The Trade Corridor Bulletin

Volume 13 – No. 1 | December 2018

We Asked, CAGTC Members Responded:

Insights into the INFRA Grant Application Process

Created by the 2015 Fixing America’s Surface Transportation (FAST) Act, the Nationally Significant Freight and Highway Project program is a competitive grant program investing in nationally and regionally significant megaprojects across the country. Funded at an average of $900 million annually over the five year duration of the FAST act, so far the program, referred to as the INFRA program by the Trump Administration but formerly titled FASTLANE under the Obama Administration, has made investments in over 50 projects across the country.

The Coalition for America’s Gateways & Trade Corridors (CAGTC) has long advocated for a competitive grant program dedicated to freight. Freight projects are often large, spanning multiple modes and crossing jurisdictional boundaries. This makes them difficult to fund through traditional funding mechanisms, like a formula program. While the FAST Act’s INFRA program was a significant step forward in freight policy, there are still areas for improvement. The program is significantly oversubscribed, with the most recent round seeing $12 in requests for every $1 available.

Many CAGTC members have been successful under the INFRA program, receiving around 27 percent of the funds in the most recent round. In addition, CAGTC members that have consulted on INFRA project applications have had a great deal of success and gained insight along the way; you can find a list of our members providing such services in this newsletter. To make use of this knowledge, we surveyed CAGTC members who have received FASTLANE/INFRA awards as well as CAGTC members who consult on the development of grant applications. What did our members have to say? Find their valuable insights condensed in the infographics that follow (CAGTC members have access to the full, anonymous responses to this survey). Click here to download a copy of these infographics.

Need Assistance With Your Next Grant Application?

These Firms Can Help:

Shant S. Boyajian
Attorney at Law
1666 K Street, NW, Suite 500
Washington, DC 20006
sboyajian@nossaman.com
www.nossaman.com
T 202.887.1400   F 202.466.3215
D 202.887.1406

Pierce Homer
Transportation Director
phomer@moffattnichol.com
www.moffattnichol.com
T 804.840.1538

William Hwang
Principal Consultant, Advisory Services, U.S.
444 South Flower Street, Suite 800
Los Angeles, CA 90071
billy.hwang@wsp.com
www.wsp.com
T 213.443.7451

Chris Kopp
ckopp@hntb.com
www.hntb.com
T 312.798.0213

Libby Ogard
918 Fox River Drive
DePere, WI 54115
logard@primefocusllc.com
www.primefocusllc.com
T 920.217.7222
F 920.983.8428

Rachel C. Vandenberg, PE
Vice President
rvandenberg@Dewberry.com
www.dewberry.com
D 562.350.0567

 

2018 Mid-Term Elections Update

On November 6, 2018, voters had the opportunity to elect their federal representatives, as well as statewide and local officials in the mid-term elections. Nationally, all 435 U.S. House of Representatives seats were up for reelection as well as 35 U.S. Senate seats, and 36 governorships. Several states also included key infrastructure investment measures on their ballots.

Republicans maintained control of the Senate, picking up a few additional seats, but lost their majority in the House of Representatives. This shift will result in several changes in leadership on transportation-related committees. Now-Ranking Member Peter DeFazio (D-OR) will be Chairman of the House Transportation and Infrastructure (T&I) Committee. Congressman Graves (R-MO), current Chairman of the T&I Highways and Transit Subcommittee, will be T&I Ranking Member. Congressman Denham (R-CA), the current Chairman of the T&I Railroad, Pipelines, and Hazardous Materials Subcommittee, was also in consideration for the Ranking Member role but lost his reelection race. Senator Wicker (R-MS) is expected to chair the Senate Commerce Committee now that current Chairman John Thune (R-SD) has officially been elected Majority Whip. Senator Nelson (D-FL), current Ranking Member of the Commerce Committee, conceded in his close reelection race to Florida’s Republican Governor, Rick Scott. This means Senator Cantwell (D-WA) or Senator Klobuchar (D-MN), respectively, are next in line and most likely to hold the top Democratic spot on the Committee.

Shortly after the elections, Members of Congress and the Administration expressed hope that an infrastructure bill could be passed on a bipartisan basis early in the 116th Congress. Of course, the question of funding looms heavy. Congressman Earl Blumenauer (D-OR), a member of the House Ways & Means Committee, is championing the establishment of a new subcommittee within the Ways & Means Committee that would focus on infrastructure funding. Proposed to consider all types of infrastructure (including waste water, broadband, and transportation infrastructure, among other types), the Subcommittee would hold frequent hearings to hear from stakeholders as well as state and local officials about successful funding mechanisms. Congressman Blumenauer indicated that this Subcommittee would help to pave the way for an infrastructure bill that is fully funded.

