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Scalise Works to Drain Lockage Tax from President’s Budget

June 17, 2009

Washington, DC -- Congressman Steve Scalise today sent a letter to Peter Orszag, President Obama’s Director of the Office of Management and Budget (OMB), urging him to remove the lock usage tax from the FY 2010 Budget. There are 23 other Members of Congress from around the country that have signed on to Scalise’s bi-partisan letter.

“Raising taxes on the shipping industry or any industry during tough economic times will lead to more job losses and higher costs for consumers,” Scalise said. “We want to let the White House know there is bipartisan opposition to this proposed tax.”

The proposed tax would more than double the taxes that tug boats and barges currently pay, which would lead to increased costs for consumers.

A copy of Scalise’s letter follows here:

June 16, 2009

The Honorable Peter Orszag
Director
The Office of Management and Budget
725 17th Street, NW
Washington, DC 20503

Dear Director Orszag:

As you are aware, the Inland Waterways Trust Fund is currently funded by the inland waterways excise tax on diesel fuel. In the FY 2010 budget, the Administration has proposed a lock usage tax. We would strongly oppose any lockage tax and urge you to remove this idea from consideration.

Congress has rejected lockage taxes in the past, and we expect a similar result again. Funding the Inland Waterways Trust Fund by imposing lockage taxes places an undue burden on commercial waterways users. The proposed lockage tax would more than double the taxes that the industry currently pays, and therefore would also increase the costs of shipping essential commodities. The commercial waterways industry provides tremendous benefits to our economy and to consumers through the efficiencies of the lowest cost, most environmentally-friendly mode of transportation. Increasing industry taxes will only increase the costs for commodities without realizing benefits in waterways infrastructure, and during these tough economic times that would further delay our economic recovery.

The lockage tax has been put forward as a way to increase revenues for the Trust Fund which is in danger of running out of money, as demands upon it are significantly increasing. Congress, the Administration, and industry must work together to ensure this does not happen, and examine all possible alternatives other than the lockage tax to overcome the expected shortfall in funding. One proposed solution would be to improve the efficiency of construction and project delivery. The maritime industry is currently engaged in a cooperative process to find solutions to this problem by working with the Inland Waterways User Board and the Army Corps of Engineers to revise the capital projects business model for improved construction and funding of prioritized inland waterways projects. If given the time to complete this project, industry and the Corps will be able to share with Congress a realistic and equitable solution to funding inland waterways infrastructure.

Thank you for your time and attention to this request. We look forward to working with the Administration on solutions to maintain and improve our Inland Waterway system.

Sincerely,


Rep. Steve Scalise (R-LA)
Rep. Ron Paul (R-TX)
Rep. Frank Lucas (R-OK)
Rep. Kevin Brady (R-TX)
Rep. Todd Akin (R-MO)
Rep. Henry Brown, Jr. (R-SC)
Rep. Shelley Moore Capito (R-WV)
Rep. John Culberson (R-TX)
Rep. Rodney Alexander (R-LA)
Rep. Jo Bonner (R-AL)
Rep. Trent Franks (R-AZ)
Rep. Steve King (R-IA)
Rep. Charles Boustany, Jr. (R-LA)
Rep. Geoff Davis (R-KY)
Rep. Kenny Marchant (R-TX)
Rep. Charlie Melancon (D-LA)
Rep. Mary Fallin (R-OK)
Rep. Travis Childers (D-MS)
Rep. Anh “Joseph” Cao (R-LA)
Rep. Bill Cassidy (R-LA)
Rep. John Fleming (R-LA)
Rep. Pete Olsen (R-TX)
Rep. Bill Posey (R-FL)
Rep. Aaron Schock (R-IL)

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Contact: Luke Bolar
202-226-4309