beyond roads. increased utilization of freight by rail as we've heard, is resulting in more at great rail crossings and it's impacting commerce and public safety. we need at the very local level more grade separation structures and first and last mile connectors to counteract the future. the growth of the state has been stated, we believe by 2045. that increase will be about 45%, putting more pressure on both existing and future infrastructure for freight. meanwhile, 95% of the international consumers are now outside of the united states. so being at the beginning and the end of a major global supply chain, u.s. companies have to understand understand, and the government needs to understand that we need good infrastructure to reach those markets. u.s. government infrastructure as a percentage of gdp is currently less than 2%.

our trade partners our biggest ones, canada china mexico, are spending two to five times more than that on their infrastructure. and it can't be just one mode that we're focused on when we talk about funding infrastructure. we have to look at all modes and we need to make those modes work better together. rail, truck air and water are today the key components of the global supply chain. the global situation is getting worse in a lot of respects, but we have the opportunity to take advantage of what's going on internationally in the economy. the coalition for america's gateways and trade corridors ask congress to take the following steps in the upcoming surface transportation authorization. first, we would like you to establish a freight program containing dedicated and flexible funding. freight should not compete with other mobility needs. it's integral to other mobility

needs. freight movement occupies a special place in our transportation system as the elements supporting commerce competitiveness and that all-important word, jobs. we should have a dedicated funding such as a freight trust fund that is committed to stoking our economic engine by predicting swiftness reliability and speed at which our goods are moved. second, funding at a minimum of $2 billion a year, a freight program. programs such as a grant program is needed to fund certain projects that need certain criteria to advance economic goals of this country. by prioritizing projects, we can identify important public benefits as well as non-federal support. a $2 billion grant program could leverage many times that amount

in private investment in infrastructure. third, ensure robust public investment in all modes. where public benefit is derived public investment must be made. often public assistance is needed to close the funding gaps. examples are high grade rail access existing transfer facilities, tunnel and bridges for port access and border-crossing capacity and enhancements. finally, modify the national freight transportation policy to make it multi-modal. create an office of intermodalism in the d.c. office and give it the attention it needs in this country to keep our economy healthy. thank you. >> thank you very much. we will begin with a first round of questions, five minutes. i will start. mr. bessac you talked about

competing in a global market and the effect that has. being with cargill and the emphasis you have with port can you tell me what percentage of pork in this country goes for exports? >> certainly. senator, pork is much larger than beef, about -- between 20, 25% depending upon the year and about 10% of pork. i'm sorry; 10% of beef is export exported exported. >> and when you are looking at delays at our ports and you see other countries stepping forward and being able to fulfill some of those orders do you know what share of the market your company has lost and how you see that rippling effect throughout the industry? >> well i guess going to

cargill's share gets to be a bit difficult, but if you look at the u.s. pork industry or the u.s. beef industry, we certainly have been the largest exporter around the globe. but as we have dealt with the congestion in the ports, also issues like currency and other forces in play in the market, we've seen a substantial increase just in the past year to countries: the eu chile and certainly in the last couple months have seen a substantial decline in our volumes. >> do you think that will be a permanent decline? will we be able to get that market back once these customers are used to having new trading partners? >> i think any time you disappoint a customer it takes time to build trust back.

as i referred to in my testimony, there is a tremendous amount of potential for both beef and pork exports on the global scale. we have a product that the world is looking for in values. i certainly believe the growth potential remains, but there is no doubt that we've disappointed our customer base primarily japan, korea, and in china, over the last couple months, and that will take some time to rebuild trust. >> and in disappointing our customer base, what has been the loss in dollars to pork producers and the economy here in this country? >> well, i don't know that i would be the best one. i think north american meat institute estimated $40 to $50 million per week. i could probably give you a better example. just this morning we have about

15 containers of chilled pork product enroute to japan that our customers are either asking, can you guarantee us that it will arrive in a useful form with shelf life or not? and so for me that's about a million dollars i have to decide whether i'm going to put that into a port system and either slow down or potentially close closing being a complete loss. so i hope that gives you some perspective. >> yes. thank you. and miss farmer with bnsf i'm sure you have to look at the possibilities of a shutdown and a shutdown that would last for possibly an extended period of time. how does that affect the railroad in planning, and what impact does that have on your

