[Senate Hearing 113-578]
[From the U.S. Government Publishing Office]





                                                        S. Hrg. 113-578

 HARBOR MAINTENANCE TRUST FUND AND THE NEED TO INVEST IN THE NATION'S 
                                 PORTS

=======================================================================

                                HEARING

                               BEFORE THE

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            JANUARY 31, 2013

                               __________

  Printed for the use of the Committee on Environment and Public Works

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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                    ONE HUNDRED THIRTEENTH CONGRESS
                             FIRST SESSION

                  BARBARA BOXER, California, Chairman
MAX BAUCUS, Montana                  DAVID VITTER, Louisiana
THOMAS R. CARPER, Delaware           JAMES M. INHOFE, Oklahoma
FRANK R. LAUTENBERG, New Jersey      JOHN BARRASSO, Wyoming
BENJAMIN L. CARDIN, Maryland         JEFF SESSIONS, Alabama
BERNARD SANDERS, Vermont             MIKE CRAPO, Idaho
SHELDON WHITEHOUSE, Rhode Island     ROGER WICKER, Mississippi
TOM UDALL, New Mexico                JOHN BOOZMAN, Arkansas
JEFF MERKLEY, Oregon                 DEB FISCHER, Nebraska
KIRSTEN GILLIBRAND, New York

                Bettina Poirier, Majority Staff Director
                  Zak Baig, Republican Staff Director























                            C O N T E N T S

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                                                                   Page

                            JANUARY 31, 2013
                           OPENING STATEMENTS

Boxer, Hon. Barbara, U.S. Senator from the State of California...     1
Vitter, David, U.S. Senator from the State of Louisiana..........     2
Udall, Hon. Tom, U.S. Senator from the State of Mew Mexico.......     4
Crapo, Hon. Mike, U.S. Senator from the State of Idaho...........     6
Merkley, Hon. Jeff., U.S. Senator from the State of Oregon.......     7
Boozman, Hon. John, U.S. Senator from the State of Arizona.......     8
Barrasso. Hon. John, U.S. Senator from the State of Wyoming......    31
Sessions, Hon. Jeff., U.S. Senator from the State of Alabama.....    33
Cardin, Hon. Benjamin L., U.S. Senator from the State of Maryland    79
Whitehouse, Hon. Sheldon, U.S. Senator from the State of Rhode 
  Island.........................................................    82
Lautenberg, Hon. Frank, U.S. Senator from the State of New 
  Jersey, prepared statement.....................................    88
Wicker, Hon. Roger F., U.S. Senator from the State of 
  Mississippi, prepared statement................................    89

                               WITNESSES

Darcy, Hon. Joe-Ellen, Assistant Secretary of the Army, Civil 
  Works..........................................................     9
    Prepared statement...........................................    12
    Responses to additional questions from:
        Senator Boxer............................................    18
        Senator Lautenberg.......................................    19
        Senator Cardin...........................................    20
        Senator Vitter...........................................    21
        Senator Wicker...........................................    23
Christensen, Michael R., PE, Deputy Executive Director of 
  Development, Port of Los Angeles; Chair, California Marine 
  Affairs and Navigation Conference..............................    34
    Prepared statement...........................................    37
    Response to an additional question from Senator Boxer........    40
Lyons, James K., director and CEO, Alabama State Port Authority..    43
    Prepared statement...........................................    45
    Responses to additional questions from:
        Senator Boxer............................................    52
        Senator Wicker...........................................    52
Lorino, Mike, president, Associated Branch Pilots................    55
    Prepared statement...........................................    58
    Responses to additional questions from:
        Senator Boxer............................................    66
        Senator Wicker...........................................    68
Cairns, Andrew, H., P.E., PMP, board member, American Society of 
  Civil Engineers' Coasts, Oceans, Ports and Rivers Institute; 
  Port & Marine-Northeast Lead, AECOM............................    70
    Prepared statement...........................................    72
    Response to an additional question from Senator Boxer........    77

 
 HARBOR MAINTENANCE TRUST FUND AND THE NEED TO INVEST IN THE NATION'S 
                                 PORTS

                       THURSDAY JANUARY 31, 2013

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:03 a.m. in 
room 406, Dirksen Senate Office Building, Hon. Barbara Boxer 
(chairman of the committee) presiding.
    Present: Senators Boxer, Vitter, Cardin, Whitehouse, Udall, 
Merkley, Barrasso, Sessions, Crapo and Boozman.

           OPENING STATEMENT OF HON. BARBARA BOXER, 
           U.S. SENATOR FROM THE STATE OF CALIFORNIA

    Senator Boxer. The meeting will come to order. I first want 
to welcome the Committee's new Ranking Member, Senator David 
Vitter. We are so pleased to be working together now. For many 
years, Senator Vitter has been a leader in calling for 
investments in our Nation's ports. He is a pragmatist. When it 
comes to infrastructure, we have a very good partnership. I am 
excited about the opportunity to work with him and other 
members of this Committee on this and many other water 
infrastructure issues.
    Today's hearing will examine the role of the Harbor 
Maintenance Trust Fund in supporting commerce at our Nation's 
ports. The Harbor Maintenance Trust Fund is the primary source 
of Federal investment to maintain America's ports. The Trust 
Fund is financed through a fee on the value of cargo imported 
through coastal and Great Lakes ports.
    According to the American Society of Civil Engineers, if 
funding continues at current levels, by 2040 the United States 
will face a shortfall of nearly $28 billion to meet the 
dredging needs of the Nation's ports. As we will hear from our 
witnesses today, this funding gap can have significant economic 
consequences.
    Increasing investment in ports and reforming the Harbor 
Maintenance Trust Fund will be critical components of the next 
Water Resources Development Act, known as WRDA. Senator Vitter 
and I have already begun working together on this vital 
legislation, which supports water resources infrastructure 
nationwide.
    WRDA authorizes the projects and programs of the U.S. Army 
Corps of Engineers and provides many benefits to the American 
people, including expanding and maintaining navigation routes 
for commerce.
    In the coming weeks, we intend to move forward with the 
bipartisan Water Resources Development Act. Senator Vitter and 
I look forward to working with our colleagues on both sides of 
the aisle to advance a bill. We are optimistic that we can 
repeat last year's success on MAP-21.
     I want to thank the staff of Senator Mitch McConnell, who 
actually proactively came to us and said that they really 
wanted to help us with this bill. I was very pleased about 
that.
    As we will hear from our witnesses today, adequate 
investment can boost the economy and create jobs. U.S. ports 
and waterways, many of which are maintained by the Corps, move 
2.3 billion tons of goods in Fiscal Year 2011. In my home State 
of California, our ports are some of the busiest in the entire 
world.
    Continued maintenance of port facilities is critical for 
the commerce and jobs that rely on these hubs, and that is why 
we must increase investment from the Harbor Maintenance Trust 
Fund. Currently, the Trust Fund collects more revenues than are 
annually spent for maintaining our ports. In fact, the Fiscal 
Year 2013 budget, the Obama administration estimated that the 
Trust Fund would receive $1.8 billion, but the Corps budget 
request was only $848 million. This leaves a growing surplus at 
a time when many of the Nation's ports are not maintained to 
their authorized depths and widths.
    This is something that has gone on with every 
administration. They do not spend the funds in the Trust Fund 
the way they are meant to be spent. Significant challenges 
remain in working to ensure the revenues collected in the 
Harbor Maintenance Trust Fund are fully expended, including 
identification of necessary offsets, and I look forward to 
collaborating with all of my colleagues as we look for creative 
solutions to this challenging issue.
    In addition, we must also look at ways to ensure that ports 
which collect the most Harbor Maintenance Trust Fund revenues 
receive an equitable share of Federal investment. Currently, 
some of these ports receive only a fraction of the funds that 
they pay into the Trust Fund. That is unfair. I propose a 
provision for the next WRDA that would increase equity for 
ports nationwide. The provision would allow certain ports to 
use harbor maintenance funds for limited additional uses after 
other traditional operation and maintenance needs are met. This 
would be an important step forward in ensuring our Nation's 
most essential ports receive an equitable share of harbor 
maintenance revenues and it just gives a little flexibility to 
the program.
    I am so grateful to my colleagues on both sides of the 
aisle for their interest in this issue and I look forward to 
hearing from them today.
    I want to say, Senator Vitter, as my Ranking Member, you 
have been a driving force behind this hearing and this issue, 
and it is with that that I call on you for the first time as 
ranking.

            OPENING STATEMENT OF HON. DAVID VITTER, 
            U.S. SENATOR FROM THE STATE OF LOUISIANA

    Senator Vitter. Thank you, Madam Chair. I am very excited 
to be here. I am very excited to be Ranking Member, and I am 
very excited about our partnership on infrastructure issues.
    The first thing out of the gate with regard to that is, 
first of all, this hearing, which is so important. I requested 
that we focus on this issue because it is so vital, including 
in the context of a new WRDA, and I appreciate your organizing 
this hearing; and then in terms of legislative work, a new 
proactive, reform-minded, bipartisan WRDA bill, which we are 
already well into working on, and I am very excited about the 
prospects for that, again, as you said, following the model of 
good solid bipartisan work on MAP-21. So that is our goal and 
that is why we are here today.
    I certainly want to underscore your comments about how our 
Nation's ports and waterways are grossly underfunded for 
routine operation and maintenance, and one big reason is the 
misallocation of Harbor Maintenance Trust Fund revenues. It is 
a pretty simple story. Revenue into the Harbor Maintenance 
Trust Fund has increased steadily over the past decade, minus a 
one-time decrease in Fiscal Year 2009. The Fund currently 
collects about $1.8 billion a year in revenue. However, even 
though all of that money clearly, under law, is supposed to be 
used only for designated purposes with regard to harbor 
maintenance, even though that is clearly true, the 
Administration only spends roughly half that amount for harbor 
maintenance.
    What does that mean? Well, some people say that means we 
have an unspent balance of $8 billion. It really doesn't mean 
that; it is really worse than that, because that money isn't 
sitting anywhere. There is no pile of cash; that money is gone. 
What it really means is that the other money is stolen and 
spent on other completely unrelated purposes, directly contrary 
to the statute setting up the Harbor Maintenance Trust Fund and 
the revenue to go into it.
    Meanwhile, what is going on with our infrastructure? You 
know, if all of our needs were being met, if we were fully 
dredging our crucial waterways and harbors, that might be 
understandable. But, of course, that is not the case. According 
to a recent analysis from the Corps itself, fully authorized 
channel dimensions are available less than an average of 35 
percent of the time at the 59 highest use, harbors and 
waterways, and those are the harbors and waterways that 
basically get the best treatment. So there that fully 
authorized dimension and depth is available only 35 percent of 
the time.
    Of course, I care about that because the national economy, 
but also because Louisiana has five of the top 15 busiest ports 
in the Nation, with four of those located on the lower 
Mississippi River; and the lower Mississippi River, which is at 
vital as anything to our commerce, our waterborne commerce, is 
traditionally underfunded in terms of this as well.
    I want to thank all of our panelists and witnesses today, 
including my invitee, Mike Lorino, President of the Associated 
Branch Pilots. He will testify before this Committee about the 
negative effects of these draft restrictions which followed 
directly from this under-dredging and under-funding, 
restrictions which restrict commerce, restrictions which 
increase cost on commerce. For instance, every time a vessel's 
draft is decreased by one foot on the lower Mississippi because 
of under-maintained waterways, this costs shippers about $1 
million against the value of their cargo. So that is a tax on 
shippers; that is a tax on commerce, and it slows down the 
economy and holds us back from job creation and economic 
growth.
    So this is a problem we absolutely have to fix, and it is a 
problem both Senator Boxer and I are very, very focused on in 
the WRDA that we are working on.
    One final thought. A lot of folks correctly say that we 
need even more resources to fully account for, maintain, 
dredge, operate all of this waterborne commerce and 
infrastructure. I agree, and I want to be a leader in that 
effort and fully supportive of that effort. But, of course, 
industry, the folks we would ask to pay those extra resources, 
are not going to consider doing that if half of it is stolen 
for unrelated purposes; and that is what is going on now.
    So we need to fix that problem if we expect any more 
resources to be put into the bucket. That is a simple and 
obvious request from the folks who are paying the bill, so 
their commerce and their freight can be transported in these 
harbors and along these waterways.
    Thanks to all of our witnesses, and I look forward to a 
great discussion.
    Senator Boxer. Thank you so much, Senator.
    At this point I would ask unanimous consent to place into 
the record a statement by Senator Gillibrand, who is over at 
the Armed Services Committee. Without objection, I will do 
that.
    [The prepared statement of Senator Gillibrand was not 
received at time of print.]
    Senator Boxer. Also place into the record a statement from 
Senator Levin, who has written the Harbor Maintenance Act, a 
bill to require funds deposited into the Harbor Maintenance 
Trust Fund be fully expended for operation and maintenance at 
our Nation's ports. Without objection, we will do that.
    [The prepared statement of Senator Levin was not received 
at time of print.]
    Senator Boxer. I am pleased to call on Senator Udall.

