From Keystone XL to the most recent Dakota Access, debates over pipelines seem to have sprung up overnight. The pipes that connect us and deliver opportunity used to unite us, but lately, the political agenda of a relative few has caused a riff. At a time when our country needs to come together more than ever, it’s dangerous that much of the debate ignores the facts. Read More
The National Association of Manufacturers (NAM) recently released “Building to Win,” a blueprint for the next Congress and president on how to repair and revolutionize the infrastructure that makes the American Dream possible. There are many pieces of infrastructure mentioned in the report—traditional transportation infrastructure as well as energy, water and communications systems. Broadband is one segment of infrastructure that is often overlooked but cannot be forgotten as the next president and Congress look ahead to a renewed focus on infrastructure.
There is little or no argument about the benefits of widespread adoption of broadband. It creates economic opportunity and equality. In the manufacturing sector, it is helping to power the disruptive technology—the Internet of Things, the cloud, Big Data, 3D printing, drones, etc.—that is transforming traditional businesses.
NAM members told us in a recent survey that these new technologies are increasing shop floor efficiencies, enabling new revenue streams and allowing manufacturers to move into completely different product lines. And a common link throughout all these technologies? They all run on top of our nation’s telecommunications infrastructure.
Our products and processes have become increasingly dependent on the latest telecommunications tools and networks. Many manufacturers leverage commercially available networks, and many others manage their own networks for their facilities. No matter what type of network, they are all almost entirely funded with private investment.
Unfortunately, if private investment in this piece of the infrastructure lags, our manufacturing innovation leadership will be further challenged.
The Progressive Policy Institute recently published its “Investment Heroes” report in which it ranks corporations by levels of capital spending. PPI’s primary conclusion was that these private investments raise productivity and wages across the country. It also cited a “vitally important” policy challenge to maintain investment and that was to get regulation “out of the way.”
Those of us in the manufacturing sector agree: a regulatory environment that fosters investment rather than restricts it is needed, especially when it comes to broadband. When companies are faced with a complex, mandatory regulatory regime, it severely reduces investment in infrastructure. This lack of investment will significantly lower the multiplier effect technology has on our industry, the people we employ and the products we create.
Amid the partisan rancor of Washington, D.C., a small but important development occurred in the House beyond the overwhelming bipartisan vote of the Water Resources Development Act (WRDA) of 2016. Two years ago, Congress pledged to return to approving WRDA every other year. The promise was kept, and it was in large part due to the long-term education and advocacy efforts of a range of groups, including the National Association of Manufacturers (NAM), which continued after the previous WRDA bill was signed into law.
Water resources bills are responsible for authorizing or approving construction projects for our inland waterways and ports as well as other Army Corps of Engineers Civil Works projects. When Congress fails to pass these bills, projects vital to the movement of U.S.-manufactured goods are put on hold. WRDA 2016 includes approval for infrastructure improvements, such as three lock and dam projects on the Upper Ohio River. According to the Corps, all of these lock and dam systems were built before 1936 and have structural and capacity deficiencies that increase both economic inefficiencies and consumer costs. According to the Port of Pittsburgh, the Ohio River System supports 53,000 jobs mostly for the mining and manufacturing industries. Passing legislation that improves our navigable waterways makes manufacturers more competitive in the global economy.
Unfortunately, the House WRDA bill became entangled in partisan debate surrounding government funding for safe drinking water programs to help communities like Flint, Mich., as well as a possible shutdown. In the end, a bipartisan Flint amendment was included in the bill containing $170 million for drinking water aid without violating House jurisdiction or budget rules. While the amendment passed with bipartisan support, manufacturers recognize that America’s water infrastructure—from drinking water to wastewater—urgently needs investment. The NAM has long supported policy reforms that increase access to private activity bonds and innovative public–private partnerships for water infrastructure projects.
The ranking member of the House Transportation and Infrastructure Committee Peter DeFazio (D-OR) remained opposed to the bill because of the elimination of a bipartisan provision that would increase access to dredging money within the Harbor Maintenance Trust Fund. The NAM strongly supported the provision. Unfortunately, it violated the House Budget rules, subjecting the entire bill to a budget point of order and jeopardizing passage of WRDA as a whole. The NAM will continue to urge Congress to increase access to the Harbor Maintenance Trust Fund to ensure that user fees collected for harbor maintenance are spent on harbor maintenance. For example, the Brazos Island Harbor in Texas has a backlog of dredging projects that need to be completed to support the 44,000 jobs and $3 billion of economic activity at the Port of Brownsville. Without essential dredging and other maintenance, manufacturers’ ability to export our products will be put at risk.
