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THE ECONOMIC IMPORTANCE OF SEAPORTS: 

IS THE UNITED STATES PREPARED FOR 

21ST-CENTURY TRADE REALITIES? 

(112–57) 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

WATER RESOURCES AND ENVIRONMENT 

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

OCTOBER 26, 2011 

Printed for the use of the 

Committee on Transportation and Infrastructure 

( 

Available online at: http://www.gpo.gov/fdsys/browse/ 

committee.action?chamber=house&committee=transportation 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

JOHN L. MICA, Florida, Chairman 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

FRANK A. LOBIONDO, New Jersey 

GARY G. MILLER, California 

TIMOTHY V. JOHNSON, Illinois 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

SHELLEY MOORE CAPITO, West Virginia 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

DUNCAN HUNTER, California 

ANDY HARRIS, Maryland 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

JAIME HERRERA BEUTLER, Washington 

FRANK C. GUINTA, New Hampshire 

RANDY HULTGREN, Illinois 

LOU BARLETTA, Pennsylvania 

CHIP CRAVAACK, Minnesota 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

BILLY LONG, Missouri 

BOB GIBBS, Ohio 

PATRICK MEEHAN, Pennsylvania 

RICHARD L. HANNA, New York 

JEFFREY M. LANDRY, Louisiana 

STEVE SOUTHERLAND II, Florida 

JEFF DENHAM, California 

JAMES LANKFORD, Oklahoma 

REID J. RIBBLE, Wisconsin 

CHARLES J. ‘‘CHUCK’’ FLEISCHMANN, 

Tennessee 

NICK J. RAHALL II, West Virginia 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

ELIJAH E. CUMMINGS, Maryland 

LEONARD L. BOSWELL, Iowa 

TIM HOLDEN, Pennsylvania 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

RUSS CARNAHAN, Missouri 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

MAZIE K. HIRONO, Hawaii 

JASON ALTMIRE, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

HEATH SHULER, North Carolina 

STEVE COHEN, Tennessee 

LAURA RICHARDSON, California 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

(II) 

SUBCOMMITTEE ON WATER RESOURCES AND ENVIRONMENT

BOB GIBBS, Ohio, Chairman 

DON YOUNG, Alaska 

JOHN J. DUNCAN, JR., Tennessee 

GARY G. MILLER, California 

TIMOTHY V. JOHNSON, Illinois 

BILL SHUSTER, Pennsylvania 

SHELLEY MOORE CAPITO, West Virginia 

CANDICE S. MILLER, Michigan 

DUNCAN HUNTER, California 

ANDY HARRIS, Maryland 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

JAIME HERRERA BEUTLER, Washington, 

Vice Chair 

CHIP CRAVAACK, Minnesota 

LARRY BUCSHON, Indiana 

JEFFREY M. LANDRY, Louisiana 

JEFF DENHAM, California 

JAMES LANKFORD, Oklahoma 

REID J. RIBBLE, Wisconsin 

JOHN L. MICA, Florida (Ex Officio) 

TIMOTHY H. BISHOP, New York 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

RUSS CARNAHAN, Missouri 

DONNA F. EDWARDS, Maryland 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

MICHAEL E. CAPUANO, Massachusetts 

GRACE F. NAPOLITANO, California 

JASON ALTMIRE, Pennsylvania 

STEVE COHEN, Tennessee 

LAURA RICHARDSON, California 

MAZIE K. HIRONO, Hawaii 

NICK J. RAHALL II, West Virginia 

(Ex Officio) 

(III) 

(V) 

CONTENTS Page 

Summary of Subject Matter .................................................................................... vi 

TESTIMONY 

Anderson, A. Paul, Chief Executive Officer, Jacksonville Port Authority .......... 12 

Benjamin, Omar R., Executive Director, Port of Oakland ................................... 12 

Bridges, Jerry A., Chairman of the Board, American Association of Port 

Authorities ............................................................................................................ 12 

Darcy, Hon. Jo-Ellen, Assistant Secretary of the Army (Civil Works), United 

States Department of the Army .......................................................................... 12 

Friedman, William D., President and Chief Executive Officer, ClevelandCuyahoga County Port Authority ....................................................................... 12 

Koch, Christopher, President and Chief Executive Officer, World Shipping 

Council .................................................................................................................. 12 

Peyton, Peter, President, ILWU Marine Clerks Association Local 63 ................ 12 

PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS 

Brown, Hon. Corrine, of Florida ............................................................................. 49 

Hirono, Hon. Mazie K., of Hawaii .......................................................................... 53 

Landry, Hon. Jeffrey M., of Louisiana ................................................................... 55 

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Anderson, A. Paul .................................................................................................... 58 

Appendix A—Florida Seaports: A Dynamic Economic System, presentation by Florida Ports Council ................................................................... 67 

Appendix B—Excerpts from 2011 JAXPORT Directory: JAXPORT Overview, Facilities, Cargo Handling, Jacksonville Port Authority 

(JAXPORT), 2011 .......................................................................................... 83 

Benjamin, Omar R. .................................................................................................. 94 

Bridges, Jerry A. ...................................................................................................... 98 

Darcy, Hon. Jo-Ellen ............................................................................................... 106 

Friedman, William D. .............................................................................................. 111 

Koch, Christopher .................................................................................................... 114 

Peyton, Peter ............................................................................................................ 124 

SUBMISSION FOR THE RECORD 

Gibbs, Hon. Bob, a Representative in Congress from the State of Ohio, request to submit written testimony by the South Carolina State Ports Authority ................................................................................................................... 8 

ADDITIONS TO THE RECORD 

Knatz, Geraldine, Ph.D., Executive Director, Port of Los Angeles, written 

testimony .............................................................................................................. 128 

Attachment 1—National Economic Trade Impact Study, Federal Summary ............................................................................................................... 137 

Attachment 2—Importers and Exporters by Congressional District ........... 167 

Attachment 3—President’s Export Council Letter ........................................ 168 

Attachment 4—PNRS Congressional Letter .................................................. 171 

Attachment 5—Harbor Maintenance Trust Fund Expenditures, Congressional Research Service (CRS 7–5700 R41042) January 10, 2011 ............ 174 

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(1) 

THE ECONOMIC IMPORTANCE OF SEAPORTS: 

IS THE UNITED STATES PREPARED FOR 

21ST-CENTURY TRADE REALITIES? 

WEDNESDAY, OCTOBER 26, 2011 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON WATER RESOURCES

AND ENVIRONMENT, 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

Washington, DC. 

The subcommittee met, pursuant to notice, at 10:06 a.m., in 

Room 2167, Rayburn House Office Building, Hon. Bob Gibbs 

(Chairman of the subcommittee) presiding. 

Mr. GIBBS. Good morning. The water and environment subcommittee will come to order. Welcome. 

Today we are having a hearing on the economic importance of 

seaports, and if the United States is prepared for 21st-century 

trade realities. And I will start my opening statement. 

While 95 percent of the Nation’s imports and exports go through 

the Nation’s ports, waterborne commerce is, by far, the Nation’s 

most ignored mode of transportation. Nearly a third of the Nation’s 

gross domestic product is derived from international trade, the bulk 

of which is waterborne. With more of our economy expected to be 

dependent on international trade in the coming decades, we must 

begin to prepare our infrastructure for the future. 

Our integrated system of highways, railways, airways, and waterways has efficiently moved freight in this Nation. But as we 

enter a new era of increased trade among our worldwide trading 

partners, the Nation’s navigation system has struggled to keep 

pace. While the ports themselves have done an admirable job of investing in landslide improvements and enhanced intermodal connections, the Federal Government has all but ignored the Nation’s 

navigation channels, the gateways to the world markets. 

In May 2010, the President proposed an export initiative that 

aims to double the Nation’s exports over the next 5 years. However, 

the Corps of Engineers’ navigation budget was slashed by 22 percent over the previous 5 years, and the President, only requesting 

$691 million for the Harbor Maintenance Trust Fund expenditure, 

the export initiative will not be a success. 

In addition, the President’s request of a little over $280 million 

for construction of new navigation projects, this is almost the same 

amount as requested for recreation projects, and almost half of 

what is requested for ecosystem restoration projects. 

2 

Only if our ports and waterways are at their authorized depths 

and widths will products be able to move to their overseas destinations in an efficient and economical manner. Since only 2 of the 

Nation’s 10 largest ports are at their authorized depths and widths, 

the President’s budget does nothing to ensure our competitiveness 

in world markets. Transportation savings are a key factor in economic growth. But an inefficient transportation system will make 

U.S. products uncompetitive in world markets. And if the transportation costs go up, the competitiveness on American products in the 

world market goes down. 

So, addressing the infrastructure needs of the Nation’s ports is 

not about economic benefits to a few shipping companies, it’s about 

keeping American farms and businesses competitive, and growing 

American jobs. For a tiny percentage of the $1 trillion failed stimulus program of 2009, or the $450 billion jobs program recently suggested by the 

administration, we could spend approximately $1.5 billion annually 

in the Harbor Maintenance Trust Fund for its intended purposes 

to ensure the Nation’s ports are at their federally authorized 

depths and widths. Instead, the administration, through its proposed budget, states that 35 percent of the channel’s availability is 

adequate to ensuring America’s products are competitive overseas. 

Unless the issue of channel maintenance is addressed, and—the 

unreliability and unresponsiveness of the entire intermodal system 

will slow economic growth and threaten national security. 

I am a fiscal conservative, but I still believe it is necessary to invest in America’s transportation, infrastructure, and to stimulate 

the economy and keep it strong. Unlike a lot of Government spending, investing in transportation provides a positive economic return 

on investment. We need to make investments in our maritime infrastructure, and other investments that will multiply jobs 

throughout the economy. Many of the recent suggestions that come 

from the administration and elsewhere call for expenditures on 

projects that simply create short-term construction jobs with little 

or no economic benefit coming from the project being built. 

I welcome our witnesses to the hearing today, and look forward 

to hearing from each of you. And now I would yield to Mr. Bishop, 

our ranking member, for any remarks he might have. 

Mr. BISHOP. Thank you very much, Mr. Chairman, for holding 

this hearing on the economic importance of our Nation’s seaports. 

I could not agree more with the premise of this hearing. Seaports 

are the critical hub of exports leaving and entering the United 

States. Nothing could be more important to our trading and economic balance than to ensure that our seaports are prepared to 

handle cargo and create jobs. 

Twice in the last 5 months we have held hearings on issues in 

legislation associated with our maritime and inland waterway systems. We have heard from witness after witness about the importance of maintaining our waterway transportation system. I get it. 

And I think we all agree that more needs to be done. The problem 

that I am struggling with is how we are going to meet the needs 

under the present constraints that we are operating under. 

As I have looked over the testimony from our witnesses today, 

I am struck by three consistent themes. The first theme, that in 

3 

order to prepare for a shipping world where the cost of shipping 

and the timing of getting the commodities to market, or the market 

drivers, we need seaports that can support the shipping carriers of 

the future, along with the land-side infrastructure to quickly and 

efficiently move the cargo from ship to rail, trucks, or airplanes, 

and out of the—out to the intended industries. 

The second theme is that ports create jobs, lots of jobs, both directly loading and unloading ships, and indirectly, through the 

moving and distributing of the commodities from port to destination. If the seaports lose capacity, or cannot handle the bigger container ships, then ships and jobs go away to Canada, Mexico, or 

other ports that will support them. 

The third theme is that we need to find a more efficient and 

timely way to fund and support our seaports. The Harbor Maintenance Trust Fund, the U.S. Army Corps of Engineers operation and 

maintenance, and Corps construction programs, along with private 

partners, have historically stood together to find ways to meet the 

seaport needs of our country. This is where I’m having the problem. 

Under the 112th Congress, the Republican majority pushed to cut over $500 million, or 10 percent, in fiscal year 2011 from an 

already-strained Corps budget. Included with this overall cut, H.R. 

1, which was passed—which passed the House of Representatives, 

proposed to reduce the Corps construction account by over 16.8 percent over the previous fiscal year’s level. 

The fiscal year 2012 budget follows the same trend. The House 

passed funding bill for the Corps further reduces the level of funding for the Corps by 11.5 percent, when compared to fiscal year 

2010 levels, including a remarkable cut of 20.5 percent to the 

Corps’ construction account. I have heard my majority colleagues 

suggest that somehow the Corps should be doing more with less. 

However, I don’t understand how shifting money around without 

having the discussion about the overall impact of the Corps budget 

is good for anybody. Someone’s ox is going to get gored. 

Contrast this with the recent jobs proposal of President Obama, 

which calls for an increase in investment for our Nation’s infrastructure, including its wastewater and drinking water infrastructure, as well as commercial ports, levees, and projects on the inland 

waterway system. We need to get our ship back on an even keel, 

with leadership, sound policy, and investments in the programs 

and infrastructure that keeps our country moving forward. 

I hope that today we can all concur in our support for increasing 

expenditures from the Harbor Maintenance Trust Fund. That 

seems to be without question. However, the broader agreement 

does not address the reality that unless we increase the overall investment in the Corps of Engineers, we cannot increase the funding for harbor dredging and channel maintenance, without impacting other Corps construction or maintenance or restoration 

projects. The mantra of doing more with less makes for a great 

bumper sticker, but makes for terrible public policy, especially 

when considering the large number of jobs and the impact to our 

Nation’s economy. We simply can’t have it both ways. 

We all understand the terrible spot we are in with the national 

financial picture. It is not pretty, and it will not be fixed overnight. 

I would contend that doing more with less with respect to our seaVerDate Aug 31 2005 10:28 Apr 05, 2012 Jkt 000000 PO 00000 Frm 00017 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\2011\10-26-~1\70928.TXT JEAN
4 

ports and waterway infrastructure harms our Nation and makes 

the outcome we all seek—that is to say, fiscal sustainability—more 

elusive for several reasons. 

First, it directly impacts millions of jobs across the Nation, by 

one count potentially jeopardizing over 13 million jobs. 

Second, it has substantial negative impact on local economies 

and the bottom line of industries, including both large and small 

businesses, and the employees they support. 

Lastly, it reduces our Nation’s ability to compete in a global 

trade economy. 

I am glad we are having this conversation today, because it allows us to highlight the problem that we are having, our inability 

to have an open and expansive dialogue on how we move forward 

from the quagmire we find ourselves stuck in. While we bicker 

about congressional earmarks and cutting back on all forms of regulation and agency budgets, the seaports continue to silt in, our 

shipping channels continue to shoal and narrow, and our infrastructure falls apart from age and neglect. 

The result is that more and more of the shippers of the world are 

looking to other countries to move their goods and services. We 

have to prepare for the future world of shipping and seaports. We 

have to protect our economy and our jobs. We have to think smarter and more strategically, in terms of integrating sea shipping with 

rail, roads, and air distribution systems. We cannot do this without 

having an integrative and strategic approach. To do otherwise 

would be, in my opinion, foolish and a real waste of an opportunity 

to provide the public with the leadership they are demanding. 

I stand ready to have that discussion, and encourage my colleagues and the administration to sit down and get to solving the 

problem, rather than just arguing about our problems and pointing 

fingers with respect to who caused them. 