             OPENING STATEMENT OF HON. TOM UDALL, 
           U.S. SENATOR FROM THE STATE OF NEW MEXICO

    Senator Udall. Thank you.
    Good morning and welcome, Madam Secretary. I want to 
express my appreciation to you for being here and to Senators 
Boxer and Vitter for holding this hearing on WRDA. Assistant 
Secretary Darcy, I am sorry I won't be able to stay for the 
entire hearing, but I wanted to take this opportunity to 
highlight three issues that are of importance to New Mexico. 
Now, these aren't harbor issues, as you can imagine, but they 
are the closest thing New Mexico has to harbors, as we had a 
million-year-old ancient sea which covered much of New Mexico, 
but that is obviously gone.
    I think we will see you again soon when we convene another 
hearing on general WRDA issues, so I hope to discuss these 
issues further at that time.
    The issues I wanted to raise are the potential for flooding 
in our major city, Albuquerque, NM; my continued support for 
the Rio Grande Environmental Management Program; and, three, my 
concern over the current status of the project in the Rio 
Grande Floodway, the San Acacia to Bosque Del Apache. The city 
of Albuquerque is our major metropolitan hub in New Mexico. I 
am particularly concerned about the effects flash flooding can 
have on our levee system that protects the city.
    The levees clearly need upgrading, and I am hoping that I 
can work with you through the EPW Committee and through my 
additional role on Appropriations Committee to address this 
issue this year.
    Next, I want to reiterate my strong support for the Rio 
Grande Environmental Management Program. I appreciate Chairman 
Boxer including this provision in the current WRDA draft again, 
but I am disappointed that it has not been funded. I would like 
to urge the Corps to include this program in future budgets to 
help with planning and conservation projects that will help 
balance the complex tradeoffs between flood control, 
agriculture, and habitat. The Rio Grande Basin is experiencing 
a severe drought that is harming farmers and endangered 
species, so this program is sorely needed.
    Additionally, I hope the Corps can work with the Bureau of 
Reclamation and the International Boundary and Water Commission 
about ways to better manage the Rio Grande infrastructure in 
times of drought. We can't make it rain or snow, but we should 
take every measure available to ensure that our available water 
stretches as far as possible.
    Finally, I understand that there is a disagreement between 
the Corps and the Fish and Wildlife Service about how much 
mitigation is needed for the San Acacia levee project. I want 
to take this opportunity to urge both organizations to do their 
best together toward a resolution on this so that the funding 
we have in place for it is not diverted elsewhere.
    There are obviously other projects in New Mexico that are 
of great importance to me, but, since time is limited, I wanted 
to take a minute to highlight those three. Again, I thank you, 
Madam Secretary. I look forward to working with you on these 
issues, and appreciate very much Chairman Boxer and Ranking 
Member Vitter for this first hearing on WRDA. Thank you.
    Senator Boxer. Thank you so much.
    Without objection, I will place into the record Senator 
Inhofe's statement for this hearing. He is also over at the 
Armed Services.
    [The prepared statement of Senator Inhofe follows:]

     Thank you, Chairman Boxer and Ranking Member Vitter, for holding 
this hearing and allowing committee members to receive testimony on the 
Harbor Maintenance Trust Fund. I also would like to thank Assistant 
Secretary Darcy for testifying before us this morning, as well as the 
four gentlemen who will be joining us during the second panel--this 
committee greatly appreciates you and relies on your expertise, so 
thank you very much for being here.
    I would like to also take a moment to thank the chairman, Senator 
Boxer, and our new ranking member, Senator Vitter, for all the work 
they and their staffs have done thus far on the next Water Resources 
Development Act. I look forward to working with both of you as we build 
upon our past successes and continue to work toward preserving and 
enhancing the infrastructure of this great Nation.
    Certainly the most immediate challenge this committee faces is the 
authorization of water resources development legislation. As I've said 
time and time again, we as a Congress must pass authorization bills on 
a regular schedule so as to preserve the proper authorization-then-
appropriations process. It has been 6 years now since we passed the 
last Water Resources Development Act, despite the best efforts of this 
committee--and that, in my judgment, is too long.
    Our harbors and inland waterways are vital to the economic health 
of our country. In my home State of Oklahoma, over 90 percent of the 
grain that is shipped on barges eventually finds its way to New Orleans 
to be exported. If the harbor in New Orleans is not properly 
maintained, shipping from Oklahoma will suffer. And vice versa--for 
harbors to gain the economic benefit of shipping from places like 
Oklahoma, our inland waterways must also be properly maintained. As 
everyone here knows, only about half of the annual revenue in the 
Harbor Maintenance Trust Fund is spent as intended--on critical 
maintenance dredging. But because of the current structure of budgetary 
allocations, we simply cannot afford to allow funding for our inland 
waterways and ports to be redirected--it, too, needs a source of stable 
revenue. The only reasonable solution is increased funding for the 
system as a whole.
    The Inland Waterways Trust Fund helps fund the 18 locks and dams on 
the McClellan-Kerr Arkansas River Navigation System, but it is woefully 
underfunded. In 2012, over 2.7 million tons of cargo shipped from the 
Port of Catoosa, with over 12 million tons being shipped on MKARNS, but 
the system could function much more efficiently and productively if it 
was deepened from its current 9-foot depth to the authorized 12 feet, 
and if hours of service on the locks are not further reduced. This must 
be a priority.
    I have said my entire career that I take fiscal responsibility very 
seriously. However, I believe the Federal Government has a 
responsibility to invest in national defense and infrastructure. In 
2011 the President cut the Corps of Engineers' budget by $600 million 
and by $300 million again in 2012. Our nation's system of inland 
waterways, highways, and coastal ports are our pathway to trade and 
economic prosperity, and we cannot continue this downward trajectory. 
Again, I thank the witnesses and look forward to their testimony.

    Senator Boxer. So now it is my pleasure to turn to Senator 
Crapo.
    Senator Crapo.

             OPENING STATEMENT OF HON. MIKE CRAPO, 
              U.S. SENATOR FROM THE STATE OF IDAHO

    Senator Crapo. Thank you very much, Madam Chairman and 
Ranking Member Vitter. A lot of us appreciate your holding this 
important hearing to focus on the Harbor Maintenance Trust 
Fund.
    Of interest, Idaho does actually have a seaport, contrary 
to New Mexico. Idaho actually is home to the furthest inland 
seaport on the West Coast. This port, the Port of Lewiston, is 
located at the confluence of the Snake and Clearwater Rivers in 
the city of Lewiston. For farmers and other businesses in the 
west, the Port of Lewiston provides a critical link through the 
Snake and Columbia Rivers to the Port of Portland and 
ultimately to the Pacific Ocean.
    However, the Port of Lewiston, like other ports, faces 
considerable challenges with meeting shipping needs. Despite a 
large surplus in the Harbor Maintenance Trust Fund, which has 
already been discussed, harbors across the United States are 
presently under-maintained. Again, the statistics that have 
already been presented show that the U.S. Army Corps of 
Engineers estimates that the full channel dimensions of the 
Nation's busiest 59 ports are available less than 35 percent of 
the time.
    We too, in Idaho, are very interested and concerned with 
the management of the Harbor Maintenance Trust Fund. We have 
seen, just as an example from Idaho, that the draft 
restrictions in 2011 and 2012, due to the Corps' inability to 
maintain the deep draft portion of the Columbia River, have 
been significant impacts on our economy. For every inch of 
draft that is lost due to the silted-in channel, vessels are 
unable to load 358,000 pounds of wheat. This is just one 
example of how important it is that we properly utilize the 
funds in the Harbor Maintenance Trust Fund.
    Second, Idaho is also very interested in the Inland 
Waterways Trust Fund concerns. There are eight locks between 
the Pacific Ocean and the Port of Lewiston, and we need to have 
the adequate support for the maintenance of these locks and the 
facilities to allow for the traffic to reach the port and to 
return back to the Pacific Ocean.
    So we are interested, Madam Chairman and Ranking Member 
Vitter, not only in the Harbor Maintenance Trust Fund, but also 
in reforming and making more effective the Inland Waterways 
Trust Fund that would enable us to have truly effective access 
to and support of this critical waterway for our economy in the 
Northwest.
    Each day the condition of our water infrastructure results 
in significant losses and damages from broken water and sewer 
mains, sewage overflows and other symptoms of water 
infrastructure that is reaching the end of its useful life; and 
with these challenges and the others I have already mentioned 
in mind, as this Committee is well aware, a national investment 
in water infrastructure projects would create jobs, repair 
crumbling infrastructure, and provide significant protection 
for public health and the environment. A strong focus on 
improving the financing structure of our Nation's water 
infrastructure is greatly needed.
    Again, thank you again for holding this hearing, Senator 
Boxer and Senator Vitter, and I look forward to the testimony 
we have in today's witnesses.
    Senator Boxer. Thank you so much.
    Senator.

            OPENING STATEMENT OF HON. JEFF MERKLEY, 
             U.S. SENATOR FROM THE STATE OF OREGON

    Senator Merkley. Thank you, Madam Chairman, and thank you, 
Madam Secretary, for coming. I think you are hearing the 
general story of the significant challenges in maintaining 
levees and jetties and harbor dredging and locks, and how 
frustrating it is that we have funds tat are raised 
specifically for maintenance, and in this case harbor 
maintenance, and they are not being spent in that fashion.
    Now, Oregon is a coastal State, so I go to town after town 
after town where industry depends upon the success of those 
harbors and the maintenance of the jetties; and not only is it 
important to commerce moving back and forth, it is important to 
our fishing vessels, it is important to our recreational 
coastal industry, and it imposes not just an issue of commerce, 
but an issue of safety, because when the dredging is not 
maintained and the jetties are not maintained, you can have 
very dangerous entries from the ocean.
    So how can I possibly justify that we have funds that have 
been raised for a specific purpose, commerce is at stake, 
safety is at stake, and we are not spending it in this fashion? 
I can't justify it. I want to see this policy changed. I so 
much applaud the Chair and Ranking Member for bringing this 
bill forward and I, like my colleague from New Mexico, 
apologize because I have a conflict to attend to, but I 
certainly look forward to your comments. I will be following up 
and hope that we can get to the point that we are spending 
these funds in the appropriate place. Thank you.
    Senator Boxer. Thank you so much.
    Senator Boozman, welcome.

            OPENING STATEMENT OF HON. JOHN BOOZMAN, 
             U.S. SENATOR FROM THE STATE OF ARIZONA

    Senator Boozman. Thank you, Madam Chair and Ranking Member 
Vitter, for having this very important hearing today. I am glad 
that we are moving forward toward what I believe will be a 
strong, bipartisan Water Resources Development Act early in the 
113th Congress, and I think that you are probably excited about 
that, also, and there will be tremendous input from you.
    I am also glad that the improvements to the harbor 
maintenance may be part of this process. Every American 
benefits from the harbor maintenance. Well-maintained water 
infrastructure harbors and inland waterways are critical to our 
farmers, job creators, exporters, manufacturers, and consumers.
    One of our witnesses highlights the tremendous advantage 
American farmers enjoy over foreign competitors when the 
Mississippi River's fully authorized dimensions. Water 
infrastructure does not get the attention of our other 
transportation modes, but is an indispensible part of our 
transportation system.
    I believe in the principle that the Harbor Maintenance 
Trust Fund should be fully used, but I also agree with our 
witnesses who emphasize that the Trust Fund should be used to 
boost funding for the Corps of Engineers. I am concerned that 
our budget process, specifically limited allocations for energy 
and water, could result in cuts to other Corps priorities if we 
don't do this properly.
    In short, as one witness's prepared remarks State, this 
should be additive. Another witness's prepared remarks State 
that the appropriations should not be taken from other Corps of 
Engineers programs due to the potential increased funding from 
the Harbor Maintenance Trust Fund.
    Another concern I have is how we move forward on equitable 
return of HMT dollars. Arkansas is an inland State, but we have 
significant water infrastructure. Our State, as many other 
States like it, receives just a tiny portion of the Trust Fund 
dollars, but these funds are critical.
    While I understand the importance of equitable return, we 
need to ensure that Arkansas's infrastructure and similar 
States, that that infrastructure is maintained. Expanding the 
potential uses of Trust Fund dollars may be a balanced 
approach, but we must avoid an inflexible framework, such as a 
rigid formula, which would abandon infrastructure States like 
Arkansas.
    Again, thank you all very much for having the hearing. I 
appreciate your leadership. I also appreciate the witnesses 
being here and looking forward to their testimony; look forward 
to the conversation.
    This Committee, again, has a history of being very friendly 
to the Secretary, and trying to be supportive, and the rest of 
the witnesses. Regardless of what happens today, remember it 
could be worse; you could be Senator Hagel over there right now 
in the midst of his hearing. Thank you.
    Senator Boxer. That was an unexpected truth.
    [Laughter.]
    Senator Boxer. An unexpected truth.
    We want to welcome you, Jo-Ellen Darcy, Assistant Secretary 
of the Army for Civil Works. I just want to thank you. This is 
a very contentious issue. This is not a new issue. We have had 
people sitting right there on the same issue, where members 
here were upset, but this is a circumstance that I think needs 
to be faced. People are paying into a fund and guess what? They 
are not getting what they are supposed to get from it. It is 
not right. It would be as if we paid into the Highway Trust 
Fund and the money was used for something completely different. 
It is not right.
    So I know you are in kind of the hot seat on it. We want to 
welcome you. We thank you for your service and what you are 
doing to help us every day in our States. Please proceed.