customers and on your thousands of employees that you have? >> sure. so an example of this would be this weekend, we were notified by the pma that vessel gangs would not be working and so the effect that has on our railroad is that in an average week during this period of the year we would be moving somewhere in the neighborhood of 60 trains off of our docks in southern california. that number has been reduced to 30 trains per week. the impact that that has is that we cannot move the freight that wants to move off the west coast, so we will move a limited amount of that freight off the west coast into the interior of the u.s. it will then limit the ability for us to accept freight at our inland hubs so we will have to turn freight away at those inland hubs that wants to move back to the west coast. in addition to this, i talked about our capital expenditures that we've made. we are now having to store locomotives and equipment that

we have added to our fleet to be able to handle this country's supply chain growth store that across our railroad because we can no longer continue to send this volume out to the port. when we do that it sits on the main line and it causes ripple effects across our network which impact other customers in addition to our intermodal customers. so the impact for us, senator fischer, is we cannot move the freight through it and we are not using the valuable resources that we have. >> and that impact when you see the freight migrate from the west coast, what impact does that have on a local community? >> absolutely. you know, i think when we look back at history and we know that during 2002 freight has permanently migrated around -- away from that to canada, to mexico. and we know that because of that the local freight is not ending up in those communities, and additional expenditures need to be made somewhere else when a port is there that could be used for that freight to be moved through the country.

>> thank you very much. senator blumenthal. >> thank you madam chair. there seems to be no doubt among any of our panel members that solving this threatened impasse or crisis on the west coast is necessary to america's near term and longer term competitiveness, is that correct? but moving on to the broader issue, let me go to mr. brewing's excellent testimony about our ongoing failure, and it is a kind of slow motion implosion of american competitiveness, the ongoing spending of 2% on infrastructure investment which is compared to 9% by china, 8% in india 5% in europe, even in mexico 4%.

and it extends not only to roads and bridges which are crumbling and decaying and dekrepcrepit, but also our infrastructure as simple as railroad crossings. how in new york just days ago we saw the consequences of possibly -- we don't know the causes yet -- but possibly a rail grade crossing that could have been made safer and could have prevented the deaths and injuries that occurred there. the fact of the matter is that there are more than 2,000 crashes and collisions every year at our rail grade crossings causing more than 230 deaths and more than 700 injuries not to mention the economic costs of those collisions, which are very

difficult or impossible to calculate. that's just one example of our failure to invest in infrastructure. so let me ask you, as to the $2 billion that you recommend as a fund or investment, would it make sense to do it through a public financing authority or infrastructure bank such as has been proposed and advocated by myself, other members of this committee, a very bipartisan proposal that would make available not just 2 billion but very possibly more? >> i think the concept of a set aside through a public infrastructure bank, broader utilization of public and private activity bonds along with some other finance mechanisms, i think we need to bundle these together. i think anything that costs a lot of money these days is going to take more than one source or resource to make it happen.

back in illinois we don't like to talk about gas tax, but we think in illinois to solve some of the state road and infrastructure problems a gas tax is something we should be looking at. but i do believe that loan guarantees, broader use of some of the existing bonding programs, tifia and riff, i think both would help in meeting this demand that we have. and i do believe that the multiple solutions are going to be necessary. >> my understanding is that both tifia and riff are underutilized, in fact billions of dollars have been left on the table, in effect, as a result of internal problems highlighted by the inspector general of the department of transportation very recently? would you agree? >> i would agree with that. i think that the time it takes to process going through the pre-application, going through that review, the uncertainty, quite frankly that comes about

when there is long delays and public financing tools all of a sudden the hot project becomes not so hot a project and they start looking at some other infrastructure pieces to accomplish. expedited review, broadening of the utilization of those funds and certainly making sure that we're using our full complement every year would go a long way to helping us. creating new programs is fine, but i think better utilization of existing programs makes a lot of sense. >> and riff, in fact, is a multi-billion-dollar opportunity that is lost literally every day to american intermodal transportation. i welcome the emphasis that all of our panel have put on intermodal transportation, because as you well expressed it is the transportation growth opportunity of the future. >> that's right. >> do any of you have any differences with the points that mr. greuling has just made?

