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September  2016 
UMWA holds landmark annual meeting

The Upper Mississippi Waterway Association (UMWA) held its 90th annual meeting Thursday, just a few weeks before another American transportation icon marks its 90th.  But while the famous U.S. Route 66 has been replaced by superhighways, the river infrastructure that UMWA members (and others) depend on, hasn’t changed much since it was first built in the 1930s.  

UMWA was first incorporated before Congress included a 9-foot channel in the Rivers and Harbors Act of 1930, and before work was started on Lock and Dam 15 at Rock Island, (see picture below) which had been the most difficult stretch of the Upper Mississippi to navigate. 

But closures in the past few years for drought and/or high water and a couple of equipment malfunctions clearly show the importance of the system and the fragility that comes with age.  Just one small example from the August 2014 edition of Waterways newsletter shows that interruptions on the system, “Have widespread costs” and multiplied road salt prices and crunched many city budgets.

A more contemporary example of both the importance and weakness of the system occurred last week at Locks and Dam 52 on the Ohio River.  Three older wickets broke free and the Corps was scrambling to maintain pool and traffic.  After some emergency temporary measures, the lock remains open and more a more permanent fix will be made when the river goes down.  For a time the Corps was warning shippers to expect navigation to be stopped, “for intermittent or longer periods.”

So while UMWA looks back proudly on 90 years, its members continue to work hard to ensure that the vital Upper Mississippi River system has a future. 

There’s more about the Association’s early days in the Executive Director’s column in this newsletter.  There are archives at the Minnesota Historical Society and historian John Anfinson has a very interesting article in a past Historical Society publication about the “Secret History of the Earliest Locks and Dams” available online.

Above:  Work on Lock and Dam 15 at Rock Island, Ill., was well along when this picture was taken in the early 1930s.  Although there has been periodic maintenance, most of the original structure is still in place today.                      
(Photo from Putnam Museum, Davenport, Iowa.)

From the Executive Director...

UMWA: Ninety years and counting

This year as we celebrate 90 years of advocating for the construction, maintenance and reasoned expansion of the 9-foot navigation system, it seems appropriate to look back at our roots and to speculate on the future.
Since early times, when cargoes were carried by canoe, the Mississippi River has been a vital lifeline in the Midwest.  It took over 200 years for non-Natives to explore and map the Mississippi even as the river continued to foster the growth and expansion of the Upper Midwest and our young nation.  One of the first manifestations of this growth was a 1925 start-up in the Twin Cities of Minneapolis and St. Paul:  the Upper Mississippi Barge Line which built steamships and barges to operate on the yet-to-be developed river system.
As river commerce increased, local interests in 1927 sent letters to the nation’s capitol urging the improvement of Mississippi River navigation, which found support from Presidents Coolidge and later Hoover and Roosevelt, all visionary leaders at a time of economic turbulence and uncertainty.
One year later, in response to a request to establish a nine-foot channel project, the commander of the Rock Island Corps of Engineers determined that the project would not be cost effective.  Upon appeal in 1929, the Board of Engineers of the U.S. Army Corps of Engineers overruled the Rock Island decision and recommended a survey to determine the cost and feasibility of the project.  The job of converting the Upper Mississippi from a 6-foot to a 9-foot channel with locks from St. Paul to St. Louis was estimated to cost $1.35 billion in today’s dollars.  This study was followed in 1930 by the Rivers and Harbors Act which authorized and funded the 9-foot navigation project for the Upper Mississippi River.

