September 11, 2019

Economic Boom for Inland Waterways


KEY TAKEAWAYS

  • Inland waterways and water resources infrastructure provide a crucial competitive advantage for American farmers and manufacturers.
  • Businesses transported 608 million tons of goods on inland waterways in 2018, a 21st-century high.
  • Congress and the Army Corps of Engineers are continuing to identify and promote infrastructure development. 

The strength of America’s water resources infrastructure is an unsung success story of the booming economy. Inland waterways such as rivers and canals play a key role in trade among the states and in getting agricultural products, energy raw materials, and manufactured goods from the interior of the country to coastal ports. In 2017, more than $232 billion in commerce traversed America’s inland waterways. The two highest tonnage months of inland waterway traffic in the past 20 years occurred in 2018. Businesses transported 608 million tons of goods on inland waterways that year, a 21st-century high. In 2018 Congress also passed America’s Water Infrastructure Act, which authorized additional infrastructure studies, projects, and programs.

Inland Waterways Snapshot

Inland Waterways

agriculture depends on water TRANSPORTATION

The United States has the most productive farms in the world, but many of them are located hundreds or thousands of miles away from the nearest saltwater port they could use to export their products overseas. Inland waterways provide efficient, cheap transportation to the coasts. A 2017 Texas A&M study found that barge transport is about four and a half times more fuel efficient than trucks, and 35 percent more than trains. One tow boat pulling 15 barges carries a load equivalent to 216 rail cars or 1,050 semi-trailer trucks.

To Carry the Same Load…

Inland Waterways

The cost advantage of well-maintained inland waterways provides a pivotal advantage for U.S. farmers. For example, it costs an Iowa farmer $20 more to produce a metric ton of soybeans than it costs a farmer in Brazil. But cost savings from barge transportation bring down the price of U.S. soybeans enough to make the Iowa product more competitive. So the Iowa farmer can produce and ship soybeans to Shanghai for $5.35 less per metric ton than the farmer in Brazil can.

Water RESOURCES Infrastructure Building Process

The Army Corps of Engineers has primary federal responsibility for planning and constructing improvements to inland water navigation, maintaining 12,000 miles of inland waterways. Congress directs and oversees these projects through the appropriations and authorization process. Congressional authorization for Corps projects typically occurs biennially through water resource development bills. Since AWIA passed last year, the next authorization bill would be scheduled for 2020.

According to the Congressional Research Service, appropriations for all Corps activities in recent years “have ranged from $4.7 billion in FY2013 to $7.0 billion in FY2019.” For this year, $850 million is targeted at inland water navigation projects. There is currently an overall $98 billion backlog of authorized projects that are awaiting funding.

The Corps is typically responsible for leading a project’s study, design, and construction, usually working with non-federal partners such as states, localities, and other governmental entities. These non-federal partners typically share in study and construction cost, provide the land required for the project, and help tailor the project to local needs.

Projects generally proceed through several steps of planning and construction. Congress grants authority and funding to the Corps to perform a study of the problem. The Corps then enters into a cost-sharing agreement with the non-federal partner for the study, and does the study, including environmental, economic, and engineering analyses. The Corps presents that work in a final feasibility report with a recommendation from the chief of engineers, and Congress can authorize the recommended plan for construction. The Corps and the non-federal partner would then enter into an agreement for actual construction and eventual transfer of the project to the non-federal partner for operation and maintenance.

Issue Tag: Environment