WCI Praises IWTF Tax Reform

Waterways Council, Inc. (WCI) President and CEO Michael J. Toohey today praised the leadership of House Ways & Means Committee Chairman Dave Camp (R-Mich.) for inclusion of a recommendation to increase, by six cents per-gallon, the 20-cent-per-gallon user fee paid for by inland waterways towboat operators into the Inland Waterways Trust Fund (IWTF). The IWTF funds new construction and major rehabilitation of priority navigation projects on the nation’s inland waterways system. The recommendation was included in Chairman Camp’s discussion draft of the Tax Reform Act of 2014, released today.

The section-by-section summary of the proposal cites as consideration for this increase the letter that WCI and 40 stakeholders sent to the House Ways & Means Committee last September.

“In a letter dated September 24, 2013, to the Ways and Means Committee, the Waterways Council and a coalition of nearly 40 stakeholders expressed support for increasing the excise tax that supports the Inland Waterways Trust Fund to at least 26 cents per gallon, in conjunction with spending reforms included in the Water Resources Reform and Development Act, which passed the House of Representatives on October 23, 2013.”

Chairman Camp’s proposal adopts the user fee increase recommended in legislation known as “WAVE 4: Waterways are Vital for the Economy, Energy, Efficiency, and Environment Act of 2013” (H.R. 1149), which provides a comprehensive approach to reforming the delivery of capital improvement projects on the inland waterways system. This legislation was introduced by Congressman Ed Whitfield (R-Ky.) and Democratic co-sponsor Congressman Daniel Lipinski (D-IL), along with the 31 other bi-partisan co-sponsors.

“WCI, along with its carrier, shipper, agriculture, labor, conservation and port community members, is deeply appreciative for the leadership shown by Chairman Camp to recommend a user fee increase that will allow more money to be collected into the Inland Waterways Trust Fund to modernize our critically important inland waterways system,” Toohey said. “As our nation looks to increase exports, create jobs, and facilitate American competitiveness, transportation infrastructure requires investment. An increased user fee, paid for and supported by the inland waterways industry, will serve to raise the level of investment in our inland waterways transportation system,” Toohey continued.

The full section of the Tax Reform Act of 2014 discussion draft related to the user fee increase is below:

Sec. 7003. Modification relating to inland waterways trust fund financing rate.

Current law: Under current law, an excise tax of 20 cents per gallon is imposed on fuel used in powering commercial cargo vessels on inland or intra-coastal waterways. These excise tax revenues are deposited into the Inland Waterways Trust Fund. Provision: Under the provision, the excise tax rate would be increased to 26 cents per gallon. The provision would be effective for fuel used after 2014.

Consideration: In a letter dated September 24, 2013, to the Ways and Means Committee, the Waterways Council and a coalition of nearly 40 stakeholders expressed support for increasing the excise tax that supports the Inland Waterways Trust Fund to at least 26 cents per gallon, in conjunction with spending reforms included in the Water Resources Reform and Development Act, which passed the House of Representatives on October 23, 2013.

JCT estimate: According to JCT, the provision would increase revenues by $0.2 billion over 2014-2023

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