I yield back the balance of my time. 

Mr. GIBBS. Representative Shuster for an opening statement? 

Mr. SHUSTER. Thank you, Mr. Chairman. I will be real brief. I 

appreciate all the witnesses being here today, and look forward to 

hearing from them, but I also want to thank the chairman and the 

ranking member for holding this hearing. 

And, as the ranking member said, our ports are extremely critical to the well-being of this Nation. When you’re talking about 

trade, you think about the ports, but also the connection of the 

ports to the rest of the Nation. And I know I’ve been to the Port 

of Los Angeles, the Port of Houston, and places up and down the 

east coast. And for instance, the Port of Los Angeles, about 40 percent of our goods come in there, and a third of them—almost a 

third of them—go east to the Mississippi. I don’t have a port, per 

se, in my district, but of course, the ports of this Nation serve my 

district, whether we are importing or exporting. 

So it is extremely important that we are not only looking at our 

ports, but how they connect to the rest of the United States, to 

make sure that it is a system, it is a national system that we can 

have a movement of goods that are unimpeded across this Nation, 

whether it is highways, rail, inland waterways, all extremely important. 

5 

I think also an important component of this is to streamline. And 

I know that there are some, like the ranking member—with all due 

respect, doing more with less is possible. And, in fact, I believe it 

is the first step we need to do, is to do more with less. I am all 

for doing more with more, but there are some here that want to 

do less with more, more money, and we have all the same regulations. We are not going to do more; we are going to have the bureaucracy and the lawyers in this country continue to gobble up 

more of our money. 

So, we need to streamline first. Let’s get the streamlining in 

place so that we can do more with less. And at some point, again, 

I think we can all come together and say, ‘‘Let’s do more with 

more.’’ 

So, with that, Mr. Chairman, thanks for holding this hearing, 

and I yield back. 

Mr. GIBBS. Representative Napolitano, proceed. 

Mrs. NAPOLITANO. Thank you, Mr. Chairman. And thank yourself, Chairman Gibbs, and Ranking Member Bishop, for holding 

this hearing. 

And I agree with my colleague, Ranking Member Bishop. We 

must invest in our ports. 

The Harbor Maintenance Trust Fund is an important tool to rebuild our harbor infrastructure. The intent of it is for shippers to 

pay a fee that is spent—supposed to be spent—on maintaining the 

harbors that the shippers use. Unfortunately, that is not the case. 

It is not operating in a fair or equitable manner. 

The harbors must pay into the trust fund—they pay in to receive 

a very small fraction in return to maintain their harbors. The top 

10 harbors in the U.S. collect 70 percent of the trust fund revenues, 

although they receive only 16 percent of those expenditures. This 

inequality has led to the busiest U.S. harbors that pay the most 

into the system being drastically undermaintained, and we are facing a loss to Canada and Mexico in the meantime, especially as the 

new super-tankers are requesting ports that are not maintained 

sufficiently to allow them to berth. 

The U.S. Army Corps of Engineers estimates that the Nation’s 

busiest 59 ports are maintained to only 35 percent of authorized 

depth. The situation can increase the cost of shipping as vessels 

carry less cargo in order to reduce their draft, or they wait for high 

tide before transitioning into a harbor. This can also increase the 

risk of a ship grounding or a collision, possibly resulting in an oil 

spill. 

According to CRS, only 30 to 45 percent of these revenues are 

being spent in harbors that shippers even use. Assessing a fee on 

shippers and then distributing the revenues mostly or entirely for 

the benefit of other users undermines the trust fund and its intended use, and the user fee concept. 

Our Los Angeles and Long Beach harbors, which—both are not 

in my area, but that’s the Alameda Corridor that goes right 

through my area—receive less than 1 percent of the funds they pay 

into the system. Mr. Chair, 1 percent is not exactly equity. 

Seattle and Tacoma receive about 1 percent of the funds they pay 

into the system. The harbors of New York, Boston, Houston, receive less than 25 percent of the funds they pay into this system. 

6 

And they end up going to the competitor ports. This situation is incredibly unfair. This would be as if the Government assessed a fee 

on McDonald’s and gave the money to Burger King to build better 

restaurants. We must fix the problem. Money shippers pay into the 

fund should be spent entirely on maintaining the harbors they 

are—use. 

Additionally, we should also expand the in-water uses of the Harbor Maintenance Trust Fund. Those funds should pay for harbors 

over 45 feet in depth, if those harbors are financing the fund. The 

fund should pay for berth dredging, as well. 

There are many issues concerning this, and I trust that we will 

continue to look at this, and maybe get a little bit better equity for 

those harbors that actually need it to be able to continue bringing 

business to the U.S. ports, instead of going to other ports throughout the Nation—or I mean throughout the world. 

I thank you. And I am talking about Mexico and Canada. Mr. 

Chair and Ranking Member, thank you again, and I yield back. 

Mr. GIBBS. Representative Richardson? 

Ms. RICHARDSON. Thank you, Mr. Chairman. First of all, I want 

to welcome Mr. Peyton, who is from my district. It is always good 

to see you here, and we are looking forward to your testimony, and 

the insight, that you are going to help this committee, as we go forward. 

Mr. Chairman, I want to thank you for convening this hearing 

to look at the preparedness of our Nation’s seaports, and the economic implications. 

One of my top priorities since I’ve been in Congress has always 

been to ensure that our country’s ability to move goods is second 

to none. Forty percent of all the goods entering or leaving this 

country travel through my district. I doubt that there is a more 

transportation-intensive area in this entire country. With three 

new recently signed free trade agreements only stresses the point 

that we need to invest in our Nation’s seaport infrastructure. 

It is also kind of ironic that we had the recent introduction of the 

Mexican truck pilot program, as well. And with the definite oncoming of the Panama canal and many of the other areas, for us not 

to be having a serious discussion of how we can remain competitive 

in this marketplace is a mistake. 

I will tell you that seaport infrastructure is particularly important, because when you consider the port complexes that I reside 

in, nothing is more important than being able to move the goods 

through, and to keep people working, and to do that in a safe environment for our community. 

Time and time again, we have fought for reforms to allow our 

Nation’s infrastructure to become a top-tier system for the movement of goods, while we watch China and many other countries 

make huge investments while we fight for pennies of an increase 

on a gas tax. 

I concur with my colleagues of must having reform having to do 

with the Harbor Maintenance Trust Fund, which is clearly not 

working, and the funds are not being utilized in the intent of what 

it was originated. When you have groups like the Chamber of Commerce, the American Council of Engineering Companies, the National Transportation Policy Center, ILWU, Associated General 

7 

Contractors of America, American Public Transportation Association, and the American Association of State Highways all calling 

for proper funding for infrastructure, and when this Congress fails 

to do so, something is wrong. 

We need to focus on looking at not only the funding mechanisms, 

which is critical, but a commitment by this committee that we 

move forward on the transportation bill, and properly fund the programs that are going to help us move the goods throughout this 

country. 

As I get ready to close, I also want to speak to, in this committee, 

looking at how the—for example, we have Mr. Peyton here, who is 

with us today, and also with the port authorities, of how some of 

the jobs that are being done in the ports are first responders, as 

well, and your role in security with the seaports, and how we might 

better assist you in being able to be prepared for that. 

With that, Mr. Chairman, I thank you for the work that you 

have already shown, and we look forward to really passing a bill 

that can be helpful and can allow our seaports to be competitive. 

I yield back the balance of my time. 

Mr. GIBBS. Thank you. A little housekeeping here. I ask unanimous consent for a statement from the South Carolina Ports Authority to be included in the record. 

[No response.] 

Mr. GIBBS. Hearing none, so ordered. 

[The information follows:] 

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Mr. GIBBS. Well, I want to welcome our panelists. I will just 

quickly introduce them, and then we will start. 

We have Honorable Secretary of Army Works, Jo-Ellen Darcy. 

We have Mr. Jerry Bridges, the chairman of the board of the American Association of Port Authorities; Christopher Koch, president of 

the World Shipping Council; Paul Anderson, the chief executive officer of the Jacksonville Port Authority; Omar Benjamin, the executive director of the Port of Oakland; and William Friedman, president and chief executive officer of the Cleveland-Cuyahoga County 

Port Authority. And that is Cleveland, Ohio. Welcome. And Mr. 

Peter Peyton, he is president of the ILWU Marine Clerks Association. 

Welcome. And, Ms. Darcy, the floor is yours. 

TESTIMONY OF THE HONORABLE JO-ELLEN DARCY, ASSISTANT SECRETARY OF THE ARMY (CIVIL WORKS), UNITED 

STATES DEPARTMENT OF THE ARMY; JERRY A. BRIDGES, 

CHAIRMAN OF THE BOARD, AMERICAN ASSOCIATION OF 

PORT AUTHORITIES; CHRISTOPHER KOCH, PRESIDENT AND 

CHIEF EXECUTIVE OFFICER, WORLD SHIPPING COUNCIL; A. 

PAUL ANDERSON, CHIEF EXECUTIVE OFFICER, JACKSONVILLE PORT AUTHORITY; OMAR R. BENJAMIN, EXECUTIVE 

DIRECTOR, PORT OF OAKLAND; WILLIAM D. FRIEDMAN, 

PRESIDENT AND CHIEF EXECUTIVE OFFICER, CLEVELANDCUYAHOGA COUNTY PORT AUTHORITY; AND PETER PEYTON, PRESIDENT, ILWU MARINE CLERKS ASSOCIATION 

LOCAL 63 

Ms. DARCY. Thank you, Mr. Chairman and distinguished members of the subcommittee. I want to thank you for the opportunity 

to testify on the economic importance of our seaports in preparation for the 21st-century trade realities. 

The Corps of Engineers facilitates commercial navigation by providing support for safe, reliable, highly cost-effective and environmentally sustainable waterborne transportation systems. To this 

end, the Corps invests over $1.5 billion annually, roughly one-third 

of the total budget for the Civil Works Program, to study, construct, replace, rehabilitate, operate, and maintain commercial 

navigation infrastructure for approximately 13,000 miles of coastal 

channels and 12,000 miles of inland waterways. 

Our coastal ports contribute to the Nation’s economic competitiveness, as well as to State and local governments’ economic development and job creation efforts. They handle over 2 billion tons of 

commerce annually, including over 70 percent of the imported oil 

and more than 48 percent of goods purchased by American consumers. 

In some cases, the dredging of Federal navigation channels also 

provides environmental benefits, where the dredged material is 

used to create, preserve, or restore wetlands, islands, or other habitats. 

We are working with the Department of Transportation to improve decisionmaking on Federal investments in coastal navigation 

infrastructure through better coordination. For example, the Department of Transportation has provided information on previous 

years’ selected TIGER Grant recipients to the Corps, which we are 

13 

considering as part of the Civil Works budget preparation. Similarly, the Department of Transportation has invited Corps technical experts to advise them during the upcoming review process 

for the 2011 TIGER Grant selections. 

Many of the world’s shipping companies are constructing larger, 

more efficient container vessels that require channel depths from 

50 to 55 feet. The new Panama Canal locks are scheduled for completion in 2014 and will increase the permissible draft of vessels 

transiting the Panama Canal from 39.5 feet to 50 feet. 

On the Atlantic Coast, the United States now has two 50-footdeep ports capable of receiving these ships: Norfolk and Baltimore. 

The Corps expects to complete deepening of the Port of New York 

and New Jersey to 50 feet by the year 2014. The Corps is also 

working with the Port of Miami, which is financing a project to 

deepen the Federal channel to 50 feet. The ports of Los Angeles, 

Long Beach, Oakland, Seattle, and Tacoma also have depths of 50 

feet or greater. 

The United States also has several other ports with depths of 45 

feet on the Atlantic, Pacific, and gulf coasts, which will be able to 

accommodate such vessels when they are less than fully loaded. The President’s fiscal year 2012 budget includes $65 million for 

the ongoing deepening of the Port of New York and New Jersey, 

$42 million for construction or expansion of dredged material placement facilities at the ports of Norfolk, Savannah, Jacksonville, and 

Tampa, in order to continue the maintenance of the deep draft 

channels serving these ports. And we have $600,000 for 

preconstruction engineering and design for the proposed deepening 

of the channel in Savannah Harbor. 

The Corps is also working with 10 ports on the Atlantic and gulf 

coast to evaluate proposals to deepen or widen their channels. The 

Civil Works Program to date is focused on the operation, maintenance, repair, and replacement of major navigation, flood control, 

and hydropower infrastructure systems, and the restoration of 

aquatic ecosystems that past Corps projects have affected. The 

overall budget for the program is primarily devoted to maintaining 

these systems, so they can continue to provide economic, environmental, and social benefits to the Nation. 

The fiscal year 2012 budget for the Corps includes $758 million 

from the Harbor Maintenance Trust Fund to support the maintenance of our coastal harbors and their channels, and related work, 

including maintenance dredging. This is comparable to the enacted 

fiscal year 2011 level. To make the best use of these funds, the 

Corps evaluates and establishes priorities, using objective criteria, 

including transportation cost savings, risk reduction, and improved 

reliability, all relative to the cost. 

Consequently, maintenance work generally is focused more on 

the most heavily used commercial channels, which together, carry 

about 90 percent of the total commercial cargo traveling through 

our coastal ports. However, many ports will experience draft limitations on vessels due to channel conditions at least during part of 

the year. 

In summary, the Corps supports commercial navigation by providing for safe, reliable, highly cost-effective and environmentally 

sustainable waterborne transportation systems. Through the Corps 

14 

and other Federal agencies, the administration is investing in our 

ports. As part of the administration’s broader strategy of economic 

growth for our Nation, the Corps has been working to deepen and 

widen several of our ports. 

Mr. Chairman and members of the committee, I look forward to 

working with the subcommittee on these issues. Thank you. 

Mr. GIBBS. Mr. Bridges, welcome. The floor is yours. 

Mr. BRIDGES. Thank you, Chairman Gibbs and members of the 

subcommittee, for this opportunity to testify on the economic importance of seaports to trade, and how the United States can be 

poised for future growth. 

Today’s discussion is very timely, as Congress debates how to 

create jobs while controlling Government spending over the next 

decade. I am here today on behalf of the American Association of 

Port Authorities, where I serve as chairman of the board. We were 

founded over 100 years ago. AAPA promotes the common interests 

of ports and provides leadership on trade, transportation, and environment. 

Since the birth of our Nation, U.S. seaports and waterways have 

served as a vital economic lifeline, delivering prosperity to our Nation. Today ports move 99 percent of our country’s overseas cargo. 

International trade account for more than a quarter of the American domestic gross product. For every $1 billion in exports shipped 

through seaports, 15,000 U.S. jobs are created. 

As we recover from the current economic downturn, we must 

make investments today to address future trade realities. We face 

many challenges and many opportunities, such as the expansion of 

the Panama Canal, the growth in ship size, the hemispheric competition related to imports, exports, and maritime jobs, the 

growth—the goal of increasing U.S. exports, new trade agreements, 

and the 30 percent growth in U.S. population. 

