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Oregon’s new governor Kate Brown two weeks ago signed into a law a bill requiring distributors to reduce the carbon “intensity” of vehicle fuel by 10 percent over the next decade.
Now the American Trucking Associations has joined with the American Fuel & Petrochemical Manufacturers and the Consumer Energy Alliance in suing Oregon to block the fuel standards.
“The Oregon program is set up to give a big boost to Oregon’s small biofuel industry, without reducing net greenhouse gas emissions, and at the expense of higher fuel costs for everyone,” said ATA Vice President for Energy and Environmental Affairs Glen Kedzie. “Unfortunately for Oregon, the Constitution doesn’t allow states to set up these kinds of trade barriers in order to promote in-state businesses, nor does it allow Oregon to regulate how fuel is produced in other states.”
The trucking group contends that the Oregon law will hurt out-of-state refiners and producers and thus violate the Constitution’s Commerce Clause.
Brown said she signed the bill because it will help counteract “the effects of a warming planet. This year, 85 percent of our state is experiencing drought, with 33 percent experiencing extreme drought.”
She noted that her state’s Pacific Coast neighbors, California, Washington, and British Columbia, have launched their own lower carbon emissions programs, “which will shape the West Coast market,” and therefore “it is imperative not only that Oregon does its part to reduce greenhouse gas emissions but also that we build a program that meets the needs of Oregonians.”
Brown, a Democrat who had been serving as Oregon’s secretary of state, became governor last month when Gov. John Kitzhaber, also a Democrat, resigned amid federal and state investigations into potential conflicts of interest and influence peddling involving his fiancée, green energy consultant Cylvia Hayes.
Oregon House Minority Leader Mike McLane, a Republican, insinuated during the final House debate on the bill that it might have been improperly influenced by Hayes. “We need to know who influenced who, and was that influence improper or illegal,” he said.
Congress is another week closer to the May deadline for re-authorizing highway and mass transit spending.
What that means: if lawmakers don’t pass an authorization bill before May ends, then the Highway Trust Fund would be paying out money to the states at a much slower pace than normal, which would hinder or halt projects during the spring and summer construction season.
This week most of the Obama administration’s transportation officials will be testifying on Capitol Hill at appropriations hearings.
Tuesday the Senate Commerce, Science and Transportation Subcommittee on Aviation Operations, Safety and Security hears from Melvin Carraway, acting administrator of the Transportation Security Administration about the Obama administration’s Fiscal Year 2016 TSA budget request and issues such as the effectiveness of the TSA’s Pre-Check program for trusted travelers.
The chairwoman of the panel is Sen. Kelly Ayotte, R- N.H., who is up for re-election in 2016.
Meanwhile the Federal Aviation Administration chief Michael Huerta will testify to the House appropriations subcommittee on Commerce, Justice, Science, and Related Agencies.
Also Tuesday, the House Transportation and Infrastructure Committee gets the state and local perspective from North Carolina Gov. Pat McCrory, Salt Lake City Mayor Ralph Becker, and Wyoming Department of Transportation director John Cox.
On Wednesday, Transportation Secretary Anthony Foxx testifies before the Senate Appropriations Subcommittee on Transportation.
Finally on Thursday, the House Appropriations Subcommittee on Transportation hears from Gregory Nadeau, acting head of the Federal Highway Administration, Therese McMillan, acting head of the Federal Transit Administration, National Highway Traffic Safety Administration chief Mark Rosekind, and Maritime Administration chief Paul Jaenichen.
The administration witnesses are sure to make the case for budget certainty and for a long-term infrastructure funding solution. The latter is looking less and less likely in 2015.
This week the 29 West Coast ports began their recovery from a damaging nine-month labor dispute that led to work slowdowns. Container ships lined up off shore as they waited to dock and unload their containers.
We looked at the need for the ports to regain the trust – and patronage—of shippers, some of whom have diverted ships to East Coast, Mexican, and Canadian ports.
The theme of protectionism ran through a couple of stories this week, with our look at the Buy America requirement for infrastructure projects – even for components as small of four-inch steel valves on a the Kosciuszko Bridge project in New York City.
(Kosciuszko, by the way, was a Polish military officer and engineer who designed fortifications along the Hudson River and helped the colonies win their independence.)
Will that shipment arrive in time? That’s a big question in the aftermath of Friday’s announcement from the Pacific Maritime Association and the International Longshore and Warehouse Union that they’d come to a tentative agreement on a five-year contract.
How soon can U.S. exporters, and the dockyard workers, terminal operators, railroads, and truckers upon whom they rely, convince customers in Korea, China, and elsewhere that U.S. products will get there as promised?
All sides need to “help restore confidence that the West Coast and the United States are open for business,” said National Association of Manufacturers president Jay Timmons.
