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Effectiveness of Federal Efforts to Support the Marine Transportation 
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United States Government Accountability Office: 
GAO: 

Report to Congressional Addressees: 

November 2012: 

Maritime Infrastructure: 

Opportunities Exist to Improve the Effectiveness of Federal Efforts to 
Support the Marine Transportation System: 

GAO-13-80: 

GAO Highlights: 

Highlights of GAO-13-80, a report to congressional addressees. 

Why GAO Did This Study: 

The MTS is integral to the efficient movement of the nation’s freight. 
The MTS includes navigable waterways, ports, and port connectors, such 
as roads and railways that provide access to the Interstate highway 
system and the national rail network. According to DOT, approximately 
90 percent of America’s overseas imports and exports by tonnage move 
by ship. Consequently, the continued maintenance and improvement of 
the MTS is essential to sustaining the nation’s competitive position 
in the global economy. This report examines (1) Corps and DOT programs 
that can be used to maintain or improve the MTS, (2) key challenges to 
maintaining and improving the MTS, and (3) opportunities to improve 
the effectiveness of the federal role in the MTS. GAO analyzed 
information from the Corps and DOT, interviewed relevant agency 
officials and industry associations, and conducted site visits to six 
ports—-selected based on tonnage, geographic representation, and other 
factors-—to discuss federal, state, and local investment in MTS 
infrastructure. 

What GAO Found: 

The U.S. Army Corps of Engineers (Corps) and the Department of 
Transportation (DOT) use a variety of programs to maintain and improve 
Marine Transportation System (MTS) infrastructure. The Corps is the 
lead federal agency responsible for maintaining and improving 
navigable waterways. Corps data show that obligations for navigable 
waterways have decreased from over $3 billion in fiscal year 2009 to 
about $1.8 billion in fiscal year 2011. Most annual DOT funding is 
provided to states through formulas, and states determine which 
projects to fund. For example, in fiscal year 2011, the Surface 
Transportation Program provided $9.5 billion to states for a variety 
of transportation projects, which may have included port improvements. 
However, because DOT does not specifically track formula funding used 
to maintain or improve ports or port connectors, officials were unable 
to provide GAO the extent to which these funds were used for port 
improvements, although the officials stated that the number of port-
specific projects was likely small. Several DOT grant and credit 
programs can also provide specific funding to ports, though ports are 
primarily responsible for maintaining and improving infrastructure on 
port property. 

Aging MTS infrastructure, a growing backlog of projects, and the lack 
of an MTS system-wide prioritization strategy represent key challenges 
for the Corps and DOT to maintain and improve MTS infrastructure. For 
example, some structures that support navigation, such as locks, are 
over 100 years old, and their condition has resulted in deteriorating 
performance and costly delays to shippers. The Corps and DOT have 
taken some steps to prioritize their individual funding decisions, but 
none of these efforts consider MTS infrastructure system-wide. While 
the Corps is prioritizing projects within its navigation program, DOT 
has a more limited ability to prioritize funding for port 
infrastructure projects because the majority of DOT’s funding goes to 
the states where decisions about transportation priorities are made at 
the state and local level. 

Two efforts in particular provide opportunities to improve the 
effectiveness of federal support to MTS infrastructure. First, the 
recently enacted Moving Ahead for Progress in the 21st Century Act 
requires DOT to develop a National Freight Strategic Plan and to 
consult with appropriate transportation stakeholders. However, DOT and 
the Corps have historically had limited coordination involving system-
wide MTS investments. Involving the Corps in the development of the 
National Freight Strategic Plan is particularly important given the 
critical role navigable waterways play in freight movement. Second, 
the Committee on the Marine Transportation System (CMTS), a 
partnership of federal agencies chaired by DOT, has the opportunity to 
take further actions to help ensure that its 2008 National Strategy 
for the Marine Transportation System is reviewed and updated to 
reflect new and emerging challenges, and that its 34 recommendations 
to improve the MTS are implemented. One recommendation included 
studying approaches to allocate federal dollars among competing 
transportation priorities. However, the Strategy has not been reviewed 
and updated since the CMTS published it in 2008 and it does not 
incorporate accountability mechanisms, such as identifying desired 
results or performance measures, for the recommended actions. Such 
mechanisms would help ensure that the actions CMTS recommended to 
improve the MTS are indeed implemented. 

What GAO Recommends: 

DOT should (1) inform the development of the National Freight 
Strategic Plan with the Corps’ planned investments in the nation’s 
navigable waterways and (2) ensure the review and update of the 
National Strategy for the MTS to include accountability mechanisms for 
the Strategy’s recommended actions. DOT agreed to consider the report’
s recommendations. 

View [hyperlink, http://www.gao.gov/products/GAO-13-80]. For more 
information, contact Lorelei St.James at (202) 512-2834 or 
stjamesl@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

A Variety of Corps and DOT Programs Can Be Used to Maintain or Improve 
Some Segments of the MTS: 

Several Challenges Exist to Maintaining and Improving the MTS: 

Federal Government Has Taken Steps to Address MTS Challenges; However, 
Opportunities Exist to Improve the Effectiveness of Its Role in the 
MTS: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: DOT Programs We Reviewed That May Fund MTS Infrastructure: 

Appendix III: DOT Programs We Reviewed That May Finance MTS 
Infrastructure: 

Appendix IV: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Corps Navigation Program Obligations by Appropriations 
Account, Fiscal Years 2009 to 2011: 

Table 2: Selected Corps Navigation Operation and Maintenance 
Activities Performance Indicators: 

Table 3: MTS Stakeholders with Whom GAO Met during Site Visits: 

Table 4: DOT Obligations for Programs We Reviewed That May Fund MTS 
Infrastructure: 

Table 5: DOT Obligations, Principal Amount and Net Lifetime Subsidy 
Reestimate for Programs We Reviewed That May Finance MTS 
Infrastructure: 

Figures: 

Figure 1: Three MTS Segments: Navigable Waterways, Port, and Port 
Connector Infrastructure: 

Figure 2: Mississippi River at the Port of South Louisiana: 

Figure 3: Corps Navigation Lock Inventory, 2012: 

Figure 4: Construction at the Inner Harbor Navigation Canal Lock, New 
Orleans, Louisiana: 

Abbreviations: 

CMTS: Committee on the Marine Transportation System: 

Corps: U.S. Army Corps of Engineers: 

DOT: Department of Transportation: 

FHWA: Federal Highway Administration: 

FRA: Federal Railroad Administration: 

GDP: gross domestic product: 

MAP-21: Moving Ahead for Progress in the 21st Century Act: 

MARAD: Maritime Administration: 

MOU: memorandum of understanding: 

MPO: Metropolitan Planning Organization: 

MTS: Marine Transportation System: 

MTSNAC: Marine Transportation System National Advisory Council: 

RRIF: Railroad Rehabilitation and Improvement Financing: 

SAFETEA-LU: Safe, Accountable, Flexible, Efficient Transportation 
Equity Act: A Legacy for Users: 

TEU: twenty-foot equivalent unit: 

TIFIA: Transportation Infrastructure Finance and Innovation Act: 

TIGER: Transportation Investment Generating Economic Recovery: 

[End of section] 

United States Government Accountability Office: 
Washington, DC 20548: 

November 13, 2012: 

Congressional Addressees: 

The United States is one of the largest trading nations in the world, 
and approximately 90 percent of America's overseas imports and exports 
by tonnage move by ship.[Footnote 1] Consequently, the continued 
maintenance and improvement of the nation's Marine Transportation 
System (MTS) is essential to sustaining the nation's competitive 
position in the global economy and the efficient movement of freight 
within the United States. The MTS includes navigable waterways, ports, 
and port connectors such as the roads and railways that provide access 
to and from ports.[Footnote 2] While a worldwide slowdown in economic 
activity has recently resulted in less freight moving through the MTS, 
forecasts estimate that U.S. freight tonnage will steadily increase 
through 2040.[Footnote 3] 

The MTS operates in a complex funding environment, with the federal 
government, state, local, and private entities all playing a role in 
helping maintain and develop MTS infrastructure. The U.S. Army Corps 
of Engineers (Corps) is the lead federal agency for maintaining and 
improving navigable waterways, and the Department of Transportation 
(DOT) is the primary federal agency supporting landside infrastructure 
projects that facilitate the movement of freight to, from, or within 
ports. In addition, port authorities, some of which are quasi state or 
local public entities, are primarily responsible for managing 
infrastructure such as terminals, wharfs, berths, and piers "inside 
the gate" of a port where cargo is loaded onto and unloaded off of 
ships. 

Given the variety of stakeholders responsible for specific segments of 
the MTS, nationwide efforts such as adapting to a potential shift in 
U.S. trade routes because of the expansion of the Panama Canal or 
developing infrastructure to support an increase in the nation's 
exports can be challenging. This is particularly true in the current 
fiscally constrained environment where many MTS infrastructure needs 
outweigh the resources available. In light of these issues, we 
prepared this report under the authority of the Comptroller General to 
conduct evaluations at GAO's initiative to assist Congress with its 
oversight responsibilities. This report examines: 

1. Corps and DOT programs that can be used to maintain or improve the 
MTS. 

2. Key challenges to maintaining and improving the MTS. 

3. Opportunities to improve the effectiveness of the federal 
government's role in the MTS. 

To address these objectives, we reviewed program documentation and 
related reports from the Corps, DOT, the Committee on the Marine 
Transportation System (CMTS), and the American Association of Port 
Authorities. We also reviewed prior GAO reports on several topics, 
including surface transportation programs, freight mobility issues, 
Corps budget formulation and project delivery processes, marine 
transportation financing, strategic planning, and interagency 
collaboration and coordination practices. We reviewed budget 
documentation and collected and analyzed funding and financing 
information for federal programs within the Corps and DOT. We reviewed 
relevant documentation and interviewed knowledgeable officials about 
these data and determined that they were sufficiently reliable for the 
purposes of this report. We reviewed legislation related to surface 
and MTS infrastructure programs and funding, including the new surface 
transportation reauthorization--the Moving Ahead for Progress in the 
21st Century Act (MAP-21).[Footnote 4] We interviewed officials from a 
variety of federal transportation programs and representatives from 
industry associations representing various stakeholders in the MTS. We 
conducted site visits to the Port of New York and New Jersey, Port of 
New Orleans, Port of Portland, Port of Savannah, Port of South 
Louisiana, and the Port of Vancouver (USA). We chose these site visits 
based on a variety of criteria, including freight tonnage, ongoing and 
completed port-related infrastructure development projects, a mix of 
coastal and river ports, and geographic representation. During these 
site visits, we collected relevant documentation and interviewed a 
range of port stakeholders, including officials from local port 
authorities, Corps division and district offices, state DOTs, and 
Metropolitan Planning Organizations (MPO).[Footnote 5] The results of 
these site visits are not generalizable, but do provide insights 
regarding state, local, and private-sector experiences maintaining and 
improving MTS infrastructure. For additional information on our scope 
and methodology, see appendix I. 

We conducted this performance audit from November 2011 to November 
2012 in accordance with generally accepted government auditing 
standards. Those standards require that we plan and perform the audit 
to obtain sufficient, appropriate evidence to provide a reasonable 
basis for our findings and conclusions based on our audit objectives. 
We believe that the evidence obtained provides a reasonable basis for 
our findings and conclusions based on our audit objectives. 

Background: 

As economic activities become more integrated and globalized, foreign 
trade has become increasingly important to the U.S. economy.[Footnote 
6] According to DOT, recent projections indicate foreign trade may 
reach 35 percent of the U.S. gross domestic product (GDP) in 2020 and 
potentially grow to 60 percent of GDP by 2030. As the types of goods 
exported from and imported to the United States vary greatly, the 
specific type of cargo can determine the mode of shipment. For 
example, cargo such as grains, coal, ore, and cement typically ship by 
dry bulk carrier, oil and gas by tanker, while other commodities such 
as apparel and appliances ship via containership.[Footnote 7] 
According to Corps data, U.S. ports handled a total of 2.3 billion 
tons of commodities in 2010. 

Most types of cargo (including agricultural goods such as grains) are 
increasingly being moved by containership--ships that carry cargo in 
containers measured in twenty-foot equivalent units (TEU).[Footnote 8] 
In 2009, U.S. ports handled $474 billion in containerized imports and 
$177 billion in containerized exports. In addition, shippers are 
increasingly using larger ships to gain transportation efficiencies 
and cost savings in a competitive market. For example, in 2000, the 
average containership carried 2,900 TEUs; in 2012, the average 
containership carried 6,100 TEUs. According to DOT, the number of port 
calls to the United States by very large post-Panamax containerships 
[Footnote 9] carrying 5,200 TEUs or greater increased 156 percent 
(from 1,700 to 4,400 port calls) from 2004 to 2009. These vessels are 
expected to represent 62 percent of total containership capacity in 
the world by 2030. Consequently, continued trade growth in coming 
years, as well as the increasing size of containerships calling on 
U.S. ports, will place even greater demands on the nation's MTS and 
necessitate some changes to MTS infrastructure, such as deepening 
channels to accommodate these larger vessels. 

MTS: Navigable Waterways, Ports, and Port Connectors: 

The MTS is integral to the efficient movement of the nation's freight. 
It provides a cost effective means of moving bulk, breakbulk, and 
containerized cargo to U.S. consumers and to foreign markets through a 
variety of transportation modes. The MTS includes three primary 
segments: navigable waterways, ports, and port connectors. There are 
25,000 miles of commercially navigable harbors, channels and 
waterways, 4 million miles of public highways and roads, and over 
140,000 miles of national, regional, and local railroad networks in 
the United States over which trillions of dollars worth of freight 
move annually. Figure 1 below illustrates these three MTS segments. 