>> i would say from being a sets perspective, we certainly have an interest in the supply chain running smoothly. we definitely want to invest in freight. >> through an infrastructure bank? >> again, we don't necessarily want to drive that decision, but we certainly want to be part of the conversation. >> thank you. my time is expired. thank you, all. >> thank you, senator blumenthal. senator deines? >> thank you madam chair. i get to represent the state of montana, and in montana our number one industry is agriculture. it's about a $5 billion industry just last year. as we know in ag, you have to be able to export. like senator fischer, we don't have a lot of oceanfront

property in montana i don't think nebraska does, either, so the supply chain becomes critically important. in fact, 80% of montana's wheat is exported. it was nearly a billion dollars in 2013 and primarily through the west coast ports. we're very proud of our ranchers and farmers who not only feed america, they feed the world now. for ms. farmer i heard concerns certainly from our producers in montana about the backlog we had -- i think a backlog of nearly 3400 cars past due in the region. could you tell us what the current status of the rail backlog is now in montana? >> as i have responsibility for intermodal, i would be happy to follow up with specific statistics around the backlogs. but what i can tell you is that by any measurement on a year over year basis, because of the

capital we've invested because of the milder winter that we've had, by any metric that you look at, we are far improved where we were last year. we are making significant progress towards delivering the service that your constituents in the state of montana have come to expect from us and we will continue to make progress along those lines. what i would say is concerning to us is that one of the ways that agricultural products get to the west coast as we've discussed, is through the use of containers. it can move in hopper cars or containers, and what i can say is that as we limit the inbound flow of containers into the interior of the country, it makes it more difficult for me to be able to move that product for export. so that's certainly of concern to us. >> well i can tell you too, last summer our montana ag producers were not so concerned about the rail backlog it was the issues going off the west coast ports. i used to be a supply chain guy

myself, i worked for procter & gamble for 12 years and was in the supply chain and have an appreciation that the chain is only as good as its weakest link. if we can't get the harvest to market thepn we really cannot realize the great potential of our ag industry. the port of vancouver, the port and labor dispute we had going on there that now we see going on in long beach and in l.a., it is having a great impact in creating dwindling confidence in our global markets, the ability for us to deliver. in thinking about our global opportunity as our competitors continue to improve in their products the differentiator for us long-term to win will be in excellent customer service, that when we say the product is going to be there, it will be there. as has been said when we lose as senator fischer mentioned, when we lose the ability to

deliver, our customers will look elsewhere to find those same products. in fact, i just got a rather haunting e-mail from the president of an outdoor products company that manufactures -- in montana, they have leading global market share. in fact, they're the only producer of some of these products that still produce in the united states. the rest is producing over in china. so this manufacturer, the president of the company e mailed me about the concern that is going on with the west coast slowdowns, the in-house unions that are putting their interests, he said ahead of their customers. he said if something doesn't happen soon, we will have no choice but to reduce our current hiring plans and potentially lay off some of our current staff. in your view what if anything, can be done as we look at these challenges right now with these west coast ports being virtually either slowed down or shut down?

>> you know certainly we're not party to the negotiations between the pa and the iowu. but it's clear to us that there needs to be some speedy resolution of this. the biggest opportunity that i think is in front of us is that it is going to take us several weeks to work off the backlogs that exist once some type of resolution comes to bear. we have an opportunity in front of us, and that is that chinese new year is upon us, and that will give us several weeks of reduced freight inbound to the west coast that would allow us to catch up. so i couldn't agree with you more that it is very concerning we need to find a way to be able to resolve this but again we're not party to those negotiations, and as such, we just -- the urgency is really where we're focused. >> thank you. i'm out of time madam chair. >> thank you senator daines. senator klobuchar? >> thank you very much. i'm losing my voice here, but i

wanted to thank everyone from coming, especially mr. bessac from cargill, which is a great minnesota company, biggest private company in the country. we have worked extensively with them on these transportation issues, so thank you for being here. i'm very glad that we were able to pass the user fee increase from the river act, and i appreciated all the work that people who transport on the river did to get that bill done. as you know it was part of the ablec. can you talk please, about what the increased revenue will mean for locking greats and damates and dams on the river system? >> i'm sorry my expertise is cargo. i know cargill is interested in building a stronger infrastructure so we can compete

on the global scale. i would be happy to get you a written answer from our staff. >> but you're happy we passed the bill to get infrastructure improvement? >> yes, i am. >> that was supposed to be an easy question but that's okay. could you talk about how this works and why it's such a problem if you're able to get things out? as mr. daines points out, we are states not on an ocean. we are on lake superior so the port matters a lot. i was once placed on the ocean subcommittee of this commerce committee, and i remember frank lottenberg giving me a note when i was told that i was the only one on the ocean subcommittee not given an ocean, and he said next time just ask for one. anyway, can you tell us how the river ports depend on this traffic? >> absolutely. as you know, the demand for safe, wholesome food products around the world continues to increase as population increases.