In a week of some bad transportation news – a crippled mass transit system in snowbound Boston, cracked rails and delays on Washington’s Metro, an oil train derailment in West Virginia, and the unresolved West Coast ports dispute, here’s one bit of good news: Bertha is now closer to her rescue and repair.
In January we reported on Bertha, the $80 million, 7,000-ton tunnel-boring machine that was stuck 60 feet under Seattle’s waterfront.
Bertha had been digging a tunnel under the waterfront part of the city to replace the Alaskan Way viaduct, a major north-south artery which was damaged by the Nisqually earthquake in 2001.
But the giant machine got stuck in December of 2013 after the project manager reported that “unanticipated and increasing resistance was experienced” and crews discovered damage to the machine.
On Thursday, part of Bertha’s cutter head broke through a wall of an access pit that will eventually allow crews to take the machine apart and repair it.
“We don’t have an estimated repair cost yet.” Chris Dixon, project director for the Seattle Tunnel Partners told the Seattle Times.
And when Bertha will return to her job of boring the tunnel is also not yet known.
Boxes of apples are stacked to the ceiling in a warehouse in Yakima, Wash., fruit that should be headed to markets in China for next week’s New Year celebrations, but won’t be going due the West Coast ports dispute.
That image from Rep. Dan Newhouse, R- Wash., was one of the many examples cited Thursday by House members of both parties, and from Ohio to American Samoa, as they pleaded with the International Longshore and Warehouse Union and the Pacific Maritime Association to come to terms and end their nine-month contract battle.
“I’ve heard of [potato] producers facing bankruptcy because their products are en route and stuck, and obviously that’s not a good situation to be in” when you export a perishable product, Newhouse said. “We’re missing out on tremendous market opportunities, for instance the Chinese New Year is one of the biggest windows of sales that we have for Washington apples.”
An increasing number of disenchanted Korean, Japanese, and Chinese buyers of U.S. pork are now looking elsewhere, Cargill vice president for international sales Norman Bessac told a Senate Commerce subcommittee Tuesday.
Cargill is a Wayzata, Minn.-based agricultural processor with $135 billion in sales last year.
Asian buyers are cancelling U.S. orders and shifting to suppliers in Chile, Australia and the European Union, Bessac said.
“Any time you disappoint a customer, it takes time to build trust back,” Bessac told subcommittee chairwoman Sen. Deb Fischer, R- Neb. “There is no doubt that we’ve disappointed our customer base, primarily in Japan, Korea and China over the last couple of months and that will take some time to rebuild trust.”
Running through our stories this week was the theme of struggle, the competitive fray, the battle between contending forces.
Since we’re in Washington, D.C., of course there’s the inevitable struggle between the executive and legislative branches over political power and the interpretation of law.
Rep. Janice Hahn, D-Calif., told us that in the Water Resources Reform and Development Act (WRRDA), enacted just last year, “We laid out a very reasonable, common-sense goal of increasing what we’re spending every year” on harbor dredging and port maintenance.
But Hahn said President Obama’s proposed Fiscal Year 2016 budget “decreases what we’re spending every year and in fact in 2025 is only proposing that 30 percent of all the money we collect would be returned to the ports.”
And we described another legislative vs. executive struggle over a new tank car standard which the Pipeline and Hazardous Materials Safety Administration has yet to deliver, creating regulatory uncertainty among railroads, shippers, and car manufacturers.
A sardonic Rep. Peter DeFazio, D- Ore., said at a House hearing Tuesday the rule is “lost somewhere in the bowels of the administration between the agency and the trolls over at the Office of Management and Budget who will further delay the ruling.”
Then there’s the struggle between major U.S. airlines and Persian Gulf competitors such as Emirates over the terms of Open Skies agreements were intended to allow fairly free and open competition.
The U.S. air carriers are asking the Obama administration to consider re-negotiating those deals, alleging that Gulf air carriers are government subsidized.
Another form of struggle is the eternal one of labor versus management. We saw it this week in the West Coast port managers’ standoff with the International Longshore & Warehouse Union over a new contract.
Pacific Maritime Association President Jim McKenna as he warned that ports from Los Angeles to Seattle were at “the brink of collapse” due to union work slowdowns.
A book of government cost-cutting ideas offered by the conservative Heritage Foundation on Thursday includes a big one for transportation: limit spending from the Highway Trust Fund only to the amount of revenue the fund collects from federal highway taxes.
Eight-five percent of those revenues come from gasoline and diesel fuel taxes, but there is some revenue from excise taxes on trucks, trailers, and truck tires.
Heritage says its idea would save $179 billion over 10 years.
The Heritage Budget Book said that “Congress diverts at least 25 percent of HTF dollars to non-road, non-bridge projects, including bicycle and nature paths, sidewalks, subways and buses, landscaping, and related low-priority and purely local activities.”
