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New bill aims to ensure full use of harbor maintenance tax

May 1, 2019 04:03 PM

H.R. 2396 would exempt expenditures from the Harbor Maintenance Trust Fund from budget caps

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

(WASHINGTON) — House Transportation and Infrastructure Committee Chairman Peter DeFazio, D-Ore., and ranking member Sam Graves, R-Mo., introduced legislation (H.R. 2396) on Tuesday to help ensure full use of the harbor maintenance tax (HMT).  

Originally enacted in the Water Resources Development Act of 1986, the HMT is a fee assessed on the owners of cargo handled at the nation's ports. Funds generated by the tax are placed into the Harbor Maintenance Trust Fund (HMTF) from which Congress appropriates dollars for the Army Corps of Engineers' operation and maintenance activities. In the Great Lakes these activities include harbor dredging, repair and reconstruction of breakwaters and jetties, and operation and maintenance of the Soo Locks.

Although the HMT generates enough annual revenue (currently $1.7 billion) to maintain all the nation's ports, budget constraints have prevented Congress from fully appropriating necessary funds. This has resulted in a $9.3 billion surplus balance in the trust fund. Inadequate Corps funding has resulted in a backlog of needed maintenance work. In the Great Lakes there is a $500 million backlog of Corps maintenance activity.

For more than a decade, Great Lakes ports and others in the maritime industry have lobbied Congress for full use of HMT revenue. To achieve that goal, H.R. 2396 would provide special budgetary treatment to expenditures from the Harbor Maintenance Trust Fund by exempting such expenditures from congressional budget caps. Should this legislation be enacted, House and Senate appropriators would have little motive to continue to constrain spending. The legislation is expected to unleash both the past surplus balance and also enable full spending of future HMT revenue — in total $34 billion over the next decade.

The House legislation is similar to a provision championed last month by Senate Appropriations Committee Chairman Richard Shelby, R-Ala. The Senate provision was included in a disaster funding bill that ultimately stalled; however, the bill is expected to move forward again in coming weeks.

AGLPA sent this letter to House committee leaders on Tuesday. The letter not only expresses our support for their efforts, but also urges the committee to include the national funding distribution scheme crafted by the American Association of Port Authorities (AAPA) in early 2018. Under the terms of this scheme, the Great Lakes region would receive 10 percent of all future expenditures from the trust fund.

House transportation leaders are planning to develop a comprehensive infrastructure investment package later this year. It is likely that the text of H.R. 2396 will be rolled into that package.

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