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Lawmakers Want to Replace HMT with New Fee to Prevent Cargo Diversion

Tuesday, August 20, 2013
Sandler, Travis & Rosenberg Trade Report

Sens. Patty Murray and Maria Cantwell of Washington plan to introduce in September legislation that aims to restructure federal port infrastructure financing to prevent the diversion of cargo away from West Coast ports. The forthcoming bill would repeal the Harbor Maintenance Tax, which the senators said is not being fully collected and is thus preventing U.S. ports from making certain infrastructure investments, and replace it with a Maritime Goods Movement User Fee, which they said “would double the amount of funds available” for port operation and maintenance.

An article in the Puget Sound Business Journal states that the funds collected from the proposed fee “could be used by ports nationwide for a wider variety of maritime infrastructure projects than just dredging” and that “all of the money collected would be used for ports — instead of just half, as is now the case.” A portion of the revenues would be used for “low-use, remote and subsistence harbors that are at a competitive disadvantage for federal funding,” the senators said, and a percentage would be used to create a competitive grant program “to improve the U.S. intermodal transportation system so imported goods and goods for export can more efficiently reach their intended destinations.” The bill would pay for expanded infrastructure investments by “closing loopholes that allow the largest oil and gas companies in America to receive billions of dollars in taxpayer subsidies every year, even though they enjoy profits in excess of $100 billion annually.”


The HMT is assessed on goods imported through U.S. ports, and there has been concern that some shippers are avoiding this fee by shipping goods through ports in Mexico and Canada and then transporting them by rail or truck into the U.S. A split Federal Maritime Commission gave some credence to those concerns in a controversial 2012 report asserting that the HMT is one of several factors that put a significant amount of containerized cargo imports moving through the U.S. ports of Oakland, Seattle, Tacoma and Portland at risk of being diverted through Canada. As a result, the proposed new fee would be imposed on all U.S.-bound shipments regardless of whether they first transit Canada or Mexico.

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