So, are we ready? I am not sure. The ports are planning for the 

future, but the Federal Government has, unfortunately, not kept 

pace. The Federal Government has a unique constitutional responsibility to maintain and improve infrastructure that enables the 

flow of commerce, and much of that infrastructure in and around 

seaports have been neglected for too long. Many of our land and 

water connections are insufficient and outdated, affecting the port’s 

ability to move cargo efficiently. This diminishes U.S. business, 

hurts U.S. workers, and impairs our national economy. 

So, what must we do? The Federal Government must make funding of dredging a higher priority. Number two, Congress must pass 

a surface transportation bill with more funding for ports, freight, 

and land-side infrastructure, including TIGER programs. And Congress must not cut or eliminate port security grant programs, environmental programs that benefit ports. 

I will focus the remainder of my time on U.S. dredging programs, 

since this is within the jurisdiction of this subcommittee. 

Federal investments are needed to modernize and maintain Federal navigational channels. As you know, port users currently pay 

100 percent of the cost to maintain our harbors through collections 

of the Harbor Maintenance Tax and cost sharing formulas. While 

the President’s fiscal year 2012 budget calls for $758 million for 

harbor maintenance dredging, the trust fund revenues for fiscal 

15 

year 2011 was $1.48 billion. Revenue is almost double what is currently being spent. This is truly unfair taxation, especially since 

fewer navigational channels are at their authorized depth or width. 

This injustice must be corrected. 

We encourage you to work with congressional leadership on the 

permanent HMT solution, not only encourage for use, but also provide the funds to make this a reality. 

We also encourage you to weigh in on the House appropriators 

who are currently considering the 8 percent decrease in this year’s 

maintenance budget, despite the large and growing surplus in the 

Harbor Maintenance Tax fund. 

Another troubling trend impacting our preparedness for future 

challenges is the time it takes to complete new projects. This new 

norm is decades, and costs rise with each delay. Impediments include long, slow approval process and small amount of available 

funding to reduce—that has reduced the Corps’ capability to provide full services to ports. Port modernization must become a higher priority; today the most cost-effective way to move cargo is on 

the American marine highway. Federal investments should encourage this. 

Our Nation’s ports are at a defining moment, facing enormous 

challenges and opportunities. Ports are making necessary investments to build and maintain world class maritime facilities in a 

transportation system to support U.S. jobs, our global competitiveness, and our economy. We need our Federal partner to make this 

vital commitment also. 

We commend you and your staff for drafting the maritime title 

for the surface bill, and it includes several provisions that will aid 

getting projects done more quickly. We urge your committee to 

serve as advocates for port infrastructure, and meet challenges of 

today and tomorrow. Thank you. 

Mr. GIBBS. Thank you. Mr. Koch, welcome. The floor is yours. 

Mr. KOCH. Thank you, Mr. Chairman. On behalf of the World 

Shipping Council, which represents the liner shipping industry— 

the ocean carriers that carry much of the Nation’s commerce, we 

appreciate the subcommittee’s review of these issues today. I have 

given a more complete set of comments in my written testimony. 

I won’t try to repeat that here. There is a common set of themes 

I think you will hear from the panel’s testimony today, and I will 

try not to be redundant with those, either. 

There is not a single issue involved in addressing the questions 

you are trying to deal with today. The chart that I put in my statement illustrates that where the private sector owns the Nation’s 

critical transportation infrastructure, there is generally not an existing capacity problem or shortage of necessary investment capital, 

despite the enormous capital requirements. The ports are investing, terminal operators have invested, rail carriers have invested, 

ocean carriers have invested. The capacity problems tend to rise 

more often with those portions of the critical infrastructure that 

are owned by the Government, such as locks and dams, harbor 

channels, and the efficient connections for freight to the national 

highway system. 

There is a lot of variability that one deals with in trying to plan 

for the future. The recession of 2008 and the economic doldrums we 

16 

have been in have actually bought us some time because volumes 

today still are not what they were at in 2008. But, for the long 

term, there is no question what we have to do as a Nation. We 

have to invest in the infrastructure necessary to support future 

population growth, and future economic growth. 

In my testimony, as requested by the staff, I have addressed a 

number of questions that arise in trying to figure out what the effect of the Panama Canal’s new locks will be on the port infrastructure system, and the services that call there. I won’t repeat those, 

but will be happy to answer any questions, should the subcommittee have those later on. 

What I would simply like to summarize is that today some ports’ 

infrastructure clearly can accommodate large vessels being built, 

and more will be able to accommodate these ships when current 

dredging expansion projects are complete. The major U.S. east 

coast and gulf ports are in various stages of readiness to handle 

larger ships and the larger volumes with approved highway and 

rail intermodal connections. Mr. Bridges’ port in Virginia is the 

most ready of the east coast ports. 

But the Army Corps of Engineers port deepening program is an 

important part of future infrastructure capacity. The Nation’s 

major ports are critical enablers of the economic health of the country, and their ability to continue serving in that role and handling 

the growth of the American economy should not be impaired by aspersions they are inappropriate earmarks, aspersions that undermine an otherwise appropriate funding process. 

That portion of the critical maritime infrastructure that the Government owns, including the highway connections, deserves the 

subcommittee’s and the Congress’ continued attention and investment. The committee’s continued efforts to enact a long-term highway reauthorization bill that includes due recognition of freight 

transportation, and the committee’s continued support for the 

Army Corps of Engineers channel deepening and maintenance 

projects are both important to making sure that American commerce will continue to have efficient and competitive access to 

world markets. Thank you, Mr. Chairman. 

Mr. GIBBS. Thank you. 

Mr. Anderson, welcome. Proceed. 

Mr. ANDERSON. Thank you, Chairman Gibbs, Ranking Member 

Bishop, and the distinguished members of the subcommittee. It is 

really an honor today to speak on this subject, having an indepth 

perspective on today’s hearing as a former Federal maritime commissioner and as the current CEO of Jacksonville, Florida Port Authority, known as JAXPORT. 

First, I commend Chairman Mica and Ranking Member Rahall 

for their leadership in looking at improving the health of America’s 

seaports, and working to ensure our gateways will support the economic health of our Nation’s ports for generations to come. 

U.S. seaports play a critical role. More than 13 million Americans work in international trade, trade accounting for more than 

a quarter of the U.S. gross domestic product. Nearly all of that 

cargo, imports and exports, is carried by ship. With volumes expected to double in the next 20 years, we must step up investment 

in our ports today. This growth will not be experienced equally 

17 

across the American seaport regions of the Pacific, the gulf, and the 

east coast. 

Mounting economic pressures have shippers demanding more efficient networks, new trade routes focused on the U.S. east coast, 

expansion of the Panama Canal, and innovations and logistics are 

influencing the movement of cargo in dynamic ways. 

JAXPORT and north Florida region are at the center of these 

trends. Our new MOL TraPac container terminal is ready—is already serving container ships sailing through both the Panama and 

the Suez Canals, and has doubled our capacity to handle containers. Once Hanjin Shipping Company of Seoul, Korea, opens its 

own container terminal, JAXPORT will have tripled its container 

handling capacity in one short decade, adding 90,000 jobs to a region with double-digit unemployment today. 

However, TraPac does not offer the Federal channel depth required by the larger ships it serves, so they come in light-loaded. 

This means fewer cargo moves, fewer jobs, higher transportation 

costs, costs that are passed on to the American consumer. Without 

a deep harbor, it will be incredibly difficult for TraPac to maximize 

their $200 million investment. Hanjin stands ready to invest an additional $300 million in private sector dollars, but continues to 

wait, also wondering if America will commit to investing in its own 

waterways. 

I have serious doubts that we will be ready for the larger ships, 

because of the delays in the Nation’s process and overarching regulatory process, including the U.S. Army Corps of Engineers, and 

also here in Congress. I can tell you from first-hand frustrating experience, harbor project sponsors wade through an approval, authorization, and appropriation process that is muddy, at best, and 

face constantly changing requirements, making it nearly impossible 

to move forward. Our country can clearly do this better, especially 

when American jobs and competitiveness are at stake. 

I propose a multifront attack on this challenge, along with the 

American Association of Port Authorities and my fellow colleagues 

here today. We have helped develop recommendations for expediting the Corps process. We need to insist that those changes be 

adopted and adhered to. 

Further, I urge the passage of H.R. 104. You’ve heard from every 

witness up here today on the Harbor Maintenance Trust Fund, so 

I will pass on commenting further. 

I also ask that you support proposed language in the surface 

transportation bill which will seek to streamline the process for 

getting port projects done. 

For whatever reason, it has rarely resonated with our Federal 

leadership that our economy is inescapably linked to our waterways and international trade. We are so accustomed to our reliable 

delivery system for goods that we take it for granted. If our consumer products get stuck on the docks because we lack the infrastructure to move them—or worse, because of a catastrophic failure—from lack of strategic investment, such as the bridge collapse 

in Minnesota in 2007, it will be unforgivable. 

With strategic investment now, our national recovery will come 

by sea. Are we going to increase export volumes in the next decVerDate Aug 31 2005 10:28 Apr 05, 2012 Jkt 000000 PO 00000 Frm 00031 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\2011\10-26-~1\70928.TXT JEAN
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ade? How will we move that cargo without investing significantly 

in our Nation’s gateway infrastructure? 

Harbor improvements are not pork barrel, and they are not legislative gifts. The Nation’s deep water port system is fundamental to 

our country’s long-term economic health. To realize the maximum 

positive impact, we must start investing in our gateway infrastructure. We must be building the ports of the future today. 

Thank you for the opportunity to testify. 

Mr. GIBBS. Thank you. Mr. Friedman, welcome. 

Mr. FRIEDMAN. Thank you, Chairman Gibbs and members of the 

committee, for this opportunity to come before you on this critical 

topic. 

For nearly 25 years, I have worked at tidewater and inland ports 

and on real estate development tied to the global supply chain. I 

am here today representing the Cleveland port only, but I believe 

my views are consistent with those of maritime professionals 

throughout the Great Lakes St. Lawrence Seaway region. 

First, let me thank you and your colleagues for initiating several 

bills that are critically needed in the Great Lakes and nationally. 

These are H.R. 2840, the Commercial Vessel Discharges Reform 

Act of 2011; H.R. 1533, the Short Sea Shipping Act of 2011; and 

H.R. 104, the Realize America’s Maritime Promise Act. All 3 bills 

would better prepare our port and others for 21st-century trade realities. 

The Great Lakes St. Lawrence Seaway system is a major economic resource and trade corridor with vast, unrealized potential. 

It provides direct waterborne connections between our manufacturing and agricultural heartland, and the global marketplace. An 

economic benefit study released just last week documents the value 

of the Great Lakes St. Lawrence Seaway system. On the U.S. side 

alone, system shipping generates 128,000 jobs, $9.6 billion annually in personal income, $18.1 billion annually in business revenue, 

and more than $2.6 billion annually in Federal, State, and local 

taxes. 

In Greater Cleveland, maritime commerce supports almost 

18,000 jobs and more than $1 billion in paychecks cashed every 

year. Our cargoes include raw materials and finished goods that 

are dependent on our maritime highways. Iron ore from Duluth is 

shipped on thousand-foot Great Lakes vessels to our local steel 

mill, the most productive, integrated steel facility in the world, and 

massive pieces of industrial equipment made in Ohio and neighboring States are exported from our port to the world. 

Waterborne transport to and from the industrial Midwest has 

proven to drive down shipping costs and make exports more competitive, while easing congestion on our highways and rail networks. Yet, despite these benefits, the promise of the St. Lawrence 

Seaway, one of the great engineering wonders of the world, has yet 

to be fully realized, and both the system and our ports are vastly 

underutilized. 

Reform of Federal regulations and policies must occur for the 

Great Lakes to play its intended role as a critical gateway for U.S. 

exports and trade. 

First, we need passage of the Short Sea Shipping Act. I find it 

astonishing that Canada is our number one trading partner, yet 

19 

virtually none of this trade is moved by water across the Great 

Lakes. Current law puts the Great Lakes at a disadvantage. This 

is why we urge passage of H.R. 1533, to put waterborne transport 

on an even playing field with land modes. 

The lack of Federal ballast water standard also threatens current 

and future Great Lakes Seaway trade. As you know, ballast water 

discharge is regulated by two Federal agencies under two separate 

authorities, one of which allows States to do whatever they want. 

This has given rise to New York’s utterly unworkable ballast water 

rule, which will effectively shut down seaway shipping if it goes 

into effect next year, jeopardizing tens of thousands of jobs. H.R. 

2840, the Commercial Vessel Discharges Reform Act, will rectify 

this deplorable state of affairs. And again, we strongly urge its passage. 

Lastly, I want to comment on dredging and the U.S. Army Corps 

of Engineers project delivery system. In Cleveland we are working 

extremely hard to plan and implement a new approach to managing material dredge from our shipping channel. In essence, we 

want to put sediment to beneficial use, rather than dispose of it in 

landfills along our downtown waterfront. We believe this approach 

is smarter, more efficient, and less expensive for taxpayers. 

We are prepared to commit local dollars, seek contributions from 

private beneficiaries, and take over project management from the 

Corps to accomplish this. However, this Corps’ authorities, rules, 

and practices make this a difficult and years-long process. Therefore, we urge Congress to take up a comprehensive reform of 

WRDA and other relevant laws to usher in 21st-century management of water resources. 

We urge you to rewrite laws to first, spend 100 percent of the 

Harbor Maintenance Trust Fund on harbor maintenance, as H.R. 

104 provides. Second, allow multiyear reauthorizations to provide 

for predictable funding for projects. Third, allow non-Federal sponsors to directly manage projects without waiting for project delivery 

by the Corps. And, fourth, substantially shorten the timeframe for 

Federal planning and decisionmaking on navigation and water resource projects. 

We believe our ports and local sponsors are, in many cases, best 

positioned to manage harbor maintenance and improvement 

projects. This will save scarce public dollars, get projects online 

faster, and ultimately drive job creation by making our Nation 

more competitive. 

Thank you again for allowing me to come before you today. 

Mr. GIBBS. Thank you. 

Mr. Benjamin, welcome. 

Mr. BENJAMIN. Good morning. Thank you, Chairman Gibbs, 

Ranking Member Bishop, and committee members, for holding this 

hearing today to focus attention on the critical role that seaports 

play in our Nation’s economy, and how we can support and enhance international trade opportunities. I also want to thank committee members Shuster, Richardson, along with Mica and 

Denham for their recent listening tour in California, and their willingness to share insight from our community. 

I am Omar Benjamin, executive director of the Port of Oakland. 

I also serve as president of the California Association of Port AuVerDate Aug 31 2005 10:28 Apr 05, 2012 Jkt 000000 PO 00000 Frm 00033 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\2011\10-26-~1\70928.TXT JEAN
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thorities, and was recently appointed to serve on the Secretary of 

Transportation’s port advisory committee, which is part of the Marine Transportation System National Advisory Council. 

