In this issue:
The Trade Corridor Bulletin
Volume 15 – No. 2 | January 2021
117th Congress Ushers in Several Leadership Changes on Transportation Committees
By: CAGTC Staff
On November 3, 2020, elections were held for all 435 seats in the U.S. House of Representatives and 35 in the U.S. Senate. Democrats held onto their majority in the House by securing 222 seats, however, Republicans narrowed the margin by winning 211. Two House seats remain vacant. One was held by Louisiana Republican Luke Letlow, who died due to complications from COVID-19 on December 30. The second seat is in New York, where tight election results are currently moving through the court system in a race between Democratic incumbent Anthony Brindisi and his Republican challenger Claudia Tenney, who held the seat immediately before Brindisi.
Following two runoff elections in Georgia on January 5, the previously Republican-led Senate will now be split evenly between the two parties. Vice President-elect Harris will have the tie-breaking vote, giving Democrats narrow control of both legislative chambers. The election results will lead to significant leadership changes within the 117th Congress, particularly in the Senate. However, a few additional steps are necessary before the Senate can designate new Democratic committee chairs and finalize committee assignments. Due to Vice President-elect Harris’ resignation from the Senate, Democrats won’t officially hold the majority until her replacement, Alex Padilla (D-CA), and Georgia’s two newly elected Senators are seated on January 20.
Among the committees with jurisdiction over transportation policy, now-Ranking Member Maria Cantwell (D-WA) is expected to become Chair of the Senate Committee on Commerce, Science, and Transportation. Current Commerce Committee Chair Roger Wicker (R-MS) will trade in his gavel to serve as the committee’s top Republican. The Senate Environment and Public Works (EPW) Committee will likely be led by its current Ranking Member Tom Carper (D-DE). A spokesperson for Senator Carper noted that as Senate EPW Chairman, one of his top priorities would include supporting his former Senate colleague from the First State, President-elect Biden, to implement the Build Back Better infrastructure agenda. Senator Shelley Moore Capito (R-WV) is expected to be the next EPW Ranking Member.
House committee leaders will remain largely the same as in the 116th Congress, though one notable exception is the Appropriations Committee, which will be chaired by Congresswoman Rosa DeLauro (D-CT) following the retirement of Congresswoman Nita Lowey (D-NY). Congressman Peter DeFazio (D-OR) will continue to serve as Chair of the Transportation and Infrastructure (T&I) Committee. While subcommittee chairs have not yet been announced, Congressman Donald Payne (D-NJ) has expressed interest in succeeding Chairman Daniel Lipinski (D-IL), who was defeated in the 2020 primaries, as head of the T&I Subcommittee on Railroads, Pipelines, and Hazardous Materials.
End-of-Year Package Combines FY21 Appropriations, $900 Billion in COVID Relief and Other Significant Legislation
By: CAGTC Staff
After a renewed focus on emergency COVID-19 relief delayed lawmakers’ efforts to finalize fiscal year 2021 appropriations, resulting in several stopgap funding measures, Congress ultimately passed a large end-of-year package on December 21. The legislation, which includes the FY21 appropriations omnibus, COVID-19 aid, tax extenders, and several other individual measures, was signed into law by President Trump on December 27.
The FY21 appropriations omnibus provides approximately $25 billion in discretionary funding for the U.S. Department of Transportation (USDOT) through September 30, 2021. The Better Utilizing Investments to Leverage Development (BUILD) program will receive $1 billion in total funding. Consistent with previous years, funding must be split evenly between projects in urban and rural areas and USDOT is directed to use the selection criteria from the FY17 BUILD notice of funding opportunity. Of the total $1 billion, $30 million is reserved for planning grants and USDOT may utilize up to $20 million for program oversight activities. Now in its third year, the Port Infrastructure Development Grant Program will receive a $5 million increase over FY20 levels for a total of $230 million in FY21 funds. Of this total, the bill reserves $205 million for projects at coastal seaports or Great Lakes ports. The Consolidated Rail Infrastructure and Safety Improvements (CRISI) program received a funding boost of $50 million over FY20 levels. This year’s appropriations package provides a total of $375 million for CRISI grants with a set-aside of $75 million directed toward intercity passenger rail improvements and $25 million reserved for projects to prevent trespassing.
