Realize America's Maritime Promise
Harbor Maintenance Trust Fund Fairness Coalition
RAMP is a coalition of maritime companies formed to seek a legislative fix to the maintenance dredging crisis facing the nations ports and waterways. The crisis is such that our shipping channels are being neglected and continue to offer much less service than they are intended to. Ironically, Federal taxes are being collected to pay for this overdue maintenance dredging yet only half of what is collected is being spent for its intended purpose. RAMP seeks to emphasize and remind Congress about the importance of the maritime infrastructure to the US economy and seek legislation that will make sure our shipping channels are maintained as intended. Given the fact that a taxing mechanism and revenue stream already exist for this purpose, our plan is to mobilize the U.S. maritime community to make sure that these tax collections are spent as they were intended, on Maintenance Dredging!!!!!!
The Harbor Maintenance Trust Fund and its Harbor Maintenance Tax were authorized in the Water Resources Development Act of 1986. The purpose of the Tax, a 0.125% ad valorem tax levied on cargo imported or domestically moved through Federally maintained channels and harbors, is to pay for Army Corps of Engineers operations and maintenance of these ports and harbors. The Tax is collected by the Bureau of Customs and Border Protection and directed to the Trust Fund. However, the monies are not immediately eligible for dredging activities. Those monies can only be spent if the funding is actually appropriated by Congress. In Fiscal Year 2008, the tax revenues collected amounted to $1.6 billion, yet only $766 million was actually allowed to be used by the Corps.
The Harbor Maintenance Trust Fund ("the Trust Fund") and its Harbor Maintenance Tax ("the Tax") were authorized in the Water Resources Development Act of 1986, P.L. 99-662. The purpose of the Tax, a 0.125% ad valorem tax levied on cargo imported or domestically moved through Federally maintained channels and harbors, is to pay for Army Corps of Engineers operations and maintenance dredging. The Tax is collected by the Bureau of Customs and Border Protection and directed to the Trust Fund. However, the monies are not immediately eligible for dredging activities. Those monies can only be spent if the funding is actually appropriated by Congress.
The problem with the Trust Fund is that far more money is being collected from shippers under the Tax than is actually being spent on dredging projects. In a typical recent year, for example, the Trust Fund collected $1.3 billion but spent between $700 and $800 million. The under-spending problem is so acute that the Trust Fund now has a surplus of more than $4.7 billion. As such, a significant portion of the Tax revenue is not being used for its intended purpose. Those funds that are collected but not spent on dredging are being held "on the books" for the apparent sole purpose of reducing the size of the Federal debt and deficit.
Unfortunately, this under-spending comes at a time when there is a desperate need for additional Federal operations and maintenance dredging. The U.S. Department of Transportation estimates that world trade, the vast majority of which is transported by ship, will double in the next 20 years. Ships have become bigger, requiring more sustained dredging. Some regions in the United States have maintenance dredging backlogs totaling hundreds of millions of dollars, backlogs that impact both commercial efficiencies and military readiness. One recent publication summarized the situation with the headline, "Waterway Dredging Runs Aground."
The Proposed Solution
A national coalition of shipping companies, shippers, labor organizations, dredging contractors, ports and other waterway users ("the Coalition") has come together in an effort to address the inherent unfairness of a system that collects revenues but does not use them for their intended purpose. The Coalition proposes an approach similar to that taken recently with the Highway Trust Fund and the Airport and Airway Trust Fund, where the Congress legislatively enacted "firewalls" around them guaranteeing minimum levels of spending that could only be used to support eligible projects. The Coalition also proposes to follow the precedents set in the Highway Trust Fund and Airport and Airway Trust Fund initiatives by including a funding mechanism to ensure revenues into the Trust Fund are expended on an ongoing basis. Such an approach with the Trust Fund would ensure that monies from the Tax would be used for their intended purpose of dredging and not merely for deficit reduction.