The next step will be for House and Senate leaders to iron out the differences between the two bills. The NAM will advocate WRDA to be signed into law by the end of the year because these infrastructure investments are essential to economic competitiveness.
Today, the Senate voted 95 to 3 to approve essential infrastructure legislation, the Water Resources Development Act of 2016 (WRDA) (S. 2848). The bill includes authorizations for key civil works missions of the U.S. Army Corps of Engineers, including inland waterway navigation and port dredging—infrastructure investments that are vital to manufacturers and our competitiveness. The NAM sent a key-vote letter to the Senate on this measure.
The nation’s deepwater ports and inland waterways help keep transportation costs competitive and are an important means of transport for manufacturers and other industrial shippers. The waterways in particular move products and commodities now valued at $232 billion annually, but unfortunately, more than half of the inland waterways’ lock chambers have exceeded their 50-year design life. Our nation needs a modern infrastructure that manufacturers can depend on to remain competitive.
Too frequently, Congress has failed to pass water infrastructure legislation for periods as long as seven years, leaving critical projects waiting for a green light from Congress. Manufacturers are encouraged by the bipartisan, bicameral support in Congress to return to a regular two-year WRDA process and to get WRDA done this year. On September 13, 141 members of the House sent a letter urging House leadership take up and pass the House version of WRDA (H.R. 5303) this September, and the House Transportation and Infrastructure Committee will hold a hearing on potential water infrastructure projects that could be included in the bill. Manufacturers urge the House to immediately take up H.R. 5303.
Manufacturers are optimistic that Congress will continue to build on recent infrastructure accomplishments, such as the FAST Act and WRRDA 2014, to address the national backlog of infrastructure projects that threaten American competitiveness.
In a small town once praised for its inspiring ability to overcome obstacles and win support for a high school rocket-building project, there’s another story of opportunity on the horizon. A new pipeline is bringing natural gas to a diverse community in a remote part of the Southwest.
Even after building a 10 megawatt solar facility in recent years, energy was still at a premium, and bringing economic development to Presidio, Texas, has been a real challenge. But as the new pipeline winds its way south, a chili processor is now willing to invest in the city’s future.
Previously, the lack of natural gas had prevented investment, but Don Biad, managing partner of the Biad Chili Company, explained that the pipeline is a game-changer for small manufacturers. “It’s the difference between whether or not our company is profitable or not profitable.”
While this economic opportunity brings a wave of hope, the pipeline also brings environmental protection into view for the local communities because much of the natural gas will power modern electricity just across the border in Mexico. Building the pipeline is also helping to rebuild the railroad—once the lifeblood of trade through the town. That’s because transporting the steel pipes sparked investments in the rails that moved them from manufacturing facilities to the pipeline construction.
Presidio sits where the Rio Conchos joins the Rio Grande in the Big Bend of Texas; as the hardworking people in this international port town like to say, the rivers join us. So when you talk to Brad Newton, executive director of the Presidio Municipal Development District, his can-do-it optimism is anchored in unity.
“We’ve been stuck in the politics of poverty, but now we’re turning the page to the promising politics of progress. And natural gas is our best, new hope for a future—a bright future.”
As Newton put it, “The people of Presidio aren’t looking for a handout; we just want a level playing field in a world economy. That’s what natural gas gives us—a chance to compete.”
The House Transportation and Infrastructure Committee recently released H.R. 5303, the Water Resources Development Act of 2016. The House legislation includes authorizations for key civil works missions of the U.S. Army Corps of Engineers, including inland waterway navigation and port dredging—infrastructure investments that are vital to manufacturers and our competitiveness. The bill also aims to ensure continued investment in harbors and includes a provision that ensures the ad valorem duties collected on imports going into the Harbor Maintenance Trust Fund (HMTF) would be fully utilized for maintenance of ports and harbors beginning in 2027, essentially creating a firewall to protect funds.
Most importantly, this bipartisan legislation shows support in Congress to return to a regular two-year WRDA process. Holding a hearing just last week to discuss the bipartisan support for the authorization of 28 Army Corps projects, the committee is anticipated to move swiftly and hold a markup for the legislation this Wednesday at 10:00 a.m. Senate counterparts in the Environment and Public Works Committee already introduced legislation in April, S. 2848, which has passed out of committee and is awaiting floor time. Though there are significant differences between the House and Senate bills, there is wide agreement on the need to accomplish WRDA legislation this year.