The COVID-19 emergency relief measures provide approximately $900 billion in total funding, including $45 billion for select transportation entities distributed as follows: $16 billion for passenger air carriers and air carrier contractors, $14 billion for mass transit; $10 billion for state departments of transportation; $2 billion for airports and airport concessionaries; $2 billion for bus companies; and $1 billion for Amtrak. Although earlier drafts contained additional general-purpose funding for state and local governments, it was not included in the final package. The bill did, however, extend the deadline for state and local governments to spend funding received under the CARES Act to December 31, 2021.
The bill also contains extensions of various tax provisions and credits. Included is a provision to make permanent the short line railroad tax credit under section 45G of the Internal Revenue Code. The tax credit will maintain its current rate of 50 percent through December 2022 and decrease to 40 percent thereafter.
Congress also incorporated the Water Resources Development Act (WRDA) of 2020 into the omnibus package. The two-year WRDA bill contains a provision excluding certain appropriations of the Harbor Maintenance Trust Fund (HMTF) from budgetary spending caps, allowing Congress to gradually spend down the current HMTF balance of approximately $9 billion. Each year, the exclusion will apply to the full amount of HMTF deposits collected two years prior as well as an annual spend-down amount beginning at $550 million in FY21. This amount will increase by $100 million annually through FY30 at which time the existing HMTF balance will have been fully appropriated toward harbor maintenance and dredging projects.
Pete Buttigieg Named Biden's Nominee for Secretary of Transportation
By: CAGTC Staff
President-elect Biden has selected former South Bend, Indiana mayor and 2020 Democratic presidential candidate Pete Buttigieg as his nominee for U.S. Secretary of Transportation. If confirmed as transportation secretary, Buttigieg will not only be tasked with executing Biden’s Build Back Better plan, but also with crafting a surface transportation authorization proposal ahead of the FAST Act’s expiration on September 30, 2021. In his remarks at the official announcement, Buttigieg spoke about the historic opportunity to lead the U.S. Department of Transportation (USDOT) toward policies “that will create jobs, rise to the climate challenge, and equitably serve all Americans — all while continuing to ensure the safety of travelers and workers alike.”
At age 38, Buttigieg is the youngest person to have been nominated for the Secretary of Transportation position and, if confirmed, would be one of the youngest cabinet members in history. As a former presidential candidate, he also has nationwide name recognition—a relatively rare feature for an incoming transportation secretary. These factors could raise the USDOT’s profile under the Biden Administration, increasing awareness of and interest in the Department’s activities. Buttigieg has already discussed plans for an infrastructure bill and transportation aid in future COVID-19 relief legislation with several Senate Democrats, including incoming Majority Leader Chuck Schumer (D-NY) and Senator Tom Carper (D-DE), who is expected to lead the Committee on Environment and Public Works.
While mayor of South Bend, Buttigieg ushered in transportation safety reforms and accepted two awards from USDOT through its Mayors’ Challenge for Safer People, Safer Streets initiative for the city’s Smart Street adoption. During his bid to become the Democratic presidential nominee, Buttigieg introduced his $1 trillion infrastructure plan calling for investments in clean energy as well as cutting the backlog of road and bridge repairs in half over the next 10 years. His plan also suggested doubling the Better Utilizing Investments to Leverage Development (BUILD) program to $2 billion annually, adopting a user fee system, such as vehicle miles traveled (VMT), to achieve Highway Trust Fund solvency, and immediately finalizing the National Multimodal Freight Network.