and we need very effective, reliable modes of transportation, whether it be a river, railroad truck or ocean vessel to efficiently move those products to their best value consumer. and our farmer and rancher suppliers depend upon us to be able to take those crops and move them efficiently and get the best value so we can in turn pay them a strong value for the hard work that they do raising those crops and those livestock. >> thank you. dr. kenses, can you talk about the interrelationship with the ports, and we do have the lake superior port, and rail and intermodal issue? >> well, over the last 15 to 20 years, the numbers of unscheduled outage at america's locks and dams, particularly on the mississippi waterway has increased substantially. it has made barge traffic less

predictable, and agricultural shippers have been finding alternative routes. and perhaps the easiest way to see this is when you look at the port of new orleans' share of agricultural exports, it used to be close to 65% about 10 years ago, and today it's about 45%. it is an kbedimpediment for farmers to get product down the river on large enough vessels. so rather than looking at threats of job cuts or not making investments, there are quantitative tasks that can assessed here. under the free trade agreement, there are quotas for agricultural goods, other grains and oil seed. if a shipment is delayed beyond the calendar year, then the quota for that year isn't made. the importer on the other side

of the trade is normally allowed some small growth rate, say 2 to 3%, but if they don't make their quota the year before the 2 to 3% growth rate is applied to a lower base rate. the excess amount is actually filled by other countries that do have a reliable system. >> exactly and it's going to hurt us competitively and nationally. mr. greuling one other question on public and private partnerships. there is the exporting of goods to our neighbors to the north and south and bringing goods in from mexico and canada is really important. canada is the biggest importer we have and people don't always realize that. we are having huge problems at the borders with delays in places like international falls, minnesota. there is an issue with a bridge that i'm not going to get into which we hope is soon solved. in windsor from michigan and i've been working on this as head of the interparticleliamentarianticleliamentarian

group with the canadians. on the mexican border, our country has started to do a lot of public and private partnerships at building up the infrastructure at the port of entry. do you think this is a smart way to go, because i want to get it rolled out on the northern border as well. >> we definitely think it's a smart way to go. in our own case we're looking at private built bridges connecting modes of transportation, highway with rail highway with water ports knowing that the users will pay their way, their fair share knowing that that money is being invested into that specific infrastructure. we can't afford to build, you know, $150 million bridges without some infusion of private equity. it's being used in north africa, it's being used -- >> in canada. >> -- in canada. we have a great example on the ohio river of a private bridge being built with equity funding.

it kept their people employed. so it is a good approach to these. >> this project is more about the custom plazas to try to speed up the back and forth between the countries with the new dawn in north america. so thank you. >> thank you. >> thank you senator klobuchar. senator cantwell. >> thank you madam chair, and thank you for having this important hearing on the movement of freight. when i think of this issue, i think so much of washington state and the products that come through on the way to asia. we have a short period of time seeing something like a doubling in the size of the ships over the last five years, so yes we have a lot more capacity, and we obviously have a rising middle class in asia and they want higher -- they want more u.s. product. so the question is, what are we going to do to meet that demand as it relates to improving our infrastructure? one of the things that has occurred is the recommendations of the freight mobility board which was chaired by mort

downey, i think someone you're familiar with mr. greuling, and ms. farmer, i think someone from the railroad participated in that. how would move forward with those recommendations and would you support a funding source to freight so that we could raise the importance of why moving this product is so critical to our economy and infrastructure? and that tiger alone just isn't going to get it done. >> are you asking me? >> yes. miss farmer or mr. greuling, anybody who wants to jump in on that. >> certainly we want to make our ports more competitive. we're excited about working together of seattle and tacoma. we will certainly stand together to work with them. we believe the tiger grants were a good thing that we need more funding around those kinds of issues. so from our perspective, anything we can do to make them more competitive, we're certainly in favor of that as

well. >> senator, certainly our four points with the coalition, number one is to establish a fully funded dedicated freight program, and we believe that that needs to be at least $2 billion a year. and this is not a program that's going to pick winners and losers in the transportation field, this money should be spent on what makes the most economic sense in terms of performance for the entire system. and we believe that setting priorities on a national scale for the projects of national regional significance is one of the mechanisms to do that. but -- and also the establishment of a separate freight office within usdot again, to strictly focus on these multimodal needs nationally. >> so what do you think we need to do to get people to understand this from a -- either an economic impact or some of the things that your organization has done in studying the economic development associated with this?

