Ports around Great Lakes on sidelines during shipping crisis
GREEN BAY, Wis. (WBAY) - With hundreds of ships stacked up off ports along the east and west coasts, ports around the Great Lakes can’t help alleviate the current supply chain crisis.
According to the Port of Green Bay’s director, Dean Haen, it’s due in part to a federal taxation policy on ships sailing the Great Lakes.
“There’s a 1,000 ports in the United States, including 25 fairly decent size ones in the Great Lakes that can’t help in this situation without some changes in legislative policy,” says Haen.
The policy Haen is referring to is the Harbor Maintenance Tax established in the early 1980′s.
“And that was a way to facilitate and pay for dredging and that’s happened, and now we’re fully dredged, but it needs to be tweaked because it’s stopping ways to alleviate congestion and commerce, it’s stopping commerce,” says Haen.
Haen says the tax essentially limits Great Lakes shipping to raw materials destined to one port.
“The way the federal taxation works on these vessels, you get charged on the value of goods at each stop, so if your goods don’t get off until the third stop you’re taxed three times,” explains Haen.
While many of the massive container ships require 50 feet of water, and the Great Lakes’ locks system only provides just over 26 feet, Haen believes adjusting the tax policy and other federal incentives would make it cost effective for smaller container ships to sail into the heart of the Midwest.
“The Great Lakes is the 3rd largest economy if we were our own country around the Great Lakes, so there’s a lot of manufacturing, there’s a lot of consumption that’s happening around the Great Lakes and yet all those goods that are being produced are moving to a coastal port, and other goods coming in to be consumed are also moving into coastal ports and then moved by truck or train to the region. You think about the cost of building a highway, adding another lane, millions and millions of dollars per mile, this water is already here, there’s no infrastructure costs, the docks are there,” says Haen.
As ports around the Great Lakes continue advocating to become a commercial waterborne transport route, known as Short Sea Shipping, the current shipping crisis could be the tipping point to it becoming a reality.
“Truthfully what drives change is a crisis situation like this, legislators start looking for solutions and industries telling them that and now they actually have the desire to push that legislation through,” says Haen.
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