With many Members of Congress, including potential future House Speaker Nancy Pelosi (D-CA), and Administration representatives indicating their interest in infrastructure investment, there is a possibility that the long-hoped for infrastructure investment package, outside of the normal surface transportation reauthorization process, could move through the 116th Congress. But with new Members needing to settle in to their offices, potential oversight hearings, and other logistical and political considerations, such a bill will still face challenges.

A number of states voted on transportation funding ballot initiatives during the mid-term elections. Overall, voters approved over $30 billion in new transportation funding. In Maine, voters passed a $106,000,000 bond issue. $101,000,000 of that will be used for “construction, reconstruction and rehabilitation of highways and bridges and for facilities and equipment related to ports, piers, harbors, marine transportation, freight and passenger railroads, aviation, transit and bicycle and pedestrian trails.” The funds will combine with federal and private funds to complete such projects. Hillsborough and Broward counties in Florida each passed a penny sales tax increase to fund infrastructure improvements. California voters maintained their 2017 gas tax increase by rejecting a measure that would have repealed it. Not all transportation ballot initiatives were successful however: Missouri and Colorado both rejected measures that would have increased funding for infrastructure projects.

Of the 36 gubernatorial races, 26 took place in states with Republican governors, nine Democrat, and one Independent. Following the elections, seven of the states flipped from Republican control to Democrat control and one state, Alaska, flipped from Independent to Republican. Newly elected governors in Colorado, Connecticut, Michigan, Minnesota, New York, and Oregon listed freight infrastructure as one of their top priorities.

USMCA: the Renegotiated NAFTA and its Path to Ratification

Mexican President Enrique Peña Nieto, U.S. President Donald Trump, and Canadian Prime Minister Justin Trudeau sign the USMCA.

After 13 months of heated trade negotiations among the three North American nations, the updated North American Free Trade Agreement (NAFTA), now referred to as the United States-Mexico-Canada (USMCA) agreement, was released on September 30, 2018. While the USMCA is similar to NAFTA, there are several key changes. In particular, modifications would impact the auto, agriculture, and intellectual property industries.  For imports to remain duty free, NAFTA required 62.5 percent of auto parts to originate in North America, the USMCA would gradually increase this percentage to 75 by 2023. Additionally, it would mandate 40 percent of a vehicle to be manufactured by employees earning at least $16 per hour. The USMCA also offers the U.S. increased access to Canada’s dairy market and eliminates a milk pricing policy that favored certain Canadian milk ingredients. Additionally, the agreement increases digital trade and intellectual property protections including copyright, trademarks, and patents.

Leaders of the U.S., Mexico, and Canada signed the USMCA at the G20 Summit on November 30, prior to Mexican president Peña Nieto leaving office on December 1. Complicating the agreement’s progress are the steel and aluminum tariffs the U.S. imposed on various allies earlier in 2018. The USMCA does not change the Section 232 tariffs on steel and aluminum, meaning they remain in effect on imports into the U.S. from Mexico and Canada. Leaders of both Canada and Mexico have indicated that they hope the USMCA will result in the elimination of the tariffs, which is why they were willing to sign the agreement prior to their removal with the hope the issue will be resolved soon.

Despite North American leaders having signed the agreement, the USMCA will not go into effect until it has been ratified by each country’s legislature. November’s U.S. midterm elections could add a layer of complication to the U.S. ratification process. Democrats, who will take control of the House of Representatives in January 2019, could leverage their new majority to attempt to change some USMCA provisions. These changes would likely center around increased environmental and labor protections, as well as ensuring enforcement across the board. Although some legislators are pushing for a Congressional vote during the lame-duck session, most sources predict the vote will likely be delayed until next year after the new Congress is sworn into office.

The freight industry has generally been supportive of the new agreement’s continuation of the trilateral North American relationship.  The American Trucking Associations and the Association of American Railroads both released statements applauding the renewed commitment to free trilateral trade.

For daily updates and more information on the USMCA agreement, follow @NAFTANEXT on Twitter.

PNCT Member Spotlight

Ports America – Industry Leader in Public Private Partnerships

Ports America is the largest independent U.S. terminal operator and stevedore, with operations in every major port in the nation. With more than 90 years of experience through predecessor companies, Ports America possesses dedicated resources that only a company of such scale and scope can deliver, including skilled personnel, robust training programs, best-in-class technology and experienced management.

