The International Council on Clean Transportation (ICCT) has published a brief providing an overview of inland waterway freight transportation development in the United States, including key policy and regulatory frameworks to enhance inland water transport.
According to the publication, to support the continued development and modernization of inland waterway freight transportation, several key policies and funding mechanisms have been implemented in the United States. These policies aim to enhance the efficiency, reliability, and sustainability of inland water transport while addressing infrastructure challenges. Key policies to enhance inland water transport in the United States include:
Fixing America’s Surface Transportation (FAST) Act
Fixing America’s Surface Transportation (FAST) Act, signed into law in December 2015, authorized $305 billion over fiscal years 2016 through 2020, including for statistics programs related to major U.S. inland ports and for freight projects involving inland waterways and smaller coastal ports. It also required DOT to develop a National Freight Strategic Plan to address multimodal freight transportation, and the Plan promotes the integration of various transportation modes, including inland waterways, to create a seamless and efficient freight transportation network.
Water Resources Development Act (WRDA)
Water Resources Development Act (WRDA), updated biennially, authorizes various projects managed by USACE to improve and maintain water infrastructure, including inland waterways. The modern series of WRDA bills began in 1974, with the objective of addressing a wide range of water resource challenges beyond navigation, including flood risk management, environmental restoration, and water supply. The 1986 WRDA was a landmark legislation for U.S. waterway infrastructure and one of its key provisions was the establishment of the Inland Waterways Trust Fund. The WRDA of 2024 focused on funding to improve the nation’s ports, harbors, inland waterway navigation, and other aspects of water resources infrastructure.
Infrastructure Investment and Jobs Act (IIJA)
Infrastructure Investment and Jobs Act (IIJA), also known as the Bipartisan Infrastructure Law, is a federal statute signed into law in November 2021. By November 2023, about $400 billion from the bill was allocated to more than 40,000 projects related to infrastructure, transport, and sustainability. The IIJA invests over $16.7 billion to improve infrastructure at coastal ports, inland ports and waterways, and land ports of entry along our border, with a focus on modernizing ports, locks, and dams to enhance the efficiency and reliability of inland water transport, strengthening the competitiveness of the IWT system. In addition to economic benefits, the IIJA’s investments in inland waterways are expected to have positive environmental impacts. By improving the efficiency of waterborne transport, the act can help reduce greenhouse gas emissions and ease congestion on roads and railways, leading to a more sustainable transportation system. Overall, the IIJA’s provisions for inland waterways represent a significant step toward modernizing the nation’s infrastructure and ensuring the long-term viability of waterborne transportation in the United States.
Navigation and Ecosystem Sustainability Program
Navigation and Ecosystem Sustainability Program, managed by the USACE, is focused on upgrading the lock and dam infrastructure in the Upper Mississippi River System, including the replacement and rehabilitation of aging infrastructure and increasing capacity. One feature of the program is extensive stakeholder engagement, which includes environmental groups and local communities.
Inland Waterways Trust Fund
The Inland Waterways Trust Fund was established to direct more money toward the construction and rehabilitation of navigation projects on the inland and coastal waterways of the United States. It is funded primarily through a tax on diesel fuel used by commercial vessels operating on approximately 11,000 miles of designated inland waterways, and the current tax rate is 29 cents per gallon. This tax revenue collected is used to finance up to 50% of the costs of construction and major rehabilitation projects on inland waterways, with the remaining costs covered by federal appropriations.
Role of Inland Waterways in U.S. Freight Transportation
Inland waterways play an important role in the national freight transportation system in the United States. About 8% of U.S. freight each year is moved by IWT, and this mode is uniquely positioned to handle commodities such as agricultural products, chemicals, and bulk goods. The strategic role of IWT in facilitating efficient and cost-effective freight movement is supported by a robust data infrastructure that includes detailed monitoring of commodity flows, fuel consumption, and emissions associated with freight operations. This data offers valuable insights that help to improve efficiency and reduce the environmental impact of freight transportation via IWT.
Challenges and future policy considerations
While IWT maintains a steady role within the U.S. freight sector, shifts in the broader economy and supply chains over recent years have led to a change in the types of commodities being transported along inland waterways. At the same time, the IWT fleet is aging, and the infrastructure supporting IWT, including locks, dams, and ports, is increasingly outdated. Despite some efforts to retire older, less efficient vessels, current policies lack a strong focus on expanding IWT capacity, restructuring, or fostering intermodal integration. Expanding policy goals in these areas could help unlock IWT’s full potential as a cleaner, more sustainable freight option.