 STATEMENT OF HON. JO-ELLEN DARCY, ASSISTANT SECRETARY OF THE 
                       ARMY, CIVIL WORKS

    Ms. Darcy. Thank you. Thank you, Chairman Boxer, Ranking 
Member Vitter, and distinguished members of this Committee. I 
want to thank you for the opportunity to testify on the Harbor 
Maintenance Trust Fund and the importance of investment in the 
Nation's ports.
    The Army Corps of Engineers provides support for safe, 
reliable, highly cost-effective and environmentally sustainable 
waterborne transportation systems, investing over $1.7 billion 
annually, more than one-third of the total budget of the Civil 
Works program, to study, construct, replace, rehabilitate, 
operate, and maintain commercial navigation infrastructure 
across this Country.
    The Nation's ports handle over 2 billion tons of commerce 
annually, including over 70 percent of the imported oil and 
more than 48 percent of goods purchased by American consumers.
    The Administration understands that our ports are an 
important part of the Nation's infrastructure and has formed an 
Interagency Task Force on Ports to develop a strategy for 
investment in our ports and related infrastructure. Maintaining 
these ports and making targeted investments in their 
improvement can lower shipping costs for U.S. exports and 
imports.
    The work of the task force will reflect a strategic, multi-
modal view of the Nation's investment priorities for the 
infrastructure that supports the movement of freight through 
our ports, including the protections for life, safety, and 
property during transport, as well as protections for affected 
communities and for sustaining our ecosystem.
    The Harbor Maintenance Tax and the Harbor Maintenance Trust 
Fund were established by the Water Resources Development Act of 
1986. The harbor maintenance tax is an ad valorem fee on the 
value of commercial cargo loaded or unloaded on vessels using 
federally maintained harbors. An amount equivalent to the 
revenue collected is deposited in the Harbor Maintenance Trust 
Fund and is then available to finance certain costs, subject to 
the congressional appropriations process.
    For the Civil Works Program, the Harbor Maintenance Trust 
Fund is authorized to be used to finance up to 100 percent of 
the Corps' eligible operation and maintenance expenditures for 
commercial navigation at all Federal coastal and inland harbors 
within the United States. Expenditures from the Harbor 
Maintenance Trust Fund are also authorized to be used to 
recover the Federal share of construction costs for dredged 
material placement facilities, including beneficial uses 
associated with the operation and maintenance of Federal 
commercial navigation projects. The Harbor Maintenance Trust 
Fund is also authorized to be used to finance operation and 
maintenance costs of the U.S. portion of the St. Lawrence 
Seaway.
    Harbor Maintenance Tax receipts in Fiscal Year 2012 were 
$1.54 billion, and the interest earned was $47.3 million. The 
balance in the Harbor Maintenance Trust Fund at the end of 
Fiscal Year 2012 was $6.95 billion.
    An increasing portion of Civil Works funding in recent 
years has been devoted to harbor maintenance. The President's 
2013 budget request for the Corps included $848 million for the 
Harbor Maintenance Trust Fund to support the maintenance of 
coastal harbors and their channels and related works, the most 
ever requested by any president. This is a significant increase 
over the level in the Fiscal Year 2012 budget, which was $758 
million; this all at a time when many programs governmentwide 
are being reduced in order to put the Nation on a sustainable 
fiscal path.
    Our investments in coastal port maintenance are directed 
primarily at providing operational capabilities and 
efficiencies. To make the best use of these funds, the Corps 
evaluates and establishes priorities using objective criteria. 
These criteria include transportation cost savings, risk 
reduction, and improved reliability, all relative to the cost. 
Consequently, maintenance work generally is focused more on the 
most heavily used commercial channels, those with 10 million 
tons of cargo a year or more, which together carry about 90 
percent of the total commercial cargo by tonnage traveling 
through our coastal ports.
    The amount proposed in the Fiscal Year 2013 budget is an 
appropriate level, considering the other responsibilities of 
the Corps for inland navigation, flood risk management, aquatic 
ecosystem restoration, hydropower, and other Civil Works 
Program areas. The Corps is working to develop better 
analytical tools to help determine whether additional spending 
in this area is warranted based on the economic and safety 
return.
    Dredging costs continue to rise due to increases in the 
cost of fuel, steel, labor, and changes in methods of disposal 
of dredge material. We recognize that this presents challenges 
in maintaining commercial navigation projects. The pending 
improvements to the Panama Canal will increase the draft of 
vessels transiting the Canal to 50 feet.
    On our Atlantic Coast we now have two 50-foot deep ports 
capable of receiving these ships, Norfolk and Baltimore. The 
Corps expects to complete the dredging work for deepening the 
Port of New York-New Jersey to 50 feet in fiscal year 2015. The 
Corps is also working with the Port of Miami, which is 
financing a project, to deepen the Federal channel to 50 feet.
    On the West Coast, the Ports of L.A., Long Beach, Oakland, 
Seattle, and Tacoma all have channel depths of 50 feet or 
greater.
    In addition to the ongoing work, the Corps is also working 
with seven ports on the Atlantic and Gulf Coasts to evaluate 
proposals to deepen or widen those channels.
    Madam Chairman and members of the Committee, I look forward 
to answering any questions you have, and also to work with you 
on this difficult issue as you prepare for the WRDA bill. Thank 
you.
    [The prepared statement of Ms. Darcy follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    
    Senator Boxer. Thank you very much for that. You know, you 
stay away from the bigger notion, bigger issue here, which is 
is it right to collect fees and then not spend them on this 
purpose that they are supposed to be used for, and I don't 
blame you for staying away from that because, in essence, you 
don't really have control over that; the Administration does 
and prior administrations did, and we do, and we intend to fix 
it to the greatest extent that we can.
    Now, the Corps has estimated that the Nation's 59 busiest 
ports have access to their full channel dimensions only 35 
percent of the time. These ports are critical for commerce and 
international trade. Restrictions on commerce as a result of 
inadequate port maintenance can have significant consequences. 
In fact, a recent report by the American Society of Civil 
Engineers, which we will hear about on our second panel, 
indicates that failure to adequately maintain our ports could 
result in a variety of economic impacts.
    Do you agree that failure to invest in port maintenance 
could have economic consequences that we must seek to avoid?
    Ms. Darcy. Senator, I do believe it could have 
consequences; however, I do see that we are investing in our 
ports. As I noted, the President has asked for more money for 
the Harbor Maintenance Trust Fund than ever before. He has also 
established the Interagency Task Force working with the 
Department of Management and Budget, as well as Transportation, 
to look at evaluating what resources are needed for 
transportation, and we are hoping that, in looking at 
transportation in the future, in addition to the three Rs, 
which are always rail, road, and runways, it can now be the 
four Rs and we can include rivers in that.
    I think we need to look at the infrastructure all together, 
we need to expand the way we have traditionally looked at it as 
just mostly asphalt and make sure that we include the river 
systems that need to be reliable for our economy.
    Senator Boxer. Well, I do appreciate the President moving 
in the right direction, but I still note he is still not 
spending all that came into the Fund, and I still note that 59 
busiest ports have access to their full channel dimensions only 
35 percent of the time, and I just think that is as clear as 
anything; it just shows that we are not doing enough. But yes, 
the President is definitely moving in the right direction, but 
he still isn't using all the funds that come into the Trust 
Fund.
    When Congress created the Harbor Maintenance Trust Fund, it 
sought to recoup the cost necessary to operate and maintain 
U.S. ports and waterways, but, as we have said, much less is 
spent on operations and maintenance than is collected, and, as 
you point out, it is in the billions.
    Do you believe it is important to increase the amount 
expended from the Harbor Maintenance Trust Fund so that we can 
better maintain the Nation's ports?
    Ms. Darcy. Senator, I believe the amount that is in the 
President's request for the Harbor Maintenance Trust Fund is 
appropriate at this time, given all of the other fiscal 
constraints that we are faced with within not only the Corps, 
but across the Country.
    Senator Boxer. Well, I hear you doing what you should do, 
which is defending the President's budget. I appreciate you are 
in that situation, but, again, this, to me, isn't about this 
President. This President is doing more than any other 
president, there is no doubt, but we are in a bad situation 
here because we are the leading economy in the world and yet, 
still, we have problems at our ports. I can tell you, at our 
ports back home, just out of Los Angeles-Long Beach, about 40 
percent of the imports; and you just can't afford to have 
problems at the ports.
    Let me just go here. You said you would work with us, which 
I really appreciate, even though, perhaps, the Administration 
doesn't like what we have come out with on this particular 
issue. Would you be available for technical assistance? Because 
we may need to call on you for that.
    Ms. Darcy. Absolutely, Senator.
    Senator Boxer. Good.
    Ms. Darcy. It would be the first time in my career that I 
had not worked on a WRDA bill.
    Senator Boxer. I know. Well, we can't let that happen. We 
have to use all your experience here. But I think the bottom 
line is we are moving in the right direction, but we are 
certainly not there because we are still not spending the 
revenues that come in. Nobody has looked at the backlog and how 
we can possibly offset those billions, but Senator Vitter and 
I, and the rest of our colleagues, are very strong on this, so 
it is going to be a central piece of our WRDA bill.
    Senator Vitter.
    Senator Vitter. Thank you, Madam Chair, and thank you, 
Madam Secretary, for your service. This is something you can 
tell, I hope, we are communicating that we care passionately 
about and it is thoroughly bipartisan.
    Madam Secretary, in your testimony you noted the authorized 
uses of this money. It was first set up in WRDA in 1986, 
Section 210. It was amended a little bit in WRDA 90, Section 
316, and you listed the uses. Are there any other authorized 
uses?
    Ms. Darcy. There is a certain percentage, about $30 million 
a year, maybe a little more, that goes to, the St. Lawrence 
Seaway, and then there is a portion I think it is about $3 
million to $5 million annually that goes to the Treasury and 
the Customs Service for the administrative costs of the 
program.
    Senator Vitter. Right. I was thinking of that too. But 
given that entire list, are there any other authorized uses?
    Ms. Darcy. No, sir.
    Senator Vitter. In fact, isn't that money spent on plenty 
of other things every year that are not those authorized uses?
    Ms. Darcy. Senator, the receipts go directly into the 
Harbor Maintenance Trust Fund through the Treasury and then the 
Bureau of Public Debt, which manages 18 different trust funds 
across the Government, then is the dispenser of those funds 
when our agency says we have been appropriated this much money 
and that is what comes out of the Fund.
    Senator Vitter. Doesn't the other money come out of the 
Fund for other unauthorized uses, unrelated uses?
    Ms. Darcy. The balance of the funds are invested and 
accumulate interest, and it is up to the Bureau of Public Debt 
as to how those funds then are used.
    Senator Vitter. Well, if there is this balance of $6.95 
billion, what vault can I go to and look at it? That is what I 
am asking. Because it doesn't exist. So where can I look at 
that balance of almost $7 billion?
    Ms. Darcy. Again, those are the Federal investments in 
securities, for the most part, I understand, and then the 
interest that accrues on that is what gets you to that balance.
    Senator Vitter. Well, again, this is a big fiction, and I 
think the first important part of this conversation is to get 
beyond the fiction. It is the same fiction as the Social 
Security Trust Fund, because when you go and look at that 
balance, basically this is what you find, IOU $6.95 billion. It 
is gone, it is spent for unrelated purposes, and that is wrong 
when it is authorized for specific uses under the law.
    Now, you mentioned this administrative task force looking 
at water infrastructure, looking at all of this big picture. Is 
that task force going to come up with a solution that ensures 
that all of this Trust Fund money is spent regularly for its 
intended uses?
    Ms. Darcy. We will be looking at the uses of the Harbor 
Maintenance Trust Fund and how that can help to ensure that the 
future of the navigation system is adequate. I can't tell you, 
at this point, what it is we are going to say or do, but it is 
something that we will definitely be considering.
    Senator Vitter. Well, what you have done previously in that 
regard is to just want to tremendously expand the uses. Now, 
there may be some room for that, but if you just expand the 
uses to all sorts of other things, you don't solve this 
problem, the same thing happens. That is what is happening now. 
So let me just repeat the question. Is the task force focused 
on our central question today, which is ensuring that all of 
the revenue into the Trust Fund is spent for authorized uses 
under statute?
    Ms. Darcy. It is one of the issues that will be focused on, 
Senator. We will also be looking at the uses for the other 
trust funds, including the Inland Waterway Trust Fund. This is 
a navigation system; it is not just a port system, it is an 
inland waterway system as well, that we must maintain given the 
other competing uses, as well as what the other agencies, 
including OMB and the Department of Transportation, and 
Commerce, can bring to the table as we look at it as a system.
    Senator Vitter. Let me ask a related question that I 
mentioned in my opening statement. A lot of folks, including 
me, think it is going to take more resources to fully maintain 
this vital infrastructure that is important for the economy. Do 
you think it is reasonable to expect the folks affected, like 
industry, to pay more into anything when it is being diverted, 
in this case, to unrelated uses?
    Ms. Darcy. I don't think that we would expect people to pay 
more. I understand, that since the total balance is not being 
spent in the intended use, that there would be a concern by 
those paying the tax that there be some way to get the return 
on what it is they are paying for.
    Senator Vitter. I will close with this. I am out of time. I 
think you all have already proposed they are paying more in 
some instances, like, for instance, lockage fees, just one 
instance. I am just pointing out I think it is a commonsense 
nonstarter to even have that discussion if half of the Harbor 
Maintenance Trust Fund is being diverted for unrelated 
purposes. Thank you very much.
    Senator Boxer. Thank you, Senator.
    What we are going to do is Senator Boozman will ask his 
questions and then we will go to Senators Barrasso and Sessions 
to use their 5 minutes for either an opening statement, 
questions, or both.
    Senator Boozman.
    Senator Boozman. Thank you, Madam Chair.
    Again, thanks for being here, and we do appreciate your 
office. You have always been very open as we have approached 
you with different difficulties relating to all of this and, 
like I say, we appreciate that. You were a big help with the 
recent crisis on the Mississippi River, which is kind of an 
ongoing thing with the dredging and stuff, making it such that 
we were able to get our farm products out. Again, you can't 
always help us, but you always do listen, and we do appreciate 
that.
    As Senator Boxer mentioned, in your data and in a recent 
CRS report, it keeps coming up the busiest 59 ports are 
available less than 35 percent of the time as far as their full 
channel width and depth; and then the CRS report goes on to 
point out that that makes it such that the vessels are less 
efficient, they can't carry as much, there is essentially more 
prone to accident and things like that. So that is a serious 
problem; I think we all agree with that.
    In your testimony you mention while the Corps could spend 
more on harbor maintenance and related work, the amount 
proposed in the 2000 budget for this purpose, which is financed 
from the HMTF is an appropriate level, and then you go on 
considering the other challenges that you face.
    I guess, for me, it is hard to reconcile that. If only 35 
percent is operational on a given day, and yet to come back and 
say that you are happy with the funding that you are getting.
    Ms. Darcy. I think I said appropriate, not happy. But in 
looking at the overall budget for the Corps of Engineers, we 
have to manage for all of the missions within the Corps, we 
operate under a cap, and we know that if you increase one 
mission, there must be a decrease somewhere else within the 
program.
    As I said in my statement, over one-third of our budget, 
$1.7 billion, is spent on navigation, and that additional money 
that does not come out of the Harbor Maintenance Trust Fund is 
spent on other studies or construction, because the Harbor 
Maintenance Trust Fund does not fund construction.
    Senator Boozman. So you mention the cap, which is a 
concern, and you also mention that we are going to be 
increasing the money spent from the Harbor Maintenance Trust 
Fund. So where is that coming from, is that new money or is 
that money that you are essentially shuffling around, so that 
something else under the cap is going to suffer?
    Ms. Darcy. The 2013 budget request which includes $848 
million is $90 million more than Fiscal Year 2012. Within our 
program we had to make a decision as to how to balance 
preograms, because we are still under the $4.7 billion program. 
We did put more money on activities reimbursed from the Harbor 
Maintenance Trust Fund, so some of the other programs like some 
of our other operation and maintenance activities were reduced. 
Although operation and maintenance has also increased in our 
overall budget over the last couple of years. We would have to 
take decreases in some other programs, including some of our 
CAP programs, which are our small project programs. Again, the 
overall program has to be balanced across all the business 
lines within our budget.
    Senator Boozman. So I guess that is really the real 
problem. It doesn't matter how much we put into the Harbor 
Maintenance Trust Fund; the reality is it really wouldn't be 
any additional new money.
    Ms. Darcy. No. But also within the budget process, when the 
appropriations committees get their 302(b) allocations, there 
is a cap in there, and there is Army Corps of Engineers within 
that 302(b), there is the Nuclear Program, there is the Energy 
Program. So the balance within that allocation would have to 
either be increased in order to accommodate increases across 
all the programs.
    Senator Boozman. Right. OK. Thank you very much.
    Senator Boxer. Thank you.
    Senator Barrasso, welcome.