Figure 1: Three MTS Segments: Navigable Waterways, Port, and Port 
Connector Infrastructure: 

[Refer to PDF for image: illustration] 

Navigable Waterways: 
Lock; 
Jetty; 
Navigation channel. 

Port: 
Rail yard; 
STaging area. 

Port connector: 
National rail network; 
Road and rail port connectors; 
Interstate highway system. 

Source: GAO. 

[End of figure] 

Navigable Waterways: Navigable waterways include harbors, shipping 
channels (including both deep and shallow draft), rivers, lakes, and 
inland waterways, as well as locks, dams, and other navigation 
structures such as jetties.[Footnote 10] They provide safe passage for 
a wide range of shipping vessels including containerships, tankers, 
bulk carriers, and other vessel types such as inland and oceangoing 
barges. Inland waterways carry approximately one-sixth of the national 
volume of intercity cargo on 12,000 miles of commercially active 
inland and intra-coastal waterways. There are also 13,000 miles of 
coastal deep and shallow draft harbors and channels that are operated 
and maintained for commerce. These deep draft harbors and channels 
provide access to 70 ports, including about 40 ports that have channel 
depths of 40 feet or more and handle 10 million or more tons of cargo 
per year. 

The federal government pays for all operation and maintenance 
activities for inland waterways and one-half of the inland waterways 
construction costs for rehabilitating, modernizing, or replacing locks 
and dams. The other half comes from commercial waterway users that pay 
fuel taxes that flow into the Inland Waterways Trust Fund.[Footnote 
11] In contrast, for coastal harbors and channels, the federal 
government pays from 40 to 90 percent, and the non-federal sponsors 
pay from 10 to 60 percent of new construction costs depending on the 
channel depth and sponsor's contribution for land, easement, and 
rights-of-way.[Footnote 12] The federal government pays for most 
operation and maintenance costs for coastal harbors and channels, 
which are then reimbursed from revenues from the Harbor Maintenance 
Trust Fund, which comes largely from an excise tax on imports imposed 
on commercial users at certain ports.[Footnote 13] The tax applies a 
second time to cargo that has already arrived at a U.S. port, but is 
transferred by barge to another U.S. port. Importers or shippers pay 
an amount equal to 0.125 percent of the value of the commercial cargo 
involved at the time of unloading. The Harbor Maintenance Trust Fund 
balance totaled $6.42 billion at the end of fiscal year 2011. Non-
federal sponsors are responsible for a small percentage of operation 
and maintenance costs for harbors and channels that are deeper than 45 
feet. 

Ports: All ports serve as gateways for the movement of goods between 
navigable waterways and landside transportation systems, such as the 
Interstate highway system or the national rail network. For the 
purposes of this report, we refer to ports as the area "inside the 
gate" and under the control of the local port authority or private 
terminal operator, where cargo is loaded and unloaded to and from 
ships. Ports may be publicly or privately owned and operated, and 
consist of thousands of large, medium, and small terminals and 
intermodal facilities in approximately 360 commercial sea and river 
ports. However, most of the United States' containerized cargo is 
handled by a few major ports. For example, in 2009 U.S. ports handled 
over 206 billion tons of containerized imports and exports, and the 
top 10 U.S. container ports accounted for 85 percent of the total 
trade, according to DOT.[Footnote 14] 

Port Connectors: Efficient freight movement depends upon the condition 
of intermodal connections. Port connectors include transportation 
infrastructure such as roads, railways, and marine highways that 
connect the port to major trade corridors and allow freight to 
transfer from one transportation mode to another (e.g., from a ship to 
a truck).[Footnote 15] The Alameda Corridor, a 20-mile, $2.4 billion 
railroad express line linking the ports of Los Angeles and Long Beach 
to the transcontinental rail network east of downtown Los Angeles, 
provides one example of a major port connector that facilitates the 
movement of containerized freight to the East Coast as well as the 
Midwest. 

The federal government's expenditures for surface transportation 
infrastructure, including port connectors, are based, in part, on the 
user pay principle. The government collects taxes and fees, which flow 
into the Highway Trust Fund--historically the principle mechanism for 
funding federal highway programs. The Highway Trust Fund generally 
provides for the construction, reconstruction, restoration, and 
rehabilitation of roads that serve both freight and non-freight users. 
State and local governments also invest in public highways and roads. 
Within the federal-aid highway program, the federal government 
generally is responsible for funding 80 to 100 percent of highway 
project costs, while state and local governments are responsible for 
the remainder.[Footnote 16] Typically, state and local governments 
collect revenue from a combination of fuel taxes, vehicle taxes and 
fees, and tolls. State and local governments supplement user fees with 
general revenues to support highway and road activities. 

GAO's Prior Work on Freight Mobility and a National Freight Policy: 

Freight mobility is dependent on MTS infrastructure, and we have 
published a number of reports addressing surface transportation issues 
identifying a variety of challenges to freight mobility in the United 
States.[Footnote 17] We have highlighted challenges such as: 

* facilitating the efficient movement of freight and the growing 
demand for freight transportation; 

* adding capacity to accommodate that increased demand; 

* limited investment from federal, state, and local government in 
freight projects; and: 

* including freight projects in the state and local transportation 
planning process. 

We have also reported on the numerous federal goals for surface 
transportation and the lack of clarity in federal stakeholder roles. 
For example, DOT operating administrations with roles in freight 
transportation include the Federal Highway Administration (FHWA), 
Federal Railroad Administration (FRA), Federal Motor Carrier Safety 
Administration, and Maritime Administration (MARAD). An office of 
freight management and operations within FHWA administers programs, 
develops policies, and undertakes research that promotes freight 
movement across the nation and its borders, but the office does not 
coordinate federal actions such as federal funding related to freight 
mobility. 

We have previously reported that although there is a clear federal 
interest in freight transportation, there has not been a strategy that 
clearly defines the federal role or a mechanism to implement a 
national freight strategy. In the past, we have recommended or 
proposed for congressional consideration a number of actions to 
address this issue.[Footnote 18] On July 6, 2012, MAP-21 was enacted 
into law and authorized funding for 2 years to core federal-aid 
highway and transit programs.[Footnote 19] This legislation 
establishes a framework for a national freight policy and directs DOT 
to develop a national freight network and a National Freight Strategic 
Plan. It encourages states to develop freight plans with a description 
of procedures states will use to make investment decisions involving 
freight transportation. It also authorized the increase of the federal 
cost share of freight-related projects on Interstate highways to 95 
percent and to 90 percent on other roads if the Secretary of 
Transportation certifies that the projects meet specified 
requirements. On July 19, 2012, the President announced the 
establishment of a White House-led task force to develop a federal 
strategy to inform future investment decisions and identify 
opportunities for improved coordination and streamlined review of 
investments in coastal port infrastructure. The task force is 
comprised of senior officials from five departments and five White 
House offices and plans to build on steps already taken to coordinate 
across agencies with port-related responsibilities.[Footnote 20] 

Committee on the Marine Transportation System and the MTS National 
Strategy: 

A Presidential Directive in the U.S. Ocean Action Plan, issued in 
2004, elevated the existing Interagency Committee on the Marine 
Transportation to a Cabinet-level body, and created the Committee on 
the Marine Transportation (CMTS).[Footnote 21] The CMTS adopted a 
charter in 2005 creating a partnership of federal agencies with 
responsibility for the MTS to ensure the development and 
implementation of national MTS policies consistent with national needs 
and report to the President its views and recommendations for 
improving the MTS.[Footnote 22] The CMTS is a federal cabinet-level, 
interagency organization chaired by DOT and supported by a sub-cabinet 
policy advisory body, the Coordinating Board, a dedicated staff body, 
the Executive Secretariat, and Integrated Action Teams. According to 
the committee's charter, the CMTS is responsible for: 

* improving federal MTS coordination and policies; 

* promoting the environmentally sound integration of marine 
transportation with other modes of transportation and with other 
ocean, coastal, and Great Lakes uses; 

* developing outcome-based goals and strategic objectives for the 
safety, security, efficiency, economic vitality, environmental health, 
and reliability of the MTS for commercial and national defense 
requirements as well as a method for monitoring progress towards those 
goals; 

* coordinating budget and regulatory activities that impact the MTS; 
and: 

* recommending strategies and implementing plans to maintain and 
improve the MTS. 

In July 2008, the CMTS published a National Strategy for the Marine 
Transportation System (Strategy) to address challenges to improving 
the MTS and ensuring that policies and actions of CMTS agencies are 
synchronized and coordinated.[Footnote 23] The Strategy provided a 
policy framework for the MTS for 2008 through 2013 and recommended 34 
actions in 5 priority areas including capacity, safety and security, 
environmental stewardship, resilience and reliability, and finance. 

A Variety of Corps and DOT Programs Can Be Used to Maintain or Improve 
Some Segments of the MTS: 

The Corps and DOT have programs that can be used to address three key 
infrastructure segments of the MTS. Specifically, the Corps is 
responsible for navigable waterways' infrastructure and provides 
funding through its navigation program. Projects that improve or 
maintain ports and port connectors can receive federal funding or 
financing through a variety of programs administered by the DOT. 

Navigable Waterways Segment: 

The Corps' navigation program is responsible for maintaining navigable 
harbors, channels, and waterways and supporting structures--such as 
locks, dams, and jetties--for the MTS.[Footnote 24] Primary 
responsibilities of the navigation program include dredging to 
maintain channel depths at U.S. harbors and on inland waterways as 
well as planning, constructing, rehabilitating, operating, and 
maintaining navigation channels, locks, dams, and other structures. 
The Corps maintains only the federally designated channels in inland 
and coastal harbors, the depth and width of which are authorized by 
Congress.[Footnote 25] Increases in a navigation channel's authorized 
depth or width--referred to as construction or "new work"--are also 
congressionally authorized. 

The Corps' navigation program activities are generally funded from the 
Energy and Water Development Appropriations Acts. Funding requests in 
the President's Budget for the navigation program that primarily 
supports Corps activities to maintain and improve navigable waterways 
have decreased from $2 billion in fiscal year 2008 to $1.58 billion in 
fiscal year 2012. More specifically, the navigation program has 
decreased as a percentage of the President's budget for the civil 
works program from 41 percent in fiscal year 2008 to 34 percent in 
fiscal year 2012.[Footnote 26] Similar decreases occurred in 
obligations from three of the four separate appropriations accounts 
that support the Corps' maintenance and improvement activities for 
navigable waterways: the (1) Investigations, (2) Construction, and (3) 
Operation and Maintenance accounts. According to a senior Corps 
official, a separate Mississippi River and Tributaries appropriations 
account--which is used primarily for flood control--can provide 
additional funds for investigations, construction, and operation and 
maintenance. As shown in Table 1 below, our analysis of Corps data 
found that the Corps' total obligations for these accounts have 
decreased from over $3 billion in fiscal year 2009 to about $1.8 
billion in fiscal year 2011, a reduction of approximately 41 percent. 
[Footnote 27] The vast majority of the funds in each fiscal year are 
obligated for operation and maintenance activities. 

Table 1: Corps Navigation Program Obligations by Appropriations 
Account, Fiscal Years 2009 to 2011: 

Appropriations Account: Investigations; 
FY2009: $15,503,342; 
FY2010: $11,528,453; 
FY2011: $7,785,470. 

Appropriations Account: Construction; 
FY2009: $473,193,927; 
FY2010: $334,385,585; 
FY2011: $233,420,154. 

Appropriations Account: Operation and Maintenance; 
FY2009: $2,478,036,016; 
FY2010: $1,866,911,203; 
FY2011: $1,526,723,174. 

Appropriations Account: Mississippi River and Tributaries: 
Construction; 
FY2009: $9,328,116; 
FY2010: $11,888,462; 
FY2011: $837,855. 

Appropriations Account: Mississippi River and Tributaries: Operation 
and Maintenance; 
FY2009: $37,240,186; 
FY2010: $54,176,060; 
FY2011: $20,145,861. 

Appropriations Account: Total; 
FY2009: $3,013,301,587; 
FY2010: $2,278,889,764; 
FY2011: $1,788,912,515. 

Source: GAO analysis of Corps data. 

Notes: These data represent obligations using all funding sources, 
including funds from the Inland Waterway Trust Fund and the American 
Recovery and Reinvestment Act of 2009, Pub. L. No. 111-5, 123 Stat. 
115 (2009). 

Totals may not add due to rounding. 

[End of table] 

* Investigations: Prior to beginning any new navigation project, the 
Corps studies the proposed project's necessity, feasibility, costs, 
and benefits. According to data provided by the Corps, the Corps 
obligated approximately $7.8 million for such investigations in fiscal 
year 2011, with work on most investigations projects conducted over 
multiple years. For example, according to the Corps' fiscal year 2012 
Budget Justification, the federal share to fund preconstruction 
engineering and design activities for a navigation channel-deepening 
project at the Port of Savannah will cost an estimated $31 million. 
According to the Corps' final report for the project, it will deepen 
the harbor from its current authorized depth of 42 feet to 47 feet as 
well as widen areas where the navigation channel bends or where 
vessels pass or turn. The final report states that the increased depth 
will result in annual benefits because of the increased transportation 
cost efficiencies, reduced tidal delays, and reduced channel-
congestion delays.[Footnote 28] Specifically, the report concluded 
that although deepening the harbor would cost $39 million each year to 
maintain, it would generate average annual benefits to the nation of 
$213 million, thereby resulting in $174 million in net annual benefits 
to the nation.[Footnote 29] 

* Construction: The Corps obligates funds for construction and major 
rehabilitation projects related to navigation through its Construction 
account--totaling over $234 million in fiscal year 2011, according to 
data provided by the Corps. Similar to its Investigations account, 
work on most construction projects is conducted over multiple years. 
For example, according to the Corps' fiscal year 2012 Budget 
Justification, the federal share of the New York and New Jersey Harbor-
deepening construction project will cost an estimated $1.17 billion. 
The project will deepen 35 miles of navigation channels at the Port of 
New York and New Jersey to enhance access to the port's major 
container terminals, according to the Corps. In addition, as part of 
its Olmsted Locks and Dam Project, the Corps is replacing two existing 
locks and dams on the Ohio River that can no longer meet current 
traffic demands without significant delays. According to a March 2012 
Corps fact sheet, the project's current cost estimate without 
inflation at the October 2011 price level is approximately $2.9 
billion. 

