January 2013 Archives

It was Christmas Eve at my sister's house, where her twin three-year-olds vied for attention by hanging on the treadmill bars and the grown-ups quizzed me about whether the country would go over the fiscal cliff.

"By the way," said my brother-in-law, "did you know the East Coast ports are about to go on strike?"

Actually yes, I did know. But I was so busy trying to ascertain the fallout of the fiscal cliff crisis that I barely paid attention. The rest of the country was similarly preoccupied.

That's unfortunate. Ports are an integral part of the U.S. economy, and they have the potential to grow exponentially over the next decade. The value of imports through U.S. ports was $1.16 trillion (that's trillion with a T) in 2011, according to the National Oceanic and Atmospheric Administration. A recent report from Building America's Future projects that port volume could double by 2020 and quadruple on the West Coast.

Unfortunately, says the BAF report, the U.S. port system ranks 19th in the world in terms of port infrastructure quality. The Shanghai port in China now moves more container traffic a year by itself than the top eight U.S. ports combined. (Ports aren't the only part of the problem, by the way. The report projects predominant congestion at crucial points in the country's internal freight network by 2035.)

Cynically speaking, it's too bad that the more immediate crisis of a dockworker strike was temporarily averted. Policymakers and citizens these days appear immune to national challenges unless they are literally hours away from doom. Maybe being 19th in the world won't get our attention, but a mass shutdown of the East Coast and Gulf Coast ports would certainly wake us up.

What should ports of the future look like? What are the immediate problems now? Who really needs to be paying attention to ports, the public or just the relevant business and government stakeholders? Is unionization a barrier, a sideshow, or an asset to U.S. port development? How do other parts of the freight system in the country need to interact with ports and what is their role? Where are the weak spots in the system? Where are the strengths?

3 responses: Patrick J. Natale, P.E., Kerry O'Hare, Kurt J. Nagle

Give Virginia's Republican Gov. Bob McDonnell credit for shaking things up. His proposal to eliminate the Commonwealth's gas tax in favor of an 0.8 percent increase in the sales tax definitely got people's attention. Slate's Will Oremus called it the "Dumb Idea of the Week." The Greater Greater Washington blog called it "insane." The Washington Post editorial board called it "bold and paltry."

McDonnell wants to replace the Commonwealth's 17.5 cents per gallon gas tax (that's on top of the 18.4 cents per gallon federal tax) with a combination of higher sales taxes, increased vehicle registration fees, and new fees on alternative fuel vehicles. The math is suspect. The new taxes and fees barely add up to half of the estimated $1 billion per year needed for Virginia's infrastructure. How the rest of the money gets raised is a mystery, although McDonnell has a few ideas. Collecting out-of-state sales taxes? Streamlining the bureaucracy of VDOT? Hmmm. There is, indeed, a lot to poke fun at.

Regardless of the plan's merits, McDonnell's statement about the antiquity of the gas tax shows a clear-eyed vision of the problems confronting infrastructure and an attempt to confront them outside the box. He said, "If we stick to the same old means of funding transportation, we will find ourselves having the same debates and facing the same revenue shortfalls over and over again as inflation slowly eats away at the gas tax, cars get better mileage to meet CAFÉ standards and more alternative fuel vehicles hit the streets."

People with far more liberal political leanings than McDonnell have no quibble with him on that statement. True, they would probably prefer to see a user fee based on vehicle miles traveled (VMT) rather than a reliance on sales taxes. But let's pause for a moment and appreciate the moment: Liberals and conservatives alike agree that the gas tax is passé. Isn't that the first step toward finding a better way?

What are the merits of McDonnell's plan, even if the numbers don't quite add up? Is a sales tax an appropriate place to gather revenue for roads and transit? Does it make sense to add fees to alternate fuel cars? Part of McDonnell's plan involves reworking the transit funding formula. What is at risk there? What does the state stand to gain from tinkering in transit? If the plan is truly a Hail Mary pass, as suggested by the Washington Post, does it have any inherent value?

4 responses: Richard Mudge, Deron Lovaas, Patrick D. Jones, Gabriel Roth

The Federal Aviation Administration finally got a break. The acting administrator for the last year, Michael Huerta, was confirmed by the Senate to a five-year term to run the agency last week. His nomination finally cleared when Sen. Jim DeMint, R-S.C., lifted his objection to the nomination. (DeMint now heads the conservative Heritage Foundation.)

By all accounts, Huerta is more than qualified for the job. He has been at the FAA since 2010 and has served previous stints at major ports in New York City and San Francisco. He replaces former FAA administrator Randy Babbitt, who resigned after a drunken driving arrest a year ago. Babbitt's demise was the perfect, if ironic, complement to the years of uncertainty in the aviation community over a long-stalled FAA bill that finally passed last year.

Now it's time to think about the FAA's next steps, and they are big-time high-tech. Huerta will be charged with overseeing the transition to GPS-based air traffic control system from the current radar-based system. He also must integrate unmanned aerial systems into the national airspace, which carries with it a host of delicate issues about privacy and aviation markets. Technology enthusiast Mitch Joel says unmanned aircraft are "the dawn of a new industry." Not too much pressure, there.

Let's not forget the day-to-day funding of the FAA, which could be on the chopping block by some 8 percent if lawmakers don't reach a deal on the automatic spending cuts in the next two months.

Still, the outlook for the FAA is better than it has been in years with the aviation bill and a confirmed leader in place. How can the agency take advantage of the limited breather it has before the next crisis comes along? What are the most important actions the agency should take? How can NextGen air traffic control best be spurred along? What should the FAA do about unmanned aerial systems? Are there other issues that could trip up the agency? What advice do you have for Huerta as he begins his term in earnest?

3 responses: Greg Principato, Nicholas Calio, Craig L. Fuller