>> you know, a lot of what we do at the center and through the coalition is education. you may see this brochure that we recently produced through the coalition. follow that on and it shows a supply chain from a california groer to the almond, and it shows the port in the united states going to hamburg germany. i think we need to think on more a national level and not just what's good for elm street or what's good for my river, but look at the whole national system and make sure they're aware that what we do at the national level at the local level interconnect and we really need to make sense of that when it comes to funding. >> mr. bessac, do you have anything you want to add to that? >> i guess more of a comment, senator. you hear lots of numbers talked

about, $2 billion for infrastructure, and i go back to the numbers senator fischer mentioned in a port -- if the ports were closed today it would be $2.5 billion per day to the u.s. economy. and i would submit we're very close, although they're not officially closed, i think we're very close to that at this moment. and i guess my comment is simply, it seems like a very wise investment and an expense that the u.s. taxpayers and consumers are paying today daily because we don't have the free flow of goods. >> well, i think, you know, we learned the lesson in washington because we're at the tip of the spear, and that congestion caused so many problems that we learned if we were going to be competitive and not lose that business that we had to make the improvements. but now we need the improvements made all along the system not just right there.

but i think we just have to prioritize for people to understand that we will actually lose the economic impact, it's not just the upside but there is huge upside, but there is a downside if we don't act as well, and that is that people will go to other ports or start buying product from somewhere else just because they can get more its delivery. so we really need to make that investment. thank you, senator chair. >> thank you senator cantwell. i believe we need more time and senators have more questions, so we'll do another round. take a big sigh here. i'm interested, mr. bessac and ms. farmer, when we look at freight transportation systems and we look at the midwest and some of the challenges that we have with containers how would you address those challenges where we have that lack of containers to move our product?

and other members of the panel if you would like to jump in on that as well. >> certainly. i'll go ahead and start, chairman fischer. i think that what you'll see is that we've proven in normal times that we have sufficient containers to be able to move the product that wants to move export. in fact, last year we moved 236,000 units of grain in a box back to the west coast. we work very closely with the ocean carriers and the trucking companies, and they are able to scale relatively quickly to be able to meet the demands. what bnsf has been very focused on is improving our velocity. because as you very well know, when we look at the speed at which we can turn these assets we can turn more capacity in the supply chain in the market if we invest in our infrastructure if we have expansion in our infrastructure. so we have a very thoughtful approach to investing so we can get the velocity we need which will generate the capacity for the midwest to be able to have the containers that they need.

>> anyone else? >> there was a structural deficiency for the exports and our exports tend to be agriculture, large scale capital goods and energy products, and these come from places where not a lot of people live and therefore, not a lot of containers arrive full of imported goods. so there is a structural gap that has to be addressed. and from where i sit and what i've seen in the data, i don't think it will be addressed very simply by trying to match or reposition containers because every time you have these congestion issues, things do get paralyzed. it may be necessary to pursue an alternative solution such as using 53-foot domestic containers and then doing cross stock operations like we do with the imports but in reverse so we can compress these onto the container ships. >> thank you. mr. greuling? >> the demand is there. empty containers are certainly at a premium in certain

locations. in our case we're receiving grain and dried distiller's grain on six different containers that are being shipped out to the west coast. when you think of that transportation just to get to an empty container shows clearly we've got this very high demand. and, really, we can't afford to build more ports. we just need to use the existing ports as efficiently as we can, and i think that applies to both inland ports and water ports. that's going to be the solution, and tie it all together with highways and railroads and we've got a winning situation. >> that ties in to what i wanted to ask dr. kemmsies with making our ports sufficient. what role do you see for automation? is that going to help make our ports more efficient more competitive and what success do you see us having in that

regard? >> well, i don't think it's possible to operate the ports with the larger vessels coming without some degree of automation, if not eventually full automation. these ships, as i mentioned in testimony earlier they have to be on the water as much as possible, not sitting at ports. so if you were to look at an 18,000 tu vessel which is the largest size really currently operating, it takes four and a half days. if you can do 35 gross moves an hour on a 24/7 basis. to maintain productivity like that without some sort of automation, i think, is impossible. i have yet to see it demonstrated. so we have to move in that direction. if we do that, then i do see u.s. ports being able to maintain an ability to compete with foreign ports particularly

those to our north and to the south. >> thank you doctor. senator blumenthal? >> thank you. what is the cause of the shortage of container cars in this country? i'll ask that question to whomever or all of you, if you want to answer it. >> senator i think from our perspective, i'm not sure there is a net shortage. i think the real issue is where the empty containers are versus where the demand for the containers is. >> and what accounts for that imbalance? >> well, a lot of it has to do with the system that we have set up, the intermodal system today. we can handle over 3 million can containers at our yard, a million and a half coming in and a million and a half going out. downstate in illinois or indiana don't have that kind of capacity, therefore, they don't

have the available containers to ship out. it's a market balance to some degree. i'm not sure that's fixable in the short term. building more containers is not necessarily the answer, ask i would -- and i would defer to my rail colleague to maybe defer to that. >> i don't believe there is a net shortage of containers, but what we need to challenge ourselves with is how do we efficiently get them to the interior of the country? with that, what bnsf and western railroads have done is we have found ways to load those containers into the interior hubs in the country. where there is a surplus of empty containers that is naturally made that come from the goods on the west coast, the majority of grain that gets loaded out or a very large percentage of grain that gets loaded outcomes from the state of kansas. as we can draw that closer to our log c have the containers there that can be loaded out.