* Operation and Maintenance: According to data provided by the Corps, 
in fiscal year 2011 the Corps obligated over $1.5 billion from its 
Operation and Maintenance account, which funds activities that 
maintain existing infrastructure. This generally includes dredging 
navigable harbors, channels, and waterways up to their congressionally 
authorized depth and width; however, these funds are also used for 
other purposes, such as to conduct routine maintenance on existing 
locks and dams. For example, Corps officials from the New Orleans 
District told us that dredging needs can vary significantly throughout 
the year, with some river sections receiving sediment deposits of up 
to 5 feet in one day. As a result, according to Corps officials, daily 
dredging of navigation channel sections at the mouth of the 
Mississippi River during certain times of the year is needed to ensure 
that ships can safely and efficiently access ports. According to the 
Corps' Navigation Data Center, New Orleans dredged more material than 
any other district in fiscal year 2010, removing over 65 million cubic 
yards of material. 

Port Segment: 

The federal government provides some funding or financing for projects 
that improve the port segment of the MTS. However, local taxes, 
private investment, and port authorities have typically financed 
infrastructure maintenance and improvements "inside the gate." 
According to the American Association of Port Authorities, ports and 
their private-sector partners plan to invest $46 billion through 2017 
in port operations and infrastructure. Ports that we visited also plan 
to make such investments. For example, according to Port Authority of 
New York and New Jersey officials, the port plans to invest an 
estimated $1.7 billion over the next decade to sustain port growth and 
improve transportation infrastructure by, among other things, 
improving capacity of the port marine terminal roadway and rail 
systems, and local connections to major freight corridors. They noted 
that the figure does not include an estimated $1 billion Port 
Authority of New York and New Jersey project to raise the roadway deck 
of the Bayonne Bridge, which will allow larger ships to pass 
underneath. 

The federal government may also provide some funding or financing for 
projects on port property. For example, DOT's Transportation 
Investment Generating Economic Recovery (TIGER) grant program has 
provided funds for infrastructure improvement projects on port 
property that are expected to have a significant impact on the nation, 
a metropolitan area, or a region. We have previously reported that 
while there was no requirement to distribute grant awards across 
different modes of transportation, TIGER funding has supported merit-
based highway, transit, rail, port, and other projects.[Footnote 30] 
The American Association of Port Authorities has strongly supported 
the TIGER program as a way to fund projects that will sustain and 
improve the nation's critical gateways for global trade. 

Ports that we visited viewed the TIGER program as an opportunity to 
improve their existing infrastructure. Each of the ports we visited 
applied for a TIGER grant since funds were first appropriated for this 
grant program in the American Recovery and Reinvestment Act in 
2009.[Footnote 31] Overall, we found that DOT's TIGER program awarded 
approximately $357 million for at least 26 port or port-connector 
projects between fiscal year 2009 and fiscal year 2012. For example, 
in 2010 the Port of Vancouver (USA) received a $10 million TIGER grant 
to help complete its West Vancouver Freight Access project, which will 
create a direct freight rail entry and exit from the port and 
alleviate rail traffic congestion. The project is divided into 20 
elements, with completion anticipated in 2017. Similarly, in 2011 the 
Port of New Orleans received a $16.7 million TIGER grant to construct 
a new 12-acre freight rail intermodal terminal and improve a 4-acre 
storage yard that is used for ultra-heavy project cargoes. The 
project's objective is to reduce congestion, facilitate the movement 
of marine and rail cargo, stimulate international commerce, and 
maintain an essential port asset in a state of good repair. 

Other DOT programs may also provide funds for port infrastructure 
development "inside the gate." For example, the National Defense 
Authorization Act for Fiscal Year 2010 established the Port 
Infrastructure Development Program to improve port facilities. 
[Footnote 32] Specifically, the act authorized the MARAD Administrator 
to, among other things, provide technical assistance to port 
authorities for project planning, design, and construction as well as 
to administer and carry out projects. According to MARAD officials, 
Congress has not appropriated any funds to the Port Infrastructure 
Development Program. Similarly, MARAD administers the America's Marine 
Highway Program, intended to, among other things: 

* expand domestic water transportation services as an alternative 
means of moving freight cargo and passengers; 

* mitigate the economic, environmental, and energy costs of landside 
congestion; and: 

* integrate marine highways into the transportation planning process. 

Under the program, ports that are sponsors of designated Marine 
Highway Projects are eligible to compete for grants, and in September 
2010, DOT awarded three projects and three research studies, totaling 
$7 million in funds. For example, the Virginia Port Authority was 
awarded $1.1 million to help purchase two barges to expand container 
transportation services both between the ports of Richmond and Norfolk 
and between the terminals within the port of Norfolk. This action is 
intended to relieve congestion along I-64 and within the City of 
Norfolk. 

Port Connector Segment: 

A variety of DOT formula, grant, and credit programs may be used to 
maintain and improve port connector infrastructure, such as road and 
rail connections to the Interstate system or national rail network. 
MAP-21 restructured highway programs by eliminating or consolidating 
the number of programs by two-thirds into new core formula programs: 
the National Highway Performance Program, the Surface Transportation 
Program, the Highway Safety Improvement Program, the Congestion 
Mitigation and Air Quality Improvement Program, the Railway-Highway 
Crossings program, and the Metropolitan Planning program. We did not 
assess how MAP-21 may affect the programs that DOT uses to fund or 
finance MTS projects; however, at the time of our review, we 
identified various surface transportation formula programs that could 
be used by state and local governments to develop or improve port 
connectors, all of which were administered by FHWA. These programs 
included, among others, the Congestion Mitigation and Air Quality 
Improvement Program, the Highway Safety Improvement Program, and the 
National Highway System. FHWA distributes this funding to the states 
through annual apportionments established by statutory formulas, and 
state and local governments are ultimately responsible for, among 
other things, selecting, planning, and supervising their 
infrastructure projects, including determining which, if any, port 
connections should be maintained or improved. 

FHWA obligations for formula programs in fiscal year 2011 ranged from 
approximately $232.6 million from the Metropolitan Planning Funds 
program to $9.5 billion from the Surface Transportation Program. (See 
app. II for a table of DOT programs we reviewed that may fund MTS 
infrastructure.) Although FHWA can determine overall obligations for 
these programs, according to FHWA officials, it does not track the 
extent to which formula programs fund port connector projects 
specifically. As a result, we were not able to determine the total 
funds that were used to benefit ports. FHWA officials noted that 
FHWA's role is to ensure that state projects meet federal program 
eligibility requirements and identified several challenges to 
identifying port-specific projects: 

* The number of port-specific projects for which formula funds are 
obligated is likely small. One FHWA official told us, for example, 
that less than 1 percent of Congestion Mitigation and Air Quality 
Improvement Program funds are likely obligated to port-specific 
projects. 

* Although some FHWA division offices may be able to identify port-
specific projects because they use distinct accounting codes for these 
investments, such coding is not required and is inconsistently applied 
across division offices. 

* Some larger highway projects may include components that could 
benefit a port; however, according to one FHWA official, it can be 
challenging to make that distinction. 

By contrast, several DOT programs allow the department to grant or 
direct funds to port-connector infrastructure projects. According to 
data provided by DOT officials, the department obligated the following 
approximate amounts in fiscal year 2011: 

* FHWA's Freight Intermodal Distribution Pilot Grant Program ($14 
million), National Corridor Infrastructure Improvement Program ($77 
million), and Projects of National and Regional Significance program 
($237 million); and: 

* FRA's Program for Capital Grants for Rail Line Relocation and 
Improvement Projects ($32 million). 

Of these programs we identified, the majority of funds were obligated 
from the Projects of National and Regional Significance program, under 
which funds are distributed by congressional directive. For example, 
under the program Congress directed $100 million from fiscal year 2005 
to fiscal year 2009 to the Cross Harbor Freight Movement Project in 
New York.[Footnote 33] According to FHWA, the goal of the project is 
the near-term rehabilitation and the long-term improvement of the 
underutilized rail freight network connecting the New York and New 
England markets to national markets west of the Hudson River. 

Some DOT credit programs can also target and finance port connector 
projects. For example, under these programs, DOT may obligate funds 
for direct loans to project sponsors. Generally, for credit programs, 
federal agencies obligate the credit program's subsidy costs and 
administrative expenses.[Footnote 34] This amount differs from the 
credit instrument's principle amount, which represents the total 
credit provided by the federal government to the project's sponsor. 
(See appendix III for a table of obligations, principal amount, and 
subsidy cost information related to these programs.) One such credit 
program is FHWA's Transportation Infrastructure Finance and Innovation 
Act (TIFIA) program, which provides federal credit assistance in the 
form of direct loans, loan guarantees, and lines of credit to finance 
surface transportation projects of national and regional significance. 
[Footnote 35] The TIFIA program supported at least one port connector 
project to date--providing a $341 million direct loan to a public-
private partnership project intended to construct a dedicated roadway 
connector between the Interstate system and the Port of Miami. FRA's 
Railroad Rehabilitation and Improvement Financing (RRIF) Program is 
another credit program that may be used to upgrade port connectors to 
the nationwide rail network. Under the RRIF program, FRA provides 
direct loans and loan guarantees to (1) acquire, improve, or 
rehabilitate intermodal or rail equipment or facilities; (2) refinance 
outstanding debt, or (3) develop or establish new intermodal or 
railroad facilities. According to data provided by FRA officials, FRA 
obligated approximately $842 million for direct loans under the 
program between fiscal year 2009 and fiscal year 2011. 

Several Challenges Exist to Maintaining and Improving the MTS: 

We identified three key challenges to maintaining and improving MTS 
infrastructure. First, aging infrastructure on the nation's waterways, 
ports, and port connectors may hinder the efficient movement of 
freight. Second, the Corps and DOT are faced with more demands for 
maintaining and improving MTS infrastructure than available federal 
funding allows. Third, while the Corps and DOT have taken some steps 
to prioritize funding within their purview for all three segments of 
the MTS that we reviewed, there is no system-wide strategy for 
prioritizing MTS investments. 

Aging MTS Infrastructure: 

Navigable Waterways and Supporting Structures: 

The Corps is facing challenges maintaining and improving navigation 
infrastructure, such as dredging channels and repairing locks. For 
example, according to navigation program officials responsible for 
managing the deep draft Mississippi River channel between Baton Rouge 
and the Gulf of Mexico, increased dredging costs have precluded the 
Corps from being able, as of fiscal year 2011, to maintain the 
Mississippi River channel at its fully authorized width and 
depth.[Footnote 36] Figure 2 below shows the Mississippi River at the 
Port of South Louisiana. 

Figure 2: Mississippi River at the Port of South Louisiana: 

[Refer to PDF for image: photograph] 

Source: GAo. 

[End of figure] 

As a result of the channel's shoaling,[Footnote 37] the New Orleans-
Baton Rouge Steamship Pilot's Association, which is responsible for 
operating vessels on the lower Mississippi River, began placing 
restrictions on certain sections of the river when conditions warrant. 
According to Corps officials, these restrictions can increase the time 
and cost of shipping services and the channel shoaling may have a 
negative impact on safety. Structures that support navigation 
channels, such as jetties, are also aging and in need of 
rehabilitation. For example, the jetties at the mouth of the Columbia 
River, which help to maintain the depth and orientation of the 
shipping channel and provide protection for ships from waves entering 
and exiting the river, are about 100 years old. The Corps' Portland 
District recently completed a major rehabilitation report for the 
jetties, with prescribed near-term repairs, as well as more 
significant rehabilitation to be pursued between 2014 and 2020. The 
Pacific Northwest Waterways Association has indicated that these 
jetties are of critical importance to shippers in the region. 

The locks and dams that support navigation on the nation's inland 
waterway system are also aging, resulting in decreased performance and 
costly delays. Over one-half of the Corps' 241 locks at 196 sites have 
exceeded their 50-year service life, requiring increased maintenance 
to keep them functioning.[Footnote 38] Figure 3 shows the age of the 
nation's navigation lock inventory. 

Figure 3: Corps Navigation Lock Inventory, 2012: 

[Refer to PDF for image: vertical bar graph] 

Age in 2012: 0-9 years; 
Number of operational lock chambers: 3. 

Age in 2012: 10 to 19 years; 
Number of operational lock chambers: 9. 

Age in 2012: 20-29 years; 
Number of operational lock chambers: 16. 

Age in 2012: 30-39 years; 
Number of operational lock chambers: 17. 

Age in 2012: 40-49 years; 
Number of operational lock chambers: 53. 

Age in 2012: 50-59 years; 
Number of operational lock chambers: 31. 

Age in 2012: 60-69 years; 
Number of operational lock chambers: 9. 

Age in 2012: 70-79 years; 
Number of operational lock chambers: 55. 

