Congressional Hearing Weighs Freight Transportation Needs

As Congress continues putting together the next surface reauthorization, the House Subcommittee on Highways and Transit held a hearing last Thursday on the needs of the freight transportation industry. Representatives from railroads, state and metropolitan transportation departments, environmental advocacy groups, and academia testified on the investment needs and other challenges facing freight transportation.

One of the primary focuses of the hearing was how to finance freight infrastructure investments, particularly highway maintenance and expansion. American Association of State Highway and Transportation Officials (AASHTO) Executive Director Jim Tymon testified that current funding levels aren’t enough to meet states’ state-of-good-repair needs, let alone investing in constructing new infrastructure like freight corridors.

A lot of the industry has come out in favor of raising the gas tax to bring more money into the Highway Trust Fund. TIA supports a modest increase in the gas tax to help pay for critical infrastructure investments; however, we ultimately need to find a new way to raise revenue for the Trust Fund given that rising fuel economy and the increasing popularity of hybrid and electric vehicles has reduced how much revenue a tax on gasoline can raise.

There’s no shortage of ideas for alternatives to the gas tax: Association of American Railroads President & CEO Ian Jefferies, for example, offered a weight-distance fee as another way to shore up the Trust Fund. Others have talked about a vehicle miles traveled (VMT) tax, though it did not come up at Thursday’s hearing. Congressman Greg Pence (R-IN) said he appreciated that the freight industry has come together to support raising revenues, but the question remains exactly how Congress will choose to do that.

As for how to spend that money, Mr. Tymon said that state departments of transportation want to maintain the federal formula programs—which are easier to administer than competitive grant programs—so that states can have multi-year certainty about how much money they will get from the federal government to make larger infrastructure investments. He also suggested providing states with more flexibility within those programs so that the states can decide what best to spend the money on. (Currently, most of the federal-aid highway programs provide states the flexibility to move up to 50 percent of their allocations from one program to another.)

There was also discussion of the Infrastructure For Rebuilding America (INFRA) grant program, formerly known as FASTLANE, which provides competitive grant funding for infrastructure projects—mostly highways and bridges—with a freight transportation component. Several witnesses, including American Short Line and Regional Railroad Association President Chuck Baker and Chicago Metropolitan Agency for Planning Executive Director Erin Aleman, agreed that the process for selecting INFRA grant winners can be “opaque” and that USDOT should ensure project selection criteria are objective, well-communicated to applicants, and closely tied to the goals of the program.

While the nearly three-hour hearing mostly kept things at a high level, there was some interesting disagreement when it came to reducing freight emissions. The surface reauthorization reported by the Senate Environment & Public Works Committee back in July was the first to include a climate title, and House Transportation & Infrastructure Committee Chairman Peter DeFazio (D-OR) has said he wants to go bigger on climate in the House bill.

Jason Mathers, Director of Vehicles & Freight Strategy for the Environmental Defense Fund, testified about various pilot programs across the country for increasing the use of zero-emission heavy-duty vehicles in the freight network, from transporting cargo in and out of ports to delivery packages to homes and businesses. He suggested creating a federal revolving loan fund for purchasing and installing ZEV infrastructure to enable greater use of ZEVs in freight transportation.

Congressman Doug LaMalfa (R-CA) took issue with the idea of incentivizing the purchase of ZEVs; he said a better approach would be to eliminate the 12 percent federal excise tax on new trucks, which would make it easier for truck operators (particularly smaller, independent owner-operators) to turn over their fleets; as newer trucks are cleaner and more efficient than the older models they’d be replacing, Rep. LaMalfa said, this would more quickly reduce emissions in the trucking industry than a new incentive. (Rep. LaMalfa has a bill, H.R. 2381, which would eliminate that tax.)

The witnesses seemed reluctant to agree with that approach: Mr. Tymon brought up the fact that the excise tax on new trucks goes into the Highway Trust Fund, and so eliminating that tax would reduce revenues at a time when the focus should be on raising additional revenue. Rep LaMalfa replied that this tax is only a small slice of Trust Fund revenue and would be easily replaced with something else.

Watch the hearing and read the witnesses’ testimony here. If you have any questions, please contact TIA Advocacy at [email protected] or 703.299.5700.

USMCA Deal Reached between White House and Congressional Leaders

There has been a lot of activity in the last 24-hours on the United States – Mexico – Canada Agreement trade deal or the USMCA. TIA is happy to report that a deal appears to be imminent, with all three nations agreeing to sign the agreement as early as today. TIA has been pushing Members of Congress to move this landmark trade deal forward for quite some time. It is imperative to the 3PL industry that we as a nation continue the free movement of goods with our friendly neighbors to the North and South.

“The update to NAFTA in USMCA will modernize trade between our most important international partners. It is essential that we have a secure, strong, prosperous, and growing North American continent. USMCA will keep us on that path,” stated TIA President and CEO Robert Voltmann.

TIA Chairman of the Board of Directors Brian Evans, CTB who is also a Member of the Arkansas State House representing the 43rd district, drafted a letter of support to Congressional leaders and authored a resolution supporting the passage of the USMCA. Chairman Evans stated in the letter which was co-authored by 26 other State officials:

Trade with Mexico and Canada is vital to the U.S. economy. It has been more than two decades, though, since trade with those countries was comprehensively addressed by the North American Free Trade Agreement (NAFTA). It is well past time to modernize our agreement with these important partners.