we need to continue to invest so our velocity is good to the containers are there. i don't think in total there is a net shortage, the issue is how do we stay competitive through the ports, over the railroads to the right places to get the containers to the right part of the country. >> but the ports are just one key to the intermodal transportation, where rail is very important in moving a lot of those containers to the right places so they can be there at the right time. >> absolutely. >> let me ask you, going back to the infrastructure investment issue, and mr. bessac mentioned this figure of $2 billion, the possible loss of $2 billion if this impasse or crisis continues, which would be very, very, very unfortunate. but it strikes me as an example

of how there are possibly costs to the lack of recognizing the importance of investment and smart policy. so what somewhat perplexes me is why the folks who run our transportation system, including your railroad and others who are here have not been more vociferous or vehement advocate to specific solutions to these infrastructure problems in a way that maybe will move policymakers, including folks who are sitting on this panel to take some action. in other words, we would welcome you to be more vigorous advocates for the system that is your responsibility and trust to run, and ultimately your shareholders have very significant investments in. >> absolutely. as i mentioned earlier senator

blumenthal, we agree from the standpoint that we absolutely have to continue to manage our network, invest in capital expenditures that make sense going forward. we also want to -- and we have a vested interest in remaining engaged in that conversation. we believe that a national transportation policy is a good thing with a focus on freight. and so i think that we've been very active relative to those discussions and participation in national transportation policy planning. >> thank you. thank you all for being here today. >> thank you, senator blumenthal. senator daines. >> this is a follow-up question thank you, madam chair, regarding infrastructure investment. we need to continue to invest here if we're going to continue our global competitiveness. i think, ms. farmfarmer, you mentioned some of the roadblocks

of export facilities we're experiencing on the west coast. i was out at one of those proposed facilities last summer the gateway pacific terminal. i was standing there with a member of the rail union from montana, i was standing there with a tribal member from montana that would benefit from expanded exports. we see both the jobs as well as the tax revenues that would be created by expanding exports. and yet it's delay after delay after delay in trying to get this port built. and it sits literally right in between two existing ports. it's zoned properly. it's environmentally sound. and yet there is great concern that how in the world are we ever going to move forward here in infrastructure investment with these endless delays and uncertainty? i'm looking for help here about what we can do to try to -- i'm not suggesting there is not a thorough review process but one that provides some degree of

certainty and reasonability on those thoughts. >> we are working very closely with indiana to put together our export platform. we, like you, are anxious to have the ability to continue to grow, to be able to export. we believe that there needs to be some improvement, whether it's around permitting reform, we've talked about that multiple times in the past. we believe that extending the environmental review position of map 21 to the railroads would be helpful and you know, further expediting the process looking at these concurrently basically reducing the timeline that these things take. but in general what i would say is that we completely agree that we are anxious to export product, to continue to grow to improve the competitiveness of the u.s. supply chain both through exports, what we've talked about here, as well as imports as well.

>> and i think mr. kemmsies talked about automation and so forth. this proposed port would be exactly that. mr. greuling, what are your thoughts? i know you're somewhat expert on this issue. >> senator, i think like we suffer from multiple jurisdictionitis with three or four or five or six governmental units controlling roads and infrastructure, the federal government has the same issue for these major projects the number of agencies that these projects have to touch, the time it takes to go through the nipa process, the environmental review. in fact i would comment that we have actually seen some improvement on that under leadership from congress and the administration. and we applaud that. it shouldn't take 10, 12 years to do an eis statement on a bridge. clearly that is an issue. multiple agencies may be working a little closer together on collaboration, and again, we

think a national freight office could help sort of quarterback that initiative especially for these major important freight projects. >> i think what's highlighted today in some of the testimony is what's happened with these choke points on our west coast ports, allowing more optionality and so forth here to resolve these issues when they come up. if we only have one way out, it's nice to have multiple choices here and so forth to ensure we protect our economic interests and can compete globally. thank you. that's all the questions i have. >> thank you senator daines. we've been joined by the chair of the committee senator thune. do you have questions, please? >> thank you, madam chair, and senator blumenthal, thank you for holding this hearing. it's a very important subject, and i appreciate the fact that your subcommittee is focused on this. a reliable and sufficient supply chain is critical to our global competitiveness and to our economy, and the ports are a vital link in that chain.

