[Congressional Record (Bound Edition), Volume 145 (1999), Part 10]
[Extensions of Remarks]
[Pages 14089-14090]
[From the U.S. Government Publishing Office, www.gpo.gov]



 INTRODUCTION OF THE BINATIONAL GREAT LAKES-SEAWAY ENHANCEMENT ACT OF 
                                  1999

                                 ______
                                 

                         HON. JAMES L. OBERSTAR

                              of minnesota

                    in the house of representatives

                        Wednesday, June 23, 1999

  Mr. OBERSTAR. Mr. Speaker, today, I am introducing legislation, the 
Binational Great Lakes-Seaway Enhancement Act of 1999, to improve the 
competitiveness of the Great Lakes-St. Lawrence Seaway system and 
restore its vitality.
  This coming Sunday will mark the 40th anniversary of the opening of 
the St. Lawrence Seaway. 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 and grains 
from the Upper Plains 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 then went into a long decline 
precipitated in part by a nationwide economic recession that hit the 
manufacturing sector particularly hard, and prolonged in part because 
of 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 had grown over time, Seaway 
facilities were too small on its opening day to serve the commercial 
fleet then in existence. Today, they are capable of accommodating no 
more than 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-value 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 and coal moving from one port to another 
within the region. Since the last 1980's 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 is shipped 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 more than 2 years, I have been working closely with interested 
parties in the Great Lakes maritime transportation community and the 
infrastructure investment finance sector in 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 1999, 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 that 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. Moreover, a unified Seaway agency 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.

[[Page 14090]]

  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 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 ensure 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.

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