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John Hennessy III,

Improving the Nation’s Freight Transportation System

Posted by Content Coordinator on Wednesday, October 30th, 2013


Executive Summary

Rail FreightThe Panel on 21st Century Freight Transportation conducted hearings, held roundtable discussions, and traveled to key freight corridors across the United States to gain insight into the current state of freight transportation and how improving freight transportation can strengthen the economy. The Panel identified many challenges and impediments to the efficient and safe movement of goods into, out of, and through the United States.

The Panel found that the current state of highway infrastructure does not adequately serve the needs of those moving goods across the Nation. Not every community is located adjacent to a railroad, airport, waterway, or port, but a consumer good is almost invariably transported along the Nation’s four million miles of highways and roads for at least part of its journey. However, the Highway Trust Fund, from which federal investment in highway infrastructure is disbursed, will soon be insolvent. This fact is especially problematic when one considers that maintenance of the Nation’s existing highway facilities alone would cost hundreds of billions of dollars, and that one of every four bridges in the United States is structurally deficient or functionally obsolete. Furthermore, a recent study found that congestion cost the United States economy $121 billion in 2011.

While most consumer goods are transported on a truck for at least part of the journey, freight rail provides efficient long-haul and short-haul service and integrates closely with the trucking industry. There are approximately 565 freight railroads in the country employing nearly 180,000 workers. These are privately owned companies that operate more than 200,000 miles of track throughout the Nation. Because the freight railroads are private entities, they own the infrastructure over which they operate, meaning they also invest heavily in those networks. In 2011, the freight railroads invested over $23 billion in capital expenditures to improve and expand their networks.

Before goods can be transported on trucks or railroads, the goods must be produced, and many of these goods are produced overseas. Over 75 percent of all United States international freight moves by water. Unlike the Highway Trust Fund, the federal fund dedicated for harbor maintenance has a positive balance. Unfortunately, a lack of appropriated funding has resulted in deferred maintenance of federal channels that serve coastal ports. Currently, the constructed depths and widths of entrance channels at 59 major ports are available only 35 percent of the time. Given the current expansion of the Panama Canal and the larger ships that will service American ports as a result, maintaining authorized channel depths and widths is critical to the stability of the Nation’s import and export market.

United States waterways carried an equivalent of over 100 million truckloads of goods last year. It is estimated that without the barges and towboats operating on the inland waterways, the Nation would need 6.3 million railroad cars or 25 million trucks to haul the difference. However, much of the critical infrastructure for waterborne transportation is in dire need of repair. More than one-half of the locks and dams in the United States are over 50 years old.

Air cargo is the fastest way to ship goods over long distances, and air freight is high-value cargo. Less than three percent of total freight by weight ships by air, but this represents over $6.4 trillion worth of goods per year, which is nearly 35 percent of all freight value.

All aspects of the supply chain rely on the warehousing, distribution center, and logistics industry. Logistics is the planning, execution, and control of a complex organization involving many different moving pieces and interests, all within a system designed to achieve specific objectives. By optimizing the movement of freight across all modes of transportation, this industry helps ensure the health of the United States economy and the future of the Nation’s global competitiveness.

The Panel found that ten percent of the Nation’s freight movement, by tonnage, travels through pipelines. Pipelines, by their very nature, specialize in the transmission of energy commodities. In that regard, pipelines carry nearly two-thirds of the Nation’s energy supply. Today, there are over 2,600,000 miles of pipelines in the United States—enough to circle the globe about 100 times.

As a result of these findings, the Panel makes the following key recommendations. To safely and efficiently meet the needs of freight movements in the 21st Century, Congress should:

  • Direct the Secretary of Transportation, in coordination with the Secretary of the Army and the Commandant of the United States Coast Guard, to establish a comprehensive national freight transportation policy and designate a national, multimodal freight network;
  • Ensure robust public investment in all modes of transportation on which freight movement relies, and incentivize additional private investment in freight transportation facilities, to maintain and improve the condition and performance of the freight transportation network;
  • Promote and expedite the development and delivery of projects and activities that improve and facilitate the efficient movement of goods;
  • Authorize dedicated, sustainable funding for multimodal freight Projects of National and Regional Significance through a grant process and establish clear benchmarks for project selection. Projects eligible for such funding would have a regional or national impact on the overall performance of the multimodal freight network identified by the Secretary of Transportation;
  • Direct the Secretary of Transportation, in coordination with the Secretary of the Treasury and the Secretary of the Army, to identify and recommend sustainable sources of revenue across all modes of transportation that would provide the necessary investment in the Nation’s multimodal freight network and align contributions with use of, and expected benefit of increased investment in, such network; and
  • Review, working through the Committee on Transportation and Infrastructure and the Committee on Ways and Means, the Secretary’s freight funding and revenue recommendations and develop specific funding and revenue options for freight transportation projects prior to Congress’ consideration of the surface transportation reauthorization bill in 2014.

This report includes a detailed discussion of the Nation’s freight network and makes recommendations that will improve the safety, efficiency, and performance of the nation’s freight transportation system.

Download full report (PDF): Improving the Nation’s Freight Transportation System

About the House Committee on Transportation & Infrastructure
“The Transportation and Infrastructure Committee has jurisdiction over all modes of transportation: aviation, maritime and waterborne transportation, highways, bridges, mass transit, and railroads.  The Committee also has jurisdiction over other aspects of our national infrastructure, such as clean water and waste water management, the transport of resources by pipeline, flood damage reduction, the management of federally owned real estate and public buildings, the development of economically depressed rural and urban areas, disaster preparedness and response, and hazardous materials transportation.”

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