MAP-21: Re-Authorization and the Effects on Transportation Logistics

Guest Post By Rico Fleshman, Corporate and Strategic Manager for Transportation, Logistics and Supply Chain at American Public University

The first federal, multi-year transportation bill enacted since 2005, Moving Ahead for Progress in the 21^st Century (MAP-21), was signed into law in July 2012. The bill funded surface transportation programs for FY-13 and FY-14 at just over $105 billion and transformed the national transportation investment framework to allow for increased growth and development of the country’s transportation infrastructure. Or so it would seem.

MAP-21 has been wrought with scrutiny and detractors since being enacted and has been deemed by some as little more than a stop-gap measure by a Congress that has been hard pressed to agree on anything.  But while there are critics of the legislation, there are also proponents from the transportation industry who see the improvements, requirements, consolidations, and assumed efficacy of the first iteration as critical building blocks to an opportunity to create long-term visions for funding infrastructure improvements, national transportation safety, and mobility, freight movement and to bring solvency to the Highway Trust Fund (HTF). MAP-21 is set to expire September 30 of this year unless extended by Congressional action.

So what does all of this mean for transportation logistics--freight forwarders, 3PLs, warehouse providers, ports, rail, etc? In short, a great deal. With U.S. freight traffic and transit usage  rising to record levels and growth expected to continue well past 2030, MAP-21 provides the framework for regulations and funding for programs that impact all transportation providers, from small private truck operators all the way up to global corporations.

In a four part series, I will examine those critical elements MAP-21 that have had and will have the greatest impact to the transportation logistics industry and look at factors in the industry which have driven the creation and enforcement of that policy. Specifically, I will take an in depth look at the impacts of a two year bill instead of a four or five year bill.

MAP-21 predecessors, including the Intermodal Surface Transportation Efficiency Act (ISTEA, 1991-1997), Transportation Equity Act for the 21^st Century (TEA-21, 1998-2003), and the Safe, Accountable, Flexible, Efficient Transportation Equity Act (SAFETEA-LU, 2005-2009) were all multiple year bills. Does having a two year bill create uncertainty in the transportation logistics market for providers who need to hire and train their workforce? Invest in technology? Plan and fund long-term projects? Ship globally through U.S. Ports?

MAP-21 consolidated the number of federal transportation programs in an attempt to focus resources and hedge duplicative programs. The result was the creation of new core programs, such as the National Freight Network Program (NFNP) and additional responsibilities and funding for existing core programs such as the Highway Safety Improvement Program (HSIP). I will look at the NFNP’s ability to establish processes that will effectively empower states to improve the movement of freight on highways and intermodal connectors to assist companies in the transport of their goods.

I will also look at the impact of the Federal Motor Carrier Safety Administration’s (FMCSA) enactment of 17 statutory requirements for freight movers, including the “hours of service” rule, the increased broker bond, and the forthcoming recommendations on rail car design and construction standards and the implications for rail companies who transport hazardous materials.

Finally, I will look at the HTF. The HTF is funded in part through taxes on gasoline, truck and trailer sales, heavy vehicle use, and heavy truck tires.  The proceeds are used to pay for highway improvements, highways and motorcarrier safety, and intermodal and transit programs. The HTF has been over-spending for years, has had several infusions of billions of dollars from the General Fund. The Congressional Budget Office (CBO) projects that, at current levels of spending and without reform, the Highway Trust fund will reach a shortfall by mid-2015.

Paul Ryan (R-WI) has proposed a budget that aligns HTF spending with incoming revenue and proposes innovative financing solutions for transportation infrastructure and safety programs.  Proponents of HTF reform have urged the House Transportation and Infrastructure Committee, which is responsible for re-authorization of the nation’s transportation bill, to consider a range of reform options including raising and indexing the gas tax.  

The policies set forth by lawmakers have an indelible impact on our transportation systems. It is no small task and is done with paramount concern for the public safety and in the interest of transportation related commercial, private, and public entities that need to move people and freight around the nation. In my next post, I will explore how the term of a bill impacts the ability of transportation logistics to do just that.    

