Photo: Port of Houston Authority
American ports create 13 million jobs and generate more than $200 billion each year in federal, state and local taxes. Taxpayers rarely think about them and elected officials tend to underfund them. In spite of that, America’s ports are huge national assets and they will have even greater value in the very near future.
Experts predict that the amount of port cargo headed to the United States will double by 2020 once the two new locks on the Panama Canal are completed. Large megaships will become the norm and port activity will be great. Unfortunately, few American ports are prepared to accommodate the increased business or the larger vessels without major renovations.
Texas boasts 16 ports from the coastline of Brownsville to the Golden Triangle. At least 564.7 million tons of cargo move through the ports and that generates about $277.6 billion in economic activity to the state. Additionally, Texas ports create approximately 1.4 million jobs and generate $82.8 billion in personal income, according to the Texas Ports Association.
For more than a dozen years, Texas has continued to lead the nation in exports. Last year, the state’s exports exceeded $289 billion, according to the U.S. Department of Commerce. The economic impact is far-reaching.
The Port of Houston, one of the world’s busiest ports, has launched several recent projects. Its current list of proposed projects include structural repairs, wharf rehabilitation, building demolition, fiber optic installation projects, port security, channel development and construction of a rail spur. This year alone, the port expects to spend upwards of $275 million on capital projects.
Not all port activity is related to the movement of cargo via waterways. Earlier this month, Port Corpus Christi announced the opening of the first phase of the Nueces River Rail Yard. This initiative was created through a public-private partnership (P3/PPP). Funding includes a $10 million TIGER (Transportation Investment Generating Economic Recovery) grant from the U.S. Department of Transportation and funding from the port and four private-sector rail lines. It is a great example of how the public and private sectors can work together to benefit citizens and taxpayers.
Phase Two of the Corpus Christi port project, which will allow for storage of rolling stock and more efficient handling of carriers and cargo, will be funded by a $22 million grant from the Texas Department of Transportation (TxDOT) and $6 million from Port Corpus Christi. The entire region will benefit from these projects.
Federal legislation was recently filed that would facilitate funding for major freight infrastructure projects. The proposed statute (HR 1308) would allocate $8 billion in funds from a 1 percent tax on shipping invoices. These funds would then be dedicated for freight-related projects. The authors of the bill note that to remain competitive, major investments must be made in all American ports. Texans will benefit greatly if this legislation passes. Our SPI Insights will continue to follow the progress of the bill.