INSIGHTS: Sean T. Connaughton

Sean Connaughton, Secretary of Transportation for the Commonwealth of Virginia, oversees seven state agencies with more than 9,700 employees and combined annual budgets of $5 billion. But this transportation professional is perhaps best known to MarineNews readers as the U.S. Department of Transportation’s Maritime Administrator during the second Bush Administration.

 

As U.S. Maritime Administrator, he was responsible for the daily management of that agency and its promotional programs for the marine transportation industry. This included advising and assisting the Secretary of Transportation on commercial maritime matters, operation of over 50 ships in the Ready Reserve Force, supervision of the U.S. Merchant Marine Academy, oversight of the six State Maritime Academies, and administration of various shipyard and cargo programs. Connaughton was appointed by the President and confirmed by the Senate. Prior to his current assignment, he served as Corporate Vice President, Government Affairs for the American Bureau of Shipping. Connaughton is a graduate of the U.S. Merchant Marine Academy and served the U.S. Coast Guard as both a commissioned officer and as a civil servant in the Office of Marine Safety, Security, and Environmental Protection. After gaining a Master's degree from Georgetown University, he joined the American Petroleum Institute, representing companies involved in the energy and marine transportation industries, during which time he also earned a law degree from George Mason University.
 

His many honors include the 2009 Vincent T. Hirsh Maritime Award for Outstanding Leadership by the Navy League of the United States and an honorary doctorate in Public Administration from the Massachusetts Maritime Academy.
 

 

Connaughton practices what he preaches. As a champion of the nation’s waterways, mariners and arguably, still the most prominent leader in the effort to jumpstart a flagging, domestic “shortsea shipping” program, what he has to say always resonates with the U.S. commercial maritime industry. Our visit with him in May was no different. 

 

It has been almost four years since you departed the U.S. Maritime Administration and your post as its chief executive. The nation arguably made great strides during your tenure in terms of moving forward on shortsea shipping initiatives. Give us a SITREP of sorts on where you think we are today.
Obviously the biggest change since I was in office is the state of the economy.  The marine highway concept seemed to be catching on and Congress even provided grant funds to seed various routes.  Unfortunately, the economic downturn meant less cargo and more competition from the other modes of transportation making it even harder to start up marine highway operations.  That being said, we need to continue to push now to get new operations started so that when the economy recovers they are in a position to provide services.

 

Closer to home, talk about what is happening in Virginia. What’s happening with your “I-64 corridor” efforts? Give us an indication of the volume going up the James River and how many trucks you’ve cumulatively removed from the highways.
The 64 Express, our barge service linking the Hampton Roads Harbor and the Port of Richmond, continues to build momentum. The three-year-old service now runs twice a week and the Virginia Port Authority expects to add a third run per week by early summer. So far this year (through April) traffic on the 64 Express is up 85 percent when compared with the same period in 2011: 2,975 TEUs vs. 1,606 TEUs, respectively. So for the first four months of 2012 the barge has been responsible for removing just about 6,000 truck trips from I-64 (counting as roundtrip moves).

 

Rescinding the federal Harbor Maintenance Tax (HMT) for the shortsea leg has been cited as a key ingredient to getting our marine highways going. Do you agree? What’s the prospect of seeing that happen soon?
The HMT is an impediment to the development of marine highways. This ad valorum tax is based on the value of the cargo and is paid by the shipper; no other mode of transportation has to pay such a tax. What makes this even more egregious is that the federal government is not using the majority of the revenues it collects for channel maintenance. So we have a double problem: a tax that drives up the costs of marine highways and increasingly silted-in channels that make it difficult for operators to serve many terminals and ports.

 

Can we expect to see a robust shortsea shipping effort here in the U.S. without the removal of the HMT?
There is already a robust marine highway industry in the inland waterways and Great Lakes since the cargo being moved are bulk commodities. However, the HMT acts as a disincentive for the movement of containers carrying higher value cargoes. Nonetheless, from a public benefits perspective, marine highways are a cost effective alternative to expanding highway infrastructure.

 

Labor has to be one of the unknown variables in shortsea shipping efforts. How has that affected your efforts in the Commonwealth?
It’s had a definite impact. Ocean-borne containers will be handled three times and this obviously will drive up costs, especially if the same labor rates and practices are used each transfer. We need for this issue to be addressed in cooperation with labor in order for marine highways to be competitive.

 

The larger Panama Canal vessels are coming. Virginia’s deepwater ports will be ready for them. Do you envision Norfolk and Hampton Roads to be a key transshipment point for domestic containers to smaller “feeder” niche ports – like Boston, for example?
That’s a possibility, particularly if the other ports on the Atlantic coasts are unable to handle the larger ships. However, we still have to overcome the higher costs associated with marine highways, such as the harbor maintenance fee.

 

What advice would you give other transportation professionals contemplating shortsea initiatives? What can be accomplished on the state level that might be harder from a federal perspective?
At a state level, you have the opportunity to see the direct impact of marine highways in modal shifts, economic development and environmental benefits. In Virginia, our 64 Express service has taken thousands of trucks off one of our most congested interstates. If the marine highway operation is completely within a state’s border, the benefits are tangible and measurable.  The challenge is developing successful interstate marine highway operations. Cooperation and collaboration between states, neighboring and not, as well as metropolitan planning organizations is essential. This is role for the federal government, which can see beyond jurisdictional borders.

 

Are there any sources of federal funding available to those wanting to get started?
There’s the possibility of federal highway, Congestion Mitigation and Air Quality (CMAQ) and Regional Surface Transportation Program (RSTP) funds, as well as Maritime Administration grants. We are using some of these in Virginia for the 64 Express.