Increase to Barge Diesel Fuel User Fee Passed by the Senate

by | Tuesday, December 23, 2014 | 0 comment(s)

The U.S. Senate has just passed a nine-cent increase to the barge diesel fuel user fee by a vote of 76 to 16, an outcome applauded by Waterways Council, Inc. (WCI) and its stakeholders and members.

This provision, part of tax extenders legislation combined with the “Achieving a Better Life Experience (ABLE)” Act establishing tax-favored savings accounts for people with disabilities, included the provision to increase the fee by nine cents and passed in the House at the beginning of December by a vote of 404-17.

The current user fee is 20 cents per gallon of fuel used while operating in the inland system, and the increase will go into effect on April 1, 2015. The increase amount, which will be deposited into the Inland Waterways Trust Fund (IWTF) is also matched by General Treasury Funds, and will be dedicated to major rehabilitation of the system, as well as new construction. The increase is expected to add approximately $80 million each year to the IWTF, and it is supported by the 300 operators who pay it. The nation as a whole, however, is expected to benefit from the increase, with the development of hydro power, flood control, municipal water supply, recreational boating and fishing, waterfront property development, and national security.

The bill was introduced by Senator Bob Casey (D-PA), with co-sponsors Tom Harkin (D-IA), Lamar Alexander (R-TN) and Amy Klobuchar (D-MN) and Al Franken (D-MN).Local Senator, David Vitter (R-LA), was also a supporter of the fee increase, as were House members Chuck Fleischmann (R-TN), Ed Whitfield (R-KY), Pat Tiberi (R-H, and Daniel Lipinski (D-IL).

Why do we care so much about the Inland Waterways?

  • The waterways provide the most competitive transportation option, cost-wise, for bulk commodities used in the U.S. and exported worldwide.
  • Sixty percent of the U.S.’s export-bound grain travels on the Inland Waterways.
  • An efficient and effective water transportation system is necessary for supplying American farmers with fertilizer.
  • The Panama Canal Expansion will create opportunity for increased U.S. trade; however, that won’t happen if U.S. channels and ports are not dredged, and if the dams and locks do not function properly.
  • The Inland Waterways are responsible for 541,000 jobs.
  • The Inland Waterways benefit consumers by providing transportation cost savings – for every $1 invested in the waterways, $10 gets refunded to national benefits.
  • Most of the locks and dams in the U.S. were built in the ‘20s and ‘30s, but they are used to transport modern cargo that fuels our 21st century economy.The Waterways, therefore, need reinvestment.

Said Michael J. Toohey, President and CEO of Waterways Council, Inc., “Waterways Council is grateful for the House and Senate passage of the increase to the barge industry’s fuel user fee. Additional money flowing to priority navigation projects could result in earlier completion and delivery of more than $82 billion in related economic activity for the nation over 20 years . . . “We thank our many Congressional champions for recognizing the great return on investment of our nation’s waterways and for their enduring support of the user fee increase: Senators Vitter, Casey, Alexander, Harkin, Klobuchar, Franken, and all the supporters of the RIVER Act (2013). We thank Congressmen Whitfield, Lipinski, Tiberi, Fleischmann, and the WAVE 4 (2013) sponsors for their commitment.”

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