The House Select Committee on Ports, Innovation & Infrastructure met in San Antonio on August 20 to hear invited and public testimony on the benefits and needs of Texas’ inland ports with a focus on the Texas Mobility Fund and a potential separate funding stream for inland ports.
This report is intended to give you an overview and highlight of the discussions on the various topics the committee took up. It is not a verbatim transcript of the hearing, but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.
Brian Ragland, TxDOT
- Will be speaking on the Texas Mobility Fund (TMF), created in 2001 and subsequently invested in later
- Primary revenue sources are driver license fees, inspection fees, certificated of title fees, etc.
- Texas Constitution designates use for state highways and other public transportation projects, generally understood that TMF is not available for projects not accessible to the general public
- Money has been appropriated from the TMF for ports in the last 2 sessions, these funds can only be used for roadways leading up to the gates of these ports as area beyond is not publicly accessible
- Constitution also states that if any revenue sources are reduced or eliminated, then they must be replaced by like amounts
- Future revenues of the TMF were bonded since 2003, most has been paid out for roadway projects; in the 84th, bill was passed to prohibit future bonding, now on a pay as you go for any amounts exceeding debt services required to be paid on bonds
- Bill also prohibited use for any toll roads
Steve Boecking, Hillwood, Alliance Texas
- Gives overview of Alliance Texas project in Fort Worth, 26,000 acres of development located on the North side of the DFW metroplex, gives access to DFW area for local distribution & positioning gives access to regional distribution and beyond
- Started in 1989 with construction of Alliance Airport and annexation of land by Fort Worth, $9 billion invested led to $2 billion in increased tax base & 50k jobs
- Currently ~half developed, large amount of economic development; AT&T, Amazon, mail services etc. funnel products through Alliance, other e-commerce enterprises and datacenters
- Designed to provide any company an efficient, quick supply chain; air cargo is the focus for large firms looking for speed
- Provided details and pictures on transport hubs in the distribution system, has spurred residential, retail, service, etc.; Comptroller Hegar has praised the development
- Also hosts community events like air shows, etc.
- Goldman – Very good development in Fort Worth, major success story; annexation of this area was a true partnership between Fort Worth and Alliance
- Have a very close relationship with all local governments we operate in
- Paul – What percentage of your containers come through a Texas port?
- Hard to measure this as containers coming from Houston come through truck instead of rail, most rail comes from the West US
- There is transport from Houston to Chicago
- Would guess somewhere around 10%-20%, many containers passing through are going out of Port of Houston
- Paul – Empty containers go by truck from Fort Worth to Houston?
- Some do, no one makes money on this, so it is rare; empty containers are often hauled to Lubbock by rail for transporting cotton to China
Jim Perschbach, Port San Antonio
- Port San Antonio is one of the largest airports, closely located next to Air Force facilities
- Comptroller estimated a $5.2 billion positive impact on TX economy a few years ago
- Port San Antonio serves as a focus point for skilled workforce, public and private; air fleet overhaul and repair, manufacturing, cybersecurity, etc. are all hosted at Port San Antonio
- Gives examples of industries at Port San Antonio, e.g. Plus One Robotics which develops and builds robots that can assist in transport and logistics, 24th Air Forces Cyber is hosted at Port Antonio, other military and private cybersecurity efforts as well
- Also heavily involved in regional logistics
- Port San Antonio has entered into education collaboratives and created cybersecurity programs in high schools; San Antonio students excel at Cyber Patriot; also with higher education institutions
- Port San Antonio developed in response to shifting air technology needs over time, will continue to do so
Miguel Conchas, Laredo Chamber of Commerce
- Appreciate hearing focus & recognition of inland port importance in South Texas
- Inland ports need a funding source specifically for them
- Laredo is the largest transport pathway along the Texas-Mexico border, $214.7 billion through Port Laredo in 2017, 363,000 jobs and $52 billion in GDP to Texas
- Laredo is part of START Alliance with Port Corpus Christi and Port San Antonio
- Mexico is increasing energy productions and thus increasing usage of trucks, rail, and pipe transport over the border
- Port development has an impact on the entire state, but need the proper supporting infrastructure; Laredo bridges need to be supported & access/exits need to be properly maintained
- Deshotel – are you going to be proposing any legislation in concert with other inland ports?
- Would be happy to promote this type of legislation with other ports
- Deshotel – Should get with delegation on mechanism by which we can expand the funding
Tyler Schrader, Boeing
- Employ 3,800 Texans throughout the state, operations in TX touch all Boeing industry
- Global Business Unit opened in 2016 in Plano, spent $1.5 billion with vendors and suppliers in TX
- Boeing San Antonio operates one of the largest military repair and maintenance facilities at Port San Antonio
- Gives an overview of Boeing’s military aircraft repair and maintenance operations & the history of how the industry and Port San Antonio facility developed
- Facility led to $5.2 billion in economic output and ~$2 billion in personal disposal income, according to Comptroller Hegar
- Invested $250 million into Port San Antonio operations to date, Port San Antonio should be considered a national asset
Ivan Jaime, Union Pacific
- Union Pacific operates more than half of the class-run track mileage in the state, only rail serving all entry ports and major entry ports in the state
- Gives examples of Union Pacific operations including fracking sand transport and food & beverage distribution
- Gives examples of ongoing investments: $100 million expansion of San Antonio intermodal terminal & ongoing investment for Laredo intermodal terminal
- Provides details on logistics tech at intermodal terminals, including cranes, etc.
- Rail can be very cost-effective over very long distances, while trucks are flexible, intermodal terminals allows use of both in the supply chain
- Expecting College Station area terminal to be completed by 2020
- Trains have a significantly lower carbon footprint than truck transport
Public Testimony
Rolando Ortiz, Texas Freight Advisory Committee
- Laredo helps support flow of trade and commerce throughout the state, need to support this
- Here to support interest in creating separate infrastructure funding category for inland ports
- Recommends prioritizing projects focusing on intermodal transport, prioritizes rail to truck transport; should invest in projecting supporting statewide transport
- Laredo ports were identified as the second largest contributor to the TX economy, one of the most important ports; $33 billion more travels through Laredo than Dallas ports
Scott Navarro, Operational technologies Corporation
- FTZ at Port San Antonio operating for 15 years
- Inland ports should receive a dedicated fund or source of state revenue due to unique aspects of inland logistics & support of local economies
- Should not exclude from the TMF, but should create an additional revenue stream
- Deshotel and Navarro discuss definition of inland ports, Navarro identified 2 ports, but Rep. Deshotel 3
Closing Comments
- Deshotel – Asks stakeholders to work with their delegation to work on future legislation and suggest models