Age in 2012: 80+ years; 
Number of operational lock chambers: 35. 

Source: U.S. Army Corps of Engineers. 

Note: Includes all operational deep and shallow draft Corps and 
Tennessee Valley Authority navigation locks. 

[End of figure] 

As locks age, repair and rehabilitation become more extensive and 
expensive, according to the CMTS.[Footnote 39] Corps officials told us 
that, at current funding levels, replacement of the Inner Harbor 
Navigation Canal lock (Industrial Canal), a vital link that connects 
the Mississippi River to the Gulf Intracoastal Waterway system in New 
Orleans, may not occur until 2030.[Footnote 40] Moreover, according to 
the Corps, the current lock, which was completed in 1921, is too small 
to accommodate modern day vessels. See figure 4 below. 

Figure 4: Construction at the Inner Harbor Navigation Canal Lock, New 
Orleans, Louisiana: 

[Refer to PDF for image: photograph] 

Source: U.S. Army Corps of Engineers. 

[End of figure] 

Corps officials attributed this delay to the years of planning and 
community involvement needed to reach consensus on the lock design, as 
well as insufficient resources to address the lock replacement because 
of other construction projects.[Footnote 41] The planned replacement 
lock will provide a nearly three-fold increase in lock chamber 
capacity; however, Corps officials told us that project costs have 
also increased considerably over time, with current construction costs 
estimated at $1.5 billion. 

The Corps uses performance indicators to measure the performance of 
its locks. Each year the Corps measures its performance in meeting a 
number of high priority goals, and as part of this effort, the Corps 
assesses the extent to which the navigation projects are meeting 
authorized purposes and evolving conditions.[Footnote 42] The Corps 
has developed performance metrics for navigation operation and 
maintenance activities to provide an indicator of the extent to which 
the Corps is meeting those goals. Recent data illustrate the effect 
that aging infrastructure is having on MTS performance (see table 2). 
These metrics show that the hours of scheduled and unscheduled lock 
closures because of mechanical failures have increased since fiscal 
year 2009. Moreover, according to a senior Corps navigation program 
official, there has been a consistent trend of deteriorating lock 
performance since 2000. For some indicators, such as the number of 
preventable lock closures over 24 hours, performance in 2011 was 
better than in 2010; however, the performance of the locks still 
failed to meet Corps' targets for 2011. Also, in fiscal year 2011, the 
Corps did not meet performance targets for locks at both inland 
waterways and coastal ports and harbors.[Footnote 43] 

Table 2: Selected Corps Navigation Operation and Maintenance 
Activities Performance Indicators: 

Inland waterways: 

Segment availability - closures over 24 hours in thousands of hours; 
2009: Actual: 11.1; 
2010: Actual: 19.6; 
2011: Target: 19; 
2011: Actual: 23.1. 

Preventable lock closures over 24 hours; 
2009: Actual: 37; 
2010: Actual: 61; 
2011: Target: 38; 
2011: Actual: 50. 

Preventable lock closures over 7 days; 
2009: Actual: 19; 
2010: Actual: 37; 
2011: Target: 21; 
2011: Actual: 26. 

Coastal ports and harbors: 

Channel availability; 
2009: Actual: 50%; 
2010: Actual: 38%; 
2011: Target: 35%; 
2011: Actual: Not available[A]. 

Source: U.S. Army Corps of Engineers - Civil Works, Annual Financial 
Report, fiscal year 2011. 

[A] U.S. Army Corps of Engineers, Waterborne Commerce Statistics data 
was not available for publication at the time of this report. 

[End of table] 

Port Connectors: 

The nation's road connectors at ports are used by trucks with heavy 
loads and are often in poor condition. DOT has reported that much of 
the nation's freight transportation infrastructure was developed 
before 1960 to serve industrial and population centers in the 
Northeast and Midwest.[Footnote 44] Since 1960, however, there have 
been fundamental changes in the American economy as the population and 
manufacturing have grown in the South and West Coast. According to 
DOT, the growth in freight transportation is a major contributor to 
congestion in urban areas and congestion in turn affects the 
timeliness and reliability of freight transportation. In its December 
2000 report to Congress, DOT found that many of the nation's 
intermodal road connectors to ports were under-maintained. For 
example, highway connectors to ports had twice the percentage of 
pavement deficiencies as non-Interstate National Highway System 
routes.[Footnote 45] In that study, DOT found that 15 percent of the 
port connector mileage, which it defined as the roadway used by trucks 
to travel between major highways and ports, was in poor or very poor 
condition. More recently in 2004, DOT reported that about one-third of 
the port connector system was in need of additional capacity because 
of current congestion and that over 40 percent of the port connector 
mileage needs some type of pavement or lane-width improvement. 
[Footnote 46] Prior surface transportation legislation did not 
specifically address the condition of port connectors on a systematic 
basis, but the Safe, Accountable, Flexible, Efficient Transportation 
Equity Act: A Legacy for Users (SAFETEA-LU) established a Freight 
Intermodal Distribution Pilot Grant Program to, among other things, 
facilitate and support intermodal freight transportation activities at 
the state and local levels to relieve congestion. This program 
included $30 million for six designated projects aimed at relieving 
congestion at intermodal facilities, including several ports.[Footnote 
47] 

Efficient freight movement at ports may also be hindered by aging rail 
infrastructure, especially key bridges. According to officials from 
the MPO serving the New Orleans metropolitan area, one of the most 
pressing rail infrastructure needs at the Port of New Orleans is 
replacement of the Almonaster Avenue Bridge, which is a central link 
in the east-west rail traffic across the southern United States 
handling numerous trains per day. The existing bridge was completed in 
1920 and is structurally deficient--in its closed position the bridge 
provides only one to two feet of vertical clearance above the average 
water level and must open to virtually all marine traffic.[Footnote 
48] Although the bridge is part of the national highway system, making 
it eligible for federal funding, it is not a part of the state highway 
system, and therefore ineligible for state funding, according to state 
officials. At issue is whether the Port of New Orleans, which owns the 
bridge, should pay for its share of the $65 million bridge 
replacement, because the transportation benefits that would come from 
the bridge's replacement would accrue to the nation. 

MTS Infrastructure Backlog: 

Today, the Corps is faced with more demands for maintaining and 
improving aging navigation infrastructure than available federal 
funding allows. According to Corps navigation program data, current 
authorization of appropriation amounts for navigation construction 
projects exceeds the amount appropriated by $13.5 billion, and the 
current estimated operation and maintenance backlog is $3.4 billion, 
assuming current funding levels. The data only include the federal 
shares and do not include the non-federal share of the costs provided 
by project stakeholders.[Footnote 49] Several factors have been 
identified as contributing to the size of the current navigation 
program backlog, including: 

* authorizations that have outpaced appropriations in recent years; 

* the aging of existing infrastructure, which requires more funds for 
operations, maintenance, and rehabilitation; and: 

* rapidly increasing costs to construct water infrastructure projects, 
in part because of price increases for construction materials and 
fuels.[Footnote 50] 

Other reasons for the increase include the cost associated with 
environmental mitigation and disposal of dredged material. For 
instance, according to the Corps, features to mitigate the 
environmental impact account for 45 percent of the total $652 million 
cost of the Savannah Harbor Expansion Project. In addition, Corps 
officials told us that the lack of proximate dredged-material disposal 
areas and the mitigation costs for feasible alternative sites 
dramatically increases project costs. 

Keeping up with the investment requirements of modern port operations 
has become a major challenge for many ports, especially at the 
nation's small and medium-sized commercial ports. According to a 
senior MARAD official, the majority of the nation's port 
infrastructure was built in the 1960s, and this infrastructure is now 
at the end of its useful life and in need of rehabilitation and 
modernization. As the TIGER program has demonstrated and as MARAD 
officials concur, port infrastructure development and modernization 
needs outweigh current funding. According to DOT, in fiscal year 2012 
over 80 ports submitted TIGER pre-applications for port development 
projects representing a variety of port types, including large 
sophisticated container ports as well as smaller commercial fishing 
ports, and DOT provided TIGER grant funding to 8 port infrastructure 
projects. 

One of the challenges facing ports is installing adequate 
infrastructure to handle new larger post-Panamax vessels, which are 
expected to begin calling at U.S. Gulf and East Coast ports after the 
expansion of the Panama Canal is completed in 2014. Post-Panamax 
vessels, for example, require bigger cranes, which can cost over $25 
million each, and more staging areas to accommodate peak cargo flow. 
Some ports, like Georgia Port Authority's Garden City Terminal at the 
Port of Savannah, have invested heavily to ensure that the port is 
ready to accommodate the new larger vessels. 

According to DOT's most recent estimate, $4.3 billion is needed to 
improve the condition of the nation's port connectors.[Footnote 51] We 
have previously reported that the nation's surface transportation 
system, including port connectors, is under growing strain, and the 
cost to repair and upgrade the system to safely and reliably meet 
current and future demands may exceed what the nation can afford. 
[Footnote 52] 

Prioritization of MTS Investments: 

Both the Corps and DOT are taking some steps to prioritize funding 
within their purview for all three segments of the MTS that we 
reviewed. We have previously reported that a systematic approach to 
help guide decisions on federal investment in the MTS is needed 
because of the growing awareness of, and agreement about, the need to 
view the various transportation modes that comprise the MTS from an 
integrated standpoint, particularly for the purposes of developing and 
implementing a federal investment strategy.[Footnote 53] 

The Corps has taken steps to prioritize limited funding within its 
navigation program and civil works budget process. Within the 
navigation program specifically, the Corps has developed the 
Operational Condition Assessment tool for all inland navigation 
structures, such as locks and dams, to ensure that structures are 
consistently assessed and to provide relative risk ratings and project 
ratings. The Corps is developing a similar tool for rating coastal 
navigation structures, such as jetties, and Corps officials expect 
this tool to inform the Corps' fiscal year 2014 budget. For navigation 
channels, the Corps is developing a uniform framework tool, 
anticipated to be available for fiscal year 2015 to assess the 
condition of all navigation channels. With respect to its civil works 
program, the Corps began using performance-based budgeting beginning 
in fiscal year 2006 as a way to focus funding requests on those 
projects with the highest anticipated return on investment.[Footnote 
54] Under the current civil works budget formulation process, the 
Corps uses performance metrics and a benefit-to-cost ratio to evaluate 
projects' estimated future outcomes and gives priority to those with 
the highest expected returns for the national economy and the 
environment. In part, the Corps focuses on anticipated outcomes 
because most of the construction and investigation projects being 
considered in its civil works budget requests are new or have not yet 
been completed, and thus have not generally begun to achieve benefits. 
Because the Operation and Maintenance account includes projects that 
have already been constructed, the Corps incorporates ongoing 
performance information, such as assessments of whether infrastructure 
meets current engineering and industry standards. Nevertheless, the 
number of investigations and construction projects receiving 
appropriations is typically greater than the number requested, and as 
we have previously reported, the Corps' budget presentation does not 
include an explanation of the relative priority given to projects or 
how they are evaluated against each other. 

In addition to these efforts, the Corps recently issued a report to 
provide advice on how Congress should address the need for additional 
port and inland waterway modernization to accommodate post-Panamax 
vessels.[Footnote 55] The Corps reported that it is critical that the 
U.S. develop and move forward with a strategic vision for ensuring 
adequate investment in maintaining navigation infrastructure and for 
facilitating the strategic targeting of investments to ensure that the 
United States is ready for these larger vessels when the expanded 
Panama Canal opens in 2014. The Corps also presented a variety of 
financing options to initiate a national discussion of possible paths 
to meet the challenge of modernizing MTS infrastructure. 

DOT has a more limited ability to prioritize funding for port 
infrastructure projects given the structure of federal surface 
transportation funding. The vast majority of DOT funding goes directly 
to state DOTs through formulas where decisions about transportation 
priorities are made at the state and local level.[Footnote 56] In 
fiscal year 2011, FHWA provided states with over $39 billion in 
federal-aid highway funding. The statewide transportation planning 
process is the forum through which states decide how to spend 
significant amounts of federal transportation funds. This process is 
informed by MPOs that lead transportation planning in urbanized areas-
-geographic areas with populations of 50,000 or more. Although states 
must comply with federal planning requirements administered jointly by 
FHWA and the Federal Transit Administration, states have considerable 
discretion to allocate federal funds and select projects. According to 
a senior DOT official, states and MPOs make the decisions about how 
best to prioritize their formula funding and how to integrate port 
infrastructure projects into their transportation plans. However, as 
we have previously reported, data limitations and the lack of 
performance measures for these projects can make it difficult to 
quantify the benefits of these projects and to achieve state-wide or 
community support.[Footnote 57] 

DOT's competitive grant and credit programs provide one opportunity 
for the agency to prioritize funding for port infrastructure, yet 
funding for these projects is relatively limited compared to formula 
funding. For example, in fiscal year 2012, DOT had $500 million in 
TIGER funds to obligate across all modes for a variety of 
transportation projects and $122 million in budget authority for the 
TIFIA program.[Footnote 58] The new surface transportation 
legislation, MAP-21, significantly expands the TIFIA program by 
authorizing $750 million in budget authority in fiscal year 2013 and 
$1 billion in fiscal year 2014 to pay the subsidy cost of supporting 
federal credit.[Footnote 59] According to FHWA, a $1 billion TIFIA 
authorization of budget authority will support about $10 billion in 
actual lending capacity. MAP-21 also calls for a number of significant 
program reforms including a 10 percent set-aside for rural projects 
and an increase in the share of eligible project costs from 33 percent 
to 49 percent. Projects that received credit assistance through TIFIA 
tend to be large, high-cost highway projects. Even with the additional 
budget authority authorized for the TIFIA program, DOT officials told 
us that the funding process is driven by applicants as opposed to a 
national assessment of priority. 

