Port Districts.
Port districts are authorized for the purpose of acquisition, construction, maintenance, operation, development, and regulation within the district of harbor improvements, rail or motor vehicle transfer and terminal facilities, water and air transfer and terminal facilities, or any combination of these facilities. There are 75 port districts in the state. A port district may also, through its commission, spend money and conduct promotions of resources and facilities within the district or general area through advertising, publicizing, or marketing.
Any port district may adopt or amend a freight development plan as an amendment to the port's comprehensive scheme of harbor improvements. The freight development plan is submitted to several entities, including the Department of Transportation, to coordinate the development and funding of freight mobility projects. After a port adopts or approves a harbor improvement plan, any improvements must be in accordance with the plan until the plan is amended.
The Washington Constitution, Article VIII, section 8, states that the use of public funds by port districts for industrial development or trade promotion is deemed a public use for a public purpose.
State Accounts.
In addition to the State General Fund, which may be expended for any lawful purpose, the state maintains several hundred accounts that are dedicated to particular statutory purposes. These accounts generally fall into one of three categories: (1) accounts located in the State Treasury, which always require appropriation by the Legislature; (2) accounts held in the custody of the State Treasurer, which may or may not require legislative appropriation; and (3) accounts located in state agencies and institutions of higher education, known as local accounts.
Freight Mobility Strategic Investment Board.
The Washington State Freight Mobility Strategic Investment Board (FMSIB) is responsible for creating a comprehensive and coordinated state program to enhance, mitigate, and improve freight mobility on designated strategic corridors. Eligibility criteria are related to location, inclusion in a regional or statewide Transportation Improvement Program, a construction timeline, and type of entity.
The Department of Transportation (Transportation) is required to set priorities, develop performance metrics, and identify evaluation criteria for efficient operation of a Supply Chain Competitiveness Infrastructure Program (Program). The Program will provide grants and loans to public ports and federally recognized tribal governments with public port operations. Transportation may adopt rules under the Administrative Procedures Act to implement the Program. "Public ports" are the ports authorized through the statutory process.
To set the Program priorities, Transportation will collaborate with critical supply chain stakeholders to develop performance metrics and evaluation criteria designed to strengthen the criteria used to prioritize projects for funding. The parties to the collaborative process will also develop a list of project types eligible for the Program. Projects that directly benefit the state's production economy and supply chain may have a weighted score, including projects where the majority of the freight volume is inputs for in-state manufacturing or materials for regional construction, state products that are grown or processed in the state, or essential supplies for supply chain resilience.
The stakeholders include, but are not limited to:
Eligible projects for the Program are required to align with six goals addressing: operation of the supply chain to and from public and tribal ports, advantages of efficient freight movement, sustenance of the international trade economy, access to market transportation for agricultural and industrial products, integration and cooperation of freight distribution systems, and mitigation of the impacts of increased freight traffic on communities. The projects must be included in a port's freight development plan. Projects eligible for the Program must not be eligible for funding from the FMSIB.
The Supply Chain Competitiveness Infrastructure Program Account (Account) is created as an account in the State Treasury. Receipts from the Legislature, proceeds of bonds, and principal and interest payments from Account loans are deposited in the Account. Money from federal, state, local, and private sources may be deposited in the Account by public and private entities. Use of the Account is limited to projects that focus on enhancing supply chain competitiveness for public and tribal ports and the capacity of ground and maritime transportation and facilities. Transportation will receive grant funds through appropriation using existing accounts.
The amended bill makes the following changes:
(In Support) Ports affect our daily lives, from the smart phones we use to the groceries we buy to the airplanes we fly on; all of these go through our ports. Since 1911, ports have been charged with providing trade and commerce, and they partner with truck and rail, maritime labor, dock workers, and exporters. We have a very trade driven economy. Per capita, more jobs are linked to trade than any other state in the union. Ports are a critical piece of supporting the industries that drive the economy forward. Our economy runs on trade.
During the pandemic, we realized how brittle the supply chain is, when products were not available, and how easily the supply chain breaks down when there are challenges. Congestion in the supply chain impacts businesses, and some are choosing to use ports in other states or stop exports. Ports are a crucial piece in the transportation and supply chain system.
As an example, the Port of Port Angeles only has a two-lane highway, so the need for interface is important. The cargo terminal the port uses to export timber and forest products reached the end of its useful life and needs renovation to connect to the marine highway system. That will cost over $10 million, and because the port generates less than $2 million per year, this is a big undertaking. The port is turning to federal funds to make the project happen, but the state has an opportunity to play a role in bringing home projects like this across the state. This will fill the funding gap in the state transportation network. It will provide a key source of matching funds for projects at ports and near ports to address supply chain issues.
The state currently has dedicated grant programs for cities, counties, and rails, but no targeted grant program for ports. Not all ports are eligible for all federal grant programs, but we should not have to rely on the other Washington to bail us out. We need state level tools to stay competitive. Ports are a critical part of the transportation system and supply chain infrastructure. By creating a port grant program, it sets up the parameters of the program pending funding. It gives ports flexibility to invest in rail and other clean infrastructure that address delays and support clean energy. It provides careers, not jobs. For overburdened communities, it means more family wage jobs and investment back into the state. When ports are supported, it brings good paying jobs to every community in Washington, especially rural and disadvantaged communities.
(Opposed) None.
Senator Marko Liias, prime sponsor; Eric ffitch, Washington Public Ports Association; Cassie Losey, Port of Benton; and Katharine Frazier, Port of Port Angeles.