U.S. Sens. Patty Murray and Maria Cantwell have introduced legislation to replace what they say is the "outdated" Harbor Maintenance Tax.
The two Washington state legislators released the text of their "Maritime Goods Movement Act for the 21st Century
," saying it would eliminate incentives for shippers to bypass American ports and move U.S.-bound goods through Canada and Mexico instead.
"With nearly 27 percent of international container cargo potentially at risk of moving to Canada from four West Coast ports, this trend could result in significant job losses," the senators said. "This bill replaces the HMT with the Maritime Goods Movement User Fee, which would discourage shippers from diverting American-bound goods through Canadian or Mexican ports simply to avoid American taxes that fund vital infrastructure investments and keep American ports competitive in the global economy."
They said their bill "would also dramatically improve support for infrastructure investments at American ports by ensuring that all of the proceeds from the user fee are spent annually for port operation and maintenance. Currently, only half of the tax revenue collected through the HMT each year is actually spent on port upkeep, even though American ports are in desperate need of more maintenance investment."
Like the harbor maintenance tax, the maritime goods movement user fee would be equal to 0.125 percent of the value of commercial cargo.
Unlike the harbor maintenance tax, however, the fee would apply even if cargo "is unloaded in a foreign country and arrives in the United States by another form of transit."
"This bill would enable full investment of fee collections, nearly doubling the amount of funds available to American ports each year. These investments support American jobs and help the economy thrive," Murray and Cantwell said.
The legislation would set aside portions of the user fee to create a competitive grant program to improve the U.S. intermodal transportation system, which helps goods reach their intended destinations quickly and efficiently.
In a statement the two legislators said "we have seen increasing competition for the market share of U.S.-bound maritime goods from ports beyond our border to the north and to the south. In fact, among the 25 largest North American ports, the fastest growing in 2012 were the Port of Prince Rupert in Canada and the Port of Lazaro Cardenas in Mexico.
"Instead of U.S.-bound cargo creating economic growth here at home by entering at U.S. ports, we are witnessing it being diverted through Canadian and Mexican ports. This loss of cargo shipments leads to decreased activity and capacity at American ports," they said.
"In our home state alone, more than 200,000 jobs are tied to the activities at the Ports of Seattle and Tacoma. With nearly 27 percent of international container cargo potentially at risk of moving to Canada from four West Coast ports, this trend could result in significant job losses." - Chris Dupin