Moreover, port projects may not always compete well against other 
transportation-funding projects. According to DOT officials, ports may 
be less accustomed to the processes and procedures involved in 
applying for federal funds, making it harder for them to compete for 
competitive grants and loans. Given the short program timelines for 
the TIGER program, some ports may have difficulty meeting timelines 
given the complexity of their proposals. Additionally, port applicants 
may not be as familiar with developing and completing federal 
environmental review requirements making it difficult to remain 
eligible for funding. According to one senior MARAD official, many 
ports lack sufficient expertise to conduct early planning or are not 
well positioned to leverage existing relationships with state DOTs. As 
a result, some ports may be less prepared to participate in DOT's 
competitive funding processes and compete against applicants with more 
experience participating in the federal funding process. 

Federal Government Has Taken Steps to Address MTS Challenges; However, 
Opportunities Exist to Improve the Effectiveness of Its Role in the 
MTS: 

A number of efforts are under way to address MTS challenges through 
better coordination of federal investments. Specifically, the Corps 
and DOT are taking steps to better coordinate MTS infrastructure 
investments between the two agencies. Other federal efforts such as a 
government-wide task force, advisory groups, and an interagency 
coordination committee also have been established to address MTS 
issues. While these federal efforts to align and better coordinate MTS 
infrastructure investments are good steps, some are limited in their 
scope and, for others, it is not clear how effective they will be in 
addressing the complex and wide-ranging challenges to maintaining and 
developing MTS infrastructure. 

Federal Efforts to Address MTS Infrastructure Investments System-Wide: 

In March 2012, DOT and the U.S. Department of the Army signed a 
memorandum of understanding (MOU) to identify and capitalize on 
opportunities to improve the nation's transportation infrastructure 
investments.[Footnote 60] Specifically, DOT and the U.S. Department of 
Army agreed to (1) develop project prioritization criteria consistent 
to the greatest degree possible, (2) look for opportunities to reflect 
national priorities for waterside and landside infrastructure 
investment alignment, and (3) coordinate project evaluation and 
selection processes as it relates to DOT grant programs and the Corps' 
project prioritization. Although it is too early to assess progress 
made in achieving these objectives, senior DOT and Corps officials 
told us that the MOU played an important role in ensuring interagency 
coordination on MTS infrastructure investments for the last round of 
the TIGER program. However, as noted above, the bulk of DOT's 
transportation funding is directed through state and local 
transportation agencies. 

MARAD, the one federal entity charged with an MTS-wide mission, has 
few programs to address system-wide challenges and a limited field 
presence. MARAD is developing the Port Infrastructure Development 
Program to improve the state of repair of all U.S. ports and enhance 
the competitiveness of ports for public and private funds through 
comprehensive planning. According to a senior MARAD official, the 
program is being designed to create a level playing field for all 
ports, including small-and medium-sized ports, to attract private-
sector financing, and it is being developed together with MTS 
stakeholders. However, despite MARAD's efforts to obtain consensus on 
the program from MTS stakeholders, the program has not been funded, 
and MARAD officials acknowledge that the agency has more work to do to 
ensure that its staff have the right skill set and expertise needed to 
manage the program. Moreover, several MTS stakeholders whom we met 
with during our site visits told us that MARAD does not currently have 
a major role to play in MTS infrastructure development. For example, 
local transportation-planning officials we spoke to in one major 
coastal city said that MARAD representatives are not at the table 
during the MPO's planning process, and therefore, DOT is missing an 
opportunity to coordinate investments in the various MTS segments. 

The recently enacted MAP-21 also provides an opportunity to better 
coordinate investments in the MTS. First, MAP-21 directly addresses 
the fragmented nature of DOT programs, including those that address 
ports and port connectors, by consolidating the number of federal-aid 
highway programs to focus resources on key national goals. While MTS 
stakeholders we met with generally told us they appreciated having 
access to a variety of federal transportation programs that can be 
used for surface transportation projects, we have previously reported 
on coordination challenges within DOT that result from a modal 
approach to administering and funding programs.[Footnote 61] 

Second, MAP-21 establishes a national freight policy and mandates that 
DOT develop a National Freight Strategic Plan and a national freight 
network. Specifically, in the development of the National Freight 
Strategic Plan MAP-21 requires DOT to consult with state departments 
of transportation and other appropriate public and private 
transportation stakeholders. As we have previously reported, to 
develop an effective strategic plan, agencies should involve their 
stakeholders, assess their internal and external environments, and 
align their activities, core processes, and resources to support 
mission-related outcomes.[Footnote 62] As noted above, both the Corps 
and DOT have taken some steps to invest in their respective segments 
of the MTS. However, there has been limited coordination of MTS 
investments system-wide. The National Freight Strategic Plan is an 
opportunity to address the MTS system-wide by considering the Corps' 
future investments in navigable waterways. Involving the Corps in the 
development of that plan is particularly important given the nexus 
between freight and the entire MTS, since the vast majority of the 
nation's freight is imported and exported via navigable waterways 
through our nation's ports. 

In addition to these Corps and DOT-specific efforts, there are a 
number of other federal efforts that have been recently created to 
address MTS infrastructure investment system-wide. On July 19, 2012, 
the White House established a Task Force on Ports to develop federal 
strategies to address coastal port infrastructure investments. This 
high-level effort is designed to address specific issues and provide 
immediate benefits to, among other things, help ensure that the 
nation's navigable waterways and ports are prepared to handle any 
increase in trade expected from the expansion of the Panama Canal in 
2014. In particular, the task force plans to examine challenges to 
coastal ports including increased competition from ports in Canada and 
the Caribbean and is tasked with developing a strategy to inform 
future investment decisions and identify opportunities for improved 
coordination and streamlined environmental review of investments in 
port-related infrastructure. According to the White House, the 
establishment of the task force responds to calls from state and local 
governments, as well as ports and other maritime stakeholders, for a 
more strategic framework for allocating federal investments. While 
this particular effort targeting coastal ports provides an immediate 
focus on some of the most pertinent MTS infrastructure challenges, it 
is too soon to know how the task force's efforts will be realized and 
whether it will provide the long-term commitment and management needed 
to address MTS challenges. 

We also identified two federal advisory groups established to advise 
the federal government agencies on system-wide MTS issues. Federal 
advisory groups can play an important role in the development of 
policy and government regulations by providing advice to federal 
agency policymakers.[Footnote 63] For example, the Marine 
Transportation System National Advisory Council (MTSNAC) was 
established to, among other items, provide advice to the Secretary of 
Transportation via the MARAD Administrator on marine highways and 
ports and their road, rail, and marine highway connections. Members of 
MTSNAC reflect a cross section of maritime industries and port and 
water resources stakeholders from the private sector, academia, labor, 
and federal, state and local entities. In addition, the Advisory 
Committee on Supply Chain Competitiveness was recently established to 
advise the Secretary of Commerce on the necessary elements of a 
comprehensive national freight policy designed to support U.S. export 
growth and competitiveness, among other items. The committee consists 
of 40 private-sector members, including representatives from supply 
chain firms and their associations, stakeholders, academia, community 
organizations, and others directly affected by the supply chain. These 
two federal advisory groups provide an opportunity for federal 
agencies involved in the MTS to obtain input from internal and 
external stakeholders such as academics, industry associations, or 
other agencies to address MTS challenges. 

CMTS Efforts to Address MTS Challenges: 

The Committee on the Marine Transportation System (CMTS), created to 
address a broad range of MTS challenges, provides another opportunity 
to coordinate MTS infrastructure investment system-wide. Established 
in 2004 by a directive from the President in the U.S. Ocean Action 
Plan, the CMTS is a long-standing committee designed to foster a 
partnership of federal agencies with responsibility for the MTS and to 
provide a forum through which agencies coordinate and take action to 
address a wide range of MTS challenges. For example, the CMTS reported 
in 2010 that multi-agency efforts to address navigation technology 
issues could lead to significant improvements to navigation safety 
information, especially in and around ports. Specifically, the Corps, 
the National Oceanic and Atmospheric Administration, and the U.S. 
Geological Survey have developed, published and adopted common data 
standards. According to the CMTS, these efforts provide improved 
delivery of navigation information and enable agencies to better share 
information of navigational value. Similarly, to build on the MOU 
signed between the DOT and the U.S. Department of the Army to 
coordinate and improve infrastructure investment between the two 
agencies, the CMTS Coordinating Board agreed in June 2012 to establish 
a CMTS Infrastructure Investment Integrated Action Team to provide a 
forum for participation by other agencies that are stakeholders in MTS 
infrastructure.[Footnote 64] 

In July 2008, the CMTS published the National Strategy on the Marine 
Transportation System (Strategy) to provide a framework and 5-year 
action plan to address MTS challenges. The Strategy is intended to 
present the most pressing challenges facing the MTS and provide a 
framework for addressing MTS needs through 2013. It recommends 34 
actions to address these issues, some of which touch upon key 
challenges we identified. For example, to address challenges related 
to the prioritization of federal investments in the MTS, it recommends 
studying approaches to prioritizing how federal dollars should be 
allocated among competing priorities as well as studying how best to 
coordinate allocation of federal funds for projects across agencies. 
Similarly, to address infrastructure capacity issues the CMTS 
recommended that agencies publish valid, reliable, and timely data on 
the MTS including cargo movements, capacity, and productivity as well 
as develop performance measures to assess the productivity of the MTS 
and the risk of potential infrastructure failures. 

The CMTS has taken steps to address some of the recommended actions 
included in the Strategy. According to a 2010 implementation plan, the 
CMTS developed a list of six priority actions taken from the 
Strategy's 34 recommended actions and identified 3 other priorities 
that address emerging issues. According to CMTS officials, when at 
least three CMTS members agree to address a long-term MTS issue, they 
may form an Integrated Action Team or subcommittee. CMTS guidance 
states that, once formed, these teams operate on a consensus basis and 
are responsible for preparing an action plan that, among other things, 
includes (1) a list of deliverables, (2) a schedule for completing 
them, (3) identification of the parties responsible for completing 
them, and (4) funding sources available. For example, the CMTS 
Coordinating Board established the Research and Development Integrated 
Action Team in March 2009 to respond to several recommended actions 
included in the Strategy, including the need for valid data and for 
the development of performance measures. CMTS members may also 
establish task teams to address short-term issues; however, these 
teams are not responsible for developing an action plan. For example, 
in December 2011 the National Export Initiative task team was 
established in support of the President's National Export Initiative 
to, among other things, monitor the availability of export containers. 
[Footnote 65] CMTS officials noted that, although the National Export 
Initiative is not addressed in the Strategy, the CMTS must be flexible 
to adapt to and address new MTS issues as they emerge. 

Opportunities to Improve the Effectiveness of the CMTS: 

While the CMTS has taken steps to address a number of recommended 
actions identified in the Strategy and has made progress facilitating 
interagency cooperation, it is unclear if those steps have achieved 
their intended results. Moreover, we found some limitations to the 
implementation of the Strategy, including: 

* The CMTS has not kept the Strategy up to date and has no plan to 
replace the Strategy's 5-year action plan. Although the CMTS website 
states that the Strategy is a "living document" to be enhanced and 
updated, CMTS officials told us that agencies had not updated the 
Strategy since it was published in 2008 and have no current plans to 
do so. As a result, the Strategy does not specifically address new and 
emerging challenges, such as the President's National Export 
Initiative. CMTS officials told us that updating the Strategy would be 
useful and that--should sufficient resources be available--the CMTS 
would review the recommendations of the Strategy and update them with 
respect to current and projected needs of the MTS. An up-to-date 
Strategy that reflects the most important challenges can help ensure 
agencies remain focused on key priorities and help stakeholders, 
including the Congress, target limited resources to those priorities. 

* The CMTS did not incorporate clear desired results, specific 
milestones, and outcome-related performance measures throughout the 
Strategy to help ensure steps taken achieve the intended results. 
While CMTS member agencies have taken steps to introduce 
accountability mechanisms through action plans developed by individual 
Integrated Action Teams, action plans were only developed for those 
areas or activities where consensus existed among agencies to 
establish them. For other areas, the Strategy's recommended actions 
remain--as a CMTS response to Congress describes--broad in scope, 
rather than finite, individually defined tasks. While identifying 
broad objectives is a good first step, without a clearly defined and 
articulated "end-state" for each recommended action, it is difficult 
to evaluate the extent to which progress has been made or determine 
whether the CMTS is achieving its intended results. Furthermore, CMTS 
officials told us that identifying broad actions was the only way to 
gain consensus among all CMTS member agencies when the Strategy was 
developed. However, without incorporating accountability mechanisms 
throughout the Strategy, agency and Congressional decision-makers may 
lack information needed to evaluate progress and determine the extent 
to which agency activities are achieving their intended results to 
address MTS challenges. We have previously identified desirable 
characteristics that we believe would provide additional guidance to 
responsible parties for developing and implementing national 
strategies. Those characteristics include incorporating accountability 
mechanisms, such as the clear identification of priorities, specific 
milestones, and outcome-related performance measures.[Footnote 66] 
National strategies are intended to provide broad direction and 
guidance--rather than be prescriptive, detailed mandates--to the 
relevant implementing parties. Nonetheless, a more detailed strategy 
can facilitate implementation and help agencies achieve strategic 
goals. 

