1. It authorizes the immediate reconstruction of Locks and Dam 26, at an estimated cost of $421 million. 2. It authorizes an administrative process to develop, subject to Congressional veto, a system of waterway user charges that would be phased in over a decade, beginning in fiscal year 1980. There also is a specific limitation in the amendment stating that no user charge, even after the full 10-year phase-in, can be set at a level greater than 1 percent of the delivered value of the commodity, a limitation that we believe protects shippers and consumers alike. 3. It authorizes the development of a master plan for the Upper Mississippi River system. The interrelated question of Locks and Dam 26 and waterway user charges need to be resolved. The transportation balance of this nation requires such a resolution. The Administration supports such a balanced approach. We believe that this amendment provides a fair and effective way to resolve these issues this year, providing assurances of the timely construction of Locks and Dam 26, while treating the American taxpayer and other modes of transportation fairly and reasonably. We hope that you will support this amendment when it is raised during debate on S. 1529. We would welcome your censorship. Sincerely, Dick Clark, Gaylord Nelson, Mike Gravel, Bill Proxmire, Robert SENATE DEBATE-JUNE 22, 1977 CONSTRUCTION, REPAIR, AND PRESERVATION OF CERTAIN PUBLIC WORKS ON RIVERS AND HARBORS The ACTING PRESIDENT pro tempore. Under the previous order, the hour of 10 a.m. having arrived, the Senate will now resume consideration of S. 1529, which the clerk will report. The legislative clerk read as follows: A bill (S. 1529) authorizing the construction, repair, and preservation of certain public works on rivers and harbors for navigation, flood control, and for other purposes. The Senate resumed the consideration of the bill. AMENDMENT NO. 442 The ACTING PRESIDENT pro tempore. The pending question is on amendment No. 442, which the clerk will report. The legislative clerk read as follows: The Senator from New Mexico (Mr. DOMENICI) and others propose amendment numbered 442. Mr. DOMENICI. Mr. President, a parliamentary inquiry. The PRESIDING OFFICER. The Senator will state it. Mr. DOMENICI. What is the pending business before the Senate? The PRESIDING OFFICER. Amendment 442 to S. 1529 is the pending business. Mr. DOMENICI. Mr. President, in my opinion amendment 442 in volves two of the more controversial issues that will come before Congress during this session; the possible reconstruction of locks and dam 26 on the Mississippi River at Alton, Ill., and the need to impose a system of reasonable water user charges. This management is essentially Senate bill 790, as reported by the Committee on Environment and Public Works, and now pending on the Senate calendar. This amendment adopts the view of the Committee on Environment and Public Works, and I might add, the view of President Carter, that these two issues, reconstruction of locks and dam 26 and user fees, must be resolved at the same time. The question which must be resolved, as I see it, is this: How can the Federal Government best promote an efficient inland navigation system that is equitable both to our other transportation forms and to the American taxpayer? This is a vital question, and it raises the issue of why inland waterways are the sole exception to the principle that direct beneficiaries must repay a portion of the Federal costs of both water resources and national transportation projects. According to a study by the Congressional Budget Office, the inland waterway system and its users received a Federal subsidy exceeding 40 percent of the industry's revenues. I repeat that: The Federal subsidy in this event exceeds 40 percent of the commercial industry's revenues. The barge industry, in terms of its growth under these circumstances which I consider to be most favorable treatment, if not the most favorable treatment, has doubled its national market in recent years. If that were achieved strictly through efficiency, it would be commendable. But as a significant in this growth has been the existence of the free rights-of-way provided to the industry by the taxpayer, I believe at the expense of competitors, who must either finance their own right-ofway or pay user taxes toward their construction and upkeep. I think, Mr. President, throughout this debate, there will be some suggestion that the imposition of user fees will cost the consumer. There will be all kinds of statements, I assume, credibly made, as to how much. This Senator in his opening remarks wants to make this point, and I will make it repeatedly. But I firmly believe that ultimately reasonable user fees for the inland waterway system will save the consumers of the United States. Mr. President, it is pretty hard to distinguish taxpayers from consumers because in many instances they ultimately end up being the same: when we consider the subsidy which comes from the consumer called taxpayer or when we consider the inefficiency in that mode of transportation which either succeed or suffer depending on at which one we are looking because they are in this unfair competition. We have the statement that has been made over and over by Department of Transportation heads and Secretaries of Transportation and, indeed, every President since Franklin D. Roosevelt in 1939, that to balance this mode of transportation across this country we must impose some reasonable share of the cost of the inland system on those who use it. When we add all those up, I believe it will come out as many economists told us in hearings, that ultimately prospering modes of transportation in competition with this one that gets a free ride will end up benefitting the consumers of America, not hurting them. Secretary of Transportation Brock Adams put in this way when he testified before the Committee on Environmental and Public Works: The really major point here is that commercial users receive major benefits from Federal expenditures, while the full burden of those expenditures falls on the shoulders of the taxpayers. It is simply not equitable, not just, that profitmaking businesses should have this much of their costs met by the American taxpayers. I emphasize again, "this much of their costs met by the American taxpayers." Some argue that this is an antibarge amendment, or conversely, a prorailroad amendment. I can say to the Senate that from this Senator's standpoint. I got involved in this neither with an antibarge sentiment nor a prorailroad sentiment. In fact, I was unware when I began my involvement in this that might be incredulous to some-that this had been a longstanding issue between