Ports America handles close to 13 million twenty-foot-equivalent container units (TEU), 2.6 million vehicles, 10.5 million tons of general cargo and 1.5 million cruise passengers annually. With diversified port operations across all three U.S. coasts, Ports America offers a vast network of interconnected transportation solutions for customers.

Ports America is a leader in generating Public-Private Partnerships (PPP) in the U.S. maritime industry, merging private capital alongside commercial terminal operating expertise in partnership with public port authorities or local municipalities.

As part of a restructured long-term leasing agreement with the Port Authority of New York and New Jersey (PANYNJ), Port Newark Container Terminal (PNCT), a Ports America joint venture, is undergoing one of the largest privately funded transportation projects ever undertaken in the State of New Jersey. To date, PNCT, a multimodal container shipping facility, has made significant progress, already investing $310 million of a terminal lease requiring $500 million in investment by 2029, which will enable PNCT to occupy the facility until 2050.

PNCT is the highest-utilized terminal per acre in the PANYNJ, handling more than 1.5-million TEU annually and supporting nearly 10,000 jobs throughout the State of New Jersey. PNCT provides seamless freight movement capacity to access interior U.S. markets and more than 45 international destinations through its multimodal container terminal. The terminal maintains highly efficient truck access and a modern on-dock rail yard, which moves 25 percent of its container volume by rail. This rate is the highest level of rail utilization in the PANYNJ.

On completion, PNCT’s container cargo handling capacity will increase by 1-million additional TEU containers annually, generating significant economic growth for the Northeast region.

In 2014, PNCT combined a $14.8 million Transportation Investment Generating Economic Recovery (TIGER) grant with private investment by Ports America to begin extensive terminal upgrades, including its new state-of-the-art gate system, unveiled in July 2018. This new gate system increases the efficient flow of vehicles through the terminal and reduces truck turn times by 25 percent, thereby reducing emissions.

In December 2018, PNCT closed on $298 million in bonds facilitated by the New Jersey Economic Development Authority. These funds were used to refinance existing debt and to continue momentum toward financing future terminal development ahead of schedule. The expansion of the Panama Canal now allows post-Panamax container ships to travel to the East Coast. To ensure that the Port of New York/New Jersey was prepared to handle this new class of ultra-large container vessels (ULCVs), the PANYNJ elevated the Bayonne Bridge. ULCVs (9,500+ TEU) are able now to call at PANYNJ terminals, including PNCT.

Additionally, PNCT’s current Wharf Revitalization and Improvement Project will rebuild and upgrade an unstable, decommissioned wharf as well as upgrade an adjacent wharf that presently cannot accommodate ultra large container vessels.

The project will enable PNCT to handle two 14,000-TEU ULCVs at the same time. These improvements make PNCT a stronger competitor in the post-Panamax market.

By the end of 2018, improvements at PNCT will have increased the terminal’s capacity from 1.5 million TEU to 2 million TEU. Taking into account additional planned improvements, PNCT predicts that its capacity will increase to 2.3 million TEU by the end of 2019. In addition, PNCT will expand its terminal footprint by 17 percent to 309 acres. Additionally, PNCT improved its electrical, global positioning, WiFi equipment, and added four super-post-Panamax cranes this year.

An additional set of 20 new straddle carriers are set to arrive in December 2018.

Ports America and PNCT are proud to be a part of the Coalition for America’s Gateways and Trade Corridors (CAGTC), an important, valuable team of diverse organizations that are dedicated to promoting the seamless, efficient movement of goods to benefit BCOs, consumers and communities as well as advocating for increased federal investment in freight infrastructure.

Industry News

USDOT Publishes Automated Vehicles 3.0 Guidance

Preparing for the Future of Transportation: Automated Vehicles 3.0 (AV 3.0) builds upon Automated Driving Systems 2.0: A Vision for Safety (ADS 2.0). AV 3.0 expands the scope to all surface on-road transportation systems, and was developed through the input from a diverse set of stakeholder engagements, throughout the Nation. AV 3.0 is structured around three key areas:

1.  Advancing multi-modal safety,
2.  Reducing policy uncertainty, and
3.  Outlining a process for working with U.S. DOT

The U.S. DOT sees AV 3.0 as the beginning of a national discussion about the future of our on-road surface transportation system.