what's frustrating is some of these things, and sometimes you can't control, these things are sort of, i guess self-imposed problems. they're really kind of unforced airunforced errors, and if you're trying to quantify this, it's having a profound effect on the economy. i know some of you on the panel have testified to that effect and cargill, 40 million a week. i've talked to tyson's in my state in south dakota and they shared with me that we've got beef and pork sitting in freezers in the ports instead of heading to asian markets. and while we've got all these large container ships sitting off the coast waiting to export our nation's products. and that affects jobs. tyson's employs 41000 people. the usda estimates there are a million jobs associated with agricultural exports in this country, so it has a profound impact on the economy not just on the west coast but all across the country, and workers in south dakota and other places that are dependent upon like i

said, a reliable supply chain. outdoor gear inc. family-owned business in south dakota they're a wholesaler, receives 5% of its inventory from west coast ports, has been forced to miss deadlines and pass up sales opportunities including in december, which is the holiday peak season. this is an issue that just really needs our focus. it's a huge drain on the economy, and i just urge all sides to come to a resolution in this dispute to find a solution as soon as possible. we can't afford to drag this on and have our economy pay this kind of price and if we can get this behind us, we can start focusing our energy and creativity on a lot of the other long-term infrastructure challenges that desperately need our attention as well. in na light, i wanted to ask a

question question. i know all of you attempted to quantify what some of the financial economic impacts of this have been but the question i would like to pose is once this is resolved how long will it take to unwind this and to get those networks working in an efficient way again and where things are sort of normalized? what are we talking about once we get, hopefully which will be very soon a resolution to this issue? >> senator, i would answer from our side as the exporter. i think it's an excellent question. our best estimate is on chilled shipments, it will take at least a month to get back into a normal flow when we can get those products moving through to the high value markets in japan and korea. at least a month. if you move over to the frozen side, the products that we would send to japan, korea china mideast, all around the globe,

our best estimate is three to four months before we're back to a normal flow. we've moved through the backlog of goods that we have. and that number continues to increase every day. >> senator thune, from our perspective at the railroad, we certainly stand ready to be able to help the backlog, but what i would say is because of the challenges we've faced with not being able to move freight, we have had to store locomotives and equipment across our network. so there will be some period of time that it will take for us to be able to go and get those assets, reposition them to the port be able to be in position to handle that. but what i would tell you is we are anxiously awaiting the ability to do that and we will be able to do that. we have a unique opportunity, as i mentioned earlier before you stepped in, in that chinese new year is coming, and when chinese new year hits we will see less vessels that would be headed toward the west coast.

it would give us an opportunity if there were a speedy resolution to this current ilwu negotiations to use that time to work off the backlog that reiterate, madam chair and again thank you for having this hearing, that this is not something that's confined to the west coast. this is has a ripple effect throughout our entire economy. having a efficient transportation system is really one of the keys to our advantage, our competitive advantage in the global economy. and so when you see this kind of thing happen and recognize the impacts that it has, i would just, again, encourage all the parties to create a new sense of urgency and build some intensity behind coming to a resolution. we just can't continue to keep this going on and not expect that it's going to have some very, very detrimental and adverse impacts on a whole range of sectors of our economy and all jobs that go with it.

so madam chair, thank you. and thank the panel for your great testimony today. >> thank you, chairman thune. >> thank you, senator fischer for holding this hearing and you and senator blumenthal for drawing attention to this issue. i know a lot of questions have already been asked on the dr. kemmsies in your written testimony you mention that the underinvestment in the mississippi ports, the inland ports, indicates that we've been more import oriented than export oriented, which is expand for a few minutes on the significance of the inland ports, particularly with the panama canal development and agriculture opportunities and trade as well as manufacturing. >> most of the growth in trade was on the import side and when we look at the various vegmentsegments of the freight movement in the u.s. the larger projects that