           OPENING STATEMENT OF HON. JOHN BARRASSO, 
             U.S. SENATOR FROM THE STATE OF WYOMING

    Senator Barrasso. Thank you, Madam Chairman.
    We agree in a bipartisan way that our Nation's harbors and 
ports are vital to the economic growth of the entire Country. 
The majority of our Nation's ports are along the coasts and the 
Great Lakes, the Gulf of Mexico, but the products that our 
Country exports come from all 50 States and, in the case of the 
west, many are exported from river ports. I think it is vital 
that the Country maintain all ports for the benefit of the 
people whose jobs depend on these exports and the communities 
where they live.
    So American exports really are one of the backbones of our 
economy, and it doesn't matter which sector of the economy, 
whether it is high-tech manufacturing, whether it is the 
aerospace industry, automobile production, pharmaceuticals, 
ranches, farms, mineral extraction. All of these sectors 
require modern, fully functioning ports and growing ports to 
export our products.
    Now, the White House has stated that it is putting a 
priority on maintaining and improving ports, streamlining the 
barriers to port projects. In July of last year, the President 
established the White House Task Force on Ports. The mission 
calls for ``improved coordination and streamlined review of 
investments in port-related infrastructures.' Last July, on the 
19th, the White House announced that five major ports in the 
eastern United States would receive help in making ``the 
permitting and review process for infrastructure projects more 
effective and efficient, saving time while driving better 
outcomes for local communities.' Those ports include, as you 
know, Jacksonville, Savannah, New York, New Jersey, and the 
Port of Charleston.
    Madam Chairman, I believe that all American ports, 
especially in the west, need a quicker, more efficient review 
process for building and expanding their operations as well.
    So the questions that I have are do you agree with the 
President's initiative with regard to the need for expanding 
port projects across the Country?
    Ms. Darcy. Yes, Senator.
    Senator Barrasso. In his State of the Union Address, going 
back even to 2010, President Obama announced the National 
Export Initiative, stating, ``We will double our exports over 
the next 5 years, an increase that will support 2 million jobs 
in America.'
    How close do you think we are to achieving that goal?
    Ms. Darcy. I think we will achieve the goal by 2015. I 
think the fact that this budget reflects an increase in the 
Harbor Maintenance Trust Fund, as well as other investments in 
navigation, will help to prove that not only within the Army 
Corps of Engineers, but across the Government, including the 
Department of Transportation.
    Senator Barrasso. Yesterday, the Commerce Department 
reported that the U.S. economy had actually shrank, which would 
defy the expectations. CNBC reported that the economy shrank 
from October through December for the first time since the 
recession ended, and they had a number of different reasons 
that they listed, one of which was fewer exports. So I don't 
know if you are aware of the report, but do you believe we need 
to increase the export of all American goods by mobilizing and 
modernizing our Nation's ports in an expeditious and fiscally 
responsible manner to help address this falling exports?
    Ms. Darcy. I think that we do, and I think that we will be 
able to meet the goal by 2015.
    Senator Barrasso. Finally, you said in your written 
testimony the White House created this Task Force on Ports in 
July of last year. According to the White House announcement, 
the Task Force, they said, will develop a strategy to inform 
future investment decisions and identify opportunities for 
improved coordination and streamlined review of investments and 
port-related infrastructures.
    Now, your agency is one of the 10 Federal agencies involved 
in this project. Can you give us an update as to the progress 
of the Task Force?
    Ms. Darcy. Yes, Senator. Actually, I think we have a 
meeting next week, but I have to check. What we have done is 
establish the principles of what it is we want to move forward 
on, and part of what we have already done, is working with the 
other Federal agencies, looking across programs as to where we 
are making our investments.
    For example, the Corps of Engineers, as you know, operates 
and maintains and dredges ports and harbors, and the Department 
of Transportation has what is called the TIGER Grant Program, 
where they make investments on the land side at different ports 
around the Country. Working with the Department of 
Transportation, we have looked at where we have our ports 
deepening and where it would make sense for an investment to be 
made on the land side, so that we are not working at cross 
purposes with the Federal investment in that port on the land 
side.
    Senator Barrasso. Well, thank you. I think all of us look 
forward to seeing the Task Force recommendation in a timely 
manner.
    Thank you, Madam Chairman.
    Senator Boxer. Thank you very much.
    Senator Sessions, welcome.

           OPENING STATEMENT OF HON. JEFF SESSIONS, 
             U.S. SENATOR FROM THE STATE OF ALABAMA

    Senator Sessions. Madam Chairman, involved as I know 
Senator Inhofe is now with the Armed Services hearing on the 
confirmation of former Senator Hagel, and I am sorry to have 
missed earlier. Thank you for having this hearing, Madam 
Chairman. I congratulate you particularly because looking at 
the amount of money spent under the energy and water 
appropriations, harbor maintenance is about 1 percent. So it is 
an important 1 percent, and I am glad that you found time to 
have a hearing on it. It is not as much money as has been 
coming in.
    We have a chart, I think, as you just pointed out, has been 
mentioned before, but this indicates in blue how much of the 
funds that are coming in are actually spent on harbor 
maintenance and how much finances the rest of the Government, 
and our smart staff found that that surplus would make a huge 
difference for harbors and ports, but only funds for the 
Government for 3 hours, in terms of what it would contribute to 
the overall spending.
    So thank you for your presence here, and I think we will be 
looking at how to deal with some of the issues. I am skeptical 
about proposals that give the Corps more authority and Congress 
less control over water resources, and I am skeptical about 
creating new programs when we are having a hard time funding 
the ones we have, and I do think we have to confront this issue 
of our ports and how we get there.
    I know the Chairman and Ranking Member understand that one 
of my problems is fixing this surplus or using more of it has 
budget consequences that we can't ignore, and that makes it 
harder than we would like it to be. The President has submitted 
spending the money in that fashion and Congress has gone along 
with that, so if we change it, it won't be as easy as a lot of 
people might think, but I think we need to work in that 
direction.
    So I guess I won't ask any questions now, Madam Chairman. 
Thank you for giving me the opportunity to be here.
    I guess I would just ask Secretary Darcy would this 
surplus, if it allowed to be utilized by you and for harbor 
maintenance, make a substantial improvement in our ability to 
meet the needs of harbor maintenance?
    Ms. Darcy. It would.
    Senator Sessions. That is an easy question. Thank you.
    Thank you, Madam Chair.
    Senator Boxer. Well, that is the point of this hearing. We 
thank you for your honest answer, and your very good question 
and your brilliant staff's chart.
    Now, we thank you very much, and we will work closely with 
you, as we have in the past, on this whole harbor maintenance 
issue, because it will, Senator Sessions and Senator Boozman, a 
big part of our WRDA bill. So we really want to reform this 
situation so we don't put somebody like Jo-Ellen Darcy in a 
tough situation, and the future Jo-Ellen Darcys, because this 
is an issue that both Republican and Democratic presidents have 
handled the same way; they have never spent on the harbor 
maintenance what comes into the Fund. So we thank you very 
much.
    We will ask our second panel to come up and, as they do, I 
will be introducing Michael Christensen and Senator Vitter will 
be introducing Mike Lorino, Senator Sessions will be 
introducing Mr. Lyons, and I will introduce Mr. Cairns. Is that 
right? OK.
    So please step forward. This is an excellent panel we have 
coming forward because they work with these issues and these 
policies every single day.
    So, Mr. Christensen, I will introduce you. You are the 
Deputy Executive Director of Development and No. 2 ranked 
executive at the Port of Los Angeles. That is a big job. You 
are responsible for oversight of the planning, the permitting, 
the design, and construction of all port infrastructure.
    Mr. Christensen is a transportation engineer with over 35 
years of experience in the planning, design, and construction 
of a wide variety of port, rail, and highway programs. Mr. 
Christensen also serves as Chair of the California Marine 
Affairs and Navigation Conference, and he is a member of the 
California Association of Port Authorities.
    Well, welcome to you, and I am sure you can't wait to get 
back home after witnessing some of the winds out there. Please 
do begin your testimony.

   STATEMENT OF MICHAEL R. CHRISTENSEN, PE, DEPUTY EXECUTIVE 
DIRECTOR OF DEVELOPMENT, PORT OF LOS ANGELES; CHAIR, CALIFORNIA 
            MARINE AFFAIRS AND NAVIGATION CONFERENCE

    Mr. Christensen. Thank you very much, Chairman Boxer, 
Ranking Member Vitter, and Senators for this opportunity to 
testify on behalf of the Port of Los Angeles, the California 
Association of Port Authorities, and the California Marine 
Affairs and Navigation Conference. I am Michael Christensen 
and, as was mentioned, I am the Deputy Executive Director at 
the Port of Los Angeles responsible for all of the capital 
improvements and infrastructure at the Nation's largest 
container port.
    The Port of Los Angeles, in conjunction with our neighbor, 
the Port of Long Beach, handles over 40 percent of all the 
containerized goods that come into the United States, worth 
approximately $311 billion. This cargo supports about 900,000 
regional jobs, nearly $40 billion in annual wages and tax 
revenues, and nationally the goods that come through the port 
complex of Southern California support also about 3.5 million 
jobs throughout the United States.
    We are not tax supported; instead, our revenues are all 
derived from fees and from other shipping service revenue.
    Now, I am testifying today on behalf of a number of 
organization. One is the California Association of Port 
Authorities, which is comprised of the State's 11 publically 
owned commercial ports. It is dedicated to maintaining vigorous 
and vital port industry throughout the State of California.
    I also serve right now as Chair of the California Marine 
Affairs and Navigation Conference, which is also a consortium 
of California harbors and ports, both large and small, along 
with marine interest groups dedicated to optimizing 
California's maritime benefits by supporting the maintenance 
and improvement of California's harbors, ports, and navigation 
projects.
    We very much appreciate the purpose of this hearing on HMT. 
It is a critical source of funding, as has been mentioned a 
number of times, for the ports and harbors not only within our 
State, but also within the entire Country in order to keep us 
globally competitive. With the sense of Congress in support of 
full use of the HMT that was included in MAP-21 and the changes 
contemplated in this draft of the WRDA, we are encouraged that 
are being taken to improve HMT.
    The maintenance that is funded by HMT supports a well-
functioning navigation system that includes the ports and 
harbors that accommodate a wide variety of commodities: 
containers, bulk goods, agriculture products, automobiles, 
fisheries, and also serve these facilities of service critical 
harbors of refuge. The system not only supports jobs in 
operation and maintenance, but facilitates trade that supports 
jobs throughout the supply chain throughout the United States, 
reduces the transportation costs for American businesses, and 
ultimately keeps the prices lower for American consumers.
    For this reason, the California ports support the 
following: No. 1, full utilization of HMT revenues for 
operations and maintenance purposes; No. 2, the prioritization 
of HMT funds for use on traditional O&M purposes, including 
maintenance of Federal navigation channels, disposal sites, 
selected in-water projects such as breakwaters and jetties, and 
studies; No. 3, more equitable return of HMT funds to the 
systems of ports of California; and, No. 4, a cost-share 
formula for maintenance that reflects the current cargo fleet.
    First, we believe HMT should be fully used for O&M 
purposes. Appropriations from the HMTF have lagged behind 
receipts for several years, leaving a surplus and deferring 
maintenance on our Nation's system of ports and harbors. 
Achievement of full use of the HMT should be additive in 
nature. That is, in a given fiscal year, the guarantee of full 
utilization should not be achieved by taking funds from other 
U.S. Army Corps priorities.
    We commend you for including the full utilization and the 
additive aspects in this draft of the WRDA. We support a more 
equitable allocution framework within WRDA. Even if HMT funds 
are fully utilized for O&M, we believe efforts should be made 
to increase the funding return to systems that contribute large 
amounts to the Harbor Maintenance Trust Fund.
    One of the reasons we believe in this approach is because 
the users, not the ports, pay into the harbor maintenance tax. 
The users of the California port systems, for example, have 
reasonable expectation that the money they pay would be 
returned to the systems that they use.
    Now, based on these facts, we believe that an equitable 
return should be part of an HMT reform effort and, in fact, the 
American Association of Port Authorities has come out with an 
equity principle that I am sure they will be sharing with you.
    Senator Boxer. I am going to ask you to sum up, if you can.
    Mr. Christensen. In conclusion, I would like to again thank 
you again, Chairman Boxer and Ranking Member Vitter, for 
prioritizing the WRDA authorization and allowing me the 
opportunity to provide testimony on behalf of the California 
Ports and Harbors. I would like to reiterate our support for 
full utilization of HMT for its intended purpose, an equitable 
return in updating the cost-share formulas. As you continue to 
work on the reforms for HMT, the California ports would like to 
offer our continued assistance and support. Please refer to my 
written testimony for some of the other information, and I am 
available for questions.
    [The prepared statement of Mr. Christensen follows:]
    