* The CMTS does not have a process for reporting the extent to which 
the Strategy's recommended actions have been addressed. Such a process 
could enable more effective oversight and accountability. Although the 
CMTS created reports in 2009 and 2010, these reports describe its 
annual accomplishments and do not address all of the Strategy's 
recommended actions. For example, the CMTS annual report for 2010 
states that it summarizes "the high points and accomplishments 
achieved" by the CMTS. We have previously reported that including a 
process for reporting on progress could help agencies implement 
national strategies more effectively.[Footnote 67] According to CMTS 
officials, with no budget and limited member resources, the Strategy's 
recommended actions were prioritized resulting in a set of six top 
priority actions, with the work done on these priority actions 
reflected in the 2009 and 2010 annual reports. However, without a 
schedule for regular reporting on the extent to which all recommended 
actions included in the Strategy have been addressed, agency and 
congressional decision-makers lack key information needed to hold 
agencies accountable and enable effective oversight. 

Finally, according to the CMTS, activities undertaken by the CMTS are 
dependent on member agencies' ability to dedicate resources and staff 
support. CMTS officials told us that commitment of necessary staff 
time and resources to CMTS activities is driven by CMTS member 
interest in the work to be done and the availability of resources. 
Specifically, CMTS members that participate in Integrated Action Teams 
or task teams provide time and resources to carry out their 
responsibilities, which range from full staff support to providing 
comments on documents. In addition, MARAD, the Corps, and the National 
Oceanic and Atmospheric Administration dedicate one full time senior 
staff to the CMTS's Executive Secretariat. Managing competing 
priorities and coordinating interagency actions are key challenges 
given the complex nature of the MTS and the variety of task forces, 
advisory groups, and other MTS stakeholders involved in supporting the 
MTS. However, these challenges also highlight the benefits and 
opportunities of ensuring that the Strategy remains up to date, 
reflects current conditions, and is focused on the areas of greatest 
need. 

Conclusions: 

Given aging MTS infrastructure, the uncertainty around the Panama 
Canal expansion and its potentially significant impact on the MTS, and 
the renewed focus on ports and their importance to the U.S. economy, 
improving the effectiveness of federal MTS efforts is critical. There 
are a variety of efforts under way--recent and long standing--to help 
the wide range of MTS stakeholders coordinate to address system-wide 
prioritization of MTS investments. For example, efforts such as the 
recently announced White House Task Force on Ports directly address 
some of the challenges facing the nation's MTS infrastructure. While 
the task force plans to build on some of the more recent steps taken 
to improve coordination of port-related responsibilities, it is too 
soon to know how the task force will proceed and the extent to which 
it will leverage more established long-standing efforts in this area. 
Moreover, the recent proliferation of efforts to address system-wide 
investment in the MTS runs the risk of being less effective unless 
properly coordinated. 

The recently passed MAP-21 will focus efforts on improving freight 
mobility and the surface infrastructure that supports it, but it also 
provides an opportunity to better coordinate MTS investments system-
wide. Besides establishing a framework for a national freight policy, 
MAP-21 requires DOT to develop a National Freight Strategic Plan in 
consultation with appropriate state DOTs and other appropriate private 
and public stakeholders. While the National Freight Strategic Plan 
requirements do not specifically mention consultation with the Corps 
and its plans to maintain and develop the nation's navigable 
waterways, consideration of these waterside infrastructure investments 
is important to strategically investing in the MTS system-wide. 
Considering all MTS segments--navigable waterways, ports, and port 
connectors--and coordinating the prioritization of infrastructure 
investments between the Corps and DOT will help to ensure that limited 
resources are efficiently targeted and invested. 

The CMTS, a long-standing interagency coordinating committee, is 
tasked with addressing a wide array of MTS challenges. The committee 
has made some progress facilitating information sharing, coordinating 
member agencies and taking some actions to address a variety of MTS 
issues. However, it is unclear if the committee's actions have 
improved the MTS. Given the breadth and complexity of the MTS 
challenges and the numerous stakeholders and on-going efforts, an up-
to-date Strategy with mechanisms to measure progress and hold member 
agencies accountable for these actions is critical. Interagency 
coordinating bodies such as the CMTS face a variety of obstacles and 
gaining consensus on priorities, measuring progress and holding member 
agencies accountable can be challenging. However, without developing a 
sound Strategy that considers the changing landscape of MTS efforts, 
the CMTS will not be able to capitalize on its established 
coordinating body or to effectively contribute to the growing number 
of federal efforts to support the nation's Marine Transportation 
System. 

Recommendations for Executive Action: 

To help ensure coordination of U.S. Army Corps of Engineers and 
Department of Transportation infrastructure investments in the Marine 
Transportation System, we recommend that the Secretary of 
Transportation take the following two actions: 

1) Direct the Administrator of the Federal Highway Administration to 
inform the development of the National Freight Strategic Plan with 
information from the U.S. Army Corps of Engineers' planned investments 
in the nation's navigable waterways. 

2) As the Chair of the Committee on the Marine Transportation System, 
ensure the review and update, as needed, of the National Strategy for 
the Marine Transportation System. In ensuring the review and update of 
the National Strategy for the Marine Transportation System, the 
Secretary should: 

* establish accountability mechanisms--such as developing clear and 
desired results, specific milestones, and outcome-related performance 
measures--for the recommended actions of the National Strategy for the 
Marine Transportation System, and: 

* establish and implement a schedule for regular reporting of progress 
made in addressing the recommended actions of the National Strategy 
for the Marine Transportation System. 

Agency Comments: 

We provided a draft of this report to the Corps and DOT for review and 
comment. DOT agreed to consider the report's recommendations. The 
Corps and DOT also provided technical comments, which we incorporated 
as appropriate. 

We are sending copies of this report to interested congressional 
committees, the Secretary of Defense, Secretary of Transportation, and 
the Chief of Engineers and the Commanding General of the U.S. Army 
Corps of Engineers. In addition, this report is available at no charge 
on the GAO website at [hyperlink, http://www.gao.gov]. 

If you have any questions about this report, please contact me at 
(202) 512-2834 or stjamesl@gao.gov. Contact points for our Offices of 
Congressional Relations and Public Affairs may be found on the last 
page of this report. Key contributes to this report are listed in 
appendix IV. 

Signed by: 

Lorelei St. James: 
Director, Physical Infrastructure Issues: 

List of Addressees: 

The Honorable Dianne Feinstein:
Chairman:
The Honorable Lamar Alexander:
Ranking Member:
Subcommittee on Energy and Water Development:
Committee on Appropriations United States Senate: 

The Honorable Peter J. Visclosky:
Ranking Member:
Subcommittee on Energy and Water Development, and Related Agencies 
Committee on Appropriations:
House of Representatives: 

The Honorable Maria Cantwell:
United States Senate: 

[End of section] 

Appendix I: Objectives, Scope, and Methodology: 

The objectives of this report are to (1) identify programs the U.S. 
Army Corps of Engineers (Corps) and the Department of Transportation 
(DOT) administer to maintain or improve the Marine Transportation 
System (MTS); (2) determine the key challenges to maintaining and 
improving the MTS; and (3) discuss opportunities that may exist for 
the federal government to improve the effectiveness of its role in the 
MTS. 

To identify programs the Corps and DOT administer to maintain or 
improve the MTS we reviewed and analyzed federal program 
documentation, including authorizing legislation, federal program 
guidance, and other federal program reports describing federal roles 
and responsibilities for MTS infrastructure. We reviewed legislation 
related to surface and MTS infrastructure programs and funding, 
including the Safe, Accountable, Flexible, Efficient Transportation 
Equity Act: A Legacy for Users (SAFETEA-LU)[Footnote 68] and the new 
surface transportation reauthorization, Moving Ahead for Progress in 
the 21st Century Act (MAP-21).[Footnote 69] We interviewed officials 
from the Corps' civil works navigation program at the headquarters, 
division, and district level to determine how the Corps maintains and 
improves navigation infrastructure on inland and coastal waterways. We 
also interviewed officials from DOT including officials from the 
Federal Highway Administration (FHWA), Federal Railroad Administration 
(FRA), Maritime Administration (MARAD), and Office of the Secretary of 
Transportation to confirm the federal transportation programs and 
discuss how these programs are used to support ports and port 
connectors. In addition, we interviewed officials from the Waterborne 
Commerce Statistics Center to determine data efforts to support the 
Corps' navigation program, and we reviewed transportation statistics--
including freight commodity and port statistics--from the Bureau of 
Transportation Statistics. We also conducted interviews with a variety 
of industry associations including the American Association of Port 
Authorities, American Association of State Highway and Transportation 
Officials, American Trucking Association, the American Association of 
Railroads, and the Waterways Council, Inc., to obtain their 
perspectives on federal Corps and DOT programs. 

We obtained program budget data for programs that may be used to 
support MTS infrastructure by reviewing budget documentation, 
including annual budget justifications, from the Corps and DOT. We 
used navigation project obligations data provided by the Corps to 
determine program obligations for the Investigations, Construction, 
and Operation and Maintenance accounts. To determine obligations for 
DOT programs, we developed a short data collection instrument to 
collect and analyze financial obligations data. We administered the 
data collection instrument to obtain data from a total of 16 DOT 
programs, including 11 FHWA programs, 2 FRA programs, 2 MARAD programs 
and 1 Office of the Secretary of Transportation program. We conducted 
one pretest with FHWA to test the use of our instrument for grant and 
formula funding programs. We also conducted one pretest with FRA to 
test the use of our instrument for credit programs. Based on agency 
input, we revised the data collection instrument and submitted it to 
the relevant agency for the programs that we identified. We received a 
100 percent response rate. We used Corps navigation program data to 
determine the current backlog for navigation construction and 
operations and maintenance projects, and reviewed published DOT 
reports to identify the backlog of projects affecting ports, including 
port connectors. In determining the reliability of the financial data, 
we reviewed relevant documentation about the agencies' data collection 
and quality assurance processes, talked with knowledgeable officials 
about these data, and compared these data against other sources of 
published information to determine data consistency and 
reasonableness. We determined that the data were sufficiently reliable 
for the purposes of this report. 

To determine key challenges to maintaining and improving the MTS, we 
reviewed GAO work on surface transportation programs and issues 
related to freight transportation. Our work is informed by prior GAO 
reports on freight mobility, intermodalism, and marine transportation 
finance. We also reviewed prior GAO reports assessing the Corps' 
organization, budget formulation process, project delivery process, 
and programs. To obtain current examples of challenges facing port 
stakeholders at the state and local level, we conducted site visits to 
the Port of New York and New Jersey, Port of New Orleans, Port of 
Portland, Port of Savannah, the Port of South Louisiana, and the Port 
of Vancouver (USA). We identified these ports using the following 
criteria: 

* ranking by total tonnage (domestic and foreign), 2010; 

* ranking by container traffic (domestic and foreign), 2010; 

* ranking by total value of foreign trade shipments, 2010; 

* existence of current or recently completed navigation, port, or port 
connector expansion projects; and: 

* geographic diversity. 

For our final selection, we chose larger ports (both in tonnage and 
container traffic) in order to get representation from (1) both 
container and bulk ports, and (2) river and coastal ports. We also 
selected ports that had ongoing or completed expansion projects funded 
or financed by the federal government and for which the site visits 
would provide some geographic diversity in experiences. We also 
included the Port of Vancouver (USA), a small port based on tonnage 
and container traffic, to provide some context and comparison to 
larger ports. The results of these site visits are not generalizable, 
but do provide insights regarding state, local, and private-sector 
experiences maintaining and improving MTS infrastructure. 

During the site visits, we collected and reviewed relevant 
documentation on port operations, projects, and trade statistics. We 
also interviewed a range of MTS stakeholders during each site visit, 
including officials from the port, Corps division and district 
offices, state DOTs, and Metropolitan Planning Organizations (MPO). 
Table 3 below provides a table of stakeholders that we met with during 
each site visit. 

Table 3: MTS Stakeholders with Whom GAO Met during Site Visits: 

Site visit location: Port of New York and New Jersey; 
MTS stakeholders: 
* Port Authority of New York and New Jersey; 
* Corps' North Atlantic Division and New York District Office; 
* New York Metropolitan Transportation Council; 
* North Jersey Transportation Planning Authority. 

Site visit location: Port of New Orleans and Port of South Louisiana; 
MTS stakeholders: 
* Port of New Orleans; 
* Port of South Louisiana; 
* Louisiana Department of Transportation and Development; 
* Corps' Mississippi Valley Division and New Orleans District Office; 
* New Orleans Regional Planning Commission. 

Site visit location: Port of Portland and Port of Vancouver (USA); 
MTS stakeholders: 
* Port of Portland; 
* Port of Vancouver (USA); 
* Corps' Northwestern Division and Portland District Office; 
* Pacific Northwest Waterways Association; 
* Tidewater Barge Lines. 

Site visit location: Port of Savannah; 
MTS stakeholders: 
* Georgia Ports Authority; 
* Georgia Department of Transportation; 
* Corps' South Atlantic Division and Savannah District Office; 
* Chatham County Metropolitan Planning Commission. 

Source: GAO. 

[End of table] 

To identify and assess opportunities for the federal government to 
improve the effectiveness of its role in the MTS, we reviewed 
documentation from the Committee on the Marine Transportation System 
(CMTS), including the CMTS Charter and the National Strategy for the 
Marine Transportation System (Strategy). We interviewed staff from the 
CMTS Executive Secretariat and observed a session of the Coordinating 
Board to determine actions taken by the CMTS to implement the 
Strategy, as well as any opportunities for improvement. During 
interviews with Corps and DOT officials, and industry associations, we 
also asked about their perspectives on the federal government role in 
maintaining and improving the MTS. In assessing the implementation of 
the Strategy, we reviewed prior GAO reports on enhancing and 
sustaining federal agency collaborative efforts and evaluated progress 
in implementing the Strategy. 