ABOUT THE AUTHOR

Rico Fleshman is the Corporate and Strategic Manager: Transportation, Logistics and Supply Chain for American Public University. He has worked with numerous transportation associations and has extensive knowledge of federal and state transportation policy, funding, metropolitan planning processes and regulatory compliance of transportation programs.  

Hazmat Situations and Deployments Map Is Excellent Tool for Logistics Professionals

Guest Post By Dr. Robert Gordon, faculty member at American Public University

The North American Hazmat Situations and Deployments Map is a free public service website provided by GlobalIncidentMap.com. It provides worldwide hazardous incident information, making it an excellent research tool for forward and reverse logistics professionals and an outstanding source for historical incident information for lessons learned. Started as a repository for information related to hazardous incidents, it now encompasses a growing number of potential threats or issues. 

Information beyond hazardous incidents is included, such as news, Amber Alerts, forest fires, disease outbreaks, gang activity, border security, presidential threats, earthquakes, drug interdiction, aviation (non-terror), food and medicine, and human trafficking incidents. The website also provides safety, security, and threat monitoring with location information being listed for each incident. 

However, some sections of the website are not free. The sections with more sensitive information are only available to pre-screened individuals who complete an application and pay a fee. 

The public information provided is robust and should be consulted by anyone in the business of logistics.  One should have this resource available when considering the transportation of hazardous materials to help with trip planning, researching spill response, and investigating lessons learned about the transport of dangerous goods.

About the Author

Dr. Robert Lee Gordon is currently an associate professor with American Public University System in its Reverse Logistics Management program. He has published four books, three regarding project management and one regarding reverse logistics in addition to dozens of articles. Dr. Gordon curates a reverse logistics topic at http://www.scoop.it/t/reverse-logistics-by-robert-gordon2.

Military applications in reverse logistics

Guest Post By Dr. Oliver Hedgepeth, Program Director, Government Contracts and Acquisition at American Public University

Many people have told me that the military has no group in place to conduct reverse logistics operations. But the fact is that the military has been practicing reverse logistics since day one. Currently, the military has the largest reverse logistics operations in history.

The problem of understanding the concept of military use has to do with one small part of the definition of reverse logistics. In the civilian world, reverse logistics can be considered as a customer returning a product to a retail store, with the idea that the broken product will be sent back through the supply chain and through a series of warehouses until it arrives at the place where it was manufactured. That’s a good story. However, that is not the complete story of reverse logistics. 

Starting a few years ago, military logisticians became the leaders in the biggest reverse logistics operation in history. They are poised to return thousands of containers and equipment from the Middle East back to the U.S. Those military logisticians are rethinking new ways to load and track and trace inventory as it returns–this is called reverse logistics.

The term reverses logistics is in the United States Army vocabulary as Army Regulation 711-7. It describes how items such as trucks or tanks, or any military equipment that is damaged or unserviceable, can have some value reclaimed from that item. That is what we do in reverse logistics – reclaim value.

Some military equipment can be returned in good shape to other military units or to National Guard units; some can be fixed and sold; some can be sold as is.

Besides fixing or returning military equipment, there is an issue of transport. The return process requires many ships and thousands of containers.

Tracking and tracing technology is a key part of the military effort to ship equipment back to the U.S.  It takes tracking and tracing technology to identify each item in the inventory of hundreds of millions of items. All of it must be inventoried, categorized, and tracked along a complex virtual and real road from the Middle East to a final destination.

All of this effort costs billions of dollars. Recent military budget uncertainty has impacted the military, including logistics operations. The military logistics community has explored ways to work smarter to get the job done.

It sounds simple, but it is not. This return of military equipment is perhaps the most complex system of reverse logistics operations in the world.

About the Author

Dr. Oliver Hedgepeth is the Program Director for Government Contracts and Acquisition.  Previously, he was a tenured Associate Professor of Logistics at the University of Alaska Anchorage.  His Ph.D. is in Engineering Management from Old Dominion University. His book, RFID Metrics, examines how we define problems such as reverse logistics.