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    Senator Boxer. Thank you so much, Mr. Christensen.
    Due to his schedule, Senator Sessions, we are going to ask 
you to introduce your witness, Mr. Lyons, who will then 
testify, and then we will move to Mr. Lorino, introduced by 
Senator Vitter.
    Senator Sessions. Thank you. Appreciate that very much.
    Mr. James K. Lyons, we call Jimmy, has served as Director 
and CEO of the Alabama State Docks since 1999. He is a senior 
port director, one of them around the Country. A native of 
Mobile. He spent four decades in the maritime industry. The 
port has done exceedingly well, Jimmy. Congratulations on your 
leadership. We have seen hundreds of millions of dollars in 
capital improvements.
    Those investments are paying off. Steel shipments were up 
in 2012 26 percent; containers were up 31 percent; export coal 
shipments increased substantially. So the port is doing well. 
It also is unusual in the sense that we export a lot more out 
of the Mobile Port than most ports as a percentage of the 
cargo, and that reduces, in some way, the money that comes in, 
but it is really great for job creation and that sort of thing.
    So he is involved in many activities, including being on 
the Board of Directors of the Federal Reserve Bank in 
Birmingham and married to Beth Marietta Lyons, an attorney and 
prominent Mobilian herself.
    Thank you, Madam Chairman.
    Senator Boxer. Thank you so much.
    Mr. Lyons, I won't call you by your first name, although I 
am extremely tempted to. Mr. Lyons, we really do welcome you, 
and the floor is yours.

STATEMENT OF JAMES K. LYONS, DIRECTOR & CEO, ALABAMA STATE PORT 
                           AUTHORITY

    Mr. Lyons. Thank you, Madam Chairman, Ranking Member 
Vitter, and distinguished members of the Committee. Thank you 
for this opportunity to discuss the Harbor Maintenance Trust 
Fund.
    I am going to try to bring a little bit of local 
perspective to some of the facts and figures that I have here 
in my written statement. These facts and figures have been 
quoted several times here today, but I will try to bring a 
little bit of local perspective and just sort of bringing it 
down into the micro aspect.
    Mobile is amongst the 90 percent of the Nation's top 50 
ports in foreign trade commerce that require regular 
maintenance dredging. In total, dredged ports move nearly 93 
percent of all waterborne commerce by weight annually.
    The 35 percent availability is a very real figure, 
something that we can attest to from Mobile, and in talking to 
my fellow port directors in other ports, I believe this is a 
very real number. As an example, between 2006, after we 
finished the dredging cycle that included supplemental funding 
that came as a result of Hurricane Katrina, and 2011, Mobile 
had only half of our authorized width in much of our 30-mile-
long channel. These conditions caused numerous groundings, 
forced restrictions in vessel traffic, and, in short, cost the 
shippers using our port a great deal of time and money.
    The budget versus the appropriation in Mobile is, again, 
very real, just as it is. We saw the figures in the chart that 
Senator Sessions put up. Mobile's 2012 budget was $22.6 
million, but we really need $28 million to fully maintain our 
authorized width and depth. So enough money is not being 
appropriated in the Mobile harbor project, and the same applies 
to many of our other projects that require dredging.
    These poorly maintained harbors increase the cost for all 
port users, reduce U.S. global competitiveness, and exacerbate 
the maintenance dredging backlog, all of which adversely impact 
the U.S. tax base and the job market.
    Aside from dredging backlogs and funding shortfalls, we are 
deeply concerned with how the Nation's ports will be expanded, 
funded, and maintained in the current fiscal climate.
    As Congress considers requests for use of the Trust Fund to 
resolve the dredging conundrum, we ask Congress to consider the 
long-term relevance and economic impact of ports within the 
context of re-examining the base of all major Federal spending 
and tax programs.
    There is legitimate need for port investment to serve 
larger vessels transiting most trade lanes. Any Federal project 
investments will ultimately draw on the trust as deepened and 
widened channels are brought online. We recognize the link 
between fee collections and expenditures is complicated. 
Increased maintenance spending on harbors will impact the 
Federal deficit unless spending in other areas is decreased or 
other collections are increased.
    We also understand guaranteed funding for dredging, and the 
budget protects dredging obligations from competing interests 
with revenue sources of type. We are also mindful that any 
guarantee limits congressional discretion to make tradeoffs in 
spending priorities. Our fiscal realities necessitate policies 
that discourage zero balance or expanded uses of the Trust 
Fund.
    The Committee has been very supportive of dredging in large 
and small ports, and we applaud the Committee's work in MAP-21. 
Congressional intent notwithstanding, there is still no 
provision to dedicate Trust revenues to fully maintain our 
ports.
    Regardless of how increased allocation for port maintenance 
dredging is addressed absent offsets otherwise, solutions are 
likely to increase the Federal deficit.
    The Port Authority supports fiscally responsible priorities 
in the use of the Trust Fund and encourages Congress to mandate 
full maintenance funding of existing Federal projects first and 
foremost. We also request Congress resist expanded use of the 
Trust to guarantee a reliable maintenance funding source for 
future growth.
    The State Port Authority thanks the Committee for its 
leadership in recognizing the nexus between water resources and 
economic prosperity. Thank you for this opportunity, and I 
would be glad to address any questions.
    [The prepared statement of Mr. Lyons follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Sessions. Madam Chair.
    Senator Boxer. Yes, go right ahead.
    Senator Sessions. Thank you for that.
    One point I would like to make that is important, I think, 
to all our ports, Jimmy, and that is the ports themselves are 
supported locally, too, by State funding and bond issues and 
that kind of thing. We are not asking the Federal Government to 
do all of this work. Can you give us an indication of how much 
the State has helped you maintain your operation?
    Mr. Lyons. Our State really does not provide--they have 
provided us with some capital funding. In my tenure, in the 
last 14 years, they have provided some capital funding that 
enabled us to serve as a basis for a large capital program, a 
10-year program that we did. That was $100 million out of $700 
million. But as far as operations, debt service, etcetera, we 
are a self-sustaining entity. We are an enterprise agency; we 
strive to make money so that we can generate capital to 
continue to reinvest in our facilities and pay our share of the 
Federal project.
    Senator Sessions. That is a bond issue that you pay back?
    Mr. Lyons. It is.
    Senator Boxer. Thank you.
    Senator Sessions. Thank you.
    Senator Boxer. So am I right to assume that this funding 
for O&M is very important to you, because the State doesn't do 
that?
    Mr. Lyons. Yes, it is critical. The State has not stepped 
in on any of the O&M or any of the expansion projects that we 
have done over the last 14 years; it has been all Port 
Authority.
    Senator Boxer. I think that is an important point because, 
Senator, this is really a classic case of private-public 
partnership. But we do have this important role, and you will 
be happy to know, before you came in, I am sure you know this, 
that we are working very closely with your staff and all of us 
to make sure that these funds are spent for their purpose, the 
purpose for which they are being collected, and it is critical 
because right now the funds are, frankly, going to make it look 
like we have a stockpile of $6 billion somewhere, which, as 
Senator Vitter points out, is illusory.
    So what we are going to do now is turn to Senator Vitter to 
introduce his witness, Mr. Lorino, and then we are going to go 
to Mr. Cairns. After that we will turn to Senator Cardin and 
Senator Cardin will have the opportunity, after the last 
witness, to make his opening statement and then ask whatever 
questions.
    OK.
    Senator Vitter. Thank you, Madam Chair.
    I want to welcome Captain Mike Lorino. Captain Lorino is a 
lifelong resident of Louisiana, living along the Mississippi 
River for almost 40 years of his life. He was first elected to 
the oldest pilot association on the entire river in August 
1972, and after a 5-year apprenticeship he was fully 
commissioned as a bar pilot in 1978. Then he served on the 
board of that bar pilot's association, then as vice president, 
and today he serves as president of that important association.
    For those of you who aren't familiar with what a pilot, a 
river pilot, not an airline pilot, is, they safely guide those 
huge ships entering the mouth of, in this case, the Mississippi 
River to ports and avoid accidents, any one of which could 
cause a multibillion dollar industry to come to a dead stop and 
maybe be an environmental disaster. So he is a true expert.
    He proved his expertise a couple years ago, in June 2011, 
June 9th. A big ship, the Ratna Puja, ran aground in the lower 
Mississippi, just above Cubits Gap. The way I found out about 
it at 6:30 in the morning is Mike Lorino called me and said the 
entire lower Mississippi is shut down right down.
    Authorized depth is 45 feet. That depth at the time was, 
maximum, 42 feet; and it ran aground, shut the whole river 
down. What is even more interesting is the way the Corps found 
out about it. General Peabody, who is in charge of dredging, 
was when I called him at 6:32 in the morning. I had been 
arguing with General Peabody to properly dredge the lower 
Mississippi for a week right at that time. He had resisted. 
Needless to say, the dredges arrived that afternoon, finally.
    But that is what we need to avoid, shutting down something 
like the entire lower Mississippi. By the way, it could have 
been much worse because the cargo on the Ratna Puja was black 
oil. Thank God we didn't have a big spill.
    Thank you, Mike, for being here.