were done by rail by highway and at the port level they were focused on being able to handle the imports more efficiently. a lot of the dredging, for instance, is not really done because we were trying to export more goods. our goods are very heavy. they require deeper draft vessels. but the motivation, when you read the economic analysis, or the cost/benefit analysis was essentially focused on the import side. maybe you can look at it from that side to say well this is an impore bias in our investments. but if we look at the projects or where we haven't had funding for infrastructure, you get the same message. and that's what i meant in the testimony about the mississippi waterway. we have seen a chronic and consistent underfunding and we've seen a deterioration of the infrastructure there. >> i think from the locks to the ports themselves, and you know,

the obviously i'd be very focused on the mississippi river, because of where i live and where i've grown up and where we are today. but you know the inland ports also serve the geographic area logically twice as big as the coastal ports. because you serve a geographic area of both ways. and i hope we could begin to focus more on those ports. the other question i have, chairman, for miss farmer i think you all have been trying to in sf for a long time to do a california project, the california international gateway, permitting delays have been a big problem there. i'm working on some legislation now to try to streamline permitting for railroad projects. do you want to talk about the kind of problems you've had trying to serve that market in a better way? >> absolutely. southern california international gateway would be as i mentioned the greenest

facility in the world when built. we've been working for a decade to try to do this. we face local opposition, and what i would say is that that is indicative of projects that we see across our network. so it's not just southern california international gateway project. we really are in favor of permitting reform. and i know, and i appreciate your leadership in this area. as i spoke to you earlier, we really believe that extending the environmental review position of map 21 to the railroads would be a great first step. we believe that it's important to shorten the time frames. we know that we're not trying to eliminate the review process. we're just asking that there be a reasonable time. we need to shorten the time frame that the agencies could possibly look at the things concurrently, as opposed to sequentially. it's just important for us that we are able to move forward the projects that will add capacity to the supply chain. >> may i make a comment on that? we're the program managers for

the jasper ocean terminal on the savannah river. and in the report that we gave the board last year, we pointed out that if we were to start the application process then, it would be 13 years before the port could be actually you know, turnkey operational. and then we have to justify this on the basis of analysis. so i had the unfortunate position of having to forecast what volumes will go through a port that doesn't exist in 13 years. so i think this is an example of how far the process has basically gotten off kilter. >> either of the other two of you want to comment on that topic? >> i would, senator, thank you. what's interesting about this discussion about freight movement and the problems that we have in this country, it's all about choke points. whether it be a problem at the ports. whether it be congestion on the highways. whether it be at great closing for a rail crossing.

whether it be an extended period of time to get permitted for a project. those are all choke points. and what's unfortunate about that is america has a distinct and very unique advantage in this global marketplace. to think that our transportation system is one of the primary reasons we're being held back both on imports, but more importantly on exports, it's really, it's almost criminal. it's a shame. i think there is a lot that we can do better to help with that situation. >> thank you. thank you, chairman. >> thank you senator blount. any other questions from the senators? with that, i would say this hearing record will remain open for two weeks and during this time, senators are asked to submit any questions for the record. the witnesses are requested to submit their written answers to the committee as soon as possible. with that, i conclude the hearing.

i thank the witnesses for just a great response and hearing the information that you provided us here today. thank you so much. the hearing is closed.

keep track of the republican-led congress. and follow its new members through its first session. new congress best access, on c-span p c-span2. c-span radio and c-span.org. the c-span cities tour takes book tv and american history tv on the road. traveling to u.s. cities to learn about their history and literary life. next weekend we partnered with comcast for a visit to galveston, texas.

>> with the opening of the suez canal in 1869 sailing ships really were almost dealt a death blow. with that opening of the canal coal fired ships had a shorter route to the far east, to india, to all of those markets so sailing ships really needed to find a way to make their own living. so they instead of high value cargo, they started carrying lower value cargo. coal, oil cotton et cetera, so she really found her niche in carrying any kind of cargo that did not require getting to market at a very fast pace. ellisa's connection to galveston is really unique. she sailed and arrived here in galveston probably about 100 yards from where we're standing right now back in 1883 with a cargo full of bananas.

and she came again a second time later on in the 1880s, 1986, and it was real important for galveston historical foundation to find a vessel that had a connection. and the fact that she was a sailing vessel was all the more important. >> watch all of our events from galveston, saturday, march 7th, at noon eastern on c-span2's book tv and sunday march 8th at 2:00 p.m. on american history tv on c-span3. and taking live here to the senate banking committee. just seated before the committee, the chair of the federal reserve janet yellen. she'll be taking a look at the semiannual monetary policy report from the federal reserve. senator richard shelby chairing the committee. sherrod brown is the ranking member and before miss yellen's testimony the committee will be taking a few minutes to mark up legislation to award a gold medal to the marchers affected by bloody sunday in the selma