[Congressional Record Volume 144, Number 5 (Tuesday, February 3, 1998)]
[Extensions of Remarks]
[Pages E81-E82]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               THE GREAT LAKES-ST. LAWRENCE SEAWAY SYSTEM

                                 ______
                                 

                         HON. JAMES L. OBERSTAR

                              of minnesota

                    in the house of representatives

                       Tuesday, February 3, 1998

  Mr. OBERSTAR. Mr. Speaker, today, I am introducing legislation to 
improve the competitiveness of the Great Lakes-St. Lawrence Seaway 
system and restore its vitality.
  The Great Lakes-St. Lawrence Seaway system is a vital transportation 
corridor for the United States. The Seaway connects the Great Lakes 
with the Atlantic Ocean and makes it possible to ship manufactured 
products from our industrial Midwest directly to overseas markets. 
Benefits of efficient operations of this transportation route are not 
limited to the Great Lakes region but extend throughout the United 
States. Congress recognized the broader impacts and, accordingly, 
designated the Great Lakes as America's fourth sea coast in 1970.
  The Great Lakes region, and international markets, recognized the 
system's potential, as evidenced by the sharp rise in vessel and cargo 
traffic through the Seaway immediately after its opening in 1959. 
Unfortunately, that potential was never fulfilled. The upward trend in 
cargo traffic peaked around 1977-79. It has since declined in part as a 
result of a nationwide economic recession that hit the manufacturing 
sector particularly hard, and in part due to capacity constraints 
imposed by the Seaway.
  Locks on the Seaway and the Great Lakes were built as long ago as 
1895. New locks constructed for the Seaway between the mid-and late-
1950s as authorized by Congress in 1954 were built to the same size as 
those completed in 1932. Locks and connecting channels were limited to 
27 feet of draft. Because vessel size has grown over time, Seaway 
facilities were too small on its opening day to service the commercial 
fleet then in existence. Today, they are capable of accommodating only 
about 30% of the world's commercial fleet. An undersized Seaway that 
denies large, specialized, and efficient vessels access to the system 
will prevent U.S. products, especially those from the Great Lakes 
region, from competing effectively in the global economy.
  In addition to declining traffic, inadequate investment in Seaway 
infrastructure caused the mix of cargoes shipped through the system to 
be transformed from one that was diverse to one composed largely of low 
volume commodities. Although the trend of cargo tonnage through the 
system turned up once again in 1993, current cargo mix consists of 
essentially steel coming to the Great Lakes region from abroad, grains 
going overseas, and iron ore moving from one port to another within the 
region. Since the late 1980s, industrial manufacturing in the United 
States has recovered through investment in technology and corporate 
restructuring. Industrial production is flourishing once more in the 
Great Lakes region; Midwest economies are booming. Yet, only a small 
volume of high value finished goods move through the system. The Great 
Lakes region, therefore, is unable to fully participate in this 
resurgence of economic strength due to limitations in the Seaway's 
capacity.

  For the past year I have been working closely with interested parties 
in the Great Lakes maritime transportation community and the 
infrastructure investment finance sector throughout the United States 
and Canada to develop a proposal to allow the Seaway to reach its full 
potential, to guarantee the future viability of the Seaway, and to 
continue the economic development of the Great Lakes region.
  The bill I am introducing today, the Binational Great Lakes-Seaway 
Enhancement Act of 1998, developed in concert with the Honorable Joe 
Comuzzi, a dear friend of mine and a member of the Canadian Parliament 
whose district (Riding) is adjacent to mine, would establish the 
foundation, create the conditions, and provide the resources to permit 
the system to achieve its full potential. The bill would authorize the 
creation of a binational authority to operate and maintain the Seaway. 
It would also provide for the establishment of a non-federal credit 
facility to offer financial and other assistance to the Seaway and 
Great Lakes maritime communities for transportation-related capital 
investments.
  Specifically, the legislation would establish a binational 
governmental St. Lawrence Seaway Corporation by combining the existing, 
separate U.S. and Canadian agencies which operate each country's Seaway 
facilities. It would require the Corporation's top management to run 
the Seaway in a business-like manner. It would transfer Seaway 
employees and the operating authority of Seaway assets to the 
Corporation. It would provide labor protection for current U.S. Seaway 
employees, whether or not they transfer to the Corporation. It would 
offer incentives for employment and pay based on job performance. It 
would set forth a process for the Corporation to become financially 
self sufficient. At the same time, it would provide the United States 
with ample oversight authority over the Corporation.
  Through merger of the two national Seaway agencies into a single 
binational authority, we could eliminate duplication and streamline 
operations. Improved efficiency would reduce government's cost of 
operating the Seaway. At the same time, a unified Seaway agency

[[Page E82]]

would reduce regulatory burden and help cut the sailing time of ships 
through the system. This latter efficiency improvement would positively 
affect the bottom line of Seaway users. All of these efficiencies would 
make the system a more competitive and viable transportation route for 
international commerce.
  The Great Lakes and the Seaway should be considered as an integrated 
system in maritime transportation. Improvements to the Seaway 
infrastructure alone would not be sufficient to deal with the 
efficiency and competitiveness problems facing the Great Lakes-Seaway 
system. On the contrary, improvements to the Seaway for example, could 
stress the capacity of ports on the Great Lakes. A comprehensive 
approach is necessary to address the system's investment needs.
  My legislation, therefore, would provide for the establishment of a 
Great Lakes Development Bank. It would outline in broad terms the 
structure of Bank membership. To insure no taxpayer liability, this 
legislation would prohibit the United States and the St. Lawrence 
Seaway Corporation from becoming members of the Bank. It would specify 
eligible projects for financial and other assistance from the Bank. It 
would define the forms of such assistance. It would require recipients 
of Bank assistance, states or provinces in which such recipients are 
located, contractors for projects financed with Bank assistance, and 
localities in which such contractors are located to become Bank members 
to broaden the Bank's membership base. It would establish an initial 
capitalization level for the Bank, and would provide as U.S. 
contributions $100 million in direct loan and up to $500 million in 
loan commitments that could be drawn upon to meet the Bank's credit 
obligations. It would set interest on U.S. loans to the Bank at rates 
equal to the current average yield on outstanding Treasury debts of 
similar maturity plus administrative costs to preclude taxpayer subsidy 
to the Bank. It would allow the United States to call loans to the Bank 
if the Bank is not complying with the objectives of this legislation 
and would provide specific limitations on United States' liability to 
protect our interests.
  Mr. Speaker, my legislation is intended to make the Great Lakes-
Seaway system a more efficient, competitive, and viable transportation 
route. Such a system will enable our manufacturers to bring their goods 
to the world market at reduced cost, making their products more 
competitive in the global economy. This is a sensible bill; it is a 
good-government bill. We should all support it. I will be sending out a 
Dear Colleague letter seeking co-sponsors for the bill. I hope members 
will offer their support and join me in moving this legislation 
forward. This proposal should be enacted this year.

                          ____________________