John Porcari, the port envoy to the White House Supply Chain Disruptions Task Force, was asked this week for his long-term assessment of the U.S. supply chain.
“The pandemic laid bare a system that creaks along in the best of circumstances,” Porcari said. “We have an unprecedented opportunity here with the bipartisan infrastructure law and with Build Back Better to build a goods movement system that will serve our children and grandchildren. We really need to make some long-term structural changes, and we need to have more resilience and more capacity in the goods movement system than we have. It shouldn’t be this brittle.”
However, while the Infrastructure Investment and Jobs Act signed into law by President Biden does address supply chain issues by significantly increasing funding for roads, bridges, ports and rails, the Build Back Better Act, a roughly $2 trillion spending package currently being considered in the U.S. Senate (it was approved by the House on Nov. 19), is largely a climate- and social-spending bill – with billions of dollars set aside over the next 10 years for grants and tax incentives directed at helping the freight and goods movement sector transition to clean energy.
Because of staunch opposition from Republicans – and some Democrats – Build Back Better faces an uncertain future. Senate negotiators are hoping for a vote on the bill before the end of the year. Here are the top 10 highlights, by funding level:
Transportation electrification
Funding: $10 billion
Description: Grants used to install electric-vehicle supply equipment for recharging plug-in electric drive vehicles, including for medium- and heavy-duty vehicles at depots and in-route locations. Funding could be used for multiuse charging hubs used for multiple forms of transportation; medium- and heavy-duty vehicle smart charging management and refueling; battery recycling and secondary use, including for medium- and heavy-duty vehicles; and for shipside or shoreside electrification for ground support equipment at ports.
Critical manufacturing supply chain resilience
Funding: $10 billion
Description: Funding directed from the U.S. Department of Commerce “to support the resilience, diversity, security and strength of critical manufacturing supply chains affecting interstate commerce and related administrative costs.” Activities eligible for funding may include enhancements to a domestic manufacturing facility, process or practice; the preservation of surge capacity or other activities as determined by the secretary of Commerce. Eligible entities include private manufacturers, public and nonprofit institutions, or partnerships among entities.
Transportation workforce development
Funding: $10 billion
Description: Funding would establish a competitive grant program through the U.S. Department of Labor to expand workforce development and employment opportunities for high-skill, high-wage or in-demand industry sectors or occupations including infrastructure and transportation.
Clean heavy-duty vehicles
Funding: $5 billion
Description: Provides grants and rebates for Class 6 and 7 trucks (gross vehicle weight of 19,501-33,000 pounds, considered “medium duty” by Freightliner) for up to 100% of the costs for replacing eligible vehicles with zero-emission vehicles, as well as for the infrastructure needed to charge, fuel or maintain them. Funding would also go toward workforce development and training to support the maintenance, charging, fueling and operation of zero-emission vehicles. This weight class includes pickup and delivery and beverage trucks.
Reducing air pollution at seaports
Funding: $3.5 billion
Description: A competitive grants program that provides money to port authorities and private companies partnering with a port to purchase and install zero-emissions port equipment, including equipment used for cargo handling. A caveat: Funds awarded under the provision cannot be used to purchase fully automated cargo-handling equipment or terminal infrastructure designed for such equipment.
Advanced technology vehicle manufacturing
Funding: $3 billion
Description: Direct loans that would go toward reequipping, expanding or establishing a manufacturing facility in the United States to produce transportation that emits zero exhaust emissions of any greenhouse gas, including medium- or heavy-duty trucks, trains and locomotives, maritime vessels, aircraft, and hyperloop technology.
Port infrastructure and supply chain resilience
Funding: $2.5 billion
Description: Grants disbursed by the U.S. Maritime Administration would be used for projects to support supply chain resilience, including reducing port congestion, developing offshore wind support infrastructure, and projects that reduce any negative impacts of port operations on the environment.
Supply chain risk mitigation for critical products
Funding: $2 billion
Description: Money to support reducing supply chain risks and enhancing supply chain “elasticity and resilience” for critical drugs and raw materials used for critical drugs and vaccines. Funding would also be used for construction, expansion or modernization of facilities, adoption of advanced manufacturing processes, and other activities to support domestic manufacturing of critical supplies.
Aviation alternative fuels and low-emission technology
Funding: $1 billion
Description: DOT would provide grants and enter into cost-sharing agreements for projects that develop low-emission aviation technologies, or projects that produce, transport, blend or store aviation fuels that reduce greenhouse gas emissions.
Railroad rehabilitation credit risk premium assistance
Funding: $150 million (over five years)
Description: This money provides added funding assistance for freight and passenger rail projects that get funding through the U.S. Department of Transportation’s Railroad Rehabilitation Infrastructure and Financing program. At least 25% of the funds are to be used for short line and regional railroads.
