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The MAP-21 bill passed last year stands for "Moving Ahead for Progress," though Kavinoky notes that the $50bn in funding it provides over two years represents no increase in funding for highways and transit. "Congress did not increase funding over previous years, but it did institute some significant reforms that we think will drive down the cost of projects," she says. These reforms include streamlining processes for permitting and environmental assessments. "Also, it expands the Transportation Infrastructure Finance and Innovation Act, which provides low-cost loans, loan guarantees and lines of credit to various projects. TIFIA is a great way to stretch federal dollars because for every $1 of federal funds, you can get $10 of lending," Kavinoky says.
Another important policy change is the recommendation that every state put together a freight plan. "This should not seem revolutionary, but it is," Kavinoky says. "People in the transportation industry who have not heard from their state or state Department of Transportation about this should reach out and find a way to get involved. It is a great opportunity to have significant input on state policies regarding your business."
Work already has begun on the next transportation funding bill since MAP-21 expires Sept. 30, 2014. "We have to figure out what to do to solve the revenue problem," she says, "since taxes funding the Highway Trust Fund have not increased since 1993 and revenue has not kept pace with inflation. We are looking at a pretty big hole in 2015, with insufficient funds even to pay for previous obligations that states have made. Just to have enough money to reimburse states for some of their large capital projects could force as much as a 90-percent cut in other transportation spending in 2015, so we can't ignore this revenue problem any longer."
Kavinoky notes that this year Congress also needs to pass a water resources development act, which will include investments in locks and dams on the inland waterway system and at the ports. A key issue here is the harbor maintenance tax which is collected for maintenance of the ports but which Congress has for years held back to use as a budgetary offset so it can spend money elsewhere. "For those concerned about making sure our ports and channels are adequately dredged, getting the harbor maintenance trust fund money out to the ports for its intended purpose is critical," she says.
Additionally, most of the locks and dams on the Mississippi and other rivers are more than 50 years old "and are literally crumbling," Kavinoky says. "We need significant investment in those locks and dams because when a lock goes down, a tow can sit for six weeks on the river, costing millions of dollars."
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Keywords: supply chain, supply chain management, international trade, supply chain management scm, global logistics
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