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The State of Freight II: Implementing the FAST Act and Beyond

Posted by Content Coordinator on Friday, December 9th, 2016


Executive Summary

In 2015, Congress finally responded to the persistent and growing voice of freight stakeholders and included dedicated freight funding in transportation reauthorization legislation. In the Fixing America’s Surface Transportation (FAST) Act, Congress for the first time allocated funds directly for freight mobility, authorizing nearly $11 billion in dedicated freight funds. Under the FAST Act, states will be key to how our nation plans for the movement of freight and what projects will be completed.

The State of Freight II provides a snapshot of where states are collectively in developing state freight plans and a baseline on what future projected investments are needed to build out the nation’s 21st century freight network. The State of Freight II reports on how states are already funding freight-specific investments through state dedicated or discretionary funding, and how these funding sources can potentially work with Federal freight investments.

The State of Freight II compiles and analyzes results from a joint American Association of Port Authorities (AAPA) and American Association of State Highway and Transportation Officials (AASHTO) survey to identify the United States’ critical freight infrastructure needs. This report follows on the heels of AAPA’s 2015 State of Freight report that identified baseline investment needs of $29 billion in seaport landside transportation infrastructure project investments over the next decade to keep pace with rising freight volumes and increasing population density in metropolitan areas.

The State of Freight II takes a broader look at the entire freight network, starting with the states and examining how the new provisions from the FAST Act will incorporate new planning provisions, funding, and financing tools. States, which are tasked with developing state freight plans, are going to be the key building blocks for the national freight network and defining the baseline investments that need to be made.

The State of Freight II reveals that six months after the FAST Act was passed, 71 percent of states already have state freight plans that they are actively working to make FAST Act compliant. Additionally, 57 percent of the states have already identified a total of 6,202 freight projects. Furthermore, $259 billion in project costs have already been identified by only 35 percent of the states.

In a dynamic environment, states and ports will need the tools and flexibility to adapt to new trade patterns in order to accommodate anticipated freight volumes. To help plan sustainable investments in a national freight network, AAPA and AASHTO suggest several approaches:

  • Continue to provide HTF apportionments to states for highway freight projects through the National Highway Freight program, while encouraging coordination with U.S. DOT’s Build America Bureau and Freight Advisory Committees to better leverage private sector investment.
  • Provide additional and ongoing funding resources outside of the HTF for the overall multi- modal freight network that can supplement highway formula dollars and also fund discretionary grant programs.
  • Reestablish a properly funded and staffed Office of Multimodal Freight Transportation within the U.S. DOT Office of the Secretary to address the multimodal domestic and inter- national freight planning needs across the various modal administrations at the Department.
  • Move the Harbor Maintenance Tax from discretionary to mandatory spending, enabling full tax revenues to be used for the intended purpose of navigation channel maintenance.

Dedicated Federal freight funding now flows to all states on an annual basis. Every state is expected to have a state freight plan completed by December 2017.

Federal Freight Program

For the first time, the United States now has a dedicated Federal freight program, authorized at more than $11 billion over five years. This new program takes two important funding approaches:

1)  $4.5 billion for discretionary grants in the Projects of Highway and Freight Significance, of which only $500 million is eligible for multimodal projects; and

2)  $6.3 billion formula program over five years called the National Highway Freight Program. After two years, states must have an approved U.S. Department of Transportation (U.S. DOT) state freight plan to continue to receive freight formula fund- ing.

The freight program’s implementation process is well underway. The first year of the National Highway Freight Program formula funding has already been allocated to states. U.S. DOT recently made public the first round of Projects of Highway and Freight Significance, which will provide $759 million for 18 projects, a third of which are port-sponsored and more than half of which are state DOT-sponsored.

In addition to freight funding programs, the FAST Act includes broad port eligibility in the new freight programs, planning programs, and financing programs, such as codifying the Administration’s Build America Transportation Investment Center (BATIC) as the Build America Bureau, which streamlines the Federal government loan and regulatory programs into one office with the intent of making financing complex transportation projects while partnering with the Federal government more user friendly. Collectively, these funding and financing programs and tools will help play a role and inform how states and ports develop state freight plans and investment strategies. This report also seeks to determine how states are utilizing the Freight Advisory Committee as a planning or marketing tool and integrating maritime representatives into the process.

This report also illustrates the work states have done in maintaining and planning their intermodal connectors.

Key State Survey Findings

  • 77 percent maintain and update a list of National Highway System (NHS) intermodal connectors.
  • 49 percent monitor the performance and condition of NHS intermodal connectors.
  • 53 percent include strategies in their planning process to include intermodal connectors.

Finally, The State of Freight II collects a baseline of investment needs available from states; a first step in assessing and looking ahead for future opportunities to build out the national freight network.

Download full version (PDF): The State of Freight II

About the American Association of State Highway and Transportation Officials (AASHTO)
AASHTO is a nonprofit, nonpartisan association representing highway and transportation departments in the 50 states, the District of Columbia, and Puerto Rico. It represents all five transportation modes: air, highways, public transportation, rail, and water. Its primary goal is to foster the development, operation, and maintenance of an integrated national transportation system.

About the American Association of Port Authorities (AAPA)
The American Association of Port Authorities is the unified voice of the seaport industry in the Americas, representing more than 130 public port authorities in the U.S., Canada, the Caribbean and Latin America.  For more than a century, AAPA membership has empowered port authorities and their maritime industry partners to serve global customers and create economic and social value for their communities.

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