaluating the feasibility of transitioning to a new vehicle-miles-traveled fee to fund the Transportation Trust Fund, instead of the current federal fuel tax (18.4 cents per gallon on gasoline, 23.4 cents on diesel, unchanged since 1993).
The percentage of revenue produced by the fuel tax is steadily dropping as vehicle mileage improves. With electric vehicles that use no gasoline, the government gets no money. So, the thinking goes, transitioning to a mileage-based fee is a way to get some revenue from these drivers. But the procedure for collecting such revenue is complicated and could cost nearly as much in administrative costs as it collects.
That concept was declared a non-starter almost immediately by trucking interests, who remember the cumbersome truck ton-mile tax of the 1960s and 70s to fund state highway coffers. The administration trial balloon also included language that would have allowed tolls on currently “free” interstates in congested urban areas or at the discretion of the Transportation Secretary. That is another anathema to the trucking lobby.
But then a funny thing happened. Nearly as soon as the 498-page “draft” document began circulating, the White House shot it down as “not a bill supported by the administration,” according to White House spokeswoman Jennifer Psaki. She called it an “early draft” that does not take into account the thinking of the president’s senior advisor, economic aides or cabinet officials.
In other words, a trial balloon. That crashed. Badly.
As usual, the main sticking point in the next highway bill is how to pay for it. Raising the fuel tax is a non-starter among Republicans, including new Transportation and Infrastructure Committee Chairman John Mica, R-Fla.
Rep. Mica recently told CQ Today that his committee’s reauthorization draft bill will take a “sharp turn” toward increasing public-private partnerships in transportation and will focus on what he labeled a “devolution” of funding to the states.
Rep. Mica met privately with some CAGTC members during their meeting and said that while his committee was close to producing a bill, it was still a work in progress. He indicated that his committee’s draft is expected out sometime in June.
Clearly, what freight interests want is more spending on transportation infrastructure. Currently, the U.S. spends about 2.6 percent of Gross Domestic Product on transportation needs, compared to 5 percent for most of Europe as 9 percent for China and India, according to Blakey.
Hecker of the Bipartisan Policy Center said money should be spent based on merit-based projects of national interest. And that means the old ways of transportation funding—pet projects to lawmakers known as “earmarks”—have to be jettisoned.
“You have to throw earmarks under the bus,” she said.
What freight interests should do, Hecker said, is eliminate the mode vs. mode fighting for funding and shift the debate to one that simply says that reduced spending on freight is a drag on the economy.
“This is what makes us grow,” Hecker said.
For related articles, please click here.
About the AuthorJohn D. Schulz John D. Schulz has been a transportation journalist for more than 20 years, specializing in the trucking industry. John is on a first-name basis with scores of top-level trucking executives who are able to give shippers their latest insights on the industry on a regular basis.
Subscribe to Logistics Management Magazine!Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!
Moore on Pricing: The other TMS functional options 2017 Rate Outlook: Where are freight transportation rates headed? View More From this Issue