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SC Ports' Newsome Provides Testimony to Congress on Freight Transportation
4/24/2013 12:08:08 PM


Charleston, SC - To support export growth and economic investment associated with international trade, the nation must develop a prioritization system, a merit-based budget process and predictable means of authorization for needed port infrastructure, the head of the South Carolina Ports Authority (SCPA) told members of a Congressional committee today.

This morning, the U.S. House Committee on Transportation and Infrastructure's Panel on 21st Century Freight Transportation heard testimony about the state of the nation's freight transportation system from five industry executives representing different areas of the supply chain.

At the hearing, SCPA President and CEO Jim Newsome gave an overview of the changes seen in the maritime industry as a result of globalization, noting that U.S. manufacturing and export activity has been on the rise in recent years and, simultaneously, the global fleet is upsizing.

"The global shipping industry, especially the container carriers, has responded with significant investment in new vessels," Newsome stated. "Two-thousand thirteen will see the largest injection of new container capacity into the global container fleet in the history of containerization."

Newsome highlighted the approximately $2 billion in investments in port-related infrastructure by the SCPA and the State of South Carolina to support the growth of the Southeast region as both a consumption market and exporting hub. These investments include significant additional container capacity as well as $300 million set aside by the S.C. General Assembly to cover the entire cost of Charleston's harbor deepening project to take the port's shipping channel to 50 feet.

"The federal harbor system has not kept pace with the dramatic increase in size of ships," Newsome said. "Going forward, it is vital that a viable strategy and process is established at the federal level to bring port capability in line with the handling requirements of such large ships.

"As with other major transportation projects, harbor deepening, maintenance and infrastructure improvements should be treated as high-priority projects subject to streamlined approval and with a steady and reliable stream of funding," he said.

Newsome recognized the strides made by the U.S. Army Corps of Engineers, though its SMART Planning directive, to accelerate the study of port infrastructure projects.

"But sustainable improvement will only be realized when a 'private sector' type capital budgeting approach is taken to such port improvement projects," Newsome said.

Such an approach might include these components:
-Establishment of a capital budget to address U.S. harbor projects over multiple years.
-Development of a prioritization system for projects relative to cost-to-benefit analysis and capability of harbors, defined as the ability of handle fully loaded post-Panamax ships without tidal restriction.
-Rule-based authorization system for ports meeting a certain cost-to-benefit mark.
-Recognition that, due to constraints on federal resources, not all ports can be deepened in a prioritization scenario.
-Establishment of a user-fee system over a longer term to fund harbor improvements.
-Consideration of related projects, such as bridge heights, that also impact vessel movements in the nation's ports.

Additional witnesses at the hearing included Fred Smith of FedEx Corp., Charles Moorman of Norfolk Southern Corp., Derek Leathers of Werner Enterprises and Edward Wytkind of AFL-CIO.

Earlier this month, the U.S. Senate Committee on Commerce, Science and Transportation held a hearing on the Panama Canal expansion's impact on the nation's freight movements and infrastructure needs. At the hearing, local trucking executive Phil Byrd, president and CEO of Bulldog Hiway Express and first vice chairman of the American Trucking Association, outlined how inland modes of transportation must keep pace with improvements made on the water side. U.S. Sen. Tim Scott (R-SC), a member of this committee, highlighted during the hearing the importance of the Port of Charleston to serve the nation's economy. 

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