On January 7, USDOT Secretary Chao announced her resignation and extended an offer to assist Secretary-designate Buttigieg as he prepares to lead the Department. Steven Bradbury, previously USDOT’s General Counsel, assumed the position of Acting Secretary.
To assist Secretary-designate Buttigieg during his work at USDOT, President-elect Biden has nominated Polly Trottenberg to be Deputy Secretary of Transportation. Before serving as New York City’s Transportation Commissioner from 2014-2020, Trottenberg held the positions of Assistant Secretary for Transportation Policy and Under Secretary for Policy at USDOT under the Obama Administration. Her extensive experience also includes 12 years on Capitol Hill, where she worked on transportation policy in Senator Schumer’s office, among others.
Both the Secretary and Deputy Secretary of Transportation are positions that require Senate confirmation. The Senate Commerce, Science, and Transportation Committee has scheduled a hearing to consider Pete Buttigieg’s nomination on January 21. If approved by the committee, the nomination will proceed to the full Senate for confirmation. Polly Trottenberg’s nomination hearing has not yet been announced.
Statement by Executive Director Elaine Nessle: Freight Advocacy Coalition Congratulates Secretary-designate Pete Buttigieg on Nomination to Lead USDOT
The Coalition for America’s Gateways and Trade Corridors (CAGTC) commended President-elect Biden on his nomination of Pete Buttigieg to lead the U.S. Department of Transportation (USDOT). “Secretary-designate Buttigieg’s experience developing infrastructure projects at the local level will lend important perspective to policy and programming decisions made in Washington. The former South Bend, Indiana mayor’s national reputation will elevate the country’s infrastructure dialogue and aid in the advancement of an infrastructure-based economic recovery,” said Elaine Nessle, Executive Director of the Coalition. “Secretary-designate Buttigieg will be leading USDOT at an exciting time. Not only will he be an architect of President-elect Biden’s Build Back Better plan, but he will also have the opportunity to develop a surface transportation authorization proposal in advance of the FAST Act’s September 30, 2021 expiration. Robust federal investment in supply chain infrastructure should be the hallmark of both plans.”
“The COVID-19 pandemic has heightened awareness of our national supply chain’s critical function. Unique from other types of infrastructure investment, investment in the nation’s multimodal freight network is an economic multiplier. Not only are jobs created immediately in the construction phase, but an efficient goods movement system will attract and retain U.S. businesses and benefit the economy for years to come. CAGTC stands ready to assist the new Administration and looks forward to working with the 117th Congress to prioritize investment in our multimodal goods movement system. As our nation charts a path for economic recovery, much will be asked of our multimodal freight system. Sustained, dedicated investment in critical supply chain infrastructure will support our return to prosperity.”
USDOT Launches New Regional Infrastructure Accelerators Program
The U.S. Department of Transportation (USDOT) on December 16 launched a new demonstration program to establish several Regional Infrastructure Accelerators (Accelerators), which will expedite delivery of transportation infrastructure projects through innovative finance and delivery methods. The Department’s Build America Bureau issued a Notice of Funding Opportunity to solicit applications to designate Accelerators that will serve defined geographic areas, act as a resource to qualified entities within the designated areas, and demonstrate the effectiveness of these Accelerators to expedite the delivery of eligible projects through Federal credit assistance programs, including Transportation Infrastructure Finance and Innovation Act (TIFIA) and other innovative financing methods. A total of $5 million is available for the program.
“These Regional Infrastructure Accelerators will deliver projects more quickly to local communities through innovative financing methods,” said U.S. Transportation Secretary Elaine L. Chao.
The Accelerators will assist project sponsors in project planning, evaluating innovative financing options, accessing technical assistance and best practices, and developing a pipeline of projects ready for investment.
Read the full release here.