Instead, it said, Congress should limit trust fund spending to the roughly $39 billion collected from the gasoline, diesel, and other highway taxes “and refocus the federal highway program to encompass only Interstate Highway System maintenance and expansion, and a few other federal priorities, letting the states or private sector take over the other activities if they value them.”
This, the foundation said, “would free up valuable HTF money for road and bridge projects that will benefit those motorists paying for the program in the first place.”
The Congressional Budget Office noted in its annual forecast last week, federal spending on highways and mass transit has been running at about $53 billion a year.
CBO estimates that the revenues from federal taxes on gasoline and diesel which go into the Highway Trust Fund will stay at $38 billion to $39 billion a year from now until 2025.
The nine-month labor negotiations between the Pacific Maritime Association and the union representing 20,000 dockworkers at West Coast ports entered a new phase Wednesday when the port managers went public with their pay and benefit offers to the union.
The move was an apparent attempt to spur the International Longshore & Warehouse Union to agree to a new contract, or face a closing of the ports through a lockout.
Pacific Maritime Association President Jim McKenna gave reporters details of the negotiations and warned that the West Coast ports were at “the brink of collapse” due to union work slowdowns.
The pace of containers moved per hour has fallen by up to 60 percent at some West Coast ports, he told reporters on a conference call. When the labor slowdown reaches 40 or 50 percent of normal productivity “we are really paying them to strike us,” he said.
In his Fiscal Year 2015 budget last March, President Obama said he wanted to use “one-time transition revenue resulting from business tax reform” to pay for highways, roads and transit systems.
Now Rep. John Delaney, D- Md., has introduced a bill that fills in details of a concept about which Obama, House Speaker John Boehner, and several others have been thinking aloud: pay for infrastructure with tax revenue from repatriated profits of U.S. corporations.
But Delaney said his bill is “much more comprehensive” than what Obama sketched out last March.
Delaney’s measure would impose an 8.75 percent tax on overseas profits and would, he said, raise $170 billion, more than enough to both fill the shortfall in the Highway Trust Fund for six years and to create a new $50 billion infrastructure funding entity.
It would also give Congress what he called “a nice long runway” for lawmakers to devise ways to cope with the anticipated decline in revenues from taxes on gasoline and diesel fuel.
When a politician’s theme of the day is “aging infrastructure,” the default backdrop for the photo op is often the obsolete and overcrowded Brent Spence Bridge which connects Covington, Ky. and Cincinnati, Ohio.
On Wednesday Gov. Steve Beshear of Kentucky, a Democrat, and Gov. John Kasich of Ohio, a Republican, offered a plan to revamp the existing bridge, build a new bridge, and improve interstate approaches to the spans which cross the Ohio River.
The plan calls for:
According to governors’ statement, inflation is driving up the project’s cost (currently $2.6 billion) by $7 million every month.
Two sharply contrasting views of transportation policy were on display in Washington Tuesday.
Sen. Bernard Sanders, I- Vt., announced his Rebuild America Act, a $1 trillion, five-year plan to repair and build transit systems, bridges, highways, railroads, ports, the national electric power grid, and national parks.
He did not include financing proposals in the bill.
“What I wanted to do was focus on the need to build the infrastructure and not start the debate right away on how we fund it. There are many ways to fund it and honest people can have honest differences of opinion,” Sanders told reporters.
Sanders serves on the Environment and Public Works Committee which will be working on a highway reauthorization bill this year. He was skeptical about proposals to use repatriated profits of U.S. corporations now held overseas to pay for infrastructure.
He also said Sen. Barbara Mikulski, D- Md., the ranking member of the Appropriations Committee, is a co-sponsor of his bill.
Meanwhile, the limited-government, free-enterprise think tank, the Competitive Enterprise Institute, issued its 2015 legislative agenda.
In its annual budget and economic forecast Monday the Congressional Budget Office reminded members of Congress of some of the basics that set the bounds of the infrastructure debate:
Congestion. Transportation planners spend their lives analyzing it and trying to devise ways to relieve it.
Especially with lots of transportation wonks in Washington this week for the 94th annual meeting of the Transportation Research Board, we heard much expert discussion about congestion on the highways, in our cities, and at our seaports.
On the highways, HNTB’s congestion pricing guru Matthew Click gave us his thoughts on why the San Francisco Bay area is the most interesting place in country in 2015 to watch for development of toll lanes.
Once you exit the highway and arrive in the big city, you may face the question: where can I find a place to park?
We heard from urban planners at the TRB meeting who find that, in fact, parking is much over-supplied in many cities. Maybe not in midtown Manhattan at high noon on a weekday, but in small and mid-sized cities.