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WEST KENTUCKY ALLIANCE FOR A VIBRANT ECONOMY 2018 WAVE CONFLUENCE

REMARKS AS PREPARED

MARK H. BUZBY
MARITIME ADMINISTRATOR

WEST KENTUCKY ALLIANCE FOR A VIBRANT ECONOMY
2018 WAVE CONFLUENCE

CARLISLE COUNTY COOPERATIVE EXTENSION SERVICE OFFICE
65 JOHN ROBERTS DRIVE
BARDWELL, KY

JULY 19, 2018
