Marine Transportation:

Federal Financing and an Infrastructure Investment Framework

GAO-02-1090T: Published: Sep 9, 2002. Publicly Released: Sep 9, 2002.

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This testimony discusses challenges in defining the federal role with respect to freight transportation issues. There are concerns that the projected increases in freight tonnage for all transportation modes will place pressures on the marine, aviation, and highway transportation systems. As a result, there is growing awareness of the need to view various transportation modes, and freight movement in particular, from an integrated standpoint, particularly for the purposes of developing and implementing a federal investment strategy and considering alternative funding approaches. The federal approach for funding the marine transportation system relies heavily on general revenues, although the approach for funding the aviation and highway systems relies almost exclusively on collections from users of the systems. During fiscal years 1999 through 2001, customs duties on imported goods transported through the transportation systems averaged $15 billion each year for the marine transportation system, $4 billion each year for the aviation system, and $900 million each year for the highway system. Customs duties are taxes on the value of imported goods and have traditionally been viewed as revenues to be used for the support of the general activities of the federal government. Diverse industry stakeholders believe that substantial new investments in the maritime infrastructure may be required from public and private sources because of an aging infrastructure, changes in the shipping industry, and increased concerns about security. A systematic framework would be helpful to decision makers as they consider the federal government's purpose and role in providing funding for the system and as they develop a sound investment approach to guide federal participation. In examining federal investment approaches across many national activities, GAO has identified four key components of such a framework--establishing national goals, defining the federal role, determining appropriate funding tools, and evaluating performance--which could potentially be applied to all transportation systems.

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