             STATEMENT OF MIKE LORINO, PRESIDENT, 
                    ASSOCIATED BRANCH PILOTS

    Mr. Lorino. Thank you, Chairman Boxer and Ranking Member 
Vitter and distinguished members of the Committee.
    Chairman, I was honored to be here last year at this, but I 
can say this, listening to the conversations thus far this 
morning, I can see this process has grown legs and is moving 
forward, and I need to commend you and also the Ranking Member 
and members of this Committee for doing that. It is 
unbelievable how much can be done in 1 year when you put your 
mind to it, as we do, too.
    But the Harbor Maintenance Trust Fund is not a Louisiana 
issue, it is a Nation issue. It is an ad valorem tax for 
dredging jetties, breakwaters, and it is being abused. Seven 
million dollars is just being moved somewhere else.
    A little bit about the Mississippi. The Mississippi River 
touches 31 States and two Canadian provinces. We have five 
deepwater ports, the largest complex in the world. Not in the 
United States; in the world. Last year, my association that I 
represent, we did 12,000 ships in the Mississippi River. There 
was 40,000 movements of vessels from the mouth of the river to 
Baton Rouge, 40,000 in 1 year. It is unbelievable. Thirty 
percent of the Nation's oil, 60 percent of the Nation's grain 
is shipped out of the Mississippi River system.
    If we would shut down the Mississippi River, and that has 
happened a few times, it is $295 million a day for the Country, 
and grows exponentially after the fourth day. A hundred percent 
of the channel helps us maintain cost effectiveness in the 
world market, $0.13 per bushel saving over highways or rail 
when dimensions are 100 percent.
    Narrow channels hinder our ability to compete globally. 
What happens there, a ship will come in to load cargo and he 
can't get it all on that ship. So one would think, well, we 
will send it to the West Coast. That works for 1 year. After 
that we cannot compete with Brazil and Argentina. Now our 
prices are gone. Our farmers in the heartland lose that 
business. It is not acceptable when we have this money coming 
in.
    A closed Mississippi River system would dramatically affect 
gas prices, grain prices, all exports and imports. After our 
Hurricane Katrina, gas prices went up overnight because we had 
the refineries on the river. We couldn't get fuel oil out; we 
couldn't get aviation oil out. It is unbelievable. We need 
this.
    Someone mentioned about environmental. That is gigantic. We 
had an oil spill down there with BP. We have tankers coming in 
the Mississippi River system with 600,000 barrels of oil on one 
ship. If that ship runs ground and puts a hole, we have another 
BP in the Mississippi River system. But the travesty for that 
is very simple: that ship is paying. It is importing here, 
paying that tax, and here he could run aground and have another 
problem after he is paying money to come into the United 
States. That is unacceptable, ladies and gentlemen.
    Current draft at the present time is 45 by 700 feet. 
Channel width is crucial. Last year we were down to 100 feet 
from 750. We had to have one-way traffic.
    Now, I must say something. The Corps of Engineers does a 
great job when they have equipment and money, Chairman. I just 
wanted to make sure I said that for the record.
    The cost for the Mississippi River for the last 5 years, we 
have been underfunded by approximately $50 million a year. 
Fifty million a year. You know what I have to look for, and it 
is a shame in our great Country? I have to look for a 
catastrophe to put a supplemental on there to get funding. That 
is not the way it should be. That is not the way it should be.
    Safety. Safety is a huge, huge factor. Chairman, you had an 
incident out there in California a few years ago. You know what 
happens when oil is dropped in the water: everybody is 
concerned; especially a pilot, especially the owners. We can't 
have that. It happens sometimes with human error. It happens 
sometimes with mechanical. But it is not acceptable to have it 
happen when we have money coming in to keep our channels and 
ports open to project dimensions.
    The Administration said they would like to double exports. 
How can we double exports when I can't load what we have today? 
It is impossible. I am just a pilot.
    Solutions? We need the legislation that the Chairman and 
Ranking Member and this Committee are talking about. We need 
the point of order to be used. I know why the point of order, 
nobody wants it, because then you can challenge it and stop it. 
We need to have it like they have it in the Aviation Fund, so 
we can have this money directed for what it needs to be used 
for. This is a problem that can be fixed with no new taxes. The 
money is being collected.
    Solution? Yes, ma'am, I am finished. Solutions? We need 100 
percent.
    I thank you once again, Chairman Boxer, for this 
invitation, Ranking Member and distinguished members, and I 
would be happy to answer any questions.
    [The prepared statement of Mr. Lorino follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Boxer. Well, Mr. Lorino, let me thank you for that 
excellent testimony, beautiful testimony. You make the point. 
If our roads, well, you didn't say roads, I am saying if our 
roads and our waterways are clogged, we can't double exports. 
We can barely keep up with what we have got. Your State and my 
State particularly understand this, other States as well.
    I am going to call on Senator Vitter just to bid his 
farewell, because he is going off to give a--I mean to question 
Senator----
    [Laughter.]
    Senator Vitter. Well, I want to particularly thank Mike for 
his very concrete, persuasive testimony. I just want to 
underscore two things about what he said and then make a final 
comment about what we are working on.
    First of all, I want to underscore, because maybe not 
everybody heard it, lower Mississippi River, biggest waterway 
in the Country, one of the biggest in the world, reduced in 
some cases to one-way traffic. That is like having the biggest 
interState in the Country and people around there get up 1 day 
and there is an announcement, oh, I-10 is one-way today for the 
foreseeable future. If you want to go east, you better go from 
midnight to noon; if you want to go west, plan on noon to 
midnight. Crazy. Crazy.
    Second, funding for the lower Mississippi, this is the last 
5 years Mike talked about, average funding in the normal 
process, under $60 million. The average total funding after the 
supplementals we need to manufacturer, over $130 million. That 
is not the full need because that even involves restricted 
width and depth.
    My final statement is we are hard at work and making a lot 
of progress on a fully bipartisan WRDA. We are going to come 
out with that relatively soon and it absolutely is going to 
address this crucial challenge. I thank all of you and all the 
Committee members, particularly the Chair, for that work.
    Senator Boxer. Thank you so much, Senator Vitter.
    Mr. Whitehouse. Madam Chairman?
    Senator Boxer. Let me just tell you what I plan to do, and 
then I will call on you. I was going to have our last witness, 
because we interrupted our witnesses, our last witness, then I 
was going to go to Senator Cardin, Senator Whitehouse for your 
opening statement and questions. Did you have a particular 
response?
    Mr. Whitehouse. I had hoped to respond before the Ranking 
Member left, but he has now left.
    Senator Boxer. Oh.
    Mr. Whitehouse. So I will make my point during my opening 
statement time.
    Senator Boxer. That would be wonderful. I am sorry. I know 
he is rushing off to question.
    So we will move on to Mr. Cairns is a professional engineer 
with over 25 years of engineering and management experience, 
with the last 20 working exclusively in the port and maritime 
engineering field. Mr. Cairns presently serves as the Northeast 
Regional Manager for the ports and marine groups within AECOM. 
He is the past chairman of the American Society of Civil 
Engineers Committee on Port and Harbor Engineering. He is 
presently a member of the Board of Coasts, Oceans, Ports and 
Rivers Institute of the ASCE. So he understands these issues 
from a very broad perspective.
    We look forward to your testimony.

STATEMENT OF ANDREW H. CAIRNS, PE, PMP, BOARD MEMBER, AMERICAN 
 SOCIETY OF CIVIL ENGINEERS' COASTS, OCEANS, PORTS AND RIVERS 
        INSTITUTE; PORTS & MARINE--NORTHEAST LEAD, AECOM

    Mr. Cairns. Thank you, Madam Chairwoman. Senator Vitter and 
members of the Committee, it is an honor for me to appear on 
behalf of the American Society of Civil Engineers to discuss 
the importance of the Harbor Maintenance Trust Fund and to our 
Nation's overall economic health.
    The United States has approximately 300 commercial ports, 
12,000 miles of inland and intercoastal waterways, and 240 lock 
chambers which carry more than 70 percent of the U.S. imports. 
However, in order for this system to remain competitive, U.S. 
marine ports and inland waterways will require investment in 
the coming decades beyond the $14 billion currently expected to 
be spent.
    According to the ASCE's Failure to Act Economic Study, 
aging infrastructure for marine ports and inland waterways 
threatens more than 1 million U.S. jobs. Additionally, between 
now and 2020, investment needs in the marine ports and inland 
waterways sector will total $30 billion nationwide.
    With planned expenditures only expected to be about $14 
billion, a total Federal investment gap of nearly $16 billion 
remains.
    Meanwhile, the costs attributed to delays in the Nation's 
inland waterways system were $33 billion in 2010, the cost is 
expected to increase to nearly $49 billion by 2020.
    Unfortunately, even with the ever-growing price tag, these 
costs do not address the landside connections or ``inside-the-
fence'' infrastructure that is the responsibility of the port 
authorities. Therefore, the Nation will either need to pay for 
much needed investments in our ports and harbors now, or will 
pay more severely in lost labor, exports, and GDP down the 
road.
    Historically, the Nation's marine ports and inland 
waterways have been the critical link that make international 
commerce possible. However, with the scheduled expansion of the 
Panama Canal by 2015, the average size of container ships will 
increase significantly, while many U.S. ports still require 
significant harbor and channel dredging to handle these larger 
ships.
    If the Nation makes an additional investment of $15.8 
billion between now and 2020, the United States can eliminate 
this drag on our economic growth. However, if the Country does 
not make the needed investments, transporting goods will become 
costlier, prices will rise, and the United States will become 
less competitive in the global market.
    Therefore, the key solution to ensuring that the Nation's 
ports remain competitive is restoring trust back into the 
Harbor Maintenance Trust Fund.
    In 1986 Congress enacted the Harbor Maintenance Tax to 
recover operation and maintenance costs at U.S. coastal and 
Great Lakes harbors. The tax is based on the value of goods 
that are being shipped and then placed into a trust fund that 
is used for maintenance dredging of Federal navigational 
channels. However, dredging the Nation's ports and harbors has 
suffered from years of under-investment.
    The Corps of Engineers estimates, as we have heard many 
times today, that the dimensions of the Nation's 59 busiest 
ports are available less than 35 percent of the time. This 
creates an environment where vessels must carry less cargo or 
adapt to increasing delays.
    In Fiscal Year 2013, the Obama administration requested 
$839 million to be appropriated from the Harbor Maintenance 
Trust Fund. This amount equals only 50 percent of the total 
estimated revenues in the Trust Fund, and nowhere near the 
estimated needs, which, according to the Army Corps of 
Engineers, is between $1.3 billion and $1.6 billion annually.
    This troubling trend toward reduced investments has led to 
ever-greater balances in the Trust Fund, with the unexpended 
balance growing to more than $6 billion by September 2013, 
according to the Office of Management and Budget. Therefore, 
the Committee should include a provision in the Water Resources 
Development Act requiring the total of all appropriations from 
the Harbor Maintenance Trust Fund be equal to all revenues 
received by the Trust Fund that same year.
    While ASCE understands that this is a complex issue, the 
long-term viability of our Nation's ports requires action to be 
taken to ensure revenues in the Harbor Maintenance Trust Fund 
are expended for their intended purpose.
    ASCE supported language that would do just that in the WRDA 
draft that this Committee discussed last fall. ASCE has also 
supported bipartisan legislation from the last Congress that 
would tie Harbor Maintenance Trust Fund expenditures to 
revenues.
    In the 112th Congress, Senator Levin's Harbor Maintenance 
Act received 37 cosponsors from both sides of the aisle. While 
the companion legislation in the House, the Realize America's 
Maritime Promise, or RAMP, Act, received 196 cosponsors.
    Congressman Boustany reintroduced the RAMP Act last week, 
and the bill has already seen 48 Members of Congress sign on.
    In conclusion, ASCE applauds the Environment and Public 
Works Committee for working to fix the funding for shortfalls 
out of the Harbor Maintenance Trust Fund and looks forward to 
working with the Committee on a WRDA bill this year. ASCE also 
looks forward to sharing with this Committee the inland 
waterways and ports grades in our 2013 Report Card, scheduled 
to be released on March 19.
    Thank you, Senator Boxer. This concludes my testimony, and 
I would be pleased to answer any of your questions.
    [The prepared statement of Mr. Cairns follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Boxer. Well, thank you all very much.
    So here is the way we are going to go. We are going to give 
10 minutes each to Senators Cardin and Whitehouse and Boozman. 
So go ahead.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
            U.S. SENATOR FROM THE STATE OF MARYLAND