the railroads and the barge companies. I got involved in it because the committee on which I am ranking member had so diligently, under the leadership of Senator Gravel of Alaska, considered over and over again what we should do about the reconstruction of locks and dam 26-and again I use the word "reconstruction" because they have already built this system once. We have already paid for this system once with taxpayers' dollars. We are starting a second go-around. This is the second major facility in this inland system that we are about to reconstruct for the benefit of commercial barge traffic on this system. I got involved in that and the issue became very clouded as to whether or not we needed it, whether or not we should build it, and other alternatives; should we try some other engineering scheme? But clearly throughout all of those hearings, the issue began to fix themselves with reference to how much longer we will permit this inland water system, commercially speaking, to go without paying any of its share of the operation and maintenance costs of the system. How much longer will we proceed without letting them pay some share of the reconstruction cost? Mr. President, I have additional remarks; I will summarize them. Suffice it to say that the amendment before the Senate, supported by many Senators with diverse constituency, including those who are concerned about the farmers and their export products, basically, in this Senator's opinion, is, No. 1, essential if we are going to ever authorize the construction of locks and dam 26. It is clear to me that those who do not want locks and dam 26 authorized for reconstruction have many reasons. But obviously, the fact that this system is free and we are going to reconstruct a major facility under a free, totally subsidized system, again, just drags on that locks and dam and almost makes it impossible. Second, this Senator believe that the President, through his Secretary of Transportation and, I understand, by direct communication with certain Senators, has said that the authorization of locks and dam 26 without an in place, to be implemented, user fee on the inland system to recoup some or all of the tax dollars that go into it, will be voted. Third, this approach, which is a fixed-in approach and which now has a cap, which I will describe shortly, is the best way to handle those who presently rely upon the inland system either for transportation, for their business interests, or for their employment opportunities. Mr. President, as I said earlier in my remarks, in a very short period of time this mode of transportation has doubled-doubled in tonnage capacity as contrasted with significantly less growth in any other mode. It is obvious why. Those who are proponents of it can give any reason they want. They can talk about it being economic; they can talk about it being direct; they can talk about it being easy. But the plain and simple facts are that the reason it has grown so much is that it is free. That is it, plain and simple. My approach in this amendment, cosponsored by the majority member of this committee and some 12 other distinguished Senators from both sides of the aisle, recognizes nonetheless, that even though it is free and should stop being free, we cannot go from free to a major charge instantly without hurting someone. So what my amendment does is take 18 months from the time it is law for the Transportation Department to go into the field and set schedules and rates. It comes back to us and we have 60 days to veto it by joint resolution in the Congress. But we have some very important guidelines for the Department of Transportation in this amendment. First, whatever they do must be implemented in five incremental installments starting in October of 1979. For 5 years thereafter they incrementally impose this fee on the consumer users for only one purpose, that is, to recoup back to the Federal Government the operation and maintenance cost of this system to the taxpayers of America. That means 18 months. A little more time. Then for 5 years after, those who have relied upon the graciousness of the Federal Government in giving them this free, and they have relied upon it, are given that amount of time to adjust to the incremental imposition aimed at an ultimate goal of 100-percent recoupment of operation and maintenance. Mr. President, midway through that 5 years, so that no one will think we intend anyone to be arbitrary or that we want to deny hearings or that we want to deny the Secretary of Transportation an opportunity to get the facts, two things occur. The Secretary of Transportation has to have a full review of the economic impact of the first 2 years of such incremental user fees and he must report to Congress on some very specific instructions, including a discussion of its economic impact and its relevancy. At that time, they will also report as to the recoupment of capital improvement money. Five years from the beginning of this imposition-not next month, not next year, but 5 years from October of 1975-they will begin again to phase in additional fees, in five incremental annual installments, aimed at a goal set by Congress in this bill, if it is adopted, to recoup 50 percent of the capital outlay, annualized, for the inland system. That means that at the end of 10 years, this fee will reach a point10 years from October of 1979, incrementally imposed-that the commercial barges will begin to pay to the United States Treasury 50 percent of the annual capital costs that the taxpayer will bear and 100 percent of operation and maintenance. Mr. President, I have many detailed facts as to what that will mean in terms of various users. I am not going to give those at this point, because I assume they will be raised in the course of debate. However, it became obvious to me a short time ago, No. 1, that it did not matter how small we made this user fee. The commercial barge companies were not going to give up the free ride. I am certain that if this bill would recoup only 25 percent of what the taxpayers pay for them to use this system, to make money to compete with other modes of transportation that do not have that-no matter what we proposethey would be here in full force, suggesting that somehow their longevity by way of a free ride was equitable, and there is no relationship. This is not in any way to satisfy them, because I honestly believe that their greed will continue forever; and, in the free enterprise system, I do not blame them for it. But we should call it what it is-an absolutely unequivocal free ride. Even though I knew that in no way would they ever get off this gravy train, I was concerned, and some other Senators were con |