11/12/2014. Jay Ruble Crounse Corporation

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1 Jay Ruble Crounse Corporation The U.S Inland waterways system includes 12,000 miles of commercially navigable channels and some 240 lock sites. These inland highways move commerce to and from 38 states, serve industrial and agricultural centers and facilitate imports and exports at gateway ports. Kentucky has more miles of marine highway than any state, other than Alaska. Water transportation has historically played a major role in Kentucky's economy and it continues to today. Ohio River m317 m981.5, Green River Cumberland River m0 m74.7, Tennessee River Lower Mississippi m904.8 m953.8, Big Sandy River Licking River Barkley Canal Kentucky River: locks are closed as well as unsuitable for commercial navigation miles miles 74.7 miles 62.5 miles 49.0 miles 8.6 miles 4.0 miles 1.5 miles 1

2 What ships on Kentucky s Rivers Kentucky 2012 Top 5 Waterways (tons in thousands; values in millions of dollars) Waterway Tons (thousands) Value (Million $$) Ohio River 60,597.7 $ 9,845 Tennessee River 17,326.2 $ 2,490 Green Rivers, KY 11,391.9 $ 1,207 Big Sandy River 6,173.3 $ 2,290 CumberlandRiver 5,911.8 $ 188 C dit V l t l l t d f f i / t l t Kentucky Ports Top 3 Ports in Kentucky Port Type Rank Tons Huntington Tristate 1 7,735.2 Louisville, KY 6 5,922.7 Elvis Stahr Harbor, KY Tonnages represent only tons shipped or received in the state and port, and not necessarily the total port tonnage. Source: USACE Waterborne Commerce Statistics Kentucky 2012 Lock Tonnage (tonnage in thousands) Lock River Up bound Down bound Total Ohio River L&D 52 Ohio 45, , ,413.5 Newburgh L&D Ohio 56, , ,954.4 Ohio River L&D 53 Ohio 30, , ,010.5 Smithland L&D Ohio 36, , ,446.7 McAlpine L&D Ohio 49, , ,105.9 Cannelton L&D Ohio 45, , ,460.9 John T Myers L&D Ohio 40, , ,123.9 Markland L&D Ohio 35, , ,616.0 Meldahl L&D Ohio 26, , ,618.5 Greenup L&D Ohio 22, , ,757.7 Kentucky L&D Tennessee 16, , ,056.3 Green River L&D 1 Green Towboat and barge Industry in Kentucky Crucial to the Kentucky Economy Advantages of Inland Waterways Transport: One 15-Barge Tow 1,050 Large Semi Tractor-Trailers 216 Rail Cars + 6 Locomotives 2

3 Moving Freight Efficiently Throughout America Transporting freight by water is also the most energy-efficient choice. Barges can move one ton of cargo 616 miles per gallon of fuel. A rail car would move the same ton of cargo 478 miles, and a truck only 150 miles Barges have the smallest carbon footprint among other transportation modes. To move an identical amount of cargo by rail generates 30% more carbon dioxide than by barge, and 1,000% more emissions by trucks than by barge. The Greener Way to Move America s Cargoes Ton-miles Traveled per Gallon of Fuel Safeguarding Our Health and the Environment Inland waterways transport moves hazardous materials safely. Overall, spill rates remain low. Trucks lose gallons per one million ton-miles, rail cars 4.89 gallons and barges 2.59 gallons per one million ton-miles. Rate of Spills in Gallons per Million Ton-miles Safeguarding Our Health and the Environment Spills of More Than 1,000 Gallons Anticipating Future Demands Our inland waterways have capacity: to transport today s bulk commodities and intermodal cargo, to accommodate tomorrow s growth in those cargoes, and to accept cargo diverted from overcrowded highways and railways Types of Inland Barges Dry Cargo Standard 175 x26 open hopper (291) Stumbo x26 open hopper (283) Jumbo & 200 x 35 open (6400),covered(10,400) Super Jumbo 260 x 52.5 open hopper (very few) Liquids Small Tank <10,000 bbl (100) Jumbo Tank bbl (1300) Semi Integrated unit tow >20000 bbl (1400) Total Inland barge Fleet = 21,000 3

4 Open Hopper 195 or 200 x ton cargo ton weight 9 13 draft Cargo box separate from hull Rake or box end Internal slope sheet Inland Barges Inland Barges Covered Hopper 195 or 200 x ton cargo 9 13 draft Lift or slide covers Rake or box ends Higher CU Ft Cap. No internal slope sheets Tank Barges 200 x 35, 10K 250 x 52, >20K 9 13 draft Heated cargo Hazardous cargos(red Flag) Inland Barges Inland Towboats ,000 HP, ( hp typical on Ohio River) Single, twin or triple screw primarily Diesel fuel Open Wheel, Kort Nozzle or Z Drive propulsion 2 10 person Crew Crew members on board days Work two 6 hrs shifts Captain, Pilot, Engineer, Assistant Engineer, Deckhands, Cook 4

5 Maintaining our Inland Waterways Backlog of Lock and Dam Construction ( est. Completion dates) Olmsted L/D Construction (2020) Lower Mon 2,3 & 4 Replacement, phase 1 (2027) Kentucky Lock Addition (2041) Chickamauga Replacement Lock (2051) L/D 25 Upper MS 1200 Lock Addition (2064) High Island to Brazos River, TX (2053) Lagrange 1200 Lock Addition (2070) Inner Harbor Lock Replacement (2077) L/D 22 Upper MS 1200 Lock Addition (2083) L/D 24 Upper MS 1200 Lock Addition (2090) Impacts from Olmsted Lock & Dam completion OF OTHER CONSTRUCTION PROJECTS SEVERELY DELAYED Inland Waterways Trust Fund Year End Balances Ongoing Construction Kentucky Lock $0 in FY12 ($400+ million needed to complete by FY29) Lower Monongahela River Locks & Dams 2, 3 & 4 $36 million in FY12 ($1.7 billion to complete by FY23) Chickamauga $0 in FY12, restart in FY22 & completed in FY25 IHNC Lock in New Orleans $0 in FY12, restart in FY29 & completed in the 2040 s TRUST FUND DOLLARS UNAVAILABLE FOR REHABILITATIONS? 2090 BEFORE COMPLETION OF 22 AUTHORIZED PROJECTS NO NEW STARTS UNTIL AFTER FY 2040! 5

6 78% Percentage of River Locks in the U.S. Exceeding Their 50 Year Design Life* * By the year 2020 WRDA 2014 Water Resources Development Act (WRDA) Legislation that authorizes and sets policy for work by the U.S. Army Cor of Engineers. President signed bipartisan law into effect June 2014 Deauthorized old projects Authorizations more than offset by Deauthorizations 7 year sunset on projects Streamlining: 3x3x3 WRDA 2014 Hard 3 Year Cap on Project Studies; Cost Caps at $3M Limit to Study; 3 Levels of Review Funding Roles for Non Federal Interests Recognition of the Olmsted Problem Only 17 No Votes Over 500 House/Senate Members No Earmarks Funding Projects Higher project appropriations for FY 15 Proposed increase of Fuel tax rate for WTF 6 9 cents offered by Barge lines Would raise WTF revenues by 270 million $350 $380 million per year needed to reach goals $5.5 $6 billion needed to finish backlogged projects. George Washington, returning in the fall of 1783 from a tour of the Mohawk Valley, wrote to a friend concerning the Nation's natural waterways: "Prompted by these actual observations, I could not help taking a more extensive view of the vast inland navigation of these United States and importance of it, and with the goodness of that Providence, which has dealt is favors to us with so profuse a hand. Would to God we had the wisdom enough to improve them." 6