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President's budget shortchanges Savannah harbor deepening

  • Associated Press file photo The Dock dredge Alaska works to deepen the shipping channel to the port of Savannah off the coast of Tybee Island on Sept. 14, 2015.
  • The container ship Maersk Karlskrona, right, sails up river past the 300-foot dredge Alaska as it deepens the shipping channel to the port of Savannah off the coast of Tybee Island, Ga., Monday, Sept. 14, 2015. The U.S. Army Corps of Engineers and the Georgia Ports Authority started the dredging the channel five days ago. The $706 million project, first authorized by Congress in 1999, will deepen the shipping channel traveled by cargo ships along 39 miles of the Savannah River. (AP Photo/Stephen B. Morton)

The release of President Barack Obama’s budget recommendations Tuesday drew immediate criticism from Gov. Nathan Deal for including less than is needed to keep the Savannah Harbor Expansion Project — or SHEP — on track.

The administration’s budget request includes $42.7 million for the Savannah Harbor Expansion Project for fiscal year 2017, which begins Oct. 1. The administration also added another $24.3 million for the project for the current fiscal year, thanks in part to additional funds that Congress appropriated for the overall U.S. Army Corps of Engineers’ budget.

Deal has said that any amount less than $90 million would put the project further behind schedule and jeopardize the Port of Savannah’s market share.

He was joined by U.S. Senators Johnny Isakson, R-Ga., and David Perdue, R-Ga., along with U.S. Representative Earl L. “Buddy” Carter, R-Ga., who demanded answers from the Obama administration on its failure to include adequate levels of critical funding for the project

“It’s really unbelievable that the same president who called this a ‘We Can’t Wait’ project and sent his vice president here to proclaim this will get done ‘Come hell or high water’ can’t put enough money in his budget to keep it on track,” Carter said Tuesday.

“Failing to provide adequate funding for this critical project will result in delays and threaten to increase the cost to taxpayers. This project is essential for jobs and economic growth in the First District, the Southeast, and the entire nation and this administration must realize this truth and prioritize the project. This has been a long fight, which is clearly not over, and I will do everything in my power to ensure the federal government meets the commitment of the state.”

According to the Army Corps of Engineers’ current construction plan, if the federal government fails to provide at least $80-$100 million a year to the project, for fiscal years 2017-2020, the project cannot be completed on time and the resulting delays will cost taxpayers hundreds of millions of dollars.

In an October 2015 letter to Office of Management and Budget Director Shaun Donovan, the Georgia congressional delegation explained why it is critical that the administration include at least $100 million a year in federal funding for SHEP so the project can stay on track, avoid cost overruns and prevent timing setbacks.

“I am extremely disappointed that the president is shortchanging a critical infrastructure project such as SHEP while instead spending $300 billion on new ‘green’ projects and levying a new oil tax on hardworking families,” Isakson said. “The administration has inflicted irresponsible cuts on the Army Corps of Engineers’ overall budget.”

Perdue agreed.

“Over the past 15 years, the Savannah Port has been the fastest-growing port in the country,” Perdue said. “Completing the expansion of the harbor will have a dramatic economic impact not only on Georgia, but the entire country. This must remain a priority for the United States to compete globally and expand American made products into new markets.

“The Obama administration’s budget cuts the Army Corps of Engineers’ overall budget by 22 percent, including a 40 percent cut to the Corps’ construction account from the Congressionally-appropriated $1.86 billion to $1.1 billion. The vast majority of those downsized funds are going toward various conservation and environmental projects across the country rather than toward improving our country’s major infrastructure and transportation assets such as the Port of Savannah,” Perdue said.

Deal said the president’s request underscores the fact that the administration just doesn’t get it.

“The suggested allocation, which underfunds arguably the most critical dredging project in the country, appears to be the largest of any deep draft navigation projects in the president’s budget,” said Deal in a statement from his office.

Kurt Nagle, president and CEO of the American Association of Port Authorities, the recognized and unified voice of the U.S. seaport industry, also expressed disappointment in the funding levels suggested for the U.S. Army Corps of Engineers coastal navigation programs.

The proposed budget would significantly reduce funding for navigation maintenance and improvements across the country, which Nagle said is desperately needed to ensure America’s international competitiveness and to allow the nation’s ports to accommodate increasingly large, sea-going vessels.

“International trade now accounts for fully 30 percent of the U.S. economy,” he said. “To compete in global markets, America needs an efficient and modern 21st century freight transportation system.”

The Savannah Harbor Expansion Project was authorized in the Water Resources and Development Act of 1999 to deepen the Savannah River from its current 42-foot depth to up to 48 feet. The project is being undertaken in anticipation of an expansion of the Panama Canal that will increase the maximum draft of vessels traveling to and from the East Coast from 39.5 feet to as much as 50 feet.

The Corps estimates that Savannah’s harbor deepening project alone will bring $174 million in annual net benefits to the United States. For the larger post-Panamax vessels, the extra five feet of depth will allow for an additional 3,600 cargo containers in each transit, an increase of 78 percent.

The total price tag for the project is approximately $706 million, including construction and environmental mitigation costs. The federal government has a role in funding this project because the U.S. Constitution gives it authority over navigable waters.

The construction phase of the project began in January of last year with the recovery of the CSS Georgia Confederate ironclad from the Savannah River. Dredging of the outer harbor began in September.

In his message delivering the budget to Congress, Obama stressed that his approach fit within the constraints of prior negotiations with the legislative branch.

“My budget makes critical investments while adhering to the bipartisan budget agreement I signed into law last fall, and it lifts sequestration in future years so that we continue to invest in our economic future and our national security,” he said. “It also drives down deficits and maintains our fiscal progress through smart savings from health care, immigration, and tax reforms.”

Sequestration is an automatic freeze on certain spending included in the Budget Control Act of 2011. It was designed to be draconian as a way to prod lawmakers into coming up with significant spending cuts or face the automatic reductions.

 

Senior business reporter Mary Carr Mayle covers the ports for the Savannah Morning News and savannahnow.com. She can be reached at 912-652-0324 or at mary.mayle@savannahnow.com.

Follow Walter Jones on Twitter @MorrisNews and Facebook or contact him at walter.jones@morris.com.

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