Inland Waterways Trust Fund: Another Corporate Bailout

Another Corporate Bailout: Inland Waterways Trust Fund

The inland waterways navigation system – the locks and dams constructed on several of the country’s major rivers – is the most publically subsidized commercial transportation system in the United States, receiving about 90 percent of its funding from taxpayers. Despite this immense level of corporate welfare, the barge industry, through the Inland Waterways User’s Board, has proposed an increase in the public’s contribution, which would likely raise the subsidy to near 95 percent.

On April 13, 2010, the Inland Marine Transportation Systems (IMTS) Capital Projects Business Model, Final Report—Final Recommendations was released. We estimate the IMTS recommendations will further increase the public subsidy for inland waterway construction and rehabilitation by about $200 million annually.

The barge industry contributes about $80 million per year into the Inland Waterways Trust Fund (IWTF) through a $0.20 per gallon fuel tax that has not been increased since 1995. The IWTF currently pays the costs for half of all new and rehabilitation construction on the inland waterways system. Taxpayers fund the remaining half of construction projects as well as the cost of all of the system’s operation, maintenance, and environmental restoration – a total cost approaching $800 million per year.

The proposed changes in the IMTS Model would eliminate all industry funding for costs related to dams on the system and also require the industry to fund only lock rehabilitation projects that cost more than $100 million. The taxpayers will pay the full cost of all lock rehabilitations that cost less than $100 million – and every lock project to date has fallen well below this threshold (average cost is $40 million). The locks cannot function without the dams, so eliminating the barge industry’s responsibility for their rehabilitation is illogical and unreasonable.

We strongly urge that the IMTS report recommendations for increasing the public’s cost-share obligations on the inland waterways system be rejected. 

Congress is considering two bills that will turn the IMTS Model into law: H.R. 1149 and S. 407. The Senate is currently considering rolling S. 407 into the Water Resources Development Act of 2013. Please let your Senator know that you oppose S. 407. 

Conservation and Watchdog Groups Oppose Barge Industry's Plan To Shift Costs to Taxpayers (Press Release 6/21/10)

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