The Port of Oakland is the third busiest container port on the 

west coast, and the fifth busiest in the Nation. We are also one of 

the leading export gateways for American products, especially for 

agricultural goods from throughout the Nation. Over $7.1 billion in 

U.S. agricultural products are shipped through the Port of Oakland 

annually, helping to maintain a nearly 50:50 ratio of import and 

export activity and positioning us to support national efforts to increase exports and put Americans back to work. 

America’s ports do not just create jobs within their local regions, 

but instead distribute their economic impact throughout the entire 

Nation. Over 70,000 jobs in the Northern California mega-region, 

and more than 800,000 jobs across the country are impacted by the 

Port of Oakland’s activities. 

For example, in Chairman Gibbs’ home State of Ohio, $385 million worth of goods are imported and exported through the Port of 

Oakland, helping to generate over 3,500 local jobs in Ohio. In 

Ranking Member Bishop’s home State of New York, Oakland’s activities sustain over 25,000 jobs and $2.7 billion worth of cargo. 

Through the activities of our customers and tenants, we create 

local, State, and national tax revenues. The Port of Oakland, however, along with our counterparts in the Pacific Northwest and the 

Pacific Southwest is facing unprecedented competition from our 

neighbors in Canada and Mexico. Both countries are developing 

comprehensive national freight shipping programs supported by all 

levels of Government, and specifically designed and tailored to divert the trade that goes through U.S. west coast ports. 

Canada especially offers direct rail connections to the Midwest 

through the Port of Prince Rupert that allows shippers to avoid 

paying the Harbor Maintenance Tax, thereby creating an uneven 

playing field for attracting international trade. The U.S. stands to 

lose tax revenues and jobs if these trends continue. 

The Port of Oakland, along with its sister ports in Long Beach, 

Los Angeles, Portland, Seattle, and Tacoma have formed the U.S. 

west coast collaboration to elevate the importance of U.S. west 

coast ports’ competitiveness and address national policy concerns, 

such as the land border loophole I just described. Our rail labor 

and terminal operator partners have also joined with us to preserve 

job creation and economic benefits of our investments in operations. 

While we recognize that the expansion of the Panama Canal will 

have significant implications for ports and communities throughout 

the Nation, we do not take for granted that expanded all-water 

service to the east coast will achieve the anticipated demand levels 

that would require dramatic readjustment of Federal maritime investment priorities. 

Cargo volumes post-2014 will be dependent on numerous variables, including the impact of as-yet undisclosed transit fees 

through the canal. Significant additional research, and a better understanding of the supply chain needs of individual shippers will 

be required before any conclusion can be reached that might dictate 

how we spend limited Federal dollars. 

21 

What we can agree on is that all—that the improvements in rail, 

road, and deep water access are all critical to an effective transportation system that delivers jobs, economic growth, and long-term 

benefits for the region, State, and Nation. Yet what is lacking is 

a coordinated national goods movement strategy and funding mechanism that can address these multiple modes of transportation in 

a clear, consistent, and reliable manner. This coordinated Federal 

strategy can help prioritize spending and protect the significant 

Federal investments that have already been made in what are essentially national assets. 

In the absence of such a strategy, the Port of Oakland and its 

partners are doing our part to prepare for the future, building on 

public-private partnerships, extending the supply chain into China, 

and investing in our infrastructure. 

As Congress continues to contemplate and develop important 

transportation priorities as the surface transportation reauthorization and the water resources development legislation, I would urge 

you not to forget the role of ports and related goods movement 

partners in delivering economic growth and prosperity. We greatly 

appreciate the limited investment programs that seaports have recently had access to, such as the TIGER competitive grant program. But it clear that more remains to be done, and such efforts 

need to be expanded and made more robust, so that seaports can 

participate more fully in the Federal transportation funding system. 

Additionally, existing streams such as the Harbor Maintenance 

Trust Fund must be fully unlocked, as has been mentioned by my 

colleagues here today. 

In conclusion, we appreciate the increased focus and attention on 

the role of seaports in delivering economic growth. We are now 

working cooperatively like never before to increase cargo volumes 

and grow our economy. But we cannot compete and win if we do 

not do so in having a partner in the Federal Government. And we 

are ready to confront these new trade realities, but we cannot go 

alone. And it is only with your help will we be successful. 

Thank you, and we look forward to working with you and the 

committee. 

Mr. GIBBS. Thank you. 

Mr. Peyton, welcome. The floor is yours. 

Mr. PEYTON. Thank you. Mr. Chairman, thank you for inviting 

me to testify on behalf of our international president, Robert 

McEllrath, and the 65,000 members of the International Longshore 

and Warehouse Union, otherwise known as the ILWU. We are 

based in San Francisco. Our union represents longshore workers in 

California, Oregon, Washington, Alaska, Hawaii, Canada, and Panama, as well as warehouse, maritime, agriculture, hotel, and resort 

workers. 

You have our written testimony; I am going to do this a little differently, because I think there has been a lot of things said, and 

some very good things written, but I would like to take it from another angle, and try to paint a picture, if I could. 

Ten years ago I met Chris, and we met in a number of these settings. And I can say honestly that not much has changed in 10 

years, in terms of the key issues that we haven’t been able to anVerDate Aug 31 2005 10:28 Apr 05, 2012 Jkt 000000 PO 00000 Frm 00035 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\2011\10-26-~1\70928.TXT JEAN
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swer. I will say that what we did deal with for those 10 years, up 

until 2009, was double-digit growth. And there was a panic, because that panic represented what at the time meant we would 

have to build a port the size of Oakland every year to keep up with 

the double-digit growth of what was happening with our cargo volumes at the time. So the panic was reversed. 

But in 2009, when the bottom fell out of the economy, what happened was we didn’t really look at this as a point to regroup and 

say, ‘‘For 10 years’ worth of work, what did we learn that we need 

to do for supply chain management, and how can we create jobs out 

of that?’’ Instead, what we did is we went back into a hole, and we 

didn’t go and answer the questions that we sort of recognized. 

And I am going to go over a couple of these key points as we go 

along, but I want to just point out the word ‘‘jobs.’’ Last night, I 

am listening to C–SPAN, because of the time difference here, so I 

wasn’t sleeping really well, so I was listening to all the testimonies 

yesterday. Almost every testimony from every hearing was based 

around jobs. But here, we are in an industry that truly represents 

jobs, good-paying jobs, but we can’t get done what we need to get 

done to get to those jobs. 

And let me give you some examples. Right now in California 

there are 62 projects, 62 projects that are—almost all of them are 

completely funded. They are infrastructure projects that have to do 

with grade separations, have to do with moving cargo more effectively, 62 projects funded to represent 100,000 high-paying construction jobs that are sitting in the mud because of some various 

bureaucratic red tape. We can’t get the things done that we need 

to do, if we have 62 projects that are going to move cargo more effectively and we can’t get that done. It is not going to work. 

So, we look at what the ports have done. The ports have done 

an excellent job on their side, in terms of their investment, answering the environmental needs. The railroads have done an excellent 

job of capital investment so they can do their part. But we haven’t 

done a good job in answering how we get those grade separations 

done more quickly, to where we can have public-private investment 

to where it is valuable for the private entities to come into this 

stuff which we talk about. We haven’t defined merit-based projects, 

which really is what it is all about. And I know Laura, in her legislation, talks about projects of national significance, and I think 

that is very good. 

But the point here is we are dealing with something that is critical that we get right, because in a recent meeting I had with 

Trade Ambassador Ron Kirk he explained to me the national export initiative. He explained to me the importance of how small 

businesses and businesses have got to be able to compete globally, 

if we are going to stay in this game. 

And my answer to him was, ‘‘How do we compete, if we can’t 

move cargo effectively? How do we compete, if we don’t know what 

the trade corridors are that are critical? How do we compete if we 

don’t look at what Canada is doing, and we look at what they are 

doing with the Harbor Maintenance Tax, or against our Harbor 

Maintenance Tax, and we don’t answer that problem? How do we 

compete with what the new economy of this world is going to be, 

and what some people recognize’’—which I think the national exVerDate Aug 31 2005 10:28 Apr 05, 2012 Jkt 000000 PO 00000 Frm 00036 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\2011\10-26-~1\70928.TXT JEAN
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port initiative is a very good idea. But how do we compete, if we 

don’t look at the problems that we have been looking at for 10 

years that we haven’t been able to come up with answers for? 

The answer is, you want jobs? It is right in front of us. You have 

to fund it in order to get it back. If you fund it, the numbers are 

all there. We have numbers that clearly show that whatever we invest in transportation comes back to us how many times folded 

over. We know those numbers, because we have been doing this for 

a long time. But we haven’t answered the critical questions that 

need to be answered. 

Multiyear funding has to happen in order for us to be able to 

project out as to what we have to do. Permitting processes have got 

to be streamlined, in order to get public-private investment, because we know the public funds are going to be fewer and harder 

to get. 

Canada has to be answered. Harbor Maintenance Tax has got to 

be directed to where it is of basic projects of national significance, 

not just going out for the sake of politics. 

So, I leave it from another point of view here because, again, as 

a labor person, I care about jobs but I also care about this country. 

I care about the fact that we stay competitive, and that we do have 

a national export initiative that we can successfully compete in. 

And I challenge us to answer the questions that, for the last 10 

years, we haven’t been able to answer. Thank you very much. 

Mr. GIBBS. Thank you very much. I will start off with some questions. And I will start with Secretary Darcy. 

It is quite evident, by the rest of the panel, how important our 

infrastructure is, and the need for additional funding to get the job 

done. And I guess I am really struck—Mr. Koch’s and even Mr. 

Peyton’s testimony, but Mr. Koch talked about critical infrastructure that is owned by the Government, such as the locks, levees— 

the locks, dams, and harbor channels. And I know your testimony—being adequately funded, we see the cut in the President’s 

budget, and we see about half of the money raised actually going 

from the Harbor Maintenance Trust Fund. 

So, my question is, how do you reconcile that? Do you think it 

is adequately funded, currently? 

Ms. DARCY. The $758 million in the President’s fiscal year 2012 

budget request for the Harbor Maintenance Trust Fund is what we 

believe is necessary in order to maintain and operate the ports, 

given the competing interest that we have with other priorities 

within our budget constraints. 

Mr. GIBBS. I see you wrote a letter to Representative Charles 

Boustany 9 days ago. You stated that—maintain active projects— 

provide greater channel availability and maintain projects. So you 

still concur that it is adequate funding with the $758 million? 

Ms. DARCY. That is correct. I believe the question in the letter 

was, ‘‘What would you do with additional funding? What would you 

fund?’’ 

Mr. GIBBS. So if you could—if you decided to use the rest of the 

Harbor Maintenance Trust Fund available dollars, what would you 

fund? 

Ms. DARCY. Well, we are supporting the $758 million that is in 

the President’s budget. And I think that the letter that you are reVerDate Aug 31 2005 10:28 Apr 05, 2012 Jkt 000000 PO 00000 Frm 00037 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\2011\10-26-~1\70928.TXT JEAN
24 

ferring to, which was answered by our chief of operations, outlined 

the other additional 300 projects that would get that additional 

money, if it were available. 

Mr. GIBBS. OK. At an earlier hearing this year you stated that 

the trust fund had zero balance. And now in your testimony you 

say there is $6 billion. Did we find $6 billion, or is there no money 

there in the trust fund? 

Ms. DARCY. There is a $6 billion balance in the Harbor Maintenance Trust Fund. When I testified earlier a couple of weeks ago 

on the Inland Waterways Trust Fund? 

Mr. GIBBS. No, it was at the budget hearing. And I remember 

Representative Harris questioned you, and you determined that 

there was no money—you stated there was no money in the trust 

fund. And I know General Van Antwerp at the time—who is now 

retired—stated that there was no money in the trust fund. 

So, is there $6 billion in the trust fund? 

Ms. DARCY. There is a $6 billion balance in the Harbor Maintenance Trust Fund. 

Mr. GIBBS. OK. Let me ask another panelist. We have had so 

much discussion about the need for more dredging and more infrastructure improvements, if we have $6 billion in the trust fund, can 

we find the projects to do what needs done? Anybody take a stab 

at it. 

Mr. BRIDGES. Mr. Chairman, Jerry Bridges with the American 

Association of Port Authorities. Of course. I mean there is—with 

full funding of the Harbor Maintenance Tax fund, we believe that 

most of the dredging and maintenance needs within the United 

States could be covered. 

Mr. ANDERSON. Yes, Mr. Chairman, I think it is imperative that 

our country utilize the full balance of the trust fund that we have 

available for maintenance dredging throughout the United States. 

You can speak to every one of my colleagues in America and get 

the same answer. And I think that it is unanimous throughout this 

industry, nobody is going to tell you that we don’t need to draw 

down that. And that is why, again, we all urge the passage of H.R. 

104, which would allow that to happen. 

And there is a number of other Corps processes that could be 

streamlined and find efficiencies that would allow us to complete 

projects on a more timely basis to be competitive in the global marketplace. I have outlined those very clearly in approximately 10 

bullet points in my written testimony on page 5. I won’t repeat 

them, but—— 

Mr. GIBBS. OK. Just to follow up a little bit, Secretary Darcy, 

when you talk about the TIGER Grants, it is my understanding 

that the TIGER Grants are for infrastructure on the land. 

And can you elaborate a little bit how you are coordinating with 

the Department of Transportation? Because I think the mission of 

the Corps and this Harbor Maintenance Trust Fund and your responsibilities, dredging and widening the channels—so I want to 

make sure that, you know, you are not ceding authority to another 

agency. Can you elaborate a little bit? 

Ms. DARCY. Sure. 

25 

What we are doing with the Department of Transportation is a 

coordination effort between their TIGER Grant program and our 

existing authorities and existing deepening. 

What we are looking at is, does it make sense to give a TIGER 

Grant to a port that is not a nationally significant port that is 

being deepened? So it is much more of a coordination. We are informing the Department of Transportation about where our efforts 

are, where those top 59 ports are that are being dredged, and more 

information for them to make an informed decision. We don’t have 

grant authority; it is the Department of Transportation that issues 

those grants. It is more of an information sharing with them, as 

to where the—— 

Mr. GIBBS. OK, thank you. Mr. Friedman, I wanted to elaborate 

a little bit on the ballast water issue. Can you explain why it is 

important for a uniform standard, national standard, for ballast 

water? 

Mr. FRIEDMAN. Yes, absolutely, Mr. Chairman. As I mentioned, 

today States are able to implement their own rules, which may be 

more stringent than the existing Federal rules. And what has happened in the Great Lakes is that New York State has done just 

that. There is a rule that would go into effect next year, and it requires vessels transiting New York’s waters through the St. Lawrence Seaway to install ballast water treatment technology that 

doesn’t exist. The State of California, the State of Wisconsin, and 

now U.S. EPA have concluded that that treatment technology is 

not available yet. So it is really—that is why I reference it as an 

unworkable rule. 

And, on the other hand, the industry has been working very hard 

to put protocols in place that seem to be working to control the introduction of invasive species. And we are asking for a Federal uniform standard. We think that is the only way we are going to really 

get at this problem. Everyone wants to protect the waters in our 

Great Lakes, and we stand ready to do that. So, that is why we 

are urging passage of the—— 

Mr. GIBBS. One last question before I turn it over to Mr. Bishop. 

