John Porcari, the Biden-Harris Administration’s Port Envoy, warned that long-standing shortfalls in U.S. infrastructure spending going back generations have created a reliance on an infrastructure “that our grandparents built.”
Porcari told an International Propeller Club of the United States audience via Zoom that a series of measures including $17 Billion in infrastructure bill funds for ports are part of the Biden Administration’s initiatives to reduce port congestion and supply chain disruptions.
In a White House briefing on January 5th Porcari stated:
“With the passage of the Bipartisan Infrastructure Law, some of the physical infrastructure upgrades to infrastructure that was built by your parents and grandparents can actually be updated through that infrastructure program.
When bottlenecks emerge in the global supply chain, it can take more time for goods to reach store shelves, which can lead to price increases. That’s why the President has taken such aggressive action to alleviate these blockages, and we’ve seen significant progress.”
In his address to the Propeller Club on January 11th, Porcari noted:
- $17 Billion for U.S. ports. The Bipartisan Infrastructure Law will help ports improve operations. He said the emphasis would be on port operations, cargo handling, upgrades to trucking and improving connections to rail service.
- Increased funding for U.S. Army Corps of Engineering is needed. The funding is needed to support increased dredging for channel deepening and widening for coastal and inland ports.
- More investment in inland ports is necessary. The investment in inland river ports and for ports along the Great Lakes is necessary as these ports act as conduits for more imports and exports.
- The Port Infrastructure Development Program (PIDP). PIDP can be a source of grant funding for port projects. New eligibility criteria will soon be announced. The Administration will reduce delays from the time grants are approved and funding provided. In December 2021, the U.S. Maritime Administration announced, “the award of more than $241 million in discretionary grant funding for 25 projects to improve port facilities in 19 states and one territory through the Maritime Administration’s (MARAD) Port Infrastructure Development Program (PIDP).”
- The Transportation Infrastructure Finance and Innovation Act (TIFIA). TIFIA provides credit assistance for qualified projects of regional and national significance, that includes highway, transit, railroad, intermodal freight, and port access projects. Eligible applicants include state and local governments, transit agencies, railroad companies, special authorities, special districts, and private entities. Porcari noted that loan repayments for up to a 35-year repayment period are available. The Bipartisan Infrastructure Law allows up to 75 years for some projects, according to the U.S. Department of Transportation.
- Improving intermodal rail systems. There needs to be ways to “improve the handoff from maritime to rail.” The Class I railroads inland rail capacity needs improvement: “We shouldn’t have a couple of rail centers in Illinois and other places that can actually bring the whole system to its knees.”
- Increase inland rail/truck transfer sites. The increase of inland so-called ‘pop-up sites’ such as those connecting Georgia’s Port of Savannah are helping to relieve rail congestion at ports: “an intermodal transfer from rail to truck helps both imports and exports…and it’s a good way to create flex capacity.”
- Rail service interruptions. Porcari was asked about U.S. railroads’ use of service stoppages in 2021 to reduce the overload on its operations. He responded: “We have seen some breakdowns and fault lines in our intermodal system. Class I railroads and short lines have had interruptions in service. We need to take a more intermodal approach… We need to take a systems approach.”
- Vital work was performed by longshore and harbor workers during the pandemic. The vital front-line work that longshore and harbor workers performed loading and unloading vessels at ports in the face of the pandemic needs to be recognized. To address increased cargo demands, longshore operations need to be upgraded with more worker training and by increased automation that can streamline operations and provide new jobs for workers. Porcari expressed the hope that West Coast longshore contract negotiations in 2022 between the Pacific Maritime Association and the International Longshore and Warehouse Union (ILWU) will proceed “as smoothly as possible.”
- The Ports of Los Angeles and Long Beach. The two California ports have been able to move more import containers off the docks to ease the traffic jam of ships waiting to unload: “We also worked with the ports to propose fees on ocean carriers that were leaving import containers at the ports in Los Angeles and Long Beach for too long. This (proposed) fee has helped lead to a 40 percent reduction in long-dwelling containers at those two ports.” He noted that sweeper ships are coming in to pick up empty containers and transport them back to Asia and Europe freeing up some space at the ports, but he added that “some carriers are moving more empty containers than others.” New initiatives to address the empty container problem will be announced in the next thirty days, he said.
- Limited ocean carrier container space for U.S. exporters. The Biden Administration is aware of problems faced by U.S. exporters finding and obtaining outbound container space on ocean carriers: “It is not acceptable to disadvantage U.S. exporters,” he said. One example are complaints by agricultural exporters including the Agriculture Transportation Coalition (AGTC) that ocean carriers would rather rush back to Asia to pick up more imports rather than transport U.S. export shipments. Porcari noted that the U.S. Federal Maritime Commission has responsibility for investigating complaints by shippers of unfair ocean carrier practices including lack of access to cargo space on ships and demurrage and detention concerns unfairly charged to exporters. Secretary of Transportation Pete Buttigieg and Secretary of Agriculture Tom Vilsack wrote a December 16th, 2021 letter to the world’s leading ocean carriers urging them to improve service to U.S. agricultural exporters:
“In the spirit of fully utilizing our current infrastructure, we’re writing to emphasize the critical nature of service to underutilized West Coast ports to ensure American agricultural exports can be freely transported overseas. The Port of Oakland, Port of Portland, and other West Coast ports have excess capacity to alleviate supply chain congestion. Particularly, the suspension of service by ocean carriers at the Port of Oakland earlier this year has required agricultural exporters to truck their harvests to the already heavily congested Ports of Los Angeles and Long Beach. While ships must dwell for several days in San Pedro Bay to berth at Southern California ports, other West Coast ports are less congested and berths more readily available. Restoration of service would not only ease the congestion at the Ports of Los Angeles and Long Beach in Southern California but would allow the prompt export of American goods overseas and ease the strain on the supply of long-haul truckers necessary to transport goods from Northern California to Los Angeles and Long Beach…. Shippers of U.S. grown agricultural commodities and goods have seen reduced service, everchanging return dates, and unfair fees as containers have short-circuited the usual pathways and been rushed to be exported empty. This imbalance is not sustainable and contributes to the logjam of empty containers clogging ports. The poor service and refusal to serve customers when the empty containers are clearly available is unacceptable and, if not resolved quickly, may require further examination and action by the Federal Maritime Commission.”
Chassis shortages at ports. Some chassis components have been subject to U.S. tariffs imposed during the Trump Administration and have not been lifted. U.S. chassis producers are “ramping up production” to meet the shortages that truckers are experiencing at the ports. One example, reported by AJOT on January 3rd is Stoughton Trailers. The company announced its plan for expanded intermodal chassis production. In 2022, Stoughton will begin manufacturing chassis products in Waco, Texas. The new Waco facility will add additional chassis capacity to Stoughton’s already expanding chassis production capacity in Wisconsin. In December 2021, Stoughton installed a new chassis production line at its Stoughton, Wisconsin facility: “When the Waco, Stoughton, and Evansville facilities are operating at capacity, the collective output of all three facilities will increase the run rate to approximately 20,000 to 25,000 chassis per year, hitting that rate by September 2022.”
U.S. Customs and U.S. Coast Guard. Porcari urged more support for the U.S. Coast Guard and U.S. Customs and Border Protection to provide security for ports and transportation providers with the rise in volume of imports and export shipments