Port Capacity Issues and Solutions in the United States

1. Port Capacity Issues and Solutions in theUnited States 4th Africa Transportation Technology Conference Michael J. Gordon Sr. Program Manager Office of Marine Highways and Passenger Service U.S. Department of Transportation Maritime Administration August 27, 2009

2. Balancing Capacity and Demand Capacity Demand

3. Background

4. U.S. Surface Transportation Modes • Highways • Federal Aid Highway Act of 1956 established Interstate System originally 43,000 km today 80,000 km • Total of paved roads in the U.S. 4,800,000 km • Railroads • First railroads in U.S. established in the 1810 timeframe • Peak of 320,000 km - Today 220,000 km • Deregulated 1980 • Waterways • 40,000 km of rivers, coastal and Great Lakes waterways • Series of locks and dams on the river system dating to 1830 • Army Corps of Engineers responsible for dredging

5. U.S. Port System • The U.S. has over 300 ports and terminal/ 150 primary. • Ports are typically legislatively created districts. (ex. Baltimore and South Carolina are state port authorities). • Port authorities develop, manage and promote waterborne commerce and act as catalysts for economic growth. • Port authority activities may also include airports, bridges, tunnels, rail systems, inland river or shallow-draft barge terminals, industrial parks, Foreign Trade Zones, trade centers, terminal or short-line railroads, shipyards, dredging, marinas, and various public recreational facilities.

6. The Marine Transportation System (MTS) • Channels, gateway ports, near-port connectors & interstate corridors that move our freight and passengers. • International Trade depends on ports and waterways. • U.S. international trade and gross domestic product are directly proportional.

7. Issues

8. U.S. Surface Transportation System is Facing Serious Challenges • Existing Landside Congestion & Bottlenecks: • Congestion costs $200 Billion each year and climbing. • 2.3 billion gallons of fuel and 3.7 billion hours each year. • Slows freight, reduces reliability and increases cost. • Transportation Routes and Trends are changing: • Panama Canal Expansion • Ships are getting larger and deeper • Manufacturing centers are now in China and India • Environmental & community issues affect freight choices • Energy costs are rising

9. Major Freight Truck Bottlenecks

10. North American Rail Network(Bottlenecks & Congestion Areas)

11. Port Regulation and Governance • 18 Federal Agencies Play a Role in Maritime Arena • Dredging • Regulation • Environmental • Role of the CMTS • State and Local Government Roles • State DOT • County, City, MPOs • Ports and the Private Sector • Landlord/tenant • Owner/operator

12. Funding Issues • Declining Federal Fund Sources • Competing demands for funds • Slowdown of Federal revenue intake • Declining States and Local Revenue Sources • Recession has cut tax sources • Public/Private Partnership Funding Issues • Financial crisis has dried up credit markets • Obstacles to PPP • Legal issues • Scarcity of capital

13. Environmental and Community Issues • Competing community need issues • Port versus recreation uses • Jobs versus housing issues • Environmental Concerns • Natural environment versus created environment • Reclaiming port land for parks and recreation

14. Port Growth and Decline Overview • Recent and Future Increase in Intermodal Cargo • Highway and Rail Challenges • Obstacles to Port Infrastructure Development • Time to Build • Cost • Permitting • Land Use • Intermodal Road and Rail Links • Recession has caused a decline in West Coast container port throughput of 21%

15. Solutions

16. We Need to Change Our Approach Because We Have Become Landside Dependent The Marine Transportation System WATER ACCESS PORTS INTERSTATE CORRIDORS (Surface Transportation) Highways & Transit Maintenance Near-Port Connectors Deepening Railroads Navigation Marine Highways

17. America’s Marine Highway • U.S. has 40,000 km of under-utilized navigable waterways • The Marine Highway can provide relief to landside congestion • The 2007 EnergyBill establishes aMarine Highwayprogram

18. Technology Solutions • Productivity & Efficiency: • Optical Character Recognition • Electronic Seals • Global Positioning inside and outside marine terminals • Gate System Automation • Improved Business Management Practices • Equipment and highly polluting engine technology to be replaced with more modern and environmentally sound equipment

19. Funding Solutions • Develop incentives for public-private partnerships for marine transportation system projects • Develop Federal grant programs for port infrastructure improvements and marine highways • Encourage State and Port Authorities to invest in port infrastructure needs of their marine terminal partners

20. Regulatory Solutions • Streamlined environmental processes support the development of infrastructure to increase capacity • Consolidation of Federal Agency requirements to expedite port needs • Use tax and other incentives to encourage investments in terminals, equipment and maintenance

21. Environmental and Community Solutions • Reclaim polluted areas for port purposes • Educate local population about job growth and retention • Encourage use of buffer zones between port and community areas • Modernize port areas to reduce traffic congestion and increase productivity

22. End