On dredging, I know that is an issue up at the port there in Cleveland. 

Mr. FRIEDMAN. Yes. 

Mr. GIBBS. Can you talk a little bit about what—your relationship with the Corps, working with the dredging schedule, and also 

what to do with the dredging material, who is responsible for that, 

and how that works? 

Mr. FRIEDMAN. Right, OK. Well, when we do our annual maintenance dredging of the shipping channel in Cleveland, the dredging 

itself is performed by the Corps with a—utilizing a private contractor. And then it is placed in confined disposal facilities, or large 

landfills on our lakefront. Those will run out of capacity at some 

point. And when that happens, we have to have something in place 

to replace the capacity in those disposal facilities. So we have been 

going through a rather lengthy planning process with the Buffalo 

district of the Corps. 

And our view is we need to speed that up. Our approach is we 

would like to reuse that material. Instead of just putting it in a 

landfill, we think it has value. It is soil that is being washed down 

26 

the watershed, and it is now clean enough in our harbor that we 

can put it back on sites, as a development tool. 

The problem is that the way the law is written, and the way the 

policies and the rules are written, it is sort of like pounding a 

square peg into a round hole. It is just very difficult to move 

through that process. And meanwhile, the clock is ticking on us, 

and we have to have disposal capacity. So we are just looking for 

ways to streamline and move toward that. 

As I said, we are willing to put up local funding, if possible. We 

are willing to take over project management and do whatever is 

necessary to get it done. 

Mr. GIBBS. And I am assuming most of that is a Federal law 

problem, and not a State? 

Mr. FRIEDMAN. Yes. 

Mr. GIBBS. OK. OK, thank you. Mr. Bishop? 

Mr. BISHOP. Thank you very much, Mr. Chairman. I want to 

thank our panel for this testimony. I think it is really important 

that we all have the same information with respect to how the Harbor Maintenance Trust Fund actually works. 

Mr. Anderson, I just heard you say that if we were to pass H.R. 

104, that would allow for the full expenditure of the monies that 

come in to the trust fund and I guess, by implication, spending 

down the $6 billion that is there. Is that correct? I don’t want to 

put words in your mouth. 

Mr. ANDERSON. No. I think, Mr. Bishop, it is important that we 

utilize the full annual amount, not necessarily draw it down, and 

that is—— 

Mr. BISHOP. Fine. 

Mr. ANDERSON [continuing]. What the trust fund is for, is to have 

a balance. 

Mr. BISHOP. And I want to be clear on what using the full annual amount means. Right now we take in about $1.5 billion in Harbor 

Maintenance Taxes. We are expending somewhere between $700 

million and $800 million, and this is a practice that has gone on 

for years, which is why we have a $6 billion balance in the trust 

fund. 

The only way we can fully expend the $1.5 billion that comes in, 

given the constraints that we have voted for called the—I think it 

is called the Budget Protection Act, the bill that allowed for the 

debt limit to be increased, and it created the super committee—the 

Budget Control Act, I am sorry—we have now imposed statutory 

caps on domestic spending going forward for 10 years. 

So, the only way we can fully expend the revenue that comes in 

to the Harbor Maintenance Trust Fund is if we seek an exemption 

from that cap, or if we increase the 302(b) allocation for the energy 

and water appropriations bill, which would mean we would do so 

at the expense of the 302(b) allocations for any one or some combination of the other 11 appropriations bills, or if we were to eviscerate the accounts that are in energy and water by $800 million 

so that we could increase the Army Corps construction account by 

$800 million. 

So, let’s be clear that it is not free money. It would represent a 

priority decision, presumably by this committee as well as the energy and water appropriations committee, that we think it is a 

27 

more important priority to invest in this piece of the Corps’ activity 

than perhaps some other piece of the Corps’ activity, or Department of Energy labs, or whatever else is funded out of the energy 

and water appropriations bill. So let’s be clear on that. 

So, we—because it will mean that we will be expending $800 million more than we are expending now, and it has got to come from 

somewhere. So it is not free money, it has got to come from somewhere. 

So, let me get to—and, Mr. Anderson, do you agree? Do you concur with that assessment, what I just said? 

Mr. ANDERSON. I don’t pretend to understand the exact process—— 

Mr. BISHOP. All right. Will Secretary Darcy confirm the accuracy 

of what I just said? 

Ms. DARCY. Yes, sir. 

Mr. BISHOP. Yes, you are confirming the accuracy of what I just 

said? 

Ms. DARCY. Yes, I am, Congressman. 

Mr. BISHOP. Thank you very much, Secretary Darcy. But now 

let’s explore. 

I read a press report before I came to this hearing this morning 

that suggested that some of my colleagues on the other side of the 

aisle feel that the environmental restoration projects that we commit resources to within the Corps budget is perhaps a lower priority, and that we ought to be examining what we do there. And 

we spend some $470 million a year, as I understand it, on environmental restoration projects. Is that about right? 

Ms. DARCY. It is about right. I would have to check this—— 

Mr. BISHOP. OK. 

Ms. DARCY [continuing]. Year’s budget submission. 

Mr. BISHOP. Now, the biggest chunk of that is the Florida Everglades project. 

Ms. DARCY. A large portion is—— 

Mr. BISHOP. Yes. And my understanding is that a study has been 

done that suggests that the full restoration of the Florida Everglades will result in 440,000 jobs, and that it will contribute to the 

economic vitality of the State of Florida. Are you familiar with this 

study? 

Ms. DARCY. Yes, sir. 

Mr. BISHOP. OK. So, can we talk a bit? If, in fact, there is a perception that this $470 million is low-hanging fruit, that we should 

be taking money out of that and putting it into harbor maintenance 

dredging, can you talk about the economic benefits of the kinds of 

projects that we are undertaking under environmental restoration 

such as the Florida Everglades, such as the Louisiana coastline 

project, things like that? Can you talk about that for us? 

Ms. DARCY. Yes. Our ecosystem restoration projects around the 

country, we have several large ongoing ones that the Corps is part 

of. Many of our projects are on aquatic ecosystem restoration, we 

are also in partnership with not only the local community, but also 

other Federal agencies. And, in particular to your reference to Everglades, we have several Federal partners in that restoration effort, including the Department of Interior and EPA. 

28 

But all of those restoration efforts in many cases are a result— 

and Florida is another example—of some work that the Corps has 

done in the past that we are helping to restore the results of what 

that project did. In Louisiana we are doing coastal restoration 

projects, many of them—some wetlands restoration, as well as others. 

And all of those restoration projects—we are doing some in the 

Great Lakes and California Bay Delta and the Chesapeake Bay— 

all have economic impacts for the local community, as well as job 

creation. There is construction. We have started four construction 

projects in the last 2 years in the Florida Everglades. Construction 

projects create jobs, so there is economic development and economic 

activity, as a result of the ecosystem restoration, not only in the 

short-term job creation, but also long-term, for economic development within those communities. 

Mr. BISHOP. Thank you very much for that. I think Mr. Bridges, 

Mr. Koch, Mr. Anderson, Mr. Friedman all made reference to the 

necessity of passing the surface transportation bill. I couldn’t agree 

more. I hope very much that we will pass it. 

My understanding of what is on the table is a surface transportation bill that would be 6 years at $35 billion a year—which is the 

funding that flows into the Highway Trust Fund from the motor 

fuels tax—would represent roughly a $20 billion per year reduction 

in what we are spending now. Would—is it fair for me to assume, 

given your support of passing a surface transportation bill, that 

you would want us to lift that annual expenditure number to the 

greatest extent we could? Anyone? 

Mr. KOCH. Congressman, I think the private sector has been repeatedly on record, whether it is the U.S. Chamber of Commerce 

or the American Trucking Association, as saying yes to that question. And the private sector, interestingly enough, is perfectly willing—and many of the members of the private sector have expressed support for—raising the gas tax as a way to pay for it. 

Mr. BISHOP. Did you say raising the gas tax? 

Mr. KOCH. Yes, sir. 

Mr. BISHOP. I am sorry, just make sure I heard you correctly. 

Would that not be a job-killing tax increase? 

Mr. KOCH. That is a judgment others can make. But I think the 

private sector has been supportive of what you are talking about, 

and the way to pay for it. 

Mr. BISHOP. But in fairness, I shouldn’t tease. It is very important, I shouldn’t tease. You would encourage us to find alternative 

funding mechanisms so that we could make the annual expenditure 

of the surface Transportation bill be as robust as possible. Is that 

a fair conclusion? 

Mr. KOCH. That is fair, if you need to find an alternative revenue 

mechanism, yes. 

Mr. BISHOP. Mr. Friedman, would you agree with that? 

Mr. FRIEDMAN. Yes, I would, Congressman. I think, you know, 

there is ample evidence that suggests we have underinvested in 

our transportation infrastructure for years, if not decades, and we 

need to start catching up. And we certainly encourage a maritime 

title in the transportation bill, because we have needs that are not 

going in our—— 

29 

Mr. BISHOP. I am in full agreement, particularly if we are not 

going to pass a WRDA. We would need to have a maritime title in 

the transportation bill. Mr. Anderson, would you concur with that? 

Mr. ANDERSON. Yes, Congressman, I would. It is obvious to everybody, I think, that the current tax that funds the transportation 

in United States is a dwindling resource, and it certainly makes it 

difficult to fully invest in our infrastructure. I think the maritime 

title in the bill would be very, very helpful. 

I would also encourage that we look at the way that we work in 

incentivizing and encourage public-private partnerships, which we 

have done in JAXPORT. We have invested with—I mentioned in 

my testimony both—two Asian companies, Mitsui MOL and 

Hanjin, over $500 million in two public-private partnerships. So we 

feel that is another way to leverage money. 

Mr. BISHOP. I have gone way over my time, and I thank the 

chairman for his indulgence. Mr. Bridges, just give you a chance 

to comment. You would encourage us to pass a robust surface 

transportation bill? 

Mr. BRIDGES. I absolutely would, yes. We think that the focus 

should be on freight transportation, and look at it from a supply 

chain total system approach, rather than just segmented. But a 

maritime title would be absolutely essential in a surface transportation act. 

Mr. BISHOP. Thank you all, and thank you, Mr. Chairman. 

Mr. GIBBS. Representative Bucshon, you have a question? Yes. 

Dr. BUCSHON. Thank you, Mr. Chairman. I think everyone in the 

room can see today why we are way behind on everything, because 

the Federal Government doesn’t seem to have the ability to 

prioritize anything. And, you know, if you ran your household like 

that, when times are hard, when money was tight, and you continued to spend it on extravagant vacations and other things that you 

can’t afford, you get the same thing that we are doing here in the 

Federal Government. We are continuing to try to fund everything, 

when we have critical things that we need to fund. 

I think one of—the biggest dispute we have here on this committee and in Congress is not necessarily the amount of money 

that is allocated to be spent, but how do we prioritize that spending. And clearly, infrastructure is a critical part of what we should 

be funding at the Federal Government level. And we need to tighten our belts. And I do believe we can do more with less if we 

prioritize and recognize that some of the extravagant vacations 

that we want to spend it on, we can’t do that right now. 

So, I think that—I have got just a couple of questions. 

Ms. Darcy, I heard today with some of the other Members saying 

that their ports are only getting 1 percent or less of the money 

back that they put in. How does that happen? I mean who is responsible for that? 

Ms. DARCY. Congressman, the tax that is paid into the Harbor 

Maintenance Trust Fund is an ad valorem tax for the value of the 

cargo that is being imported into that port. That tax is put into the 

trust fund. Because what goes into the Harbor Maintenance Trust 

Fund is for operation and maintenance of the ports, and we make 

a determination as to which ports need, based on a national economic development and national priorities, which of those ports 

30 

need to have their operation and maintenance done with that 

year’s funding. 

Dr. BUCSHON. OK, then. But—I understand the frustration that 

I heard from other Members of Congress here about their ports 

only getting 1 percent of the money back. It seems to me—I mean 

at what point does the ports that are only getting their 1 percent— 

at what point do—does their priorities of what they think need to 

be done take precedence over everything else? 

I mean it just doesn’t make any logical sense to me, year after 

year, how we could allocate the money and people could be getting 

that little of their money back. 

Ms. DARCY. Congressman, the operation and maintenance of 

ports varies, depending on the existing depth, as well as the natural depth that occurs there. There are some ports, in particular 

on the west coast, Seattle and Tacoma, that are naturally deep 

ports, so they don’t require the same operation and maintenance 

that other ports do. And so, we would not put the exact same 

amount of money into that port that they put into the trust fund, 

because their needs for maintenance aren’t the same as other 

ports. 

Dr. BUCSHON. OK, that makes sense. I guess it seems to me 

that—would anyone—would everyone agree that, in some way, we 

need to—and anyone can answer this—not only the Harbor Maintenance Trust Fund, but a lot of other trust funds we have in the 

United States—Social Security, for example—we continually, over 

decades, raid that money and use it for other things. Would anyone 

disagree that we need to somehow fix that process, and target the 

money where it is supposed to be spent? 

I mean, would—Ms. Darcy, you can comment first. I mean would 

anyone disagree with that? 

Ms. DARCY. The current Harbor Maintenance Trust Fund is limited by statute as to where that money should be spent. 

Dr. BUCSHON. Yes, but we have been spending it on all kinds of 

things. 

Ms. DARCY. Right, the—— 

Dr. BUCSHON. And it is not only now. It is previous administrations, Republicans, Democrats. I mean this is a chronic Federal 

Government problem, right, that we find money in these trust 

funds and we use it for other things? 

Ms. DARCY. Some of the balance of the trust fund is invested in 

other—the same as other trust funds, you are right. 

Dr. BUCSHON. Yes. And Social Security is a classic example, 

right? We—it is full of IOUs, and there is really no money there. 

I mean that is one of the biggest egregious examples. 

I mean—anyone else? Mr. Koch, you want to comment on that? 

I mean—— 

Mr. KOCH. No, I think many in the private sector don’t find much 

trust in the trust funds because of the fact that money is diverted 

for purposes other than what the fees or the revenues were designed to pay for. 

I would express a note of concern, however; I would hope that 

our colleagues in the American port community do not end up at 

each other’s throats over how the Harbor Maintenance Trust Fund 

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rem basis, as has been discussed, as a national program for national harbor maintenance. It is clear, as the Secretary said, some 

ports don’t need much harbor maintenance dredging, and therefore, 

they can complain that they pay more in than they get out. 

But that is the design of the system. And if you undo that design, I think you then start pitting various U.S. ports against each 

other, whereas I would hope that the industry would be better 

served if the port community can stay together and united on this, 

rather than to get at each other’s throats over who is getting a better deal out of the trust fund in a particular year. 

I mean the Mississippi River and the Port of New Orleans are 

going to have a very different view about harbor maintenance 

dredging than Seattle and Tacoma. That is unavoidable, but I 

think the Congress recognized that when it created this fund to 

begin with. And efforts to undo it, I think, should be viewed with 

some degree of care. 

