Insights - January 2016 - (Page 7)

FAST - from page 5 Funding the Bill to be addressed through the NSFHP program. Additionally, up to $500 million in intermodal and freight rail projects is covered by the bill over the five-year funding period. "What's interesting, though, is rail/highway, at-grade crossings are treated as traditional highway projects, so they will not count towards that $500 million. That eligibility is pretty significant because it is, for the first time, allowing for nonhighway development." Funding for the five-year act comes primarily from the Highway Trust Fund which will be collecting about $208 billion. About $70 billion will come from a variety of other sources, and Nessle goes on to explain "Some of the sources for that $70 billion that's not coming from user fees include going into the Federal Reserve Surplus Account, selling off crude oil from the Strategic Petroleum Reserve, cutting the Federal Reserve's dividend rate that it pays to member banks - it's a host of things unrelated to transportation. "The driving forces behind the FAST Act were very smart. They put together a piece of legislation that had the support of transportation stakeholders. And, they were able to put together a proposal that had programming and policy that was very widely supported. They put that together first and I think once they had the positive momentum going for the bill based on its merits, they were able to more easily unlock some of these unrelated funding sources. I really think that is what made this all possible." Multi-state Corridor Planning Another first under the FAST Act is that states are required to create state freight plans. "This element requires states to do state freight plans and create state freight advisory committees and, as a part of that, encouraging those state freight plans to recognize and try to work with neighboring states," says Nessle. "If I had to make a prediction, as U.S. DOT begins to make funding decisions for the Nationally Significant Freight and Highway program, projects that are in state freight plans will likely be favorably considered when it comes time to make awards. It does demonstrate a level of support for a project if it is incorporated into a state freight plan." A Need for Further Education "We continue to talk in this industry about the education effort that needs to happen with the average consumer, but for some reason there's either a knowledge gap there or perhaps a little bit of skepticism about paying into [the Highway Trust Fund]. Is Washington going to send our money back to my region? Am I going to see any of the benefits?" mused Nessle. "I think there are also some folks that don't think there is actually a need. Going into the next surface transportation authorization bill, if Congress is going to avoid having to go through this painful process of finding unrelated sources to shore up the Highway Trust Fund, the next five years need to be spent with a really intense education effort across the country explaining to people that the fuel taxes have not been raised in over 20 years. They were a flat tax. They were not indexed to inflation. They are not dynamic with the price of fuel. The buying power has gone down. Automobiles are becoming more fuel efficient. And for all of these reasons, we need to be collecting more money to ensure that we're leaving future generations with a functioning transportation network." In closing, Nessle said "During the five-year duration of this funding bill, we need to be doing some intense study on what will eventually replace it. I believe there is utility left in the fuel tax, but there will be a day when it is obsolete. Now is the time to begin studying alternatives." Legislation and Regulation Top the Intermodal Stories of 2015 Intermodal Insights looked at some of the trending issues in 2015 and where they will take us in the coming year. It was an active year on many fronts, with some of the issues being resolved or moved forward in a positive direction for the intermodal industry. Other issues are still on the watch list or have spawned new concerns. Here's a short review and look ahead. Rising Intermodal Volumes We began the year by looking at 2014 intermodal volumes and projecting 2015 results. Patrick J. Casey, vice president of fleet management at TTX Co., predicted 6 percent to 8 percent gains in domestic container volumes for the year just ended. Casey noted that domestic intermodal still hauled less than 10 percent of long-haul (over 550 miles) truck volume, suggesting the opportunity for growth was still strong. As 2015 was coming to a close, intermodal volumes (through November) were healthy, led by 5 percent growth in domestic containers. Perhaps just as important, rail executives were giving investors and the media optimistic quotes about intermodal January 2016 | Intermodal Insights 7

Table of Contents for the Digital Edition of Insights - January 2016

Bill Would Eliminate Risk of Port Slowdowns
Driver Coercion Rule Finalized
Five-Year Transportation Bill Passed
Broome and George Join IANA Board
IANA Names New 2016 Officers
IANA Welcomes New General Counsel
Sustainability News
FAST Act Moves Freight Forward
Nominations Sought for Silver Kingpin Award
Legislation and Regulation Top the Intermodal Stories of 2015
Freight Reports
Port News
People in the News
Welcome New Members
In Brief
2015 Article Index by Subject
Intermodal Calendar

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