Issue link: https://jocdigital.uberflip.com/i/335267
GOVERNMENT WATCH INTERNATIONAL | WASHINGTON | CUSTOMS | SECURITY | REGULATION 22 THE JOURNAL OF COMMERCE www.joc.com JUNE 23.2014 By Mark Szakonyi THE U.S. IS one step closer to getting its maritime trade gateways in shape now that the Water Resources Reform Development Act is law. Congress needs to get back on track in passing a water resources bill every two years and press on in reforming how it funds and completes navigational projects, said Paul Bea, principal of maritime consul- tant PHB Public Affairs. Much of what's in the next water resources bill will depend on whether Congress backs up its pledges to send millions of dollars more annually to ports and more fairly divvy up the funding. How well the U.S. Army Corps of Engineers adopts provisions in the just-passed legisla- tion to streamline project reviews also will determine how far legislators push for fur- ther reform. But don't expect the major West Coast donor ports to let up on their effort to get a larger share of the harbor maintenance taxes they collect back for harbor work, said J. Stanley "Stan" Payne, a principal at management and transportation consult- ing firm Summit Strategic Partners. Donor ports, defined as those that have collected at least $15 million in HMT dollars annually, received less than 25 percent of their col- lected harbor maintenance taxes back in the last five fiscal years and handled more than 2 million 20-foot-equivalent container units in fiscal 2012. Donor ports, including Los Angeles, Long Beach and Seattle, have argued the current funding mechanism allows competitors to benefit from their business. In crafting the new law, legislators were able to push a plan where small or emerg- ing ports, Great Lakes ports and donor ports were guaranteed a share of funding from the Harbor Maintenance Trust Fund. That bargain was largely possible because Con- gress pledged to reform the trust fund so the amount available to all ports would increase. Under the new bill, the federal government will have to send all collected harbor main- tenance taxes — a 0.125 percent levy on the value of import cargo — to ports, and not use the money to plug general budget holes, as has been done. "This is feel-good legislation, but the reality is everyone wants a bigger slice, and the question is whether there is going to be enough to go around," Payne said. What's in the next water resources development bill is just as important as when Congress will begin crafting the leg- islation. Although the bills are intended to come every two years, Congress has missed the schedule for the last two cycles. The Water Resources Reform Development Act comes seven years after the previous ver- sion, and that bill came seven years after the prior act. "We're thrilled that for the first time in seven years there is an authorization, with real reforms and a path toward fully using the Harbor Maintenance Trust Fund critically important for energy and related industries for its intended use," said Janet Kavinoky, executive director of transporta- tion and infrastructure for the U.S. Chamber of Commerce. Bill Shuster, R-Pa., House Transpor- tation and Infrastructure Committee chairman, has regularly voiced his desire to pass a water resources bill every two years, Bea said. For brave, or perhaps fool- ish, ports, the water resources bill won't be as important as it used to be because the newest version allows them to take on major projects, including dredging work, without gaining congressional approval. Ports still will have to get approval from the corps to proceed on the projects. The catch is that ports that take that path aren't guaranteed to get federal money, potentially leaving states, port authorities and, ultimately, taxpayers on the hook for millions of dollars, Payne said. The larger issue is how Congress will fund the hun- dreds of millions of dollars East Coast ports need to deepen their harbors so they can handle the larger ships that will begin to pass through the expanded Panama Canal in early 2016, he said. The current bill authorizes about $2 billion worth of port projects, including harbor-deepening work at the ports of Jack- sonville and Savannah. But it will be up to congressional appropriators to determine how much Uncle Sam kicks in and how much states, cities and port authorities will have to fund, Payne said. JOC Contact Mark Szakonyi at mszakonyi@joc.com and follow him on Twitter: @szakonyi_joc. MANDEL NGAN/AFP/Getty Images/Newscom WALKING THE WALK ON WRRDA Now that a new water resources act is law, it's up to Congress and the Army Corps to follow through