FRA Announces Landmark Achievement with Full Implementation of Positive Train Control
On December 29, the U.S. Department of Transportation’s (USDOT) Federal Railroad Administration (FRA) announced that positive train control (PTC) technology is in operation on all 57,536 required freight and passenger railroad route miles, prior to the statutory deadline of December 31, 2020, set by Congress. In addition, as required, FRA has certified that each host railroad’s PTC system complies with the technical requirements for PTC systems. Furthermore, railroads have reported that interoperability has been achieved between each applicable host and tenant railroad that operates on PTC-governed main lines.
“Achieving 100 percent PTC implementation is a tremendous accomplishment and reflects the Department’s top priorities – safety, innovation, and infrastructure,” said U.S. Transportation Secretary Elaine L. Chao.
PTC systems are designed to prevent train-to-train collisions, over-speed derailments, incursions into established work zones, and movements of trains through switches left in the wrong position. The December 29 announcement is the culmination of over a decade of sustained and direct engagement and collaboration among FRA and the 41 railroads subject to the statutory mandate, including seven Class I railroads, Amtrak, 28 commuter railroads, and 5 other freight railroads that host regularly scheduled intercity or commuter rail passenger service. This accomplishment encompasses thousands of hours of testing and deployment, innovative technological solutions, and a tremendous amount of coordination among nearly 100 host and tenant railroads, railroad associations, material suppliers, and service providers.
Read the full release here.
FDOT Macroeconomic Analysis Shows Transportation Projects Yield $4 of Benefits for Every Dollar Invested
The Florida Department of Transportation (FDOT) recently completed a macroeconomic analysis and found that Florida’s transportation projects are expected to yield an average $4 of benefits for every dollar invested. In addition, the analysis found the benefits included investments across all transportation modes, including highway, transit, rail, airports, seaports and waterways, and spaceports. The investments will provide short- and long-term benefits for transportation system users as well as Florida’s overall economy.
“Investing in transportation is key as we plan for our state’s future,” said Florida Department of Transportation Secretary Kevin J. Thibault, P.E. “The department is proud to make vital investments in Florida’s transportation system that will create essential jobs, provide long-term economic benefits, and keep Florida moving for decades to come.”
In addition to the impressive economic benefits, it is estimated that planned transportation investments will result in an average of 30,000 additional jobs and generate more than $160 billion in future economic benefits over the course of the next 30 years, including:
• Providing $61 billion in economic value, measured as gross state product;
• Increasing personal outcome by $72 billion; and
• Increasing industry output by $99 billion.
Read the full release here.
OCTA Adapts, Overcomes Pandemic Challenges to Deliver Successfully on 2020 Initiatives
Throughout 2020, the Orange County Transportation Authority (OCTA) adapted and pushed through the many unprecedented challenges of the coronavirus (COVID-19) pandemic to continue keeping its promises to deliver a balanced and sustainable transportation network for Orange County.
“As an organization we worked diligently to proactively address the unprecedented challenges of this public health crisis,” said OCTA Chairman Steve Jones, also the Mayor of Garden Grove. “I’m proud of OCTA staff and our Board of Directors for accomplishing so much toward providing essential transportation improvements and services for Orange County.”
Accomplishments included advancing projects promised to voters through Measure M, Orange County’s half-cent sales tax for transportation improvements. Among them are important freeway improvements on I-405, continuing to make improvements on I-5 in South County, and completing the I-5 Central County Improvements Project – four months ahead of schedule.
Other notable accomplishments included continuing to build the OC Streetcar in Santa Ana and Garden Grove, funding street improvements and enhancing the OC Bus system.
OCTA also took strong steps forward with zero-emission bus efforts, debuting the largest transit-oriented hydrogen fueling station in the nation and approving a separate pilot program for 10 plug-in electric buses.
Read the full release here.
Port Canaveral has received the U.S. Coast Guard’s 2020 Rear Admiral Richard E. Bennis Award for maritime security excellence. The Port received notification of the award from Admiral Karl L. Schultz, the Commandant of the United States Coast Guard. Port Canaveral was selected as the national Port Authority recipient “for demonstrating the industry’s overall commitment to maritime security and safeguarding the nation’s vital Marine Transportation System.”