Dr. BUCSHON. Yes. My time has expired, but I just want to say 

that makes total sense to me. It just seems like 1 percent is a pretty small number. With that I yield back. Thank you. 

Mr. GIBBS. Yes, just to make one quick comment, I think you are 

trying to say think of it as a system-wide system. Representative? 

Mrs. NAPOLITANO. Thank you, Mr. Chair. And I have a ton of 

questions. I may not be able to ask them all. 

But, Mr. Friedman, we talk about ballast water. And, unfortunately, because California has the—very busy ports, and we have 

had the influx of invasive species like the quagga mussels that is 

costing millions of dollars for the water agencies to try to eradicate. 

And then they have closed beaches because of the contaminated 

water because of the ports—the tides bringing it in. So, I was just 

making a comment, because it hurts my economy, and it does create problems for our environmental areas. So that said, I don’t 

need a comment, I am just bringing that to your attention, because 

that is an issue in my area. 

Then, Ms. Darcy, the—good to see you, ma’am. 

Ms. DARCY. Yes. 

Mrs. NAPOLITANO. How many trust funds are there, besides the 

Inland Waterways Trust Fund and the Harbor Maintenance Trust 

Fund that deal with ports and inland waterways? 

Ms. DARCY. Those are the only two within the Corps of Engineers 

that deal with our ports or—— 

Mrs. NAPOLITANO. Does any other—— 

Ms. DARCY [continuing]. Our inland waterways. 

Mrs. NAPOLITANO [continuing]. Agency have any other transportation—dealing with assistance to these ports? 

Ms. DARCY. I don’t believe so, but I can’t say that for certain. 

Mrs. NAPOLITANO. Would you mind checking? Because you never 

know—— 

Ms. DARCY. I will look—— 

Mrs. NAPOLITANO [continuing]. What else there might be out 

there. 

Ms. DARCY. I will look for some more trust funds for the—— 

Mrs. NAPOLITANO. That would be great. Thank you, ma’am. 

Mr. Peyton, in your position as chair of the education committee 

of the Marine Transportation System, the National Advisory ComVerDate Aug 31 2005 10:28 Apr 05, 2012 Jkt 000000 PO 00000 Frm 00045 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\WR\2011\10-26-~1\70928.TXT JEAN
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mittee, did you develop ideas on how to educate the American people on the importance of seaports to our Nation’s economy? 

Mr. PEYTON. Yes, yes. There was about 4 years’ worth of work 

just to explain what this is. A committee was put together, took 

about 4 years for everybody to drop their swords, because it was 

basically a supply chain group, which means every different part 

of the supply chain was represented: retailers, carriers, everybody. 

After 4 years of laying down the swords, about 4 years of very 

good work was done. And I don’t think anybody ever saw it—— 

Mrs. NAPOLITANO. Why not? 

Mr. PEYTON [continuing]. Honest. 

Mrs. NAPOLITANO. And why not? 

Mr. PEYTON. Well, there was a change of an administration, 

there was a change in—like there is, you know, things flip flop, and 

then you forget what was done before. But I believe mainly because 

the group was disbanded, and it doesn’t exist any more. 

Mrs. NAPOLITANO. Does the work still exist? 

Mr. PEYTON. Yes, it does. 

Mrs. NAPOLITANO. And where might that be? 

Mr. PEYTON. Well, it was on a Web site, and then I believe it was 

taken down. It was posted, and then somebody took it down. But 

all of these studies were put in place and on a Web site at one 

time. I know I have a copy of it, because I was the cochair of the 

education committee, so I have a lot of this. 

Mrs. NAPOLITANO. Well, what I would like to have you—and 

maybe send to us, to this committee, so that we may be aware of 

some of the work that was done, because we may want to continue 

educating the public on how critical these ports are to our Nation’s 

economy. 

And then, do you link the President’s initiative to double our Nation’s exports to having a state-of-the-art transportation system 

that connects highways, railroads, and bridges to our seaports? 

And I have a real strong connection to the railroads and highways, 

because I have 54 grade separations in my area from the Alameda 

Corridor East project. 

Mr. PEYTON. Yes, absolutely. And I think the word ‘‘systems approach’’ is what was dealt with in the 4 years of study, is how we 

take a systems approach to answering what the issues are, because 

it is all the interlinking of the transportation modes to really understand freight mobility, and I understand that is what Congresswoman Richardson has worked on, and the key word is ‘‘projects 

of national significance,’’ meaning across the supply chain. That is 

the key, is understanding the systems approach to this. 

Mrs. NAPOLITANO. Well, great, because—and, Ms. Darcy and Mr. 

Bridges, you are very right on the button in linking transportation—not only rail, but highway—to the ports, because in my 

area, like I said, I have the Alameda Corridor East, which goes 

through eight of my cities. And there is an increase in traffic that 

is going to affect those 54 crossings, and only 20 are scheduled to 

be separated, creating a lot of issues: environmental, safety issues 

from my general public. And so I have great concerns over that. 

There are many other questions I have, Mr. Speaker, but what 

I—Mr. Chair. But I will submit it in writing, and I yield back. 

Mr. GIBBS. Representative Shuster. 

33 

Mr. SHUSTER. Thank you very much, Mr. Chairman. Mr. Peyton, 

I almost jumped out of my seat and said amen to what you were 

saying. I don’t mean to be insulting, but you sounded like a Republican. 

Mr. PEYTON. Oh, that’s not good. 

[Laughter.] 

Mr. SHUSTER. I said I didn’t mean to be insulting. 

Mr. PEYTON. Well, let me say something on that, if I could. 

Mr. SHUSTER. Sure. 

Mr. PEYTON. This issue of transportation is probably the first 

issue that the union has ever stood side by side with the Chamber 

of Commerce, locally and nationally, to say that the significance of 

this is so big that we need to stand together in one message. 

So, I would think and I would hope, after the years of us working 

on this—and literally, it was 10 years of work—that again, we put 

down our swords and we understood that this is for the good of the 

Nation. 

Mr. SHUSTER. Right. 

Mr. PEYTON. And I think that that doesn’t have to be any one 

party. 

Mr. SHUSTER. Right. And I think you are absolutely right. But 

some of the things you said there—look, funding right now is extremely difficult, and I understand the business community wants 

to raise the gas tax and user fees, as unions do. But the American 

people, when you go out there and talk to them, they are saying, 

‘‘Hold it a second. I want to make sure I have a job tomorrow before we—before I have to spend any more money.’’ And so that is 

the hesitation. 

But there is other things we can do, and I think the leadership 

on our side has already said, ‘‘Let’s figure out where we can find 

some money without raising revenues, taxes.’’ And I think that is 

possible. But I also come back to it just seems like, in this town, 

it is real easy to say raise taxes, get revenues, and that is real hard 

on the American people. But it is really tough for us to figure out 

how we take programs that have been in place for years and years 

and modernize them, streamline them, reform them. 

As you said, you have got 62 projects out there that are being 

held by bureaucratic red tape. And my guess is that maybe there 

is three or four of them that there is a real serious problem there. 

The rest of them, they are just bureaucratic red tape that are going 

through these endless revisions and reviews. And we have got to 

get serious about this, because again, I think we can do more with 

less, as I said in my opening statement. 

So, you know, I really appreciated hearing that come from you. 

And I hope that portion of it resonates with my colleagues on the 

other side, because this is an important issue. And let’s fix the regulatory—the bureaucratic regime, before we go out there and take 

more money out of people’s pocket books. 

Now, with that being said, Ms. Darcy, I have great concern over 

the Corps, not only in harbor maintenance, but expanding your 

role. Just—there is a situation in Pennsylvania with the Marcellus 

Shale, where the Corps of Engineers has revised its review process. 

And what the Pennsylvania Department of Transportation has 

done for 40 years, and done it extremely well, when you have small 

34 

stream crossings they have permitted these. The Corps has decided 

they are going to start to do it. And it has caused a big backlog 

in Pennsylvania, when it comes to Marcellus Shale. This is not the 

hearing to do that, but those are the kinds of things that are occurring in the Corps, in the EPA, and across the Government. 

So, my question to you is, as the administration cuts your budget, how is that going to impact you as to the size, the overhead, 

the personnel? You know, what are you doing to respond to those 

cuts in funding? 

Ms. DARCY. Congressman, we will respond to the cuts in funding 

if—your reference to our regulatory program this year, our proposal 

for our budget is to keep that constant, so that we will have the 

regulatory capability to respond to the concerns that you raise. 

Mr. SHUSTER. OK. And I hope—it is not just about—again, I 

come back to the reforming. You have been in existence, the Corps 

has done a lot of great work in Pennsylvania. But there are things 

you can do that are not necessarily cutting the people, but just reducing what you do out there, and pushing it out to the States, because there is a lot of capable and competent State agencies that 

can do what you do with you having oversight. Are those things 

you are looking at doing? 

Ms. DARCY. We are looking at some of that. One of the things 

that we are doing right now is there is—you may have heard some 

of the other witnesses here talk about some of—the length of time 

it takes for the Corps of Engineers to do its planning process. What 

we are doing right now is looking at our planning process to look 

at ways on how we can make it more efficient. We have got some 

studies that have taken anywhere from 6 to 10 years, and that is 

just too long, because it requires a Federal investment, as well as 

an investment from our local sponsors. 

So, we are looking at some pilot studies now, to see if we can find 

ways to reduce the length of time it takes, as well as the cost. 

Mr. SHUSTER. So, let me ask the question. Based upon what Ms. 

Darcy said, do you, the panel up there, get a sense that the Corps 

is reducing and looking at ways to streamline, or do you get a 

sense it is same old, same old? Anybody care to—or is everybody 

afraid the Corps is going to come in and hammer them if they criticize them? 

Mr. BRIDGES. From the AAPA’s perspective, we think that the 

Corps has made strides in improving the process. However, we 

think that, due to lack of the resources and the proper funding, 

their ability to deliver full services to the port has been hampered 

somewhat. 

And so, we work in partnership with the Corps to improve those 

processes, and I think that that will bear fruit in the long term. 

But it is absolutely essential that the Corps’ budget be restored, 

and that they be allowed to bring on the resources to deliver the 

right product for the ports. 

Mr. SHUSTER. Anybody else care to talk about the interaction 

with the Corps, and if they think they are streamlining and making strides in the right direction, or are they doing the same old 

thing? 

Mr. Anderson, you look like you are ready. 

35 

Mr. ANDERSON. Thank you, Congressman. We feel that, you 

know, we are integrally linked to the Corps process, doing water 

projects. And while we have every intention of continuing to work 

with them, there are many areas that we feel that we could do 

with just a few policy changes, both legislatively here—for example—and again, I refer to my written testimony, but a few specifics 

is allowing us to advance the Federal portion of this and get credit 

for those dollars for projects. 

We stand ready with our State to fund a specific project that is 

$40 million, and we just can’t do it. We are going to have—there 

is 11 chief’s reports sitting out there, we understand 3 to 6 more 

in the next 3 months. And those are the gold standard for moving 

forward. But we can’t move forward with those projects throughout 

the country. 

So, it is partly making more efficiencies in their process, and 

partly this body doing more to help them implement those processes. 

Mr. SHUSTER. Well—and again, my time has run out—if you 

have anything, specifics, any ways that you see we can reform the 

Corps or the EPA or any other of the agencies, I am committed to 

doing that. I believe the chairman is. I know Chairman Mica is. We 

have got to hear from you to be able to do that, to be able to 

streamline this. Because, as Mr. Peyton has pointed out, there are 

62 projects out there tied up in the bureaucracy, and they need to 

be changed. 

And again, Mr. Peyton, amen. And I meant no offense by telling 

you you sound like a Republican. I yield back. 

Mr. GIBBS. Thank you. Representative Brown? 

Ms. BROWN. Thank you. And thank you, Chairman Gibbs and 

Bishop, for holding this hearing. 

I guess my quick question is are we going to have another round 

of questioning? Are we going to have another round of questioning? 

OK, good. All right, then. I don’t have to really rush. 

Welcome, Mr. Paul Anderson, who is our port director in Jacksonville, Florida. And the port is really the economic engine for 

north Florida, over 65,000 jobs, the economic impact of $19 billion. 

The question was asked to you, Mr. Anderson, about the budget. 

You don’t understand anything about the budgeting process up 

here, nor do we. And it is evolving. 

[Laughter.] 

Ms. BROWN. And so—but the point is, the trust fund take in $1.5 

billion and is $6 billion in there, and you all can’t use it because 

it sits there and they try to make it look like, you know, we got 

all this reserve. And if we use this money for the purpose that we 

take the money in, we could generate a lot of jobs and be prepared 

for the next generation of ships that is coming. Would you like to 

respond to that? 

Mr. ANDERSON. Thank you, Congressman, and for the very gracious welcome. I agree that I don’t pretend to know—from a lay 

person’s perspective, the congressional budgeting process is very 

complex. But I do know this at home. When I take in so many dollars and I take out my taxes, I have to pay my mortgage every 

month, and how much I need to feed my family, and do the other 

36 

things that you need to live. And I think the average American understands how to do that. And we do that at the port very well. 

I do know that when you take in $1.5 billion, if we—it is about 

system preservation, is the reason that the trust fund was passed, 

to preserve our existing system so that we can maintain our harbors, our waterways. Our country was blessed with great ports. 

Cities grew up around our ports, not the other way around. Many 

of the ports, like ours in Jacksonville, are on a river. They take a 

lot of maintenance. 

We work very vigorously with our Army Corps partner to try and 

maintain the river so that we can continue to provide economic development to our country. And we could always use the additional 

dollars for that system preservation for our resource that this country and taxpayers have already invested hundreds of millions of 

dollars. So we need to preserve that investment. 

Ms. BROWN. Would you explain to us—and I know this is local, 

but you have the full funding, but you can’t get it authorized because what—local and State, but the Federal Government is not a 

partner, or we haven’t authorized it, and you know we got this silly 

thing that we can’t earmark because this is a new rule the new 

leadership—so since you can’t earmark, then we can’t pass a bill, 

because in WRDA you always have member-specific projects. 

I mean you need a process, whatever that process is, hearings, 

whatever you want to do. But it has to be a way to identify these 

projects, and not just let the administration—which you know I 

support, but I don’t care who the administration—members should 

have some say-so as to members’ priorities in their area. Can you 

expand on that? 

Mr. ANDERSON. Yes, ma’am, I will try to. I appreciate your frustration. I don’t consider it an earmark when we are willing to put 

up every dollar for the project. We just need to change the policy 

here to allow us—so we don’t have to wait for an authorization. 

And in this specific instance, I think you are referring to our 

project at Mile Point, which is hindering our ability to take in the 

larger ships of—post-Panamax ships, by the way that are coming 

through the Suez Canal for many customers and Members. We will 

do that if we can just find a way to advance the dollars that the 

State and the local government is ready to put up. 

Ms. BROWN. Madam, can you talk about it? We have had several 

meetings. I mean it is a bipartisan effort. I know it is local, but this 

is my only bite at the apple. I got to get you here. 

