ANALYSIS: You can't talk freight efficiency without good roads and bridges

By David Tanner, Land Line associate editor | 4/26/2013

Larger cargo ships are coming to U.S. ports in the near future, but how will the roads, bridges and railways hold up to move the freight?

The House Transportation and Infrastructure Committee’s Panel on 21st Century Freight Transportation heard from large shippers, carriers and ports on that and other topics during its first hearing Wednesday, April 24, on Capitol Hill.

One thing is clear to everyone in the chain, and that is without improvements to infrastructure, those who move freight will continue to face congestion, deficient bridges and other challenges.

Small-business truckers were not represented at the first hearing, but will certainly be supplying input to the discussion for future hearings.

The president and chief operating officer for Werner Enterprises, Derek Leathers, was invited to testify on behalf of carriers. He said trucks are “crucial” to all freight movement, even the goods that move most of their miles by rail, air, and water.

“The highway system connects all of these modes to manufacturing and assembly plants, warehouses, retail outlets, and homes,” he said. “An efficient highway system is the key to a fluid global supply chain, which in turn is a fundamental element of a growing and prosperous economy.”

Also testifying were Norfolk Southern Corp. President Charles Moorman, South Carolina State Ports Authority President James Newsome, FedEx Corp. President Frederick Smith, and AFL-CIO President of Transportation and Trades Edward Wytkind.

Each discussed the importance of deeper ports and the expansion project at the Panama Canal that will allow larger ships to pass through.

Addressing port expansion may be good for the ports, but inland roads need to be able to handle the needs of the freight system.

Small-business truckers as well as the large carriers know the challenges of traffic congestion, bottlenecks, detours and deficient bridges. As some lawmakers pointed out, there are also issues with truck parking, hours of service, and the uncompensated detention time truckers face at the shipping docks. Those issues are huge to OOIDA members.

“You can address problems with truck movement or rail movement at a port in Long Beach, but you still have to deal with congestion in Chicago,” said Ryan Bowley of OOIDA’s Washington, DC, office. “Those are realities that truckers see every single day.”

A recent report by the U.S. Congressional Budget Office says the Highway Trust Fund, which funds roads, bridges and transit as well as federal transportation and safety programs from fuel taxes and other user fees, faces a $100 billion deficit over the next decade due to increased costs and a tapering off of receipts.

“That means serious consequences for truckers and others in the future,” Bowley said. “The very foundation of our economic success is going to have significant issues if we don’t address that challenge.”

Congress has embarked on finding new transportation funding once the current highway bill, Moving Ahead for Progress in the 21st Century, or MAP-21, expires in the fall of 2014. That journey has taken a back seat in recent weeks as Congress deals gun control and immigration reform.

Infrastructure issues will not be going away anytime soon.

The Government Accountability Office says the average motorist driving a sedan currently pays about $95 into the Highway Trust Fund from the 18.4 cent gas tax.

On the other hand, a trucker that buys 20,000 gallons of fuel a year pays $4,880 in diesel taxes.

That trucker also pays a $550 Heavy Vehicle Use Tax each year. If that trucker buys 12 tires, that’s another $340 in tire taxes. The purchase of a new truck could put another $14,400 into the Highway Trust Fund due to the 12 percent excise tax on heavy equipment. A new van trailer might contribute another $3,000 into the fund due to the excise tax.

Truck tolls and taxes are already funding things other than highways, bridges and transit, especially at the state level. New York, for example, collects tolls on the New York State Thruway and uses the money to fund the canal system and economic development, including the World Trade Center site.

Small-business truckers have a lot at stake as their costs go up, and OOIDA plans to be at the table for discussions about freight movement, cost and regulations affecting the trucking community.

“It set the stage for the issues the panel is going to explore,” Bowley said. “Not surprising, some of our long-standing issues were raised as well. … But at this point, we’re excited about the committee putting a laser focus on the freight issue.”

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