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Economic
Benefits of Improving
the Upper Mississippi and Illinois Rivers
The
American farmers' competitive advantage in exporting grain has always
hinged on efficient transportation, not being the low-cost producer.
Our major competitors, Argentina, Brazil and China, have made investments
in their transportation systems and are dramatically reducing their
costs for  moving
grain. The facts to follow will show the economic benefits of investing
in and improving our own barge transportation systems.
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Lock delays
in the Upper Mississippi Basin cost U.S. farmers and businesses
an average of $94 million per year during the mid 1990s. 1995: $97.4m
1996: $99.8m 1997: $83.6m
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U.S. Army Corps
of Engineers indicates seven 1,200-foot lock chambers and five extended
guidewalls would have a positive net benefit to the nation.
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To date, the
Mississippi River system has $330 million in deferred maintenance.
A significant portion of this overdue maintenance could be forgone
by replacing existing structures.
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Barge companies
currently pay a 20 cents per gallon fuel tax to fund waterway construction
projects. To date, the Upper Mississippi Basin has contributed 40
percent of the revenue into this fund, but has only received 15
percent of the disbursements.
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Improving the
locks requires a 50/50 cost share with federal funds and monies
already collected from the barge fuel tax in the Inland Waterways
Trust Fund.
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Navigation on
the Upper Mississippi and Illinois Rivers supports over 400,000
jobs, including 90,000 high-paying manufacturing jobs.
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The U.S. Army
Corps of Engineers estimates that every $1 invested in navigation
projects yields $6 in national benefits.
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In any given
year 60 percent of the bulk agricultural exports are moved to world
ports via the Upper Mississippi and Illinois Rivers.
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In 1998, bulk
agricultural exports totaled $14 billion. These exports were one
of the leading positive sectors in the U.S. balance of trade.
The world population
is forecast to grow to 7.6 billion by 2020. In order for the U.S. to
capture an increasing share of the global food demand, we need to increase
the efficiency of our transportation systems. Otherwise, we will surrender
another valuable market to our competitors.
Environmental
Benefits of Improving
the Upper Mississippi and Illinois Rivers
Last reveiwed
May 10, 2004
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