Read more here: https://bit.ly/2O7Dqre

Industry News

USDOT Streamlines Environmental Permitting Requirements

Accelerating project delivery has been a longstanding priority for the Department of Transportation (DOT) and is a key part of the most recent reauthorization for surface transportation programs—the Fixing America’s Surface Transportation (FAST) Act. The FAST Act includes a number of provisions intended to streamline the environmental review process for transportation projects. In particular, section 1313 of the act requires DOT to undertake several actions to align Federal environmental reviews such as developing a coordinated and concurrent environmental review and permitting process and a checklist to facilitate interagency collaboration. The FAST Act also directs the Office of Inspector General to report on DOT’s progress in implementing section 1313 and its associated impact. Accordingly, an audit was initiated to (1) determine DOT's progress in aligning Federal environmental reviews and (2) assess the impact of DOT's actions on accelerating the environmental review and permitting process.

Read the full report here: https://bit.ly/2TSJ0wC

Member News

Remembering Phil Trenary, Greater Memphis Chamber of Commerce President and CEO

Phil Trenary

Statement by the Greater Memphis Chamber of Commerce:

“We will forever grieve the loss of our leader and our friend, Chamber President & CEO Phil Trenary.

Phil worked every day to help Memphis reach its potential, and he made incredible strides in that effort over 21 years as a business leader and an active member of this community.

We grieve alongside each of you, but we are more committed than ever to lifting up this community and finding solutions to our challenges. There is no better way to honor Phil Trenary than to continue the work he did every day and to capitalize on the momentum he was instrumental in building for this city.

Together, we will continue moving Memphis forward in his honor.”

Read more about Phil’s legacy here: https://bit.ly/2S504hx

Member News

SCAG Appoints Interim Executive Director

Darin Chidsey

The Southern California Association of Governments (SCAG) announced on October 4 that they have appointed Darin Chidsey as their Interim Executive Director. Having served as Director of Strategy, Policy and Public Affairs, and most recently as the organization’s Chief Operating Officer, Chidsey has been with SCAG for 13 years. The position became vacant following the announcement of Hasan Ikhrata's new role as Executive Director of The San Diego Association of Governments (SANDAG) in September.

“We’re fortunate to have someone of Darin’s experience and qualifications to lead our extraordinary team during this critical period for SCAG and Southern California. His familiarity with SCAG, and the relationships he has established throughout our region, will ensure a seamless transition,” said Alan D. Wapner, SCAG’s President and Mayor pro Tem of Ontario, CA.

SCAG’s Regional Council has authorized an ad hoc committee to begin a formal search process.

Read the full release here: https://bit.ly/2qUUYcb

Research News

Grade Crossing Safety: DOT Should Evaluate Whether Program Provides States Flexibility to Address Ongoing Challenges

U.S. Government Accountability Office

November 8, 2018

Crashes at highway-rail grade crossings are one of the leading causes of railroad-related deaths. According to FRA data, in 2017, there were more than 2,100 crashes resulting in 273 fatalities. Since 2009 crashes have occurred at a fairly constant rate. The federal government provides states funding to improve grade-crossing safety through FHWA’s Section 130 Program. The persistence of crashes and deaths raises questions about the effectiveness of the federal grade-crossing-safety program.

GAO was asked to review federal efforts to improve grade-crossing safety. This report examines: (1) the focus of FRA’s grade-crossing-safety research, (2) how states select and implement grade-crossing projects and what data are available from FRA to inform their decisions, and (3) the challenges states reported in implementing and assessing projects and the extent to which FHWA assesses the program’s effectiveness. GAO analyzed FRA data; reviewed FRA’s, FHWA’s, and states’ documents; reviewed a study of states’ selection of projects; and interviewed FRA and FHWA headquarters and field staff, and officials from a nongeneralizable sample of eight states, selected to include a mix in the number of grade crossings and crashes, and geographic diversity.

Read the full report here: https://bit.ly/2BA8c3U

Research News

21st Century Border Action Plan

North American Strategy for Competitiveness and Business Council of Canada

October 16, 2018

A report released by North American Strategy for Competitiveness (NASCO), in partnership with the Business Council of Canada, urges regulators on both sides of the Canada-US border to implement a number of measures to streamline North American supply chains and boost competitiveness.

The 21st century border action plan includes recommendations such as the harmonization of policies to allow access to expedited lanes for low risk traders, using Radio Frequency Identification (RFID) to quickly move trucks into Canada, and ensuring all lanes at the busiest ports of entry are always staffed. These measures would make a significant difference for cross-border trades and could be implemented immediately.

Read the report here: https://bit.ly/2Sdb6kE