Ms. DARCY. Thank you, Congresswoman. The portion of the 

project that you are referring to, the Mile Point portion, is not an 

authorized project. So, therefore, we can’t budget for an unauthorized project. 

Ms. BROWN. OK, but we can’t authorize it because it is an earmark. We are in a Catch-22. What do we do? 

Ms. DARCY. I don’t have a good—— 

Ms. BROWN. So we don’t understand the budget, nor do we understand the legislative process, because it is not working. It is broken. 

I will have another round. 

Mr. GIBBS. Representative Harris? 

37 

Dr. HARRIS. Thank you very much, Mr. Chairman. Let me go into 

some of these issues with the Harbor Maintenance Trust Fund and 

the Transportation Trust Fund. I am just going to ask everyone, 

starting with Mr. Bridges and working down. 

Mr. Bridges, do you support—and because I think you all said we 

ought to have the multiyear transportation bill, and we ought to 

fold a maritime title into it. Mr. Bridges, would you support an increase in the gas tax to help pay for that? 

Mr. BRIDGES. Yes. 

Dr. HARRIS. OK. Mr. Koch? 

Mr. KOCH. I think—— 

Dr. HARRIS. That job-killing gas tax, you know, the ranking 

member spoke about. 

Mr. KOCH. Yes, but—— 

Dr. HARRIS. You would? 

Mr. KOCH [continuing]. The gas tax increase for the surface 

transportation bill. 

Dr. HARRIS. Correct, right. 

Mr. KOCH. Yes. 

Dr. HARRIS. Yes. Mr. Anderson? 

Mr. ANDERSON. Yes, if it includes all modes of transportation. 

Dr. HARRIS. Mr. Friedman? 

Mr. FRIEDMAN. Can you repeat the question? 

Dr. HARRIS. Mr. Benjamin? 

Mr. BENJAMIN. Yes. 

Dr. HARRIS. Mr. Peyton? 

Mr. PEYTON. Spend money to make money. 

Dr. HARRIS. Same question. Do you support—Mr. Bridges, do you 

support an increase in the Harbor Maintenance Trust Fund tax 

level? 

Mr. BRIDGES. No. 

Dr. HARRIS. No? Mr. Koch? 

Mr. KOCH. No, because—— 

Dr. HARRIS. Mr. Anderson? 

Mr. ANDERSON. No. 

Dr. HARRIS. Mr. Friedman? 

Mr. FRIEDMAN. No. 

Dr. HARRIS. Mr. Benjamin? 

Mr. BENJAMIN. I support reformation of the—— 

Dr. HARRIS. Do you support an increase in the rate? 

Mr. BENJAMIN. Reforming the system. 

Dr. HARRIS. Mr. Peyton? 

Mr. PEYTON. I agree. Reform the system. 

Dr. HARRIS. OK. So, let me get—let me summarize what I am 

hearing. You think it is just fine to raise the gas tax, which doesn’t 

go to paying roads only, but you think it is not all right to increase 

the Harbor Maintenance Trust Fund, because—I suspect the reason why you believe that is because you think it ought to go paying 

for the dredging, and we are not paying for all the dredging, so we 

shouldn’t be increasing the tax. 

You just summarized the problem a lot of the Members have, 

going to our constituency and saying, ‘‘Let’s raise the gas tax, we 

really need to do it. But, oh, by the way, we are not really going 

to build roads over there, we are going to do things like fund mass 

38 

transit, we are going to build bike paths, and all the rest.’’ That 

is the problem. 

You would be much more believable to me if you say, ‘‘Sure, raise 

the Harbor Maintenance Trust Fund to—I know it doesn’t go to 

just dredging harbors, but let’s do that too.’’ 

Now, Ms. Darcy, thank you very much for coming back. And I 

think I got a handle on this Harbor Maintenance Trust Fund issue. 

There is a piece of paper floating around that has $6 billion on it. 

There really aren’t funds anywhere. There is an IOU written, 

right? 

Ms. DARCY. It is in the treasury account. 

Dr. HARRIS. ‘‘Treasury account’’ means it is in IOU—it is an IOU 

written. There are no—in other words, if we decide to spend that 

money tomorrow, they would have to go and find a place to print 

it or transfer it or something. 

What is the backlog of projects, total projects in the—dredging 

projects in the United States? If we wanted to really dredge our— 

you know, to authorize depths and widths, how much would it cost? 

All the projects. 

Ms. DARCY. All authorized projects to all authorized widths and 

depths? 

Dr. HARRIS. Mm-hmm. 

Ms. DARCY. I think the figure is about $1.3 billion. 

Dr. HARRIS. You mean we could dredge all our—well, I am going 

to find that hard—you are going to have to show that to me, because we can dredge all our ports in the United States, their authorized widths and depths, and it is only $1.3 billion? 

Ms. DARCY. In addition to what we already spend. I believe that 

is the case. 

Dr. HARRIS. You are going to have to go back and check your figures, because I know these ports. These ports, despite the fact that 

we are spending $800 million a year, we have huge backlogs. And 

the number of ports that need a dredging done that have been delayed is huge. 

But let me ask you a question. So you say that we haven’t—your 

testimony is we are already spending an adequate amount. But we 

are not spending enough to bring them up to authorized widths or 

dredge to authorized depths. So I guess it is a matter of what you 

consider adequate. 

Ms. DARCY. It is adequate for the funding that we have. 

Dr. HARRIS. I—oh, now let’s go to the funding that you have. 

In the President’s second stimulus bill, this current jobs bill, how 

much has he set aside for dredging projects? 

Ms. DARCY. I don’t believe there is any set aside for dredging 

projects. 

Dr. HARRIS. No set-aside for dredging projects? Well, that is very 

interesting. So then, you don’t—the administration really doesn’t 

think it is a priority to go down to those depths or those widths? 

[No response.] 

Dr. HARRIS. I mean because that is how you determine priorities, 

you actually put it in one of these bills. Because the President has 

said that we want roads and other infrastructure, but no money for 

dredging? No money for that important aspect of maritime infrastructure? 

39 

[No response.] 

Dr. HARRIS. Finally, because my time is running short, your testimony says that in deciding how to spend Harbor Maintenance 

Tax receipts, you are going to make a comparison with other potential uses of the available funds. 

Now, first of all, the funds aren’t being used, they are being deposited in the treasury. What are some of those other potential 

uses that could be more important than actually dredging a harbor 

to accommodate these new ships that are—you know, will be coming through the Panama Canal, et cetera? What are some of those 

other potential uses of available funds? 

Ms. DARCY. Some of them could be for other portions of harbor 

development or harbor maintenance other than dredging, things 

like jetty replacement and other kinds of maintenance that is not 

specifically dredging. 

Dr. HARRIS. OK. But you could do that with the current funds. 

I mean you have a little leeway there, because you are only spending $700 million and some-odd change out of the $1.5 billion. 

Ms. DARCY. The $758 million is what we—— 

Dr. HARRIS. Yes. 

Ms. DARCY [continuing]. Will be able to spend. 

Dr. HARRIS. Right. So you think it is a more important use of 

those funds to deposit them in the treasury than to invest them in 

harbor maintenance at this point in time? Because that is what is 

being done. 

Ms. DARCY. Well, being deposited in the treasury, they will be 

used for other priorities. 

Dr. HARRIS. This year? Next year? Ever? 

Ms. DARCY. I don’t know that answer, sir. 

Dr. HARRIS. Certainly not this year, right? Those monies deposited in the treasuries, we just get a piece of paper IOU back, right? 

We don’t actually get a project. 

Ms. DARCY. Well, those receipts are invested in treasury securities. 

Dr. HARRIS. Right, but you can’t drive a ship into a treasury security, you can’t—I mean I guess it is a matter of priorities. Thank 

you very much, Mr. Chairman. 

Mr. GIBBS. Thank you. Ms. Richardson? 

Ms. RICHARDSON. Thank you, Mr. Chairman. First of all, the gentleman who just spoke, I look forward to maybe having a thoughtful discussion over coffee or a beer or something on these issues. 

I respect and look forward to having a more thorough discussion. 

I would just like to say for the record, though, building upon the 

gentleman’s questions, there is a very key difference between—several differences—of the Highway Trust Fund versus the Harbor 

Maintenance Tax. One, the Highway Trust Fund has been unfunded for quite a few years now, even dating prior to President 

Obama, but President Bush, as well. The gas tax has not been increased since 1993. And so it is an underfunded program. 

I also think it would be helpful to have a discussion of the difference between increasing the diesel tax versus, as you said, asking our constituents to pay a tax. Because if the truckers are willing to pay a tax, an increased tax which would be a diesel tax for 

the roads that they would be able to use that would eliminate 

40 

choke points and allow goods to move more efficiently, that may be 

somewhere where we could find an agreement. 

Let me now get into the questions that I have. Mr. Peyton, in 

your testimony on page 3 you stated your concerns with the TWIC 

program. Can you describe how the TWIC program has positively 

or negatively impacted the economics of our seaports? 

Mr. PEYTON. Well, I think that we all know that—what we went 

through on 9/11. But at the same time, the question is where that 

spending goes, and what it means in the total. 

Originally, when the regs were written, there was language in 

the Coast Guard regs that said that the people that work in the 

ports would be educated and become the eyes and the ears of the 

port, which, without education, people in the ports were the eyes 

and ears, because they were the ones who knew better than anybody else if something was wrong, and a number of instances were 

taken care of as a result of this. 

So, what we are saying here is—we are not saying that there 

isn’t a place for security because, of course, there is. But we are 

saying that the expenditure of that money when we look at some 

of the other projects that need to be funded, that maybe our priorities need to be shifted into goods movement. And we have done 

enough over here, because fences, cameras, and everything we put 

up seem to be multiplying by the day, but we are not moving cargo 

more effectively because we don’t have the monies allocated there. 

That is what our point is. 

Ms. RICHARDSON. OK. And, building upon that, Mr. Peyton, I 

would also like to ask you and Mr. Bridges and Mr. Benjamin. In 

response to 9/11, port authorities lost many members. Out of this 

attack, the Department of Homeland Security was formed and subsequently funded. In addition to law enforcement officers, however, 

there is many other people who could be considered a first responder, such as retail clerks, ship pilots, marine construction 

workers, and so on. 

Do you believe that these workers should also be included in security plans, in training, and a part of the process? 

Mr. BENJAMIN. Yes, and we work actively with the other members, including Coast Guard, members of law enforcement, members of industry, in developing our specific security plans at the 

port. 

Ms. RICHARDSON. But specifically—I realize from a port perspective, but I am talking about your actual workers. Like, let’s say, 

your longshoremen or your retail clerks, do they have an opportunity to participate in the planning? Are they getting a chance to 

take advantage of the training? 

Mr. BENJAMIN. I would look to also Mr. Peyton and my other colleagues, but I believe the answer is yes, as it relates between labor 

and the PMA and other members between labor and their representative members of industry. 

Ms. RICHARDSON. Mr. Peyton, do you feel that you guys are given 

an adequate opportunity to be considered a first responder? 

Mr. PEYTON. No, we have not been built into this. We have met 

with the first responder groups, and I will say that the ports have 

done a very, very good job within their unit. But, unfortunately, we 

were put one step removed because of facility security officers at 

41 

individual terminals, which means that we were not trained. And 

it is just coming around now, it is just starting. But no, we are not. 

Ms. RICHARDSON. OK. And then, I think my last question that 

I might have, Mr. Bridges, Anderson, Friedman, and Benjamin, I 

have authored a bill called the Freight Focus Act, and I would like 

to ask the question. Are any of you involved with the Department 

of Transportation in an advisory capacity that would allow you to 

prioritize major goods movement corridors to alleviate choke points, 

to participate in freight planning, and to designate corridors of national significance, and to be able to weigh in on what you think 

would be merit-based programs or projects that should be funded? 

Are any of you allowed to participate in that at this point? 

Mr. BENJAMIN. Yes, we do. We happen—I think Mr. Bridges, myself, and other members are involved not only at AAPA but at the 

marine transportation committee established by the Secretary—or 

re-established again, I would say. 

Ms. RICHARDSON. Would you like to expand? 

Mr. BRIDGES. Yes. We are certainly involved with the Secretary’s 

office in that effort that is initiated through MIRAD, and we are— 

I think there is three or four port directors that serve on that, 

along with private sector terminal operators and others. And at the 

AAPA we are also engaged in trying to look at the national freight 

policy and talking about corridors of national significance and that 

sort of thing. 

Ms. RICHARDSON. Mr. Chairman, could I just ask a followup 

question to that? Thank you, sir. 

But are you allowed to specifically determine to look across the 

Nation and say these are the top 10 goods movement corridors, and 

where funding should prioritize—— 

Mr. BRIDGES. I believe that the agenda will—is such that we will 

move to that. We have met once, since the inception of the committee. But I believe that is the overall vision of the National Maritime Advisory Committee. 

Ms. RICHARDSON. OK. Thank you, sir. I yield back. 

Mr. GIBBS. OK. I think there is a few more questions. I will start 

off—go ahead, Representative. Go ahead. You can go, and then we 

will switch back and forth here. 

Mrs. NAPOLITANO. Thank you, Mr. Chair. 

Mr. GIBBS. We are going to make this second round kind of 

quick, though. 

Mrs. NAPOLITANO. I appreciate the time. Mr. Peyton, in your testimony you are very credible in some of the issues that I have great 

concerns with, and one of them is a diversion of cargo away from 

our west coast seaports to Mexico and Canada. Should our Government prohibit transshipment of goods through Mexico and Canada 

coming to the U.S., since they do not have the same security, the 

same safety, and environment regulations that we have at our 

ports? 

And I kind of think of the trucking situation with NAFTA, where 

that has played a great part in taking some of the jobs from our 

members. And I know that Canada has been continually investing 

in their roads and infrastructure to be able to move more cargo 

through their ports, and that they have a factor of several days, if 

42 

I remember correctly, to expedite the transshipment of goods. And 

is it cheaper? But all of those are part of my question. 

Mr. PEYTON. Yes, I think the key here is—we have heard this 

word before, but it is called fair. And fair means even, across the 

board, that they don’t get an advantage because their Government 

funds something that ours isn’t willing to, that they get around the 

Harbor Maintenance Tax when we have to pay it, when we have 

environmental concerns that they don’t have, when we have security concerns that they don’t have to go through. It is called fair. 

And an even playing field—because, given an even playing field, 

we have done a very good job—I’m talking about the west coast 

now—at developing what we need to develop, and doing what we 

need to do to stay in this game and win our market share back. 

We have picked up, since 2007, we have picked up 2 percent of the 

6—we lost 6 percent of our market share. We have picked up 2 percent of that and brought it back. So we can win this battle, but we 

need an even playing field. 

Mrs. NAPOLITANO. Well, and talking about the even playing field, 

I know there is a move of Beat the Canal, which puts the local, the 

State, labor, Chambers of Commerce, chambers themselves, former 

Governors, railroads and trucking associations on the same playing 

field to be able to expedite the port’s traffic, and also to be able to 

look at regulations, which bring me to Ms. Darcy. 