We conducted our review from November 2011 to November 2012 in 
accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. 

[End of section] 

Appendix II: DOT Programs We Reviewed That May Fund MTS Infrastructure: 

This appendix includes DOT programs at the time of our review that may 
fund MTS infrastructure and their obligations data for fiscal years 
2009 to 2011. The data reflect overall obligations for each program, 
and do not represent support for MTS infrastructure projects 
specifically. The list of programs is not exhaustive; thus, other DOT 
programs may exist that could fund MTS infrastructure projects. 

Table 4: DOT Obligations for Programs We Reviewed That May Fund MTS 
Infrastructure: 

Department of Transportation: 

Agency: Federal Highway Administration; 
Program: Freight Intermodal Distribution Pilot Grant Program; 
Total Program Obligations: 
FY 2009: $6,655,000[A]; 
FY 2010: $1,500,000[A]; 
FY 2011: $13,688,000[A]. 

Agency: Federal Highway Administration; 
Program: National Corridor Infrastructure Improvement Program; 
Total Program Obligations: 
FY 2009: $275,658,000[A]; 
FY 2010: $83,782,000[A]; 
FY 2011: $77,043,000[A]. 

Agency: Federal Highway Administration; 
Program: Projects of National and Regional Significance; 
Total Program Obligations: 
FY 2009: $231,072,000[A]; 
FY 2010: $292,753,000[A]; 
FY 2011: $237,408,000[A]. 

Agency: Federal Highway Administration; 
Program: Congestion Mitigation and Air Quality Improvement Program; 
Total Program Obligations: 
FY 2009: $1,252,177,262; 
FY 2010: $1,245,927,532; 
FY 2011: $1,346,991,087. 

Agency: Federal Highway Administration; 
Program: Highway Safety Improvement Program; 
Total Program Obligations: 
FY 2009: $1,592,099,302; 
FY 2010: $1,481,157,556; 
FY 2011: $1,688,660,663. 

Agency: Federal Highway Administration; 
Program: Metropolitan Planning Funds; 
Total Program Obligations: 
FY 2009: $229,705,770; 
FY 2010: $230,727,013; 
FY 2011: $232,596,851. 

Agency: Federal Highway Administration; 
Program: National Highway System; 
Total Program Obligations: 
FY 2009: $6,824,320,360; 
FY 2010: $8,459,646,662; 
FY 2011: $8,200,767,635. 

Agency: Federal Highway Administration; 
Program: State Planning and Research; 
Total Program Obligations: 
FY 2009: $681,605,402; 
FY 2010: $731,939,243; 
FY 2011: $765,019,201. 

Agency: Federal Highway Administration; 
Program: Surface Transportation Program; 
Total Program Obligations: 
FY 2009: $9,443,235,250; 
FY 2010: $9,603,097,643; 
FY 2011: $9,500,370,566. 

Agency: Federal Highway Administration; 
Program: Surface Transportation Research, Development, and Deployment; 
Total Program Obligations: 
FY 2009: $128,928,721; 
FY 2010: $115,089,182; 
FY 2011: $149,093,533. 

Agency: Federal Railroad Administration; 
Program: Program for Capital Grants for Rail Line Relocation and 
Improvement Projects; 
Total Program Obligations: 
FY 2009: $392,000[A]; 
FY 2010: $6,657,000[A]; 
FY 2011: $31,766,000[A]. 

Agency: Maritime Administration; 
Program: America's Marine Highway Program; 
Total Program Obligations: 
FY 2009: 0[A]; 
FY 2010: $7,060,000[A]; 
FY 2011: 0[A]. 

Agency: Maritime Administration; 
Program: Port Infrastructure Development Program; 
Total Program Obligations: 
FY 2009: 0; 
FY 2010: 0; 
FY 2011: 0. 

Agency: Office of the Secretary of Transportation; 
Program: Transportation Investment Generating Economic Recovery 
Program; 
Total Program Obligations: 
FY 2009: 0; 
FY 2010: $421,772,616; 
FY 2011: $1,551,564,686. 

Source: GAO analysis of DOT data. 

[A] DOT officials provided total program obligations rounded to the 
nearest thousand. 

[End of table] 

[End of section] 

Appendix III: DOT Programs We Reviewed That May Finance MTS 
Infrastructure: 

This appendix includes DOT programs at the time of our review that may 
finance MTS infrastructure and their total direct loan obligations 
data, total principal amount of loan disbursements through September 
30, 2012, and net lifetime subsidy re-estimate amount including 
interest. The data reflect overall amounts for each program and do not 
represent support for MTS infrastructure projects specifically. The 
list of programs is not exhaustive; thus, other DOT programs may exist 
that could finance MTS infrastructure projects: 

Table 5: DOT Obligations, Principal Amount and Net Lifetime Subsidy 
Reestimate for Programs We Reviewed That May Finance MTS 
Infrastructure: 

Department of Transportation: 

Agency: Federal Highway Administration; 
Program: Transportation Infrastructure Finance and Innovation Act: 

Total direct loan obligation; 
Cohort fiscal year[A]: 
FY 2009: $990,104,000; 
FY 2010: $2,157,638,000; 
FY 2011: $472,405,000. 

Total principal amount of loan disbursements through 9/30/12; 
Cohort fiscal year[A]: 
FY 2009: $686,206,000; 
FY 2010: $457,433,000; 
FY 2011: 0. 

Net lifetime subsidy re-estimate amount (including interest); 
Cohort fiscal year[A]: 
FY 2009: -$11,719,000; 
FY 2010: 0; 
FY 2011: 0. 

Agency: Federal Railroad Administration: 
Program: Railroad Rehabilitation and Improvement Financing: 

Total direct loan obligation; 
Cohort fiscal year[A]: 
FY 2009: $103,500,000; 
FY 2010: $172,000,000; 
FY 2011: $566,136,000. 

Total principal amount of loan disbursements through 9/30/12; 
Cohort fiscal year[A]: 
FY 2009: $98,147,000; 
FY 2010: $46,392,000; 
FY 2011: $65,279,000. 

Net lifetime subsidy re-estimate amount (including interest); 
Cohort fiscal year[A]: 
FY 2009: -$429,000; 
FY 2010: -$2,092,000; 
FY 2011: $2,000. 

Source: GAO analysis of DOT data. 

[A] The cohort represents all direct loans or loan guarantees of a 
program for which a subsidy appropriation is provided for a given 
fiscal year, even when disbursements occur in subsequent fiscal years. 

[End of table] 

[End of section] 

Appendix IV: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Lorelei St. James, (202) 512-2834 or stjamesl@gao.gov: 

Staff Acknowledgments: 

In addition to the contact named above, Sharon Silas (Assistant 
Director); Jonathan Carver; William Colwell; Bradley Dubbs; Geoff 
Hamilton; Carol Henn; Vondalee Hunt; Delwen Jones; Joshua Ormond; and 
Elizabeth Wood made key contributions to this report. 

[End of section] 

Footnotes: 

[1] U.S. Department of Transportation, Maritime Administration, 
America's Ports and Intermodal Transportation System, (Washington, 
D.C.: January 2009). 

[2] According to DOT, the MTS also includes pipelines, vessels, and 
users. See U.S. Department of Transportation, An Assessment of the 
U.S. Marine Transportation System: A Report to Congress (Washington, 
D.C.: September 1999). We did not include pipelines, vessels, or users 
(i.e., people who depend on the system for their livelihood and 
recreational access) in the scope of our review. 

[3] U.S. Department of Transportation, Federal Highway Administration, 
Office of Freight Management and Operations, Freight Analysis 
Framework, version 3.2, 2011. 

[4] Pub. L. No. 112-141, 126 Stat. 405 (2012). 

[5] MPOs, representing local governments, are responsible for carrying 
out the requirements of the transportation planning process in 
urbanized areas, in cooperation with state departments of 
transportation and other providers of transportation services. This 
may include coordination with ports, shippers, and terminal operators 
to plan needed system improvements to port infrastructure. An MPO must 
be designated for each urbanized area with a population of more than 
50,000 individuals. 23 U.S.C. § 134(d); 49 U.S.C. § 5303(d). 

[6] The importance of U.S. exports to the economy was underscored by 
the President's National Export Initiative with a goal of doubling 
U.S. exports by 2015 (from $1.57 trillion to $3.14 trillion). This 
initiative is focused on increasing exports to create jobs. 

[7] Bulk means cargo that is transported on a ship or barge, but is 
not unitized and has to be weighed to be measured. Breakbulk cargo is 
unitized in packages, bundles, or pallets, but is not shipped within a 
container. Containers are large steel boxes that contain freight that 
can be transferred from the ship to various transportation modes such 
as railcar or truck. 

[8] TEU or twenty-foot equivalent unit can be used to measure a ship's 
cargo carrying capacity. The dimensions of one TEU are equal to that 
of a standard 20 foot shipping container (20 feet long, 8 feet tall). 

[9] These are ships that are currently too large to transit the Panama 
Canal. 

[10] Inland and intra-coastal waterways have a depth of between 9 and 
14 feet and are considered shallow draft waterways. Channels and 
harbors with a depth of greater than 14 feet are considered deep draft 
waterways. Today's super-post-Panamax container ships (with at least 
8,000 TEU capacity) generally require berth and channel drafts of at 
least 50 feet deep when fully loaded, but many partially loaded post-
Panamax vessels can call at ports with 40 to 45-foot drafts or less. 

[11] The Water Resources Development Act of 1986 (Pub. L. No. 99-662, 
§ 102, 100 Stat. 4082, 4084 (1986) codified at 33 U.S.C. § 2212) 
established the cost-sharing ratios. Fifty percent of the cost of 
construction is to be paid from amounts appropriated from the General 
Fund of the Treasury, and the other fifty percent is from a fuel tax 
paid by commercial inland waterway users that is made available 
through appropriations from the Inland Waterways Trust Fund. Some 
waterborne vessels are exempt from the fuel tax, including certain 
oceangoing ships, passenger boats, recreational craft, or government 
vessels. 

[12] Costs of water resource studies and projects are shared between 
the federal government and the non-federal sponsor, which can be, for 
example, a port authority or a state. Cost sharing is a requirement 
for federal budgetary participation in harbor and inland waterway 
improvements. 

[13] The Water Resources Development Act of 1986 created the Harbor 
Maintenance Trust Fund. Pub. L. No. 99-662, § 1403, 100 Stat. 4082, 
4269 (1986) (codified at 26 U.S.C. § 9505). 

[14] Top 10 container ports include: Los Angeles, CA; New York/New 
Jersey, NY/NJ; Long Beach, CA; Savannah, GA; Houston, TX; Oakland, CA; 
Norfolk, VA; Seattle, WA; Charleston, SC; and Tacoma, WA. U.S. 
Department of Transportation, Bureau of Transportation Statistics, 
America's Container Ports: Linking Markets at Home and Abroad 
(Washington, D.C.: January 2011). 

[15] The Energy Independence and Security Act of 2007, requires the 
Secretary of Transportation to establish a short sea transportation 
(Marine Highway) program and designate short sea transportation 
projects to mitigate landside congestion. Pub. L. No. 110-140, §§ 1121-
1123, 121 Stat. 1492 (2007). America's Marine Highway system 
accommodates the waterborne movement of passengers and containerized 
freight between origins and destinations otherwise served solely by 
roads and railways. 

[16] Federal funding for highways is provided to the states primarily 
through a series of formula grants collectively known as the federal-
aid highway program. 

[17] GAO, Intermodal Transportation: DOT Could Take Further Actions to 
Address Intermodal Barriers, [hyperlink, 
http://www.gao.gov/products/GAO-07-718] (Washington, D.C.: June 20, 
2007); Freight Transportation: National Policy and Strategies Can Help 
Improve Freight Mobility, [hyperlink, 
http://www.gao.gov/products/GAO-08-287] (Washington, D.C.: Jan. 7, 
2008); Statewide Transportation Planning: Opportunities Exist to 
Transition to Performance-Based Planning and Federal Oversight, 
[hyperlink, http://www.gao.gov/products/GAO-11-77] (Washington, D.C.: 
Dec. 15, 2010); and Surface Freight Transportation: A Comparison of 
the Costs of Road, Rail, and Waterways Freight Shipments That Are Not 
Passed on to Consumers, [hyperlink, 
http://www.gao.gov/products/GAO-11-134] (Washington, D.C.: Jan. 26, 
2011). 

[18] GAO, 2012 Annual Report: Opportunities to Reduce Duplication, 
Overlap and Fragmentation, Achieve Savings, and Enhance Revenue, 
[hyperlink, http://www.gao.gov/products/GAO-12-342SP] (Washington, 
D.C.: Feb. 28, 2012). 

[19] Pub. L. No. 112-141, §§ 115-118, 126 Stat. 405 (2012). The law 
also expresses the sense of Congress that the administration should 
request, and the Congress should fully expend each year, all of the 
revenues collected in the Harbor Maintenance Trust Fund for the 
operation and maintenance of the nation's federally maintained harbors 
and channels. Id. at § 1536. It also directs the administration to 
provide an annual estimate of national harbor maintenance needs, 
including an estimate of the percentage of waterways that would be 
available for use based on the annual budget request, as well as how 
much funding would be needed to achieve 95 percent availability of the 
nation's ports and waterways within 3 years. Id. at § 1537. 

[20] The White House Task Force on Ports is comprised of senior 
officials from the National Economic Council, Office of Management and 
Budget, Department of the Army, Department of Commerce, Department of 
Homeland Security, Department of Transportation, Department of the 
Treasury, Council of Economic Advisors, Council on Environmental 
Quality, and the Office of the U.S. Trade Representative. 

