Talking Points U.S. Seaports and Job Creation May 13, 2015

Transcription

1 Talking Points U.S. Seaports and Job Creation May 13, 2015 Introductory Points For centuries, U.S. seaports have served as a vital economic lifeline by bringing goods and services to people around the world and by delivering prosperity to our nation. Port activities generate $4.6 trillion in economic activity annually and support more than 23 million American workers, including some of the highestpaying union jobs. With ambitious greening initiatives nationwide, seaports are also providing new green jobs and could do more with federal investment. By providing an estimated $28.9 billion for port-related landside freight transportation infrastructure and an estimated $30 billion for waterside freight transportation infrastructure by 2025, we can modernize the goods movement system for America s 21 st century ports and greatly enhance opportunities for job development. One of the biggest benefits of federal investments in freight transportation is the creation of transportation savings, which makes American exports more competitive. Between 2007 and 2014, the value of U.S. exports increased 60 percent. Additional federal investments can bring cost-savings which will help exporters of American products, such as U.S. farmers. Additionally, U.S. manufacturers will benefit from both import and export transportation savings as they use many imported parts, components and bulk commodities. Seaports can also help achieve our national goal of creating jobs through programs that enhance the environment by decreasing diesel emissions and improving energy efficiency in maritime operations, and by protecting our nation s homeland by bolstering port security. Investments in Ports = Jobs As Congress and the Obama Administration work to develop national job-creating policy and funding strategies, AAPA has outlined a number of key federal programs and tax incentives related to ports, which are detailed below, that will aid in job

2 creation, enhance sustainability, and provide long-term economic growth and prosperity for the nation. Infrastructure Programs Waterside The U.S. Army Corps of Engineers is responsible for improving and maintaining our nation s water access to ports. The money to maintain these channels is collected from cargo owners via the federal Harbor Maintenance Tax (HMT). The federal government doesn t fully utilize the HMT for its intended purpose to pay for navigation maintenance and provide equity to ports that pay more in HMT than they get back in benefits. Since its inception in 1986, the HMT has too often been used to fund other programs while serious dredging needs have been neglected. Given current federal appropriations, the Corps is only able to maintain the constructed depths and widths of federal navigation channels about half the time, despite a $9 billion surplus in the Harbor Maintenance Trust Fund. Projects to adequately maintain these navigation channels will create jobs immediately and will provide transportation savings that will benefit U.S. businesses. By decreasing the cost of freight transportation, these sectors can enhance their competitiveness in the global marketplace and create more jobs. AAPA strongly supports the 2014 Water Resources Reform and Development Act, which authorizes Congress to annually ratchet up appropriations for deep-draft navigation maintenance so that, by 2025, appropriations will be 100 percent of the amount of HMT that is collected each year. The U.S. Army Corps of Engineers uses these funds to maintain federal navigation channels at their constructed dimensions, although current funding is woefully inadequate to do so. AAPA believes that the development of a deep-draft center of expertise with a dedicated staff of subject matter professionals would greatly expedite and improve the quality of the Corps navigation project planning and review process. It is essential that Congress work together with the Corps, the Office of Management and Budget, other involved federal agencies and the nation s ports to make sure that there is a thorough and reliable process for the review and approval of feasibility studies on these all-important dredging projects. By working together, U.S. consumers and workers can continue to reap the benefits of our global economy that efficient ports can bring.

3 Infrastructure Programs - Landside Port access, efficiency and modernization can also be improved through several programs funded through the U.S. Department of Transportation. All these programs would create jobs if provided additional funds. These include: State highway funds for intermodal connectors into ports (including roads, rails, tunnels and rail crossings) and congestion mitigation projects; The National Corridor Infrastructure Improvement Program and the Projects of National and Regional Significance (both of which help make improvements in the movement of freight); Discretionary stimulus grants for freight and port infrastructure, such as those awarded through the Transportation Investments Generating Economic Recovery (TIGER) program; and, Infrastructure bonding and tax credit programs, such as proposed in the bipartisan Move America Act of 2015 legislation introduced in May 2015 by Senate Finance Committee Ranking Member Ron Wyden (D-OR) and Senator John Hoeven (R-ND). Environmental Programs Enhancing the environment is another great opportunity for creating jobs. Increasing investments into environmental enhancements at America s seaports can help reduce emissions, while creating good paying green jobs. These programs include: The Environmental Protection Agency s Diesel Emissions Reduction Act (DERA) grants. DERA funds received by ports are used to retrofit cargo handling machinery, purchase cleaner trucks and related equipment, retrofit ships (including dredges and tugs), provide electric shore-power for ships and retrofit rail locomotive engines. DERA funds have been some of the quickest funds to be released, and they have resulted in immediate buying power that creates American jobs. The Department of Energy s Transportation Electrification funding. While ports were eligible for the $400 million available in this program, AAPA was disappointed that DOE oriented it towards funding research for electrifying passenger cars and light trucks, but did not fund any port-related transportation projects. We hope that if additional funds are provided, Congress will direct DOE to re-evaluate its criteria for this program to be more inclusive of port needs.

4 DOE block grants to states for energy efficiency. If additional funding is provided to make energy efficiency improvements, ports hope to gain access to some of the money to make further green improvements at their facilities. Port Security Funding The American Recovery and Reinvestment Act (ARRA) included $150 million in cost-share waived funds to build jobs and help protect our ports against terrorism. Funding for additional security improvements can create more jobs, especially if the Federal Emergency Management Agency (FEMA) is allowed to provide funding for operational security positions as it did in the ARRA, and even more jobs could be created if the agency further expands its operational security personnel allowances. Continuing the cost-share waiver is also critical to job creation in this area. Tax and Trade Policies AAPA is promoting several tax incentives that would enhance goods movement. They include: Exempting certain U.S. port-to-port movements of maritime cargo from the federal Harbor Maintenance Tax. This is recommended by many in the maritime industry to promote more short sea shipping, which would create maritime jobs, reduce road congestion and wear, and reduce pollution. While several bills have been introduced in Congress, no action has taken place to date. AAPA strongly encourages this provision be included in any tax bill to help create jobs. Passage of this change would remove a federal disincentive to starting up this greener way to move freight. Elimination of the Alternative Minimum Tax (AMT) on private activity bonds issued by public entities. The AMT reduces the attractiveness to investors of bond issues necessary for infrastructure development projects. As a consequence, public port authorities must discount the bonds, thereby reducing the overall funding available for investment in infrastructure and the attendant jobs and income creation which would have been created. AAPA strongly supports permanent elimination of the AMT for private activity bonds. Passing pending and new free trade agreements, including the Trans- Pacific Partnership (TPP), the Transatlantic Trade and Investment Partnership (TTIP), and the Trade in Services Agreement (TISA). These trade pacts will help U.S. businesses, both small and large, sell their products

5 overseas, increasing exports. Increasing exports is an excellent way to create jobs for U.S. farmers, U.S. manufacturers, freight transportation workers and others. AAPA urges timely ratification of these trade agreements as part of Congress efforts to create jobs. Bottom Line Each year, America s seaports generate more than $4.6 trillion in economic activity, support the employment of more than 23 million people and handle some 2.2 billion tons of import, export and domestic cargo, including food, clothing, medicine, fuel, building materials and green technologies, such as wind-powered electricity-generating turbines. By providing funds to ports in the program and policy areas noted above, we can achieve modern, navigable seaports that are safe and environmentallysustainable, while creating jobs for both today and the future.