HMT fix would cover harbor and channel maintenance needs | Global Trade Magazine
  August 8th, 2018 | Written by

HMT fix would cover harbor and channel maintenance needs

100% of harbor maintenance funds must be dedicated to that purpose, say port advocates

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  • The HMT is supposed to pay for harbor maintenance and dredging through a tax assessed on imports.
  • There is a huge gap between what is collected through the HMT and what is invested into ports.
  • Allowing full expenditure of HMT revenues for harbor maintenance would provide over $18 billion over ten years.

The Harbor Maintenance Trust Fund is supposed to pay for harbor maintenance and dredging through a .125 percent tax assessed on the value of imported commercial cargo into the United States. But those funds must be released through annual congressional appropriations and Congress often releases less than the amount collected through the harbor maintenance fee.

That presents a problem for US ports because “there is a huge funding gap between what is collected through the harbor maintenance tax and what is invested back into our channels,” noted Kurt Nagle President and CEO, American Association of Port Authorities, who spoke at a port gathering in Philadelphia last week.

The Port of Philadelphia has an ongoing project to deepen its main shipping channel in the Delaware River to 45 feet, a project expected to be completed next year.

According to a congressional report released earlier this year, allowing the full expenditure of Harbor Maintenance Tax revenues for harbor maintenance would provide over $18 billion over the next decade, a 29 percent increase in investment.

And that level of funding, according to Nagle, would “enable the US Army Corps of Engineers to maintain navigation channels throughout the country at current depths and widths.”

A few years ago, barely 50 percent of HMT revenues were spent on harbor maintenance. That situation has improved more recently to the 80- to 90-percent level, “but there is no guarantee that will be the case going forward,” said Nagle.

That’s why AAPA is backing legislation that would do just that: require HMT funds to be spent on channels and harbors.

“Taxes for infrastructure need to be put in a lock box and used solely for infrastructure,” agreed Leo Holt, president of Holt Logistics, a company that runs several maritime terminals in the Philadelphia area.

“Another piece of the puzzle is that we need a greater level of regionalization,” Holt added. “We cover Pennsylvania, Delaware, and New Jersey on this estuary.”

“We have been encouraged by efforts of the administration and Congress to highlight our nation’s infrastructure and for suggesting innovative solutions for investment,” said Nagle, “but we can’t wait to move these initiatives forward.”

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