We need a 21st Century trade agreement for the 21st Century economy. The time is now to put USMCA to work for us here at home. This bold new agreement provides the framework for economic growth and increased jobs. It will also establish a much more balanced environment for American workers.

News broke yesterday that an agreement was on the horizon, and Speaker of the U.S. House of Representatives Nancy Pelosi was reviewing recent changes to the agreement that U.S. Trade Representative Robert Lighthizer and his Mexican counterpart Jesus Seade had discussed recently. Those changes were proposals on labor inspection rules and tougher steel provisions. The demand from the U.S. regarding steel and aluminum rules came from the United Steelworkers union, who threatened to continue to stall the negotiations last week.

Passing this important trade deal has been one of President Trump’s top priorities. There are still a few procedural hurdles before the agreement can come to the floor for a vote, including committee hearings and review of the implementing bill in the House Ways and Means and Senate Finance committees. Those steps could be waived to save time, and people familiar with the talks said lawmakers are likely to skip some of them.

If you have any questions, please contact TIA Advocacy ([email protected], 703.299.5700).

Way Too Early Election Predictions: U.S. Senate

Being the policy wonks that we are (literally eating and breathing politics), we like to maintain a pulse on the upcoming elections and predict who is likely to win in key races. This will be a two-part series, with the first part focusing on key Senate races that will determine whether Republicans maintain control of the chamber in the 117th Congress.

The first state is Alabama, with Senator Doug Jones (D) – won the 2017 special election to replace Senator Jeff Sessions, who left office to serve as President Trump’s Attorney General – currently holding the seat. In 2017, Jones beat Republican candidate Roy Moore, the former Chief Justice of the Supreme Court of Alabama, by less than two percentage points (in a state that President Trump won with 62% of the vote in 2016). Judge Moore was far from a perfect candidate and was narrowly defeated.

In 2020, Senator Jones will face off against the winner of the state’s GOP primary field, which currently includes Sessions (looking to reclaim his old seat), Congressman Bradley Byrne (R-AL1); former Auburn University head football coach Tommy Tuberville; and Judge Roy Moore, who is running again for the seat. As it relates to Sessions – who only recently jumped into the race – it will be interesting to see if he is able to clear the field or if he will fall by the wayside as a result of his falling out with President Trump.

Based on Alabama being a reliably “red” state, my prediction is that as long as the Republican nominee is not Roy Moore, Republicans should be able to pick up this seat. Republicans gain a seat here. TIA has not had too much interaction with Senator Jones.   

The next state is Arizona, with Senator Martha McSally (R) currently holding the seat that she was appointed to following the death of Senator John McCain in August 2018; prior to her Senate appointment, McSally served in the House of Representatives for Arizona’s 2nd District. Congresswoman McSally ran for the Senate in 2018 against Congresswoman Krysten Sinema (D), where she lost by roughly 2.5 percentage points. President Trump carried the state with 48% of the vote against former Secretary of State Hillary Clinton receiving 45%. Arizona continues to trend as a “purple” state, and her Democrat opponent will be Mark Kelly, former Astronaut and husband to former Congresswoman Gabby Giffords – who was the victim of an assassination attempt back in 2011. Being a border state, immigration should be a key issue to watch in this race. My prediction is Mark Kelly will squeak out a victory over Senator McSally for a variety of reasons, and Democrats gain a seat here. Senator McSally was very helpful to TIA when she was a Member of the House on Homeland Security issues.

The next state is Colorado, with Senator Cory Gardner (R) running as the incumbent. Senator Gardner hopes 2020 shakes out better for him than the Republican Party of late in the state of Colorado. Hillary Clinton won the state by 5 percentage points in 2016 and former Congressman Jared Polis easily won election as the Governor in 2018. There are a number of candidates who have announced to run against Senator Gardner, including former Governor of Colorado John Hickenlooper (D) – who recently dropped out of the Presidential race – and former Colorado Speaker of the House Andrew Romanoff. I think Governor Hickenlooper will ultimately win the nomination and continue the trend of Democrats dominating Colorado by beating Senator Gardner, who by all accounts has been a good Senator, but the political environment doesn’t bode well for him in the state. Democrats gain a seat here. Senator Gardner has been a supporter of TIA and the logistics industry.

The last state we will look at is Maine, with Senator Susan Collins (R) who will likely be facing her toughest challenge yet. Senator Collins does not always toe the Republican line and does – from time to time – break with the party on key votes. She will likely face Sara Gideon, who is the Speaker of the Maine House of Representatives. Senator Collins has been in the Senate since 1997 and won reelection to her fourth term in 2014 with 68% percent of the vote. It will be interesting to see how the voters of Maine will vote based on her vote to support Supreme Court Justice Brett Kavanaugh. I think Senator Collins will get reelected to her fifth term with around 53% of the vote. Republicans maintain a seat her. Senator Collins has been a champion for TIA and the transportation industry on many different issues.

Other states to keep a close eye on include: Georgia, Michigan, New Hampshire, North Carolina, and Texas. I don’t see a lot of upsets here, but I think there will be one that no one expects. . .

In the end, we think Republicans barely maintain control of the Senate and Congress remains divided (spoiler alert for the next issue).

If you have any questions or want to learn more about TIA’s Advocacy efforts, please contact TIA Advocacy ([email protected], 703.299.5700).

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