Hearing Focuses on Economic Impacts of Aging U.S. Inland Waterways System

A Congressional hearing highlighted the economic importance and positive impacts on job creation of the nation’s Inland Waterways Transportation System.  The hearing focused on the physical needs of the aging locks and dams as well as challenges to improving the system’s infrastructure, including the increasing amount of time it takes to complete projects.

“Transportation savings are a key factor to growing our economy and getting Americans back to work,” said U.S. Rep. Bob Gibbs (R-OH), Chairman of the Water Resources and Environment Subcommittee.  “The continual rise in fuel prices means that waterway transportation is a more attractive and cost effective shipping method.  But an inefficient transportation system will raise costs and when transportation costs go up, the competitiveness of American-made products on the world market goes down.  And that means lost jobs.” 

Gibbs highlighted the current state of the nation’s inland waterways system, and elaborated on some of the economic impacts created by system inefficiencies.  Fifty-seven percent of the structures on the system are more than 50 years old.  Thirty-even percent are more than 70 years old.  Locks built in the 1830s remain in service today.  Age is taking its toll on the reliability of this important mode of transportation. 

“The system provides freight mobility that otherwise would be costly or even impossible to address,” Gibbs said.  “However, navigation outages along the system are increasing.  For instance, Ohio River outages have increased from 25,000 hours in 2000 to 80,000 hours today.  This trend of increasing outages is expected to continue.  While it affects the reliability of the system, it also foretells the likelihood of a major physical failure at one of the structures.  A failure could shut down navigation for a few weeks or a few years.  The enormous economic consequences would be felt nationwide.

“Addressing the infrastructure needs of the inland waterways system is not about economic benefits to a few barge companies.  It is about keeping American farms and businesses competitive and growing American jobs,” Gibbs added.

Witnesses at today’s hearing provided insight into the economic importance of inland waterways as part of a balanced multi-modal freight transportation network.

According to Larry Bray, with the University of Tennessee’s Center for Transportation Research, “The use of inland waterways to support freight transportation saves shippers (and their customers) billions of dollars annually.  Moreover, in some cases, the freight that moves by water cannot be moved any other way.  In these cases, the value of available barge transportation is literally incalculable.”  Bray said that the inland waterways transportation saves shippers and customers over $7 billion every year.

Bray described the impacts on the U.S. freight system in the event of a significant disruption of the inland waterways system: “A wholesale diversion of waterway traffic to the nation’s rail network would require roughly 100 thousand additional railroad freight cars and 2,500 additional locomotives.”  Gibbs stated that if the amount of cargo that moves by inland waterways was to move by truck, it would require 58 million truck loads.

Steve Ebke, representing the National Corn Growers Association, spoke about the importance of the system to the agriculture sector, which accounts for nearly one-third of all freight transportation services in the United States.  “Farmers move their crops and receive their inputs by barge, rail and truck,” Ebke said.  “The competition among these modes of transportation helps farmers receive the best price for their crops, meet their customers’ demand for timely delivery of products and successfully compete with foreign producers.  Without the competition that comes from access to efficient, alternative transportation methods, farmers can pay significantly more to transport their grain.

“The American farmer’s international competitiveness has always hinged on the ability to move crops to market. The lower the cost of transportation, the lower the cost of U.S. grain on the world market; thus, the more grain the U.S. is able to sell.  South American countries are investing large sums in river infrastructure to upgrade their river systems to be more competitive with the U.S.  America cannot afford to allow any aspect of river commerce to deteriorate for fear of losing export market share to South America at the expense of our agriculture industry,” said Ebke.

Mike Toohey, President and CEO of Waterways Council, Inc, the national public policy organization advocating a modern and well-maintained system of ports and inland waterways, added, “In this sluggish economy where the unemployment rate is over 20% for construction workers, these projects can put thousands of people to work right away.  And, these projects, once completed, will provide billions of dollars of activity for the American economy.”

Stephen Little, former Chairman of the Inland Waterways Users Board and president of a company that employs 350 people and operates a fleet of 35 towboats and 1,000 barges, testified about the substantial increases in the amount of time for completing navigation projects compared to years past.

“Our nation’s inland waterway modernization challenge going forward is the need to create and implement an improved program for the future.  We have an aging system that needs recapitalization,” Little said.  “We have a project funding and delivery system that is terribly inefficient, resulting in enormous wasted time and taxpayer dollars.

He continued, “In the past our nation could build 26 projects in 10 years on the Upper Mississippi River, 7 lock and dam projects in 9 years on the Illinois River, locks and dams at 10 sites in 12 years on the Tennessee-Tomibigbee Waterway, and seven new projects in 4 to 8 years following WRDA 86.  Today it is taking 30 years to build new projects in each of two locations and 14 years to build what it took 3 years to build at another location.  This is completely unsatisfactory and is wasting billions and billions of dollars of scarce national investment resources.”

Little went on to outline the Inland Waterways Users Board’s recommendations for improving the Corps’ project delivery performance.