    Senator Cardin. Thank you, Senator Boxer. I don't intend to 
use the 10 minutes, but first let me apologize for not being 
here for this entire hearing, because this is a critically 
important subject matter and hearing. But, as you know, the 
conflicts are I had to chair a Senator Foreign Relations 
briefing. The urgency here is clear.
    Mr. Lorino, put me down with your enthusiasm as to the 
urgency of this matter, I am totally with you. I am going to 
ask my full statement be put in the record.
    Senator Boxer. No objection.
    Senator Cardin. Madam Chair, I will have questions for the 
record for Ms. Darcy as it relates to specific projects in 
Maryland.
    The economic impact of the work that we are doing here is 
clear: this is jobs, jobs. It is making America competitive. 
The globalization of commerce. We have to be competitive. We 
have set up a mechanism in which to be competitive and we are 
not using that mechanism; the funds are sitting there.
    I applaud the Chairman, I applaud the Ranking Member. We 
work together; this is not a partisan issue. Working together 
on an extremely important bill, the Water Reauthorization Act. 
We have to get it done. We have to get this to where it needs 
to be done.
    As we have already stated, the top ports in our Country 
handle 90 percent of the commerce and they are only dredged to 
their authorized depth and width 35 percent of the time. The 
impact here is incredible.
    I can talk about the Port of Baltimore. Since 2005, the 
costs in the Port of Baltimore has gone up 55 percent to 
maintain our port to the competitive depth and width. The 
funding during that period of time has been flat. Well, you can 
just do the simple arithmetic here, Madam Chairman. We are not 
going to be as competitive as we need to be.
    The equity issue here. From 2004 to 2010, the Harbor 
Maintenance Trust Fund generated revenue through the Port of 
Baltimore at $227 million. We received $157 million. Where is 
the fairness here? The moneys are there. The Harbor Maintenance 
Trust Fund was created to produce the revenues needed to do the 
work, and now we are not using those revenues. We have to do a 
better job.
    What is the impact? Well, vessels are loaded at a lower 
level; less efficiency, less competitiveness, and we lose jobs 
in the United States as a result of not doing what the law 
intended to be done. So there is a sense of urgency here.
    The Port of Baltimore is ranked ninth among U.S. commercial 
ports in terms of total value of goods moved through the port. 
In July 2012, the Port of Baltimore handled a record 853,000 
tons of general cargo. This cargo would not have reached the 
port if it were not for the projects financed through the 
Harbor Maintenance Trust Fund.
    In preparation for the opening of the expanded Panama 
Canal, the Army Corps, the Maryland Port Administration, and 
the regional freight logistics companies have been working fast 
to make the Port of Baltimore the East Coast premier 
international shipping destination. Between the newly 
operational super post-Panamax cranes at Seagirt, the planned 
intermodal transfer facilities in Baltimore City, and the 
deepening of the Federal channel, the Port of Baltimore is open 
for business.
    But let me make it clear. We need the projects to maintain 
the dredging capacities for this to work. My predecessor, 
Senator Sarbanes, originally got authorization for Poplar 
Island. I mention it frequently here. It is a dredge site. It 
also is an environmental treasure, Madam Chair. We did both. We 
have a dredge site plus a restoration of our barrier islands 
that were disappearing in the Chesapeake Bay.
    Well, we need to make sure that the Poplar Island expansion 
is adequately authorized, and I am working for the Corps, and I 
will have a question for Ms. Darcy, that we have to make sure 
that that is, and I thank you, Chairman and Ranking Member, for 
working with us on the WRDA bill to make sure that that is 
handled. That is an important site for dredge material and 
environmental restoration.
    We have a Hart Miller Island issue that we are working 
between the State and the Army Corps. We have Pearce Creek, 
which is another site for dredge material that we have to work 
through. On the environmental front we have the Conowingo Dam. 
I mention that because there is incredible environmental risk 
to sediment being contained by the Conowingo Dam. We have had a 
couple studies. We have to get a game plan to deal with that.
    So, Madam Chair, I just want to underscore the importance 
of the work that you are doing, that the Ranking Member is 
doing. There is an urgency here. It is very much competition 
and it is very much the investments that we make paying off for 
our Country. As I said, I applaud the witnesses that are before 
us for being here, for your working with us, for your somewhat 
understanding of the political process that we have to go 
through here. But this should be one in which we reach out 
together and do what is right for our Country.
    I will have some questions for the record for Ms. Darcy, 
and I thank again the Chairman for her courtesy.
    [The prepared statement of Senator Cardin follows:]
          Statement of Hon. Benjamin L. Cardin, U.S. Senator 
                       from the State of Maryland
    Madame Chairman, I appreciate you holding this hearing today to 
discuss the importance of America's ports and the work the Corps does 
to maintain the economic viability of our ports. I also want to 
congratulate Senator Vitter on becoming our new Ranking Member. I 
appreciate and share his interest in reauthorizing the Water Resources 
Development Act and I am grateful that the two of you are not wasting 
any time in getting back to work on the 2013 WRDA bill.
    I am hopeful that our committee will build on the bi-partisan 
success we had in passing MAP-21 in the last Congress.
    The high quality jobs associated with maintaining and building our 
infrastructure makes reauthorizing WRDA all the more important. The 
Harbor Maintenance Trust Fund, and the Army Corps projects it supports, 
keep our shipping channels open and maintain America's leadership in 
today's global economy.
    The 2007 WRDA received overwhelming bi-partisan support from this 
committee. The projects that bill supported provided critical 
employment opportunities at a time when were beginning to face 
uncertain economic times. Now, we've come back from the brink of 
economic catastrophe and reauthorizing WRDA this year will help keep 
our economy on the right course.
                  impacts of wrda to national economy
    WRDA projects are critically important for to the U.S. economy. For 
example, according to the Research and Innovative Technology 
Administration, today 1 in every 11 shipping containers engaged in 
global trade is either bound for or originates from a U.S. port.
    However, the Corps of Engineers estimates that our top-priority 
harbors, those that handle about 90 percent of the commercial traffic, 
are only dredged to their authorized depths and widths about 35 percent 
of the time.
    Costs have risen more than 55 percent for the Baltimore District 
and 40 percent for the Philadelphia District since 2005, while funding 
levels have remained essentially flat. As a result the Baltimore 
District is performing about 20 percent less dredging each year, the 
Philadelphia District about 50 percent less.
    In the Philadelphia District, some dredging funding is also 
diverted to address other needs, such as bridge maintenance.
    The Port of Baltimore has been affected by underfunding for 
maintenance dredging. Over the period 2004-2010, Harbor Maintenance 
Trust Fund taxes generated by imported cargo at the Port of Baltimore 
totaled approximately $227.7 million. Yet during this period, only 
$154.7 million of dredging was completed in the channels leading to the 
Port.
    Each year approximately 4-5 million cubic yards of material must be 
removed from the Port of Baltimore's channels to maintain the 
authorized depth and width. Given the highly competitive nature of 
maritime commerce, it is important that Port of Baltimore channels be 
maintained at their authorized depth and width on a year-round basis 
and that adequate dredged material placement capacity is available in 
order to retain and enhance the advantages of the Port of Baltimore.
    This results in ships having to light-load, which increases the 
cost of shipping and, in turn, increase the cost of goods at the cash 
register. These days many Americans are watching very carefully what 
they spend at the store and any change in the cost of goods has a 
direct impact on their consumer decisions.
    Moreover, well maintained harbors decrease costs for American 
companies who are shipping goods abroad, thereby giving American 
producers an advantage in the global marketplace. It is therefore 
imperative that we ensure that the resources are in place to maintain 
the shipping infrastructure that our nation relies on.
                 benefits of wrda to maryland's economy
    Every year the Army of Corps Engineers, in partnership with the 
Maryland Port Authority, works to maintain Maryland's vital navigation 
channels by clearing tons of eroded sediment from the Federal 
navigation channels leading in and out of the Port of Baltimore. 
Keeping our port open and the channels dredged is essential not just 
for Maryland, but for the Nation.
    The Port of Baltimore is ranked ninth among all U.S. commercial 
ports, in terms of total value of goods moved through the port. In July 
2012, the Port of Baltimore handled a record 853,818 tons of general 
cargo. This cargo would not have reached the port if not for Harbor 
Maintenance Trust Fund projects.
    In preparation for the opening of the expanded Panama Canal, The 
Army Corps, the Maryland Port Authority and our regional freight 
logistics companies have been working fast to make the Port of 
Baltimore the East Coast's premiere international shipping destination. 
Between the newly operational Super-Post Panamax Cranes at Seagirt, the 
planned Intermodal transfer Facility in Baltimore City and the deepened 
Federal channel: The Port of Baltimore is open for business.
    All of the cargo that comes through the Port would not be possible 
without the dredging projects that are supported by revenues paid into 
the Harbor Maintenance Trust Fund.
    The extensive work that is done to maintain Maryland's shipping 
channels generates a great deal of dredge material that needs to be 
disposed of in a safe and responsible manner. The Corps and the State 
have worked successfully over the years to redevelop the barrier 
islands that have historically been present in the Chesapeake Bay using 
dredge material from the Harbor. As the constructed islands reach their 
designed capacity the State and the Corps need work to close these 
facilities and move on to the next disposal site.
    I was recently informed that the Baltimore Corps District is 
working to revise its Dredge Material Management Plan (DMMP) to reflect 
the closure of Hart-Miller Island (HMI). The new Cox Creek facility 
will replace HMI as the disposal site for dredge material in the DMMP 
for Baltimore dredging projects. I am pleased that the discussions I 
facilitated between the Baltimore Corps District and the State are 
resulting in revisions to the DMMP in that reflect a mutually agreeable 
fee structure and location for where dredge material will be disposed 
of in the future. I will continue to follow the development of this 
process and will be in contact with the Assistant Secretary as the 
revised DMMP makes its way to her for approval.
    I'd be remiss if I didn't also take this opportunity to mention the 
important work the Corps is doing in Maryland, and throughout the Bay 
region, to provide critical environmental restoration of natural 
resources. The Corps' shoreline protection, sediment management, and 
oyster and habitat restoration programs are integral to Chesapeake Bay 
restoration efforts. And since oysters represent more than just a 
source of income for Maryland's watermen--they are natural biological 
filters continually cleaning up the Bay ? WRDA's habitat restoration is 
leading to long-term solutions for water quality in the Bay.
    It has been more than 5 years since Congress passed the last WRDA 
legislation. It is essential to our Nation's infrastructure, economy, 
and environment that we work together to craft a strong, effective 
bill. I look forward to working with my colleagues on the latest 
reauthorization of WRDA. Thank You.

    Senator Boxer. Well, we thank you for your passion, because 
this is really serious business, and we are lucky to have the 
Committee that we have.
    Senator Whitehouse.

