Infrastructure Alert - September 17, 2013

by Cozen O'Connor
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Yesterday, Vice President Joe Biden and Transportation Secretary Anthony Foxx spoke at the Port of Charleston, S.C. Vice President Biden stressed that investing in infrastructure projects is vital for growing the middle class and the overall economic growth of the United States. The port and the Army Corps of Engineers are currently amidst a harbor deepening project that is expected to cost more than $300 million to deepen the harbor from 45 feet to 50 feet to facilitate larger ships that will be able traverse the Panama Canal in 2015. On September 9, Vice President Biden, Secretary Foxx, and Sen. Barbara Mikulski (D-Md.) spoke at the Port of Baltimore, highlighting the $10 million TIGER grant that the port received.

The Associated Press conducted an analysis of the National Bridge Inventory and found that, of the 607,380 bridges that are subject to uniform bridge inspection standards, 65,605 are classified as “structurally deficient” and 20,808 are classified as “fracture critical.” Between the two categories, 7,795 are considered both structurally deficient and fracture critical.

ON THE HILL

House Committee on Transportation and Infrastructure Chairman Bill Shuster has introduced the Water Resources Reform and Development Act (WRRDA) of 2013, H.R. 3080. The House bill differs substantially from the Senate-passed, $12 billion Water Resources Development Act (WRDA) of 2013, S. 601.

WRRDA authorizes 23 water resources projects that the committee considers vital and have had a complete technical review and recommendation form the Corps of Engineers. The bill would deauthorize about $12 billion in inactive projects that had been authorized before the Water Resources Development Act of 2007, and imposes expiration dates on new authorization to prevent further backlogs. The bill offsets all new authorizations with deauthorizations of old projects. The bill also limits the feasibility studies of the Army Corps of Engineers to three years in duration and $3 million in federal costs per study. If a study is not completed after that three-year period, the Secretary of the Army may allow one additional year to complete it. If a feasibility study is not completed, the authorization for the feasibility study is terminated.

The bill establishes the “Water Infrastructure Public-Private Partnership Program” to permit the Secretary of the Army to engage in public-private partnerships to finance the construction of at least 15 authorized water resource development projects. The bill also allows the Corps to accept funds from non-federal public interests and utility companies to expedite permitting and the regulatory process.

WRRDA staggers increases in Harbor Maintenance Trust Fund (HMTF) spending, culminating in spending 80 percent of revenues to the trust fund in FY2020. WRRDA also allocates 10 percent of the HMTF expenditures for FY2015-2016 on harbors that have a throughput of less than one million tons annually. The bill restricts the Inland Waterways Trust Fund (IWTF) spending on the Olmsted Lock and Dam to a 25 percent cost share, allowing more funding to support the backlog of other IWTF projects. The Corps will be required under WRRDA to submit annual financial plans for any inland navigation project that costs more than $500 million.

The bill instructs the Corps of Engineers to publish a notice in the Federal Register each year requesting proposals from non-federal entities for water resource development projects, and the corps would submit an annual “Report to Congress on Future Water Resources Development” with detailed information of each prospective project. Congress would then use this report to determine which projects to authorize. The bill provides for only projects in this report to be eligible for authorization.

WRRDA enjoys bipartisan support in the committee, will be marked up this Thursday, September 19, and is expected to be scheduled on the House floor in early October. Chairman Shuster is leading the public relations charge on WRRDA and has announced that he will hold a Twitter townhall today at 4:30 pm EST to answer WRRDA questions through the committee’s Twitter account, @Transport. Chairman Shuster has uploaded a video of him utilizing a whiteboard to show how the WRRDA bill would impact the U.S. taxpayer.

Sen. Mary Landrieu (D-La.) has weighed in the House WRRDA bill, saying it would “never see the light of day unless Morganza is put back.” Morganza refers to a project recommended by the Army Corps of Engineers to create a proposed 98-mile levee near the Mississippi River in Louisiana. The House bill lists 23 projects to be authorized, but does not include Morganza. The Senate-passed WRDA bill, on the other hand, allows projects to be authorized that the Army Corps of Engineers deems appropriate, such as the Morganza project. The Morganza project is estimated to cost $10.3 billion.

Rep. Daniel Lipinski (D-Ill.) and Rep. Larry Bucshon (R-Ind.) have introduced H.R. 3095, a bill that prevents the Federal Motor Carrier Safety Administration (FMCSA) from making any sleep apnea-related rules for professional drivers without going through the formal rulemaking process.

On September 11, Sen. Bob Casey (D-Pa.) has introduced S. 1495, the Saracini Aviation Safety Act of 2013. The bill named after the captain of United Flight 175, which was hijacked and flown into the World Trade Center. The bill would require that each commercial aircraft install a barrier, other than the cockpit door, to prevent access to the flight deck of an aircraft. In April, the bill was introduced in the House by Rep. Michael Fitzpatrick (R-Pa.), and currently has 46 bipartisan co-sponsors.