[21] In the Oceans Act of 2000, Congress established the U.S. 
Commission on Ocean Policy (Commission). Pub. L. No. 106-256, 114. 
Stat. 644 (2000). The Commission issued a report, "An Ocean Blueprint 
for the 21st Century," in 2004. The U.S. Ocean Action Plan was the 
Administration's response to the Commission's report. 

[22] Members of the CMTS include the Secretary of Transportation; 
Secretary of Commerce; Secretary of Defense; Secretary of Homeland 
Security; Secretary of the Treasury; Secretary of State; Secretary of 
the Interior; Secretary of Agriculture; Secretary of Justice; 
Secretary of Labor; Secretary of Energy; Chairman of the Joint Chiefs 
of Staff; Administrator of the Environmental Protection Agency; 
Chairman of the Federal Maritime Commission. In addition, there are 
five Ex-Officio members of the Committee: Director, Office of 
Management and Budget; Chairman, Council on Environmental Quality; 
Assistant to the President for Homeland Security; Assistant to the 
President for Domestic Policy; and Assistant to the President for 
Economic Policy. 

[23] Committee on the Marine Transportation System, National Strategy 
for the Marine Transportation System: A Framework for Action 
(Washington, D.C.: July 2008). 

[24] Jetties are shore-connected structures generally built on either 
one or both sides of a navigation channel perpendicular to the shore 
and extending into the ocean. They are used to stabilize navigation 
channels and decrease dredging requirements. 

[25] See, for example, Section 3028 of the Water Resources Development 
Act of 2007 (Pub. L. No. 110-114,110 Stat. 1041, 1141 (2007)) 
providing that the Secretary may dredge the Redwood City Navigation 
Channel, California, on an annual basis, to maintain the authorized 
depth of -30 feet below mean low water. Ports are responsible for 
dredging non-federal channels and berths, which is the area next to 
the pier where a ship docks. 

[26] The navigation program is one of nine major functional areas, or 
business lines, in the civil works program. Other business lines 
within the Corps' civil works program include flood risk management, a 
regulatory program, water supply, hydropower, recreation, environment, 
emergency management, and support for others, which covers the Corps' 
activities related to interagency and international support. 

[27] An obligation is a definite commitment that creates a legal 
liability of the government for the payment of appropriated funds for 
goods and services ordered or received, or a legal duty on the part of 
the United States that could mature into a legal liability by virtue 
of actions on the part of the other party beyond the control of the 
United States. An agency incurs an obligation, for example, when it 
signs a contract or awards a grant. 

[28] U.S. Army Corps of Engineers, Savannah District, Final General Re-
Evaluation Report: Savannah Harbor Expansion Project (January 2012). 

[29] We did not independently verify the Corps' estimates for the 
Savannah Harbor Expansion Project. 

[30] GAO, Surface Transportation: Competitive Grant Programs Could 
Benefit from Increased Performance Focus and Better Documentation of 
Key Decisions, [hyperlink, http://www.gao.gov/products/GAO-11-234] 
(Washington, D.C.: Mar. 30, 2011). 

[31] Pub. L. No. 111-5, 123 Stat. 115 (2009). 

[32] Pub. L. No. 111-84, § 3512, 123 Stat. 2190 (2009). MARAD has 
existing authorities to conduct port infrastructure programs in Hawaii 
(Safe, Accountable, Flexible, Efficient Transportation Equity Act: A 
Legacy for Users (SAFETEA-LU), Pub. L. No 109-59, § 9008, 119 Stat. 
1144, 1926 (2005); Alaska (SAFETEA-LU at § 10205 ); and Guam (Duncan 
Hunter National Defense Authorization Act for Fiscal Year 2009, Pub. 
L. No. 110-417 § 3512, 122 Stat. 4356, 4770 (2008)). 

[33] SAFETEA-LU, Pub. L. No. 109-59, 119 Stat. 1144, 1203 (2005). 

[34] Budgeting for the cost of credit programs, including the TIFIA 
and RRIF program, is governed by the Federal Credit Reform Act of 1990 
(Pub. L. No. 101-508, 104 Stat. 1388, 1388-610, title V, codified as 
amended at 2 U.S.C. § 661-661f), which requires federal agencies to 
receive budget authority to cover the estimated long-term cost to the 
government (which includes defaults, delinquencies, and interest 
subsidies) of providing credit assistance, calculated on a net present 
value basis, and excluding administrative costs. 

[35] For additional discussion of the TIFIA program, see GAO, Surface 
Transportation: Financing Program Could Benefit from Increased 
Performance Focus and Better Communication, [hyperlink, 
http://www.gao.gov/products/GAO-12-641] (Washington, D.C.: June 21, 
2012). 

[36] Historically, the Corps has maintained the Mississippi River 
navigation channel to full dimensions as much as possible at all times 
using annual and supplemental appropriations, and reprogramming funds 
from other projects. 

[37] Shoaling is the natural shallowing of a river channel due to 
sediment build-up. 

[38] When properly maintained, navigation projects, such as locks, 
traditionally have a 50-year design life, which is the minimal time 
the project is expected to provide reliable performance without major 
infrastructure investments to keep it safe and efficient. 

[39] The problem of aging navigation infrastructure is not unique to 
the Corps. In 2010, GAO examined the U.S. St. Lawrence Seaway 
Development Corporation's 10-year Asset Renewal Program to address 
long-term needs of two locks and navigation channels in the U.S. 
portion of the St. Lawrence Seaway and found that the total project 
estimates had increased in cost. See GAO, St. Lawrence Seaway: 
Estimates for the Asset Renewal Program Will Change, and Implementing 
Best Practices May Improve the Estimates' Reliability, [hyperlink, 
http://www.gao.gov/products/GAO-10-541R] (Washington, D.C.: May 13, 
2010). 

[40] The Inner Harbor Navigation Canal Lock Replacement Project was 
originally authorized by Congress in 1956 (Pub. L. No 84-455, 70 Stat. 
65 (1956)) and amended by the Water Resources Development Acts of 1986 
(Pub. L. No 99-662, 100 Stat. 4082 (1986)) and 1996 (Pub. L. No 104-3, 
110 Stat. 3658 (1996)). According to industry, the average delay is 11 
hours, but can be as much as 24 to 36 hours on many occasions. 

[41] The Olmsted Lock and Dam replacement is affecting the Corps' 
ability to rehabilitate other navigation projects across the country 
as costs for the replacement have escalated from $775 million to the 
current project estimate cost to complete of $2.9 billion. 

[42] In 2009 the Corps developed four high-priority performance goals, 
including to: (1) provide sustainable development and integrated 
management of the nation's water resources; (2) repair past 
environmental degradation and prevent future environmental losses; (3) 
ensure that projects perform to meet authorized purposes and evolving 
conditions; and (4) reduce vulnerabilities and losses to the nation 
and the Army from natural and man-made disasters, including terrorism. 
The selected navigation operation and maintenance activities 
performance metrics listed in table 2 address the third goal. 

[43] The Corps measures segment availability by assessing the number 
of hours that mechanical-driven failure or shoaling results in the 
closure of a high or moderate use river segment. Channel availability 
is the percentage of time that high-commercial traffic navigation 
channels are available to commercial users. There are a total of 59 
high-use channels, defined as those that pass 10 million or more tons 
of cargo per year. 

[44] U.S. Department of Transportation, 2008 Status of the Nation's 
Highways, Bridges, and Transit: Conditions and Performance Report to 
Congress, (Washington, D.C.: January 2010). 

[45] U.S. Department of Transportation, NHS Intermodal Freight 
Connectors: A Report to Congress, (Washington, D.C.: December 2000). 

[46] U.S. Department of Transportation, 2004 Status of the Nation's 
Highways, Bridges, and Transit: Conditions and Performance Report to 
Congress, (Washington, D.C.: February 2006). 

[47] Pub. L. No. 109-59, § 1306, 119 Stat. 1144, 1215-1217 (2005). 

[48] For additional discussion on the condition of the nation's 
bridges and the Federal Highway Administration's Highway Bridge 
Program, see GAO, Highway Bridge Program: Condition of Nation's 
Bridges Shows Limited Improvement, but Further Actions Could Enhance 
the Impact of Federal Investment, [hyperlink, 
http://www.gao.gov/products/GAO-10-930T] (Washington, D.C.: July 21, 
2010). 

[49] The Water Resources Development Act of 1986 (Pub. L. No. 99-662, 
§ 102, 100 Stat. 4082 (1986)) imposed new requirements on the 
financing of Corps navigation projects and established a cost-share 
requirement for harbor and inland waterways projects. For additional 
discussion see GAO, Federal User Fees: Substantive Reviews Needed to 
Align Port-Related Fees with the Programs They Support, [hyperlink, 
http://www.gao.gov/products/GAO-08-321] (Washington, D.C.: Feb. 22, 
2008). 

[50] Congressional Research Service, Army Corps Fiscal Challenges: 
Frequently Asked Questions, R41961 (Washington, D.C.: Aug. 18, 2011). 

[51] U.S. Department of Transportation, 2002 Status of the Nation's 
Highways, Bridges, and Transit: Conditions and Performance Report to 
Congress, (Washington, D.C.: January 2003). 

[52] GAO, High Risk Series: An Update, [hyperlink, 
http://www.gao.gov/products/GAO-11-278] (Washington, D.C.: February 
2011). 

[53] GAO, Marine Transportation: Federal Financing and a Framework for 
Infrastructure Investments, [hyperlink, 
http://www.gao.gov/products/GAO-02-1033] (Washington, D.C.: Sept. 9, 
2002). 

[54] GAO, Army Corps of Engineers, Budget Formulation Process 
Emphasizes Agencywide Priorities, but Transparency of Budget 
Presentation Could be Improved, [hyperlink, 
http://www.gao.gov/products/GAO-10-453] (Washington, D.C.: Apr. 2, 
2010). 

[55] U.S. Army Corps of Engineers, Institute for Water Resource, U.S. 
Port and Inland Waterways Modernization: Preparing for Post-Panamax 
Vessels (Washington, D.C.: June 20, 2012). 

[56] While the federal government provides most funding from the 
Highway Trust Fund directly to the states and the states oversee the 
use of these funds, by statute, states must provide some trust fund 
revenues to other organizations, such as MPOs, for planning purposes. 

[57] We have identified some challenges facing states and MPOs in 
developing freight--and by extension--port projects. See GAO, 
Statewide Transportation Planning: Opportunities Exist to Transition 
to Performance-Based Planning and Federal Oversight, [hyperlink, 
http://www.gao.gov/products/GAO-11-77] (Washington, D.C.: Dec. 15, 
2010), and Metropolitan Planning Organizations: Options Exist to 
Enhance Transportation Planning Capacity and Federal Oversight, GAO 09-
868 (Washington, D.C.: Sept. 9, 2009). 

[58] According to DOT, actual TIFIA lending capacity is subject to the 
calculation of the estimated subsidy cost for each credit assistance 
transaction. The amount varies based on the risk profile of the 
project and the repayment stream. According to DOT, actual original 
subsidy rates have ranged from less than 1 percent to over 15 percent 
of the TIFIA credit assistance received. See GAO, Surface 
Transportation: Financing Program Could Benefit from Increased 
Performance Focus and Better Communication, [hyperlink, 
http://www.gao.gov/products/GAO-12-641] (Washington, D.C.: June 21, 
2012). 

[59] Pub. L. No.112-141, § 1101(a)(2), 126 Stat. 405 (2012). 

[60] We have reported that agencies can strengthen their commitment to 
work collaboratively by articulating their agreements in formal 
documents, such as a MOU signed by senior officials in respective 
agencies. GAO, Results-Oriented Government: Practices That Can Help 
Enhance and Sustain Collaboration among Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-06-15] (Washington, D.C.: Oct. 21, 
2005). 

[61] GAO, 2012 Annual Report: Opportunities to Reduce Duplication, 
Overlap, and Fragmentation, Achieve Savings, and Enhance Revenue, 
[hyperlink, http://www.gao.gov/products/GAO-12-342SP] (Washington, 
D.C.: Feb. 28, 2012). 

[62] GAO, Agencies' Strategic Plans Under GPRA: Key Questions to 
Facilitate Congressional Review, [hyperlink, 
http://www.gao.gov/products/GAO/GGD-10.1.16] (Washington, D.C.: May 
1997). 

[63] GAO, Federal Advisory Groups: DOT and DOE Can Take Steps to 
Better Assess Duplication Risk and Enhance Usefulness, [hyperlink, 
http://www.gao.gov/products/GAO-12-472] (Washington, D.C.: Mar. 29, 
2012). 

[64] According to the CMTS Charter, Integrated Action Teams are 
created as needed, can be either temporary or permanent in nature, and 
consist of representatives from relevant agencies depending on the 
topic. 

[65] According to the White House, the March 2010 National Export 
Initiative is intended to improve conditions that directly affect the 
private sector's ability to export and to help meet the 
administration's goal of doubling exports over the next 5 years. 

[66] See GAO, Combating Terrorism: Evaluation of Selected 
Characteristics in National Strategies Related to Terrorism, 
[hyperlink, http://www.gao.gov/products/GAO-04-408T] (Washington, 
D.C.: Feb. 3, 2004). 

[67] [hyperlink, http://www.gao.gov/products/GAO-04-408T] 

[68] Pub. L. No. 109-59, 119 Stat. 1144 (2005). 

[68] Pub. L. No. 112-141, §§ 115-118, 126 Stat. 405 (2012). 

[End of section] 

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