Is any move to have any of the other agencies—like EPA, Department of Transportation, Commerce, and others—working with 

the Army Corps to expedite the processes that hinder some of these 

projects that are waiting in line? 

Ms. DARCY. In our districts we try to work cooperatively with the 

other agencies, in particular, for—— 

Mrs. NAPOLITANO. But that is local, ma’am. I am talking about 

here in Washington, so that we all know that this is a move that 

is going to help create better ability for our ports to move forward 

on their projects. 

Ms. DARCY. We are working with Transportation and other agencies to try to better coordinate upfront what the requirements will 

be for the regulatory process, so that it doesn’t get bogged down 

with one agency saying one thing and the other saying another. 

Mrs. NAPOLITANO. OK. And then, to the panel, is what would you 

suggest to all these agencies to do to be able to get to the table and 

resolve these choke points? Anybody? 

Mr. BENJAMIN. Well, I think that it starts with something we 

have been advocating, of having a nationwide strategy and policy 

around the movement of goods—— 

Mrs. NAPOLITANO. With whom? 

Mr. BENJAMIN. Amongst—at the Federal level. 

Mrs. NAPOLITANO. What agencies? 

Mr. BENJAMIN. All of them. And that there be a central cabinetlevel representation that focuses on this on a systems approach, as 

Mr. Peyton said, and Mr. Bridges, and everybody has commented. 

We need a systems approach, a national perspective, to manage 

these—— 

Mrs. NAPOLITANO. But what would be the priorities that you 

would want this super-agency to be able to work on to relieve the— 

your ability to be able to move forward? Anybody? 

43 

Mr. BRIDGES. Well, if we look at the airline industry, for instance, there is the FAA that primarily focused on aviation issues. 

There is the Federal highway that deals with the road. I believe 

that we, in the national freight scenario, we would need to have an 

agency quite similar to the FAA that kind of brings all of the variant pieces together that look at the complete supply chain, from 

the water side all the way through to the destination. 

So, that is creating more bureaucracy. But hopefully it would be 

a streamlined process that can alleviate some of the road blocks as 

we go forward. 

Mrs. NAPOLITANO. Mr. Anderson? 

Mr. ANDERSON. Yes. I think my experience, that interagency cooperation isn’t always in Washington, what that sounds like. I 

think it is imperative that the leaders of each of those organizations makes sure that that is a priority for their agency, they work 

directly together, and they drive it down through the agency. 

Mrs. NAPOLITANO. And should the word come from Congress or 

from the administration? 

Mr. ANDERSON. Both. 

Mrs. NAPOLITANO. Any other comment, anybody? Yes, Mr. Koch? 

Mr. KOCH. I would simply note that I think you can look at some 

examples where things have been done very, very well with the existing system. And I would point to Mr. Bridges’ port. Norfolk is 

dredged, it has got intermodal rail connections, it has got the 

heartland corridor, it has got new rail service into North Carolina. 

It has thought about what it needed, it has invested in what it has 

needed, and it has worked with the Federal agencies very cooperatively. 

Much of the highway infrastructure that needs to be approved is 

subject to approval of the State highway plans. It is not a DC issue, 

it is for California, the California highway plan. And I think a lot 

of people struggle getting freight more recognized in the State 

highway plans; a lot of these projects require the State government 

to make them a priority, rather than to have it imposed from 

Washington. 

So, I think there are a lot of people who are actually making 

things work with the present system, and I think Mr. Bridges is 

a testament to that. So it can work, but it requires a lot of coherent 

planning and commitment. 

Mrs. NAPOLITANO. Would really request any suggestions come to 

this subcommittee, to the—because—— 

Mr. PEYTON. Can I add one last thing? I think that, you know, 

again, when we look at where we are going, as a Nation, this is 

what we have to educate people to, everybody to, that this is the 

future, that moving cargo effectively is going to be the way we stay 

competitive in this world. So, in doing this, I think it is to 

everybody’s best interest that we understand that. 

Mrs. NAPOLITANO. Thank you, Mr. Chair, for your indulgence. 

Mr. GIBBS. Thank you. Well said. Representative Landry? 

Mr. LANDRY. Thank you, Mr. Chairman. Mr. Peyton, I got to tell 

you, I am with you, OK? I mean I really am. I mean I appreciate 

your comments, I appreciate your position. It is something—this 

issue is very near and dear to me. I have got a number of ports 

44 

in my district. The Port of Orleans is actually in it, but I have got 

a lot of smaller ports. But I got a question. If Congress injected $500 million into the 

Corps’ budget to address port needs—now I know they need more 

than that, but just—do you have any idea how many jobs we could 

create with $500 million? 

Mr. PEYTON. Well, let me tell you this. On the 62 projects that are sitting there, it represents about a little short of $7 billion. 

That $7 billion has been equated out to 100,000 construction jobs. 

Mr. LANDRY. OK, all right. And—— 

Mr. PEYTON. That is the only number I have to go off of. 

Mr. LANDRY. OK. And Ms. Darcy, any idea how many jobs—if we 

just gave you $500 million, how many jobs, directly, you could—not 

only in construction, but either jobs saved, or additional jobs created by improving our ports? $500 million. 

Ms. DARCY. Sorry. The figure that we usually use for construction jobs is $1 billion of construction funding would create 30,000 

jobs. 

Mr. LANDRY. Wow—— 

Ms. DARCY. So, $500 million would be—— 

Mr. LANDRY [continuing]. 30,000? OK. Mr. Peyton, you realize we spent $500 million on Solyndra to create 12,000 jobs that are now 

gone? Do you understand how backwards this Government is, how 

they don’t know how to prioritize? How we chase utopian green energy jobs at a time when 8 of our 10 largest ports are under draft 

restrictions? 

I mean think about the amount—that amount of money, 100,000 

here, 30,000 there, 12,000 jobs at Solyndra. I just wanted to set the 

table so that you understand that this fight is not only at this table 

and this committee, it is within this entire administration. 

Now, Assistant Secretary Darcy, do you believe our Nation’s energy security should be a priority? 

Ms. DARCY. Yes, I do. 

Mr. LANDRY. OK. Well, the Corps ties its funding for ports based 

upon tonnage transported to and from ports versus the importance 

of the commodity being transported. Is that correct? 

Ms. DARCY. That is correct. 

Mr. LANDRY. OK. In my district, ports like Iberia and Fourchon 

are vital to the energy security of our Nation. In fact, 30 percent 

of the oil and gas consumed in this country flows through the Port 

of Fourchon. And yet it receives only $1.5 million for its dredging 

needs, which is not a—it is barely enough to keep the maintenance 

of the port operable. This is not to deepen the channel, this is not 

to improve the channel, this is simply a maintenance. 

Don’t you think that somewhere in the equation we should be 

looking not only in strictly a tonnage formula, but in the commodity that is transported back and forth, or the security needs of 

the country? 

Ms. DARCY. Congressman, I think you raise a good point. But as 

you outline, we do currently just base it on the tonnage. Perhaps 

we need to take a look at the value, or—especially in light of energy security—in looking at how we prioritize. 

Mr. LANDRY. Well, great. That is a great answer, and I would encourage you to do so, because it is not only small ports like myself, 

45 

like these ports in the district that I represent, but there are a 

number of small ports out there as well, that a—just a little bit 

more of investment in infrastructure could mean a lot more to 

those ports, in the way of creating jobs and allowing the towns and 

cities around them to flourish. 

And so, I just think that sometimes we should keep an eye on 

not only a tonnage formula, but exactly strategically where we 

want to be in this country. So I encourage you to look to that. 

Mr. Chairman, I yield back. 

Mr. GIBBS. Thank you. Representative Brown, do you have another question? 

Ms. BROWN. Yes, sir. I do have a couple of comments. First of all, 

let me just say, first of all, that the President proposed that Congress dispose. So members of this committee and Members of Congress pass a bill that cut Army Corps’ funding—that is first of all— 

and cut it by 10 percent. 

Now, if the members on this committee don’t like certain aspects 

of it, pass your bill. You got 200 and what members? All you need 

is 218 to pass any bill you want to pass. You control this House, 

and you keep talking about waste and abuse. Iran and Iraq and Afghanistan, over $60 billion. Halliburton. So this is Transportation. 

And in the past, Transportation have always worked bipartisan. 

And if you don’t like any of the proposals of the stimulus, some job 

proposal, pass your bill. And you only need 218. And you got one 

more. So you got one. I would vote with you on any bill that you 

have to straighten out this mess that we are talking about today. 

So, you don’t have to talk the talk, you can walk the walk. Introduce the bill. I guess that is the purpose of the hearing, to lay out 

how we can improve the funding. 

Now, let me just tell you something else. I am not going to vote 

for a bill for Transportation and Infrastructure for the next 6 years 

that is $230 billion. I mean, clearly, we need about $500 billion or 

$600 billion. Transportation is comprehensive. You can’t just 

dredge the port and then don’t have the roads or the rail system 

to move it, as you just said. 

I mean I have been on this committee for 19 years, and we have 

always worked together. And we are the committee. We are the engine that put American to work. But it is a problem. I mean we 

are just talking about it, and you know, we are just moaning and 

groaning. You control the House. You control the votes. Do something, my fellow Americans. Do something, Transportation Committee. Put your bill on the floor. Bring it to the committee. 

I mean I am sick and tired of all of the talk when people are unemployed. Someone said something about the nature—‘‘Well, you 

know, the American people, they understand about how you mortgage your home.’’ Yes, but who paid cash for it? You do—you don’t 

have no money to pay cash for your home or your car. You finance 

it. You pay your bills. And clearly, we need to put American people 

to work. 

Our competitors are there, and they are not competing with Mississippi and Alabama and Georgia, we are competing with the Japanese and the Chinese. And they have some strict rules when they 

pull up in Jacksonville. They say they want those ships in and out 

in a matter of minutes, or they are going somewhere else. 

46 

And so, we have got to have our A-game going on, and we need 

to work together. Our committee has always worked together. So, 

if you got a better idea, put your idea on the board. Bring it to the 

floor. Bring it to this committee, and let’s get it—let’s get—you 

know, I have a Governor just talks about, ‘‘Let’s get the work.’’ 

Well, let’s get the work. 

And I have some questions that I want to ask, and I know you 

going to send the answers to the committee, but I want to make 

sure that I get the answers to those questions about the Jacksonville Port. And I would like to know what it is that we can do to 

cut some of this paperwork that they been talking about. And I 

agree with it, it is getting more and more paperwork, and we are 

not getting the projects done. 

So, with that, does anyone have any quick comments to what I 

have had to say? 

[No response.] 

Ms. BROWN. Any comments? 

[No response.] 

Ms. BROWN. Well, thank you very much. I guess you all agree 

with me. 

[Laughter.] 

Mr. GIBBS. Representative Harris, did you have a question or 

comment? 

Dr. HARRIS. Yes. Just very briefly, Mr. Bridges, I just have a 

question for you. Because I think where we left off before, I had 

asked the assistant secretary what the potential other uses of the 

Harbor Maintenance Trust Fund is. Because her testimony was, 

well, you know, this is what we have to decide. You know, we think 

there is an appropriate amount spent on dredging—I personally 

disagree with that. But then it says that we actually have to compare other potential use of those funds. 

Is there any other potential use that is more important, in your 

mind, than getting through that backlog of dredging? 

Mr. BRIDGES. The short answer is no. We believe that if we expend the revenues that come in on an annual basis that will meet 

our requirements for maintenance dredging—and from the AAPA’s 

perspective, that is what the fund was designed to do—that is what 

we would like to have it do. 

Dr. HARRIS. How much do you think the backlog is, the total 

backlog of dredging, to bring all our ports into their authorized 

width and depth? 

Mr. BRIDGES. I am told that if we were to utilize the $1.5, $1.48 

billion that is collected, if we were to spend that on maintenance 

dredging, we could get all of our requirements met. 

Dr. HARRIS. Over how many years would that take, of spending 

the total amount? 

Mr. BRIDGES. We really don’t—I really don’t know the answer to 

that. 

Dr. HARRIS. You don’t know. I might ask you to go to your member ports and ask them, you know, exactly how much they would 

need if tomorrow—their wish list—tomorrow we started dredging 

all the ports to their width and depth, what it would cost. 

Mr. BRIDGES. I will—— 

47 

Dr. HARRIS. Thank you very much. Thank you very much, Mr. 

Chairman. 

Mr. GIBBS. Mr. Bishop? 

Mr. BISHOP. Thank you, and I will try to be brief. I think we all 

agree that we need—we want to see a greater proportion, if not all, 

of the revenue that comes into the Harbor Maintenance Trust Fund 

expended for the purposes for which it is assessed, and that is 

maintenance of our harbors, and seeing to it that they are dredged 

an appropriate depth. 

But let’s recognize, as I said before, the reality. There is only a 

couple of ways we are going to get there. And one of those ways 

does not include berating witnesses. We are only going to get there 

if we are either willing to list the—lift, pardon me—the statutory 

cap that we have imposed on ourselves for discretionary spending 

going forward, or if we are willing to make the hard decisions in 

terms of how we prioritize expenditures within the energy and 

water appropriations bill. 

Now, I will note that the energy and water appropriations bill 

that passed this House with pretty broad support on the majority 

side—not every majority member voted for it, but most did—encapsulates, it carries forward the very problem that we are talking 

about. It carries forward the fact that we are only spending $700 

million out of a $1.5 billion pool that is collected. 

So, if we are really serious about this, which I think we all are, 

then we have to write an energy and water appropriations bill that 

spends the money. And if we are willing to do that, or if we are 

going to do that, we have to be willing to, as a committee—and I 

would ask the chairman if we could try to structure a process 

where we will go to the Appropriations Committee and say, ‘‘This 

is a priority for us, and here are some things that you have made 

a priority in the past that we now think should be less important.’’ 

That is something that we have to do. 

We are not going to get—we can have every hearing we want— 

and the RAMP Act, by the way, I am a cosponsor of the RAMP Act, 

I think it moves us in the right direction, but it does not get us 

to the Promised Land, if we define the Promised Land as spending 

$1.5 billion. It just doesn’t. We have more heavy lifting to do. 

And I very much hope that, as Mr. Peyton said, we can lay down 

our swords and we can act on what we all say is a priority. And, 

Mr. Chairman, I hope that we can find some means of doing that 

with the energy and water appropriators that are our colleagues, 

so that we can actually move beyond the stage where we are all 

complaining, but we are not willing to make the hard decisions to 

put in place a decision. 

With that, I yield back. 

Mr. GIBBS. Well, I thank you. I want to thank all the witnesses 

for coming in. I think we highlighted how important it is to make 

sure we have the infrastructure in place to meet the 21st-century 

goals, and especially what is going on globally with the Panama 

Canal widening and deepening. Secretary Darcy, you are quite 

aware of that. And if we are going to be competitive in the world, 

we have got to make sure we get this infrastructure done right. So, 

I look forward to working with you in the future so we make 

progress on that endeavor. 

48 

It is time to—committee is adjourned. Thank you. 

[Whereupon, at 12:17 p.m., the subcommittee was adjourned.] 

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