On September 10, the House Transportation and Infrastructure Subcommittee on Coast Guard and Maritime Transportation held a hearing titled “Maritime Transportation Regulations: Impacts on Safety, Security, Jobs and the Environment, Part 1.” The hearing covered a range of proposed rules from the Coast Guard, Federal Maritime Commission and Maritime Administration. Subcommittee members expressed their frustration that proposed rules are missing their statutory deadlines, including the towing vessel safety rule that had a deadline in 2011 and has still not been finalized. An archived webcast of the hearing can be viewed here, and a summary of the rules discussed is available here. Part 2 of this hearing is scheduled for October 10.

On September 18, the Senate Environment and Public Works Committee is holding a hearing titled “Implementing MAP-21's Provisions to Accelerate Project Delivery.” Also tomorrow, the Senate Banking, Housing, and Urban Affairs Subcommittee on Housing, Transportation and Community Development will hold a hearing titled “Recovering from Superstorm Sandy: Assessing the Progress, Continuing Needs, and Rebuilding Strategy” and the Subcommittee on Economic Policy will hold a hearing titled “Implementation of The Biggert-Waters Flood Insurance Act of 2012: One Year After Enactment.” The House Transportation and Infrastructure Subcommittee on Economic Development, Public Buildings, and Emergency Management will hold a hearing on FEMA reauthorization tomorrow as well. On September 19, the House Transportation and Infrastructure Committee will markup H.R. 3080, WRRDA, and H.R. 3095, the aforementioned sleep apnea rule bill. The House Financial Services Committee will hold a hearing on September 19 on the Terrorism Risk Insurance Act, which is set to expire on December 31, 2014. On September 30, the House Transportation and Infrastructure Subcommittee on Aviation will hold a hearing titled “Moving NextGen Forward: Leveraging the Assets of the FAA's William J. Hughes Technical Center.”

AT THE AGENCIES

The Department of Transportation has announced its fifth round of Transportation Investment Generating Economic Recovery (TIGER) grants. $474 million will be made available among 52 different infrastructure projects in 37 states. Rail projects received more than $200 million, and port projects received more than $100 million. TIGER funding has been decreasing since the inception of the program. The 2009 stimulus funded $1.5 billion in TIGER funding. Since then, the program has awarded grant batches totaling as follows, sequentially: $600 million, $527 million, $500 million, and now $474 million. For the latest round of funding, the Department of Transportation received 568 applications in the sum of $9 billion.

President Obama has nominated Captain Paul Nathan Jaenichen, Sr. USN (Ret) for Administrator of the Maritime Administration (MARAD). Capt. Jaenichen has been Acting Maritime Administrator since June 4, 2013. Capt. Jaenichen joined MARAD in July 2012, when President Obama appointed him Deputy Maritime Administrator.

Secretary of Transportation Anthony Foxx has announced two new marine highways. “M-495 Marine Highways Crossing” will connect ports in the District of Columbia, Northern Virginia, and Maryland for passenger services. “M-29 Marine Highway Connector” will connect the upper Missouri River between Kansas City, Mo., and Sioux City, Iowa.

The GAO released several reports of note: Cargo Tank Trucks: Improved Incident Data and Regulatory Analysis Would Better Inform Decisions about Safety Risks, FAA Facilities: Improved Condition Assessment Methods Could Better Inform Maintenance Decisions and Capital-Planning Efforts, and Interstate Compacts: Transparency and Oversight of Bi-State Tolling Authorities Could Be Enhanced.

The Department of Energy has released a list of 38 transportation technology projects that will receive a total of $45 million in federal funding. Through the Advanced Vehicle Power Technology Alliance between the Department of Energy and the Department of the Army, the Army is contributing $3 million in co-funding to support projects focused on lightweighting and propulsion materials, batteries, fuels and lubricants. The technology projects are a part of the Department of Energy’s Vehicle Technologies program and EV Everywhere Grand Challenge Initiative.

IN THE STATES

The American Association of State Highway and Transportation Officials is urging Amtrak to complete agreements with states before the October 16 deadline for new agreements. Amtrak currently operates 21 “state-sponsored” routes across 15 states, and state-supported corridors comprise roughly half of Amtrak’s yearly ridership. Thus far, only Virginia has completed an agreement with Amtrak to keep its intrastate rail operating.

California: On September 8, the California High-Speed Rail Authority board members approved $268 million in unexpected costs, utility relocation and freight railroad collaboration. The board unanimously approved $160 million for potential cost overruns associated with the first, 29-mile construction segment, $18.4 million to reimburse AT&T for relocating fiber optic lines that are in the way of the tracks, and $50.4 million to reimburse PG&E to relocate gas lines, electricity distribution lines and other facilities to make way for the tracks.

Illinois: Chicago Mayor Rahm Emanuel has halted the plan to lease Midway Airport after one of the two infrastructure consortium bidders backed out. The IFM/Manchester consortium removed itself from the bidding process over concerns with valuation issues, and the Macquarie/Ferrovial group was the only bidder remaining. Mayor Emanuel had announced his intention to lease Midway Airport to private investors in December 2012 for a lease of 40 years or less, and would use some of the revenue to pay off Midway’s outstanding bonds.

North Carolina: Charlotte’s application for a $24 million TIGER grant for its streetcar system was not accepted, leaving the project in a funding limbo. Carolyn Flowers, CEO of the Charlotte Area Transportation System, and Mayor Patsy Kinsey have both stated that they do not think that the project will suffer major delays as a result, but will not start the second phase of the project until it is fully funded.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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