Testimony of James H.I. Weakley President, Lake Carriers’ Association

Hearing on H.R. 104 Realizing America's Maritime Promise ("RAMP") Act

U.S. House of Representatives
Committee on Transportation and Infrastructure
Subcommittee on Water Resources and Environment

Friday, June 8, 2011
2167 Rayburn House Office Building

Thank you for the opportunity to testify today. I am Jim Weakley and I am representing Lake Carriers' Association and the Great Lakes Maritime Task Force. I am also a member of the national Realize America's Maritime Promise coalition. I ask this Subcommittee to approve H.R.104 without amendment. I will be focusing on government trust, jobs and marine transportation. All are vital to America's future.

WHO I REPRESENT

Lake Carriers' Association ("LCA") represents 15 American companies that operate 55 U.S.-flag vessels on the Great Lakes. Founded in 1880, LCA is one of the oldest trade associations in the United States. In a typical year, our members haul upwards of 100,000,000 tons of cargo on the Lakes. Those cargos are the raw materials that drive our economy - iron ore and fluxstone for steel production, coal for power generation, limestone and cement for the construction industry.

Great Lakes Maritime Task Force ("GLMTF") is the largest labor/management coalition ever to promote shipping on the Great Lakes and Seaway, America's Fourth Sea Coast. Since its founding in 1992, GLMTF has grown to almost 90 members and represents shipowners and operators, shoreside and shipboard labor, shipyards, terminal operators, public port authorities, cargo shippers, dredgers and other marine service providers.

Realize America's Maritime Promise ("RAMP") is a national coalition of more than 150 shipping companies, shippers, labor organizations, dredging contractors, ports and other waterway users that have come together in an effort to address the inherent unfairness of a system that collects revenues but does not use them for their intended purpose: DREDGING.

TESTIMONY

Ships enable domestic and global trade. Unfortunately, our waterways, the very arteries of coastal infrastructure, are barely surviving a diet of neglect. Already, the disease proved fatal to one Great Lakes Port, more may soon follow. Nature is filling our ports with sediment, but only half of the tax collected specifically to remove that sediment is being spent for that purpose.

Half of this Subcommittee's members, including Chairman Gibbs, who became the 100th cosponsor, and Ranking member Bishop have taken the first step to end the national dredging crisis by cosponsoring H.R. 104. Thank you. Restoring the trust in the Harbor Maintenance Trust Fund benefits all four of our Nation's coasts, as well as the economies of inland states. California importers, Minnesota miners, Ohio steelworkers, Michigan manufacturers, New York fishermen, Louisiana exporters, Illinois farmers, Pennsylvania producers and many others depend on efficient waterborne transportation to receive goods, move products to market and expand their horizons.

Our Nation's ports handle 2.5 billion tons of domestic and international cargo annually. They move imports and exports worth more than $5.5 billion per day. In 2007, before the recessions, ports employed over 13.3 million Americans, 9 percent of the total workforce; and those jobs paid $649 billion in wages. $1 billion in exports creates 15,000 new jobs. Our ports and the maritime industry keep America "open for business."

We do it by employing economies of scale - one "laker" can carry as much as 2,800 trucks - and the laws of physics - requiring less horsepower to move a ton of cargo. If semis were as efficient as ships, they would only need a lawnmower engine to propel them.

A lack of dredging forces "light loading." For every inch of draft lost, U.S.-flag lakers each forfeit as much as 270 tons of cargo. For each inch silted in, the American Laker fleet collectively, per voyage, leaves 8,000 tons of Minnesota ore in Duluth, enough to manufacture 6,000 cars. We leave enough Montana coal behind to produce 3 hours of Detroit's electricity or we abandon enough Ohio limestone for 24 Pennsylvania homes.

Tragically, lost draft is most often measured in feet. The impacts are system wide. This inefficiency makes American products more expensive and exports jobs. Dunkirk, New York's port used to receive 500,000 tons of coal per year, but it closed DUE TO LACK OF DREDGING in 2005.

More will follow. Based on the current Army Corps of Engineers dredging budget, it is very likely some ports in Western Michigan may soon be closed for business. Similar problems exist on our other coasts. The Corps' own statistics show that the authorized depth of federally maintained navigation channels is available over only half of their authorized width less than one-third of the time, and this performance is declining. Another Corps study estimated 30 percent of the 95,550 vessel calls at U.S. ports were limited by inadequate channels.

Tributaries to the Great Lakes naturally deposit more than 3.3 million cubic yards of sediment per year; however, never in the past decade has an Administration proposed spending enough money to remove it. Only Congressional adds or stimulus funding, twice in the past decade, allowed for the removal of the annual sedimentation volume.

Established in 1986, the Harbor Maintenance Trust Fund is the depository for the ad valorem cargo tax. The need for maintenance dredging is dire, the payoff on harbor maintenance investments is great, maritime commerce is paying enough into the Trust Fund to maintain the entire system, but little more than half of Trust Fund revenues are being spent for this purpose. Industry payments exceed Fund expenditures. In 2010, maritime commerce and interest income provided almost $1.4 billion to the Trust Fund; however, only $828 million were expended. Most harbors still lost depth and width to the unrelenting deposits of sediment. Annually, the "trust gap" grows by hundreds of millions of dollars. As of today, the Fund's surplus is approaching $6 billion.

H.R. 104, Realizing America's Maritime Promise Act, is the solution. Modeled after the Airport and Airways Trust Fund fix from 2000, it bases annual Trust Fund expenditures on Trust Fund revenues. The bill doesn't "score" or violate budget rules. It should reduce the need for maintenance dredging earmarks by providing adequate funding to dredge all ports.

I respectfully urge you to pass H.R. 104 without amendment. We are on the verge of a national navigation heart attack. We need to revive our dying infrastructure with the angioplasty of dredging and sustain it with a healthy maintenance diet.

It is a matter of Trust.

Click here to see the Powerpoint presentation

For additional information contact Glen Nekvasil, Secretary, Great Lakes Maritime Task Force (440-333-9996)

info@glmtf.org