Unlike the House proposal, the Senate WRDA bill authorizes additional drinking water and wastewater resources and provides a vehicle to address the Flint crisis. Senators also included a new program to increase grant funds for drinking water infrastructure through the offering of an optional 3 cent label for manufactured products that in turn generates income for a strictly voluntary Water Infrastructure Investment Trust Fund, a provision manufacturers are concerned will be taken out of context in time and evolve to a mandatory tax.
Manufacturers praise this early authorization effort, well in advance of the September 30 legislative deadline. Too frequently, Congress has leaned on short-term authorizations and extensions for infrastructure, creating a stop-start dynamic that makes it difficult to pursue large projects of regional and national significance. Manufacturers are optimistic that Congress will continue to work in a bipartisan way to advance key infrastructure priorities.
Government decisions derailing permits for infrastructure projects raise serious questions about future access and the cost of energy in this country. Affordable energy supplies are critical to the viability and competitiveness of manufacturers in the United States, but equally important is the ability to obtain a wide variety of other permits to carry on routine manufacturing operations. After successfully navigating federal, state and local government requirements, as well as opposition from national environmental groups during the permit approval process, a company is authorized to do business as long as it follows the permit.
When a Clean Water Act permit is approved and the individual is in compliance, the act provides a shield against arbitrary enforcement actions and citizen suits. The permit sets those limits. Unfortunately, a company can be forced to defend itself in court when someone tries to claim that the permit requires more than it does. If undermined, the permit shield can be no shield at all, or at least a very expensive one to maintain.
That’s the situation in a case now before the U.S. Court of Appeals for the Fourth Circuit in Richmond. A citizen’s group wants the court to insert new limits in a permit that the government had considered and decided not to include. In an amicus brief, the Manufacturers’ Center for Legal Action argued that suits like this upend the process for setting and implementing water quality standards by second-guessing the interpretations of those responsible permitting authorities. They also create serious after-the-fact liability without fair notice.
This kind of regulation by litigation threatens to add another layer of government control, activated by special interest groups, on regulatory decisions. Enforcing permit requirements is appropriate, but changing the terms of a permit in the middle of production is an entirely new problem that increases uncertainty, saps the life from productive investments and dampens our ability to create and sustain jobs.
Yesterday, the Senate Environment and Public Works (EPW) Committee held its kickoff hearing to begin the process of advancing a 2016 Water Resources Development Act (WRDA). Nucor Corporation’s Director of Corporate Logistics Rob Roberson testified on the importance and value of waterway transportation as an efficient and cost-effective way to move both goods and supplies:
“Inland waterways and ports are an essential part of our nation’s transportation system and economy, creating jobs and revenue regionally and nationally. As a company that relies on just-in-time delivery of products to our customers, an efficient transportation infrastructure is vitally important.”
Manufacturing executives gathered in North Carolina today for a panel discussion on innovation, the future of manufacturing and key policies. The panel was hosted by John Ferriola, chairman, CEO and president of Nucor Corporation; other participants included Jay Timmons, NAM president and CEO; Matt Barr, chairman and CEO of Carolina Color Corporation; and John Lundgren, chairman and CEO of Stanley Black & Decker, Inc., and NAM Board vice chair.
Heading into a presidential election year, panelists discussed policies that candidates should be prioritizing to promote growth in the manufacturing sector. Last week, the NAM released a roadmap for political candidates, “Competing to Win: Manufacturers’ Agenda for Economic Growth and American Exceptionalism.”
When NAM President and CEO Jay Timmons visited Tampa today on the State of Manufacturing Tour, he drew attention to one of the most critical pieces of our infrastructure system here in the United States: our ports. The Port of Tampa sees more than 37 million tons of cargo per year and is a vital transportation hub for our exports to China, Japan, India and throughout South America. As Florida’s largest cargo port, it supports 80,000 jobs and adds $15 billion to the economy.
And our port system is vital to the success of manufacturers. Manufacturing supports an estimated 18.5 million jobs in the United States and contributes $2.17 trillion to the economy. For every dollar spent in manufacturing, another $1.40 is added to the economy. It’s the highest multiplier effect of any sector of the economy. When manufacturing succeeds, America succeeds. Yet, obstacles such as crumbling infrastructure remain in the way of forging an economy that lives up to our people and the potential we can unleash. Read More