Why 90th  vs 84th?
In 1932, farsighted business leaders established the Upper Mississippi Waterway Association (UMWA) to support construction and to promote business for the 9-foot channel project n the Upper Mississippi Valley. For the eagle-eyed, if UMWA’s first annual dinner was held in 1932, today’s dinner would be its 84th, not 90th.  While no records are available to explain this discrepancy, annual business-dinners were apparently initiated in 1926 following the creation of the Mississippi Barge Line.
Readers of this Newsletter will remember C. C. Webber, who, in 1932 was president of Deere and Webber Company of Minneapolis, forerunner of the current Deere & Company, a world-wide maker of Ag, Turf and Farm products.  With the U.S. in the throes of a major depression Webber argued that transportation is key to alleviating the widespread destitution and unemployment rampant in both farming and manufacturing.  Transportation, he said “is so closely interwoven in the modern process of production and distribution that it affects every article of commerce”.  In fact, he said, [freight] rates measure and circumscribe the trading area – the market of the producer.  Any barrier placed in transportation channels, such as excessively high freight rates, limit or destroy the opportunities for an exchange of commodities between producers and consumers.
Agriculture needs the river
In a 1932 radio address, Webber stated that in the U.S. and particularly in the Midwest, agriculture is the principal and basic industry that impacts the prosperity of other group.  The farmers, as a class, are the biggest shipper in the world and pays freight on his product for a longer distance than any other shipper.  Further, said Webber, as a rule the producer has no control over his selling price, either foreign or domestic as any cost related to transportation is deducted from his selling price.  Yet, industry and commerce in agricultural states are dependent for their markets on the purchasing power of farmers. 
To add to this dilemma, the upper Midwest is landlocked:  as the distance from Fargo, for example, is over 1,500 miles to the Atlantic Ocean, to the Pacific Ocean, to Hudson Bay and the Gulf of Mexico.  Then, as now, Ag products to be of any value, must reach the consumer and the centers of consumption whether domestic or international. 
Disaster, said Webber, has only been averted in the past because cheaper water transportation is available to foreign markets.  He then describe a recent hearing before the Interstate Commerce Commission where it was shown that a movement of bushel of wheat from a farm in Montana on its way to Liverpool, England pays 7.69 mills per ton-mile for the rail haul, while the ocean operator carried the same bushel to final destination at 0.78 mills per ton-mile including all transfer and terminal charges, or about one-tenth of the rail cost.  In other words, the material savings due to the low cost of water transportation enables the railroads to handle this tonnage in spite of their higher rates.
Montana to Liverpool
And, as if with a nod to the 1932 Montana to Liverpool movement, the Special Board of Engineers, in their report upon which Congress adopted the Upper Mississippi nine-foot channel project, estimated that 4.5 million tons of grain will move annually upon an improved upper Mississippi River, at a transportation cost savings of $62.8 million expressed in today’s dollars.
Webber had a similar situation in moving Ag implements from Iowa to Pacific Coast points while meeting his Atlantic seaboard competition.  Due to a high rail rate between Iowa and the Pacific Coast, Webber found he could be competitive only if he shipped his commodities back to the Atlantic seaboard, and then transport them by vessel through the Panama Canal to San Francisco or other west coast destinations.  While not fully competitive the round-about route via the Atlantic seaboard was still some 31 percent less than the direct all-rail rate.
With the inauguration of barge service on the Upper Mississippi River, Webber could ship via barge to NOLA and then by ship to the Pacific Coast and beat the all-rail rate from Iowa to California.  Industries in Iowa could now compete with Atlantic seaboard shippers, as they now have a barge-vessel rate some 45 percent less than any rail route.
Environmentally friendly
Now, as then, barge transportation allows bulk, fungible commodities to be moved a greater distance in a more economical and environmentally-friendly manner than either rail or truck.  For example, for a projected 15 billion bushel national corn crop (USDA estimate for 2016) a one cent per bushel savings via barge saves producers $150 million in shipping costs, which adds to their purchasing power.  This same increase in purchasing power applies to barge shipments of sand/gravel, coal, fertilizer, recycled metal and other commodities. 
While water transport is only one leg of a three-legged intermodal movement common to many commodities, it is the capstone which allows domestically produced products to remain competitive in the global marketplace.  And, as Webber noted, it is the material savings due to the low cost of water transport that enables railroads to handle intermodal tonnage in spite of rail’s higher rates.  In other words, he said, without the aid of cheaper water transportation, farm [and other products] could not move in foreign commerce and rail tonnage and revenue would be correspondingly reduced.
As our tag-line states, Rivers:  Important Then, Important Now.  We think Mr. Webber would agree with that.

WRDA passes Senate

WRDA 2016 passed the U.S. Senate last week, and there is some hope that House members may get to vote before lawmakers leave Washington to campaign.  Rep. Bill Shuster (R-PA) says he hopes to get the House version to the floor this week.  Because they vary, the two bills would likely go to a conference committee.

Other Items of Interest...

* Among the information available at last week’s UMWA Annual Meeting was a new UMWA brochure that explains the organization and its support for, “An environmentally friendly economic lifeline.“  This full-color brochure is intended for people who want to know more about the industry and its importance to the economy and environment.

* Iowa Department of Transportation has released an updated freight plan for that state.  The Iowa Transportation Plan 2016, talks about why, “Iowa’s central geographic location and abundance of transportation options make it a major player in the global marketplace.”  Authors go on to say, “The transport of goods and services is the backbone of the economy and investments in basic infrastructure components such as airports, highways, pipelines, railroads, and waterways secure and strengthen the economic vitality of the state.”

* More container-on-barge projects supported by the U.S. Maritime Administration were announced last week at the annual gathering of mayors at the Mississippi River Cities and Towns Initiative.   Mayor Belinda Constant, of Gretna, Louisiana and MRCTI cochair said in a statement, “Returning container movement to the waterway has been a priority of our association. Waterways and ports in my state support over 280,000 jobs and contribute $47.7 billion to Louisiana’s economy.”  New projects will be in the Ports of New Orleans, Memphis, Baton Rouge, and the St. Louis area.

* They’re not used for navigation anymore, but a congressional leader and a conservancy group are looking into ways to keep locks and dams on the Barren and Green Rivers operating because they are important to recreational boaters and people who enjoy fishing.  One of the dams is vital to an entire county’s water supply.  There are several entities interested in taking over the structures and adjoining property.

* During the National Park Service 100th anniversary celebration, the Mississippi River National River and Recreation Area (MNRRA),  has published an Historic Resources Study of the area covered by the National Park running through the Twin Cities.  It’s available for reading and download.

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