Trade coalition calls for freight transportation trust fund
The Coalition for America’s Gateways & Trade Corridors (CAGTC) is calling for a dedicated Freight Trust Fund (FTF) to finance a growing backlog of freight projects to keep pace with growth of imports and exports, which is expected to double by 2020.
“Goods movement projects are disadvantaged because freight now competes for funding with all other transportation projects, from transit needs to congestion mitigation and air quality and safety,” said Michael Huerta, managing director of the Transportation Solutions Group of Affiliated Computer Services, and a CAGTC legislative spokesman. “More often than not, when forced to compete with ‘people projects,’ freight infrastructure improvements are put on the back burner.”
Today, foreign trade accounts for nearly one-third of US GDP, and world output is predicted to increase by 33% over the next ten years. When this demand outstrips supply, the resulting congestion will have a devastating effect on both consumers and freight transportation providers.
According to a 2005 study, congestion caused 3.7 billion hours of travel delay and 2.3 billion gallons of wasted fuel – at a total cost of US$63 billion.
Over the next fifteen years, container volume through US ports is expected to double. Yet, according to the most current projections, demand will exceed capacity at most US gateways by 2020, with many having capacity constraints as early as 2012.
According to Leslie Blakey, CAGTC’s executive director, freight infrastructure requires a dedicated funding source to stave off economic gridlock.
CAGTC has commended Congress to consider the following tenets with respect to establishment of a federal FTF:
- Revenue should be assessed based on benefit.
- The revenue structure should be developed in such as way that growth in demand for goods movement yields an increase in trust fund revenue.
- All potential funding mechanisms and sources should be considered including, traditional highway user fees, tolls, as well as customs and cargo fees.
- Funding should be dedicated and sustained.
- Funds should be available to support projects across all modes, of various size and scope, but with special priority for projects of national significance.
- Funds should be available to support multi-jurisdictional and multi-state projects.
- Fund distribution should be based on objective, merit-based criteria, with higher-cost projects subject to more stringent evaluation than lower-cost efforts.
- Funding should be linked with projects in a manner similar to Full Funding Grant Agreements that ensure once a project is approved, funds will flow through to completion.
- Fund availability should be “Pay as you go” and not result in deficit spending.
The CAGTC is a diverse coalition of more than forty organisations dedicated to increasing federal investment in America’s intermodal freight infrastructure.
