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House passes Harbor Maintenance Trust Fund reforms

Oct 29, 2019 10:20 AM

Similar action in the Senate would lift constraints that have limited spending in the past

The following is text of a news release from the American Great Lakes Ports Association (AGLPA):

(WASHINGTON) — On Monday, the U.S. House of Representatives passed legislation to provide special budgetary treatment to expenditures from the Harbor Maintenance Trust Fund (HMTF). As a reminder, the trust fund supports the Army Corps of Engineers' deep-draft navigation operation and maintenance activities. In the Great Lakes these activities include regular dredging of navigation channels, repair of breakwaters and jetties and operation of the Soo, Chicago and Black Rock locks. Currently, there is a $550 million backlog of HMTF eligible work in the Great Lakes.

The legislation (H.R. 2440) passed the House by a vote of 296-109 (with 26 members not voting). Specifically, the legislation impacts the congressional budgeting process by causing an increase in the so-called discretionary budget caps equal to the amount appropriated from the Harbor Maintenance Trust Fund in any year. The net effect is to automatically "make room" in the federal budget for full harbor maintenance spending, without squeezing other programs.

In doing so, the legislation removes the historic budgetary constraints that have suppressed HMTF spending in the past. While the bill does not force congressional appropriators to fully fund the Corps' operation and maintenance program in the future, it removes any motive for them not to. Presumably, the committees will respond by appropriating more for the program.

Under the terms of the legislation, in any year the upward budgetary adjustment is only limited by the balance of the HMTF two years prior. This means that Congress cannot only spend amounts equal to incoming revenue from the Harbor Maintenance Tax (today roughly $1.7 billion), but also dip into the outstanding balance of the HMTF (about $9 billion). This could mean a future windfall of spending.

The action in the House is significant in that it overcame historic opposition in that chamber. Similar legislation has been attempted several times in the U.S. Senate under the leadership of Senate Appropriations Committee chairman, Richard Shelby, R-Ala. Should Shelby eventually succeed, it is a very real possibility that full use of the Harbor Maintenance Tax will become a reality. This has been a goal of the nation's ports and maritime industry for more than a decade.

The legislation was strongly supported by Great Lakes legislators of both parties.

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