         OPENING STATEMENT OF HON. SHELDON WHITEHOUSE, 
          U.S. SENATOR FROM THE STATE OF RHODE ISLAND

    Senator Whitehouse. Thank you, Madam Chair, and thank you 
for holding this very important hearing. I just want to say 
that I come at this issue with a particular history and a 
particular context, and particularly when I hear Mr. Lorino and 
his wonderful voice and the message that he brings from the 
Mississippi and the Gulf Coast about the urgency of their 
problems, and that is that not too long ago in Congress we 
passed a piece of legislation that conferred an enormous 
multibillion dollar benefit along the Gulf Coast, and we did so 
as the result of an agreement that was reached that the bulk of 
the benefit was going to flow to the Gulf Coast, but that there 
would be a small portion that would accrue to the benefit of 
all coastal and Great Lakes States.
    After the agreement that allowed that to go forward was 
reached, the part that went to the benefit of all coastal and 
Great Lakes States was stripped out. An agreement was made and 
an agreement was broken. I am inclined to, and I want to, 
support enhanced traffic on the Mississippi River. I want to 
support the protection and growth of the port in Louisiana and, 
frankly, in Los Angeles and Alaska, and everywhere else. But 
the past bargain has to be honored for me to be very 
enthusiastic about going forward with further benefit that goes 
to the Gulf and to the Mississippi, and I just want to make 
that point.
    Senator Boxer. I understand how you feel. I certainly 
shared that disappointment. All I can say is we need to move 
forward on a WRDA bill, and I would like to work with you 
because you have a couple small ports there. Maybe there is a 
way to help you through this WRDA bill.
    Bettina, I would like to work with Senator Whitehouse and 
the ways that we can work with his State, because there is no 
question we need this WRDA bill for the good of the Country.
    Senator Whitehouse. But it is also, if I might say, Madam 
Chairman, it is a matter of the good of the Senate. If 
agreements are that easily broken after they are made, then the 
sinews of the Senate begin to come apart, and I think it is 
fair for Senators who have been on the receiving end of a 
broken agreement to insist on the honoring of an agreement that 
I believe, thought, everybody had entered into in good faith.
    Senator Boxer. Right. There is a lot of reasons for this; 
some of them come from the House, et cetera. But the point is, 
in my view, if you listen to John Kerry yesterday, which you 
did, he made an unbelievable speech, and I hope all colleagues 
would read it. We have to treat each other better. Yours is an 
example of not treating each other the way we should. However, 
there is always tomorrow and a chance to recoup and come 
together and move forward, and I pledge to you that I will try 
to do that in the WRDA bill.
    We are going to have a WRDA bill, and let's make sure that 
everybody is enthusiastic about it, including the small States 
and the States with inner harbors and the rest. We need this 
for the good of our Country, and we are going to always have 
these problems if we don't come together and keep our bargains.
    So as somebody who always has kept her bargains, as far as 
I can remember, I would love to work with you on this WRDA bill 
in a way that gives you some redress. It is not going to make 
up all the ground, but I hope you would work with me on that. 
Would you do that?
    Senator Whitehouse. We will, of course, work with you.
    Senator Boxer. Good.
    Senator Whitehouse. I appreciate the support that you were 
able to give to our efforts in the previous effort that has 
turned into a broken agreement.
    Senator Boxer. Well, we are going to make another effort. 
There may be a way we can do something for the smaller ports 
here that really gives them an opportunity, because when you 
listen to Senator Whitehouse talk about his State, his State is 
in jeopardy right now, we know that, because of what is 
happening with the rising sea levels. He just needs to have 
some attention paid. In the last WRDA bill he was knew, I 
remember it. We really didn't do what we should do.
    By the way, just saying to colleagues who are here, we had 
a really hard time drafting this bill because there are no more 
earmarks, and we have to take care of our States. So the way we 
did it here is to make sure that any project that had a 
complete Corps report which was sent down from the Corps would 
get funded without naming any projects or getting into all 
that. This could be very well the last WRDA bill that we can 
figure out how to do without naming projects; after this one it 
is going to get increasingly more difficult.
    But I think we figured out a way to walk the walk on here 
without the earmarks and get it done right, and I look forward 
to working with you, Senator Whitehouse, to make sure that this 
bill reflects the priorities of your State. That is all I can 
say. I can't undo what was done, but I can move forward and 
make sure that we try to look at your priorities and answer 
them in this bill.
    Senator.
    Senator Boozman. Thank you, Madam Chair. I think we all 
agree, the panel, the Committee, the audience, whatever, that 
we need to, I would like to say, protect the integrity of the 
Trust Fund, but we need to establish some integrity, almost, 
before we protect it and go forward, much like the Highway 
Trust Fund and the Aviation Trust Fund and things like that. So 
that is pretty easy. It is difficult to get done, but we can at 
least reach agreement.
    The more difficult thing is, and we really have a varied 
panel with our ports and our engineer, is, once you have the 
trust fund, how do you divvy it up, realizing that it is a 
system-wide whatever? Los Angeles is remarkable in the sense 
that you have all this high-value stuff coming in there. You 
are creating about, I think, over 13 percent of the revenue 
that comes in, and because of the nature of your port you need 
more than what you are getting, but you are not getting very 
much of that 13 percent out. Some of our other ports, again, 
through no fault of their own, are in situations where there is 
a lot more silting; there is just a lot more need for dredging 
and things, and that is the difference in the East Coast and 
the South. It is just the way it is.
    So I guess what I would like to know from you all, that is 
not, and then the other thing that we have is the protection 
of, as Senator Crapo mentioned, again, my ports that lead into 
the Mississippi River that ultimately come out and create some 
of this traffic, how do you do all that? I guess what I would 
like to know from you all is what are your thoughts on that, 
how we can address the problem of, once we get the Trust Fund 
dollars that we like, or even dealing with what we have, what 
are your thoughts on equalizing the funding mechanism? We will 
start with California, the port that is funding a large part of 
it.
    Mr. Christensen. Thank you for your question, Senator. I 
believe that the biggest hurdle is getting the full use for 
intended purposes. That is the biggest hurdle that we can see. 
As Captain Lorino mentioned, and Mr. Lyons, the Corps of 
Engineers, from our perspective, does a pretty good job once 
they are funded, once they get the money they need for things. 
They have a system for racking and stacking and prioritizing. 
In our State they do a pretty good job; they just don't have 
enough money to cover the priorities that have already been 
established. So, from my perspective, if the HMT could be spent 
fully for its intended purpose, the major part of the problem 
would be dealt with.
    Senator Boozman. OK.
    Mr. Lorino. Senator, thank you for the question. As I 
mentioned when I started my testimony, this is not a Louisiana 
issue, this is a Nation issue. I just wanted to make sure that 
was there. But how do you do it? It is going to be tough, but 
you hit the nail on the head. Every port is not the same; every 
port is unique to itself. The Mississippi River, the area where 
we pilot, where my association pilots, shows up every year. I 
can look at you right now and say we will spend $83 million 
next year, at least. The only question is is it going to be 
more than that.
    So do you look at it on what the value that your port is 
bringing in or exporting? Do you tie it into jobs? Do you tie 
it into the amount that you have to spend over a 10-or 12-year 
period? I don't have those answers right off the top of my 
head, but I do know one thing, and I have been told this by the 
Corps: that if we can receive the full authorization from the 
Harbor Maintenance Trust Fund, it should take care of all of 
our ports, no matter where they are, for their projects. That 
is the way it should be, because every port is importing cargo 
that is paying that money. I really believe the answer to it 
would be get all the money and then figure it out on an 
economic basis or a condition basis, one of those two.
    So that is the best I can say on that, sir.
    Senator Boozman. Mr. Lyons real quick, and then Mr. Cairns.
    Mr. Lyons. Senator, one thing I have learned about being 
around ports for about 40 years is that they have one thing in 
common, and that is that they are all different. They are 
different in the types of cargos that they handle; some high-
value, some low-value. Some ports handle a lot of electronics; 
some ports handle a lot of low-value manufacturing raw 
materials. Some ports need a great deal of dredging; some ports 
need none.
    The Harbor Maintenance Tax, in my view, is a tax that is 
paid by the consumers of these goods that are imported into our 
Country, whether they are a person who buys a TV in Arkansas or 
Alabama, or a company that is buying wood fiber from Brazil and 
using it to manufacture something else. They are who are paying 
this tax. So that tax is paid by all the taxpayers. The tax, 
like all of our taxes, should be allocated to where they are 
needed. I think our biggest concern really needs to be that we, 
first of all, direct all of the money to take care of all of 
the dredging needs that we have throughout this Country. I 
agree with you that the inland waterways, which is a separate 
issue from the Harbor Maintenance Tax, is a big, big issue. We 
have it in Alabama, as you do in Arkansas.
    So I think the big issue is to, first and foremost, get the 
tax allocated out to take care of all of the dredging needs, 
whether in Louisiana or whatever State or whatever port. 
Second, if there is something left over, then we can talk about 
that.
    Senator Boozman. Very quickly, Mr. Cairns.
    Mr. Cairns. Sure, Senator Boozman.
    ASCE agrees with you that it is really trying to get the 
intended funds used for what their purpose is, so if the harbor 
maintenance funds are there, they should be used and spread 
about to the projects that have those needs. As far as the 
equity, really, ASCE doesn't have a position on which ports and 
how that should be.
    Senator Boozman. You are a wise man.
    Thank you very much.
    Senator Boxer. Thank you, Senator.
    So I have just a few questions.
    Mr. Christensen, you laid out four recommendations in your 
testimony: first, full use of the Harbor Maintenance Trust 
Fund; second, equity for ports that contribute the most; third, 
allowing the Highway Maintenance Trust Fund to fully 
maintenance up to 50 feet; and, fourth, prioritization of 
traditional maintenance dredging.
    I am asking you, because these are so important to 
California, that moves 40 percent of the cargo through, the 
imports, could you elaborate on why these recommendations would 
be beneficial for ports around the Country?
    Mr. Christensen. Yes, Senator. Before I start, Senator, let 
me reiterate my thanks to you and the Ranking Member and the 
Committee for doing this. This is such a great thing to be 
talking about.
    As I mentioned, full utilization gets us mostly where we 
need to be, and I think, as we have heard from some of the 
other members of the panel, that is the big issue; get it spent 
for its intended purpose. So that is our No. 1 ask.
    The No. 2, about prioritization of funds for their 
traditional purposes, we agree that that needs to be in the 
water. This needs to be spent on things that have a direct----
    Senator Boxer. You think that is important for all the 
ports, not just our port? That is the point I am making.
    Mr. Christensen. Absolutely. This is, I think, as Captain 
Lorino had mentioned, it is a nationwide issue, it is a 
nationwide problem. It is a California-wide problem. In 
California, our ports operate as a system, and while you have 
three larger container ports, you also have quite a number of 
other ports that are working to support their niche functions. 
The ports, by their very nature, are entrepreneurial; they 
operate as a business.
    The free market system has, in essence, brought these ports 
in California to their own specialty; they each do something 
very well. We feel we do containers very well. There are other 
ports that do bulk shipments very well. They all have to be 
maintained to keep this system operating. If they don't, if one 
of the wheels comes off on one of those other ones, it affects 
everyone, because those other uses get piled on.
    Senator Boxer. We call our ports a river highway.
    Mr. Christensen. We do.
    Senator Boxer. Which I think was Ray LaHood's idea, looking 
at all the ports together as a highway.
    Mr. Christensen. That is right. In fact, we have a 
demonstration project in California, as you are well aware, 
Senator, in the Port of Stockton.
    Senator Boxer. Yes.
    Mr. Christensen. But even the Port of Stockton is suffering 
because of lack of maintenance funding. They have shoaling that 
means that iron ore ships loaded in Stockton cannot leave full, 
they have to leave light-loaded; they go to Oakland and then 
they get topped off. That is extremely inefficient.
    Senator Boxer. Well, let me thank you for your very clear 
testimony on those four things, because I do think they apply 
across the board here. As we look at extreme weather we see 
more problems with dredging, too, because there is more silt 
coming down and more problems. So this is absolutely essential.
    Mr. Lorino, my final questions are for you, and then I will 
turn it over to Senator Whitehouse, should he have some 
followup questions.
    I just thought your testimony was so good because I know 
what you have gone through in Katrina; I was there and I 
understand the unique challenges in some way because the beauty 
of that State is all around, and in the middle of all that you 
have all this heavy industry and all this port activity. The 
balance of that is so important is so important. If there is a 
problem, everything is hurt.
    So I wanted to ask you about beneficial uses of dredge 
material. In your testimony you raised the possibility that 
increased spending from the Harbor Maintenance Trust Fund could 
create additional opportunities for beneficial use of dredge 
materials, such as wetlands restoration, and it was mentioned 
by Senator Cardin. Could you elaborate on some of the 
beneficial uses of dredge material that might be realized if we 
increased investment in dredging navigation channels?
    Mr. Lorino. Chairman Boxer, yes, ma'am. First of all, I did 
meet you down there during that time, and I just wanted to say 
thank you very much. It was very nice for you to come down and 
do that, along with other Members of Congress.
    But beneficial use in the State of Louisiana is a very 
tough issue, and it is only tough because of one thing: money. 
As I discussed a few minutes ago, we have $83 million to spend, 
and that is picking up sediment that comes down every year. The 
State would love us to use that for beneficial use. We would 
love to use that for beneficial use. But we are barely keeping 
our channel open. To use it for beneficial use, we have to 
transport it further. That would take time. There is not enough 
dredges to do that at the present time. So we have this 
conflict that is going back and forth.
    What I would like to see, if we could, and we are looking 
at a 50-foot channel also on the Mississippi River. Someone 
mentioned on the East Coast about the port study to get the 50 
feet. They left out the bulk port, and that is very important. 
The Mississippi River is a bulk port. But if we could dredge, 
we could use a cutterhead dredge and build the coast down in 
Plaquemines Parish that was devastated by Katrina.
    But we need the money and it has to be a combination 
between our State and the Federal Government; it can't just be 
the Federal Government, it has to be the State also. We work on 
that a lot, but it is a very difficult issue to tackle when we 
can barely keep our head above water to keep the channel open 
the way we are doing it now, if I am making any sense.
    Senator Boxer. You do. You do. I mean, it all comes down to 
the resources. It just seems so unfair to me when people pay 
into a fund and then the fund is not used for that purpose. I 
just feel it is, in a way, defrauding people. It is not right, 
and that is why we are going to hope to move in a very 
bipartisan way to change that.
    I would ask Senator Whitehouse if he has some closing 
questions.
    Senator Whitehouse. I have time for questions, but I have 
no time for answers, so what I would like to do is to ask the 
questions for the record and ask you to get back to me, if I 
could, and it is for the port operators who are here.
    Senator Boxer. Well, why don't you ask your questions.
    Senator Whitehouse. Two questions. The first is, in your 
particular port, what are you seeing, looking forward, that 
would affect you as the result of bigger storms, rising seas, 
and other effects of climate change, and how are you responding 
to those threats? That is question one.
    Question two is the American Port Operators Association is 
a strong and staunch supporter of a process that goes by the 
rather unhelpful name of Marine Spatial Planning. Are you 
engaged in that in your areas? Is it beneficial, and how?
    AMr. Lorino, you may very well have views on that. You are 
invited to join, if you would like to. Any witness who cares to 
add something to that is welcome to add.
    But I have a noon meeting that I have to be on time for and 
I apologize. But I want to again thank the Chairman for this 
hearing and for bringing us together around this very important 
issue.
    Senator Boxer. I thank you, Senator, so much. We really do 
look forward to working together, and I hope on a pretty fast 
track. There is a lot that the Senate is going to be doing, and 
we want to sort of maybe get it started in a very positive 
direction.
    All of you have been so articulate, every one of you, and I 
couldn't imagine a better panel for what we are trying to 
accomplish here.
    We stand adjourned. We thank you and we look forward to 
working with you. We are asking you to help us get this WRDA 
bill. We will call you when we feel we are running into some 
waves. Thank you very much.
    [Whereupon, at 11:57 a.m. the committee was adjourned.]
    [Additional statements submitted for the record follow.]
          Statement of Hon. Frank R. Lautenberg, U.S. Senator 
                      from the State of New Jersey
    Madam Chairman,
    The Water Resources Development Act is about strengthening our 
water infrastructure, and nowhere have we seen a clearer reminder of 
the need to improve our water infrastructure than in my State of New 
Jersey.
    Since Superstorm Sandy hit our shores, we have seen the 
catastrophic damage that can be caused when infrastructure is 
unprepared for the force of an extreme weather event.
    The storm sounded the alarm that the Federal Government must invest 
in infrastructure to recover from the storm and build it stronger so we 
are prepared for the next storm.
    That's why the Sandy supplemental appropriations law I helped write 
contains funding to rebuild and expand Army Corps beach projects and 
other infrastructure projects critical to protecting communities.
    But let's be clear: our changing climate means severe storms will 
become more and more common, and that means a new WRDA bill must make 
it permanent policy to build these infrastructure projects stronger 
than before.
    During Sandy, we also saw the limits of our outdated water 
infrastructure when two (2) water treatment facilities were damaged, 
with one (1) plant leaking millions of gallons of sewage into Newark 
Bay as a result.
    So we must include smart financing programs in the WRDA bill, to 
ensure our clean water infrastructure is modern and effective.
    Sandy also damaged the Port of New York and New Jersey, which is 
the largest port on the East Coast and serves more than one-third (1/3) 
of the country. More than two-hundred seventy thousand (270,000) jobs 
depend on this port.
    But the majority of the port's terminals were shut down for more 
than a week because of power outages, structural damage, and hazards in 
the water that could impair ships.
    We learned from Superstorm Sandy that the effects of extreme 
weather events on our ports can be devastating to the economy.
    Madam Chairman, the Harbor Maintenance Trust Fund is critical to 
maintaining and repairing our ports. We need to ensure the strength of 
this fund, but we must do so in a responsible way that does not 
compromise the Army Corps' flood control projects.
    I look forward to working with Chairman Boxer and our new Ranking 
Member, Senator Vitter, on a new WRDA bill that can take the important 
next steps to modernize our infrastructure, strengthen our ports, and 
protect our communities.

                                 ______
                                 
            Statement of Hon. Roger F. Wicker, U.S. Senator 
                     from the State of Mississippi
    I want to thank the Chairman and Ranking Member for holding this 
hearing on a matter that is vital to America's economic prosperity and 
important to my State of Mississippi.
    Our ports are gateways to global commerce, fuel economic 
development, and support millions of American jobs. Failing to make the 
proper investments at this critical time would have a serious impact on 
jobs and economic growth. The expansion of the Panama Canal has 
generated new interest in U.S. ports along the Gulf Coast and Eastern 
Seaboard.
    By 2015, the Canal will have the capacity to accommodate 
significantly larger cargo ships. As global trade increases, we must be 
ready to take full advantage of growing import and export 
opportunities. According to a June report by the Army Corps of 
Engineers' Institute for Water Resources, the expansion of the Panama 
Canal could provide significant opportunities for our Gulf and South 
Atlantic ports to become more competitive. Geographically, ports in 
these regions are positioned to be the most impacted by the expansion. 
U.S. ports need to be ready for post-Panamax vessels, which will play a 
major role in facilitating greater global trade. These vessels are 
expected to make up an estimated 62 percent of all container ship 
capacity by 2030. The boost in maritime commerce means States like 
Mississippi will be able to capitalize on international trade 
opportunities that would benefit the entire country.
    Because shipping is less expensive than other types of transport, 
reliable port capabilities help keep our country's trade market 
competitive. Yet, there are challenges. Despite opportunities for 
maritime commerce, our Nation's ports face numerous hurdles. America's 
59 busiest ports are maintained at authorized widths and depths only 35 
percent of the time. The Corps estimates a backlog of $2.2 billion in 
current harbor maintenance projects.
    Although the Harbor Maintenance Trust Fund collects sufficient 
revenue each year--and has a surplus of nearly $7 billion--these funds 
are not utilized for their intended purpose. Mississippi's State port 
at Gulfport has been dredged to its authorized depth of 36 feet only 
once since recovering from the destruction of Hurricane Katrina. Today, 
some areas of the channel are as shallow as 32 feet. This restricts 
Gulfport's throughput capacity and its associated economic benefits.
    I would like to know Assistant Secretary Darcy's views on this 
issue and what the Corps is doing to address dredging needs--
particularly when lack of maintenance dredging makes a port less 
competitive in securing future maintenance dredging. For Mississippi's 
State port, this has become a vicious cycle that must be addressed. I 
am also curious to know why the Corps' funding needs for dredging and 
other activities are not accurately reflected in the Administration's 
budget from year to year.
    Again, I thank the Committee for holding this important hearing.

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