The Federal government’s Fiscal Year 2016 is less than a month old, but members of Georgia’s legislative delegation are already thinking about the Peach State’s needs for FY 2017. Georgia’s representatives and senators sent a letter to Office of Management and Budget director Shawn Donovan requesting at least $100 million in federal funds to support the Savannah Harbor Expansion Project.
We appreciate the assurance that you and others in the Executive Branch have given that you consider completion of SHEP to be a national priority. Accordingly, we would like to point out that the key to the success of this project will be whether the Administration’s budget proposal next year includes at least the approximately $100 million that USACE has identified as the level that would keep the project on the path to timely and cost-effective completion.
The $100 million-per-year schedule would not represent any special treatment or accelerated funding for SHEP; rather, it would be consistent with funding provided to similar projects of high national importance in recent years. It would simply allow use of standard contracting practices that provide normal cost efficiencies in channel dredging projects. In contrast, if federal funding in FY 2017 and beyond continued at the funding level recommended by the Administration for FY 2016 -and even if that amount were supplemented to approximately $50 million through use of additional funding provided to you by the Congress- the USACE calculates that the resulting five year delay in project completion would cost taxpayers almost $1 billion. This includes $100 million in additional construction costs as well as the unrecoverable loss of the $174 million in annual economic benefits to the nation that would begin upon project completion.
The lawmakers asked that OMB consider that $100 in annual funding is not unusual for a project like SHEP, citing similar funding levels to assist with the deepening of the Port of New York. They also point out that Savannah Harbor is the fastest growing container port in the United States, with a 17% increase in volume in FY15.
Prior to 2011, federal funding for projects like SHEP would have been done via an earmark from congress. After earmarks were banned in an effort to restore public trust, all funding requests are made through the executive branch. Most of the work done to date has been with funds provided by the state of Georgia, including $214 million as the state’s share of the project, and an additional $52 million in state expenses.