“This is an exceptional honor for our Port and outstanding recognition of our collective efforts to ensure the safety and security of our Port and extended community,” said Port CEO Capt. John Murray. “I am immensely proud of Barry Compagnoni, and the entire port safety and security team who are dedicated to our mission to protect our people and assets.”
The prestigious Rear Admiral Richard E. Bennis Award is presented biennially by the Coast Guard to recognize outstanding maritime security achievements and contributions made by U.S. maritime organizations with regards to implementing the federal Maritime Transportation Security Act requirements and other best practices in safeguarding the nation’s Marine Transportation System. Several applicants representing a wide range of maritime organizations and port authorities nationwide competed for selection in one of three categories – Port Authority, Large Facility, and Large Company. The Coast Guard review committee evaluated all submissions in multiple categories, including “how the organization leads, develops, promotes and/or engages via maritime leadership and partnership activities to enhance Maritime Domain Awareness and share information with local, state, and federal agencies and other commercial entities.”
Read the full release here.
Failure to Act: Economic Impacts of Status Quo Investment Across Infrastructure Systems
American Society of Civil Engineers
This report quantifies how the persistent failure to invest in our aging infrastructure impacts the economy, including GDP, jobs, personal disposable income, and business sales.
ASCE finds that with an increased investment of $281 billion a year — $5.48 more per household a day — the U.S. can eliminate this drag on the economy, protecting by 2039:
- $10 trillion in GDP, nearly half of the annual U.S. GDP in 2019
- More than $23 trillion in total output (primarily business sales)
- More than 3 million jobs in 2039, two times the number of Walmart employees in the U.S.
- More than $3,300 in a family’s annual disposable income each year from 2020 to 2039, which is over half of the average American’s household’s monthly expenditure of $5,102.
Read the full report here.
The Importance of Highways to U.S. Agriculture
U.S. Department of Agriculture
Nearly all agricultural products travel by highway for at least a portion of their journey. In many cases, the country’s highways provide critical “first and last mile” transportation connections to higher-capacity transportation modes such as rail, barge, and ocean vessel, and for many products requiring long distance transportation.
This report’s analysis of agricultural commodity flows shows that 80% of domestic agricultural commodities travel on 17% of the U.S. highway mileage. These “High-Volume Domestic Agriculture Highways” (HDAH) are important to U.S. farmers, the agriculture industry, and downstream producers. This report utilizes a novel analysis technique to combine and geo-reference public and proprietary data sets to project future roadway conditions and model proposed projects to help anticipate benefits on 17 HDAH corridors. In addition, the study uses key stakeholder input from state Departments of Transportation to analyze and quantify selected performance challenges that domestic agricultural shippers encounter. These challenges include optimal commodity flows, safety, congestion, infrastructure condition, and roadway reliability. The study’s findings show that state-planned highway freight investments are estimated to produce $540 million per year in truck operating cost savings. If highway infrastructure investment is increased, at a level 2-4 times current state freight plan investment levels, the study finds these investments will still be highly cost-effective.
Read the full report here.
Reforming Surface Transportation for Long-Term Sustainability
Competitive Enterprise Institute
For more than a decade, the federal Highway Trust Fund has disbursed outlays in excess of dedicated fuel tax and other user tax revenue, leading to a cumulative $141 billion taxpayer-funded bailout by Congress, paid with general revenue funds even after leveraging. This increasingly unsustainable status quo threatens the long-term maintenance of the national highway network going forward, especially given the uncertain long-term viability of highway funding dominated by fuel tax revenue in a possible future of partial electrification of the nation’s vehicle fleet.
To provide actionable recommendations for federal policy, this paper analyzes how projects could be throttled for true resource efficiency in contexts from rural intercity travel to urban daily commuting. The recommendations suggest a middle ground between greater general fund spending and new widespread tolls in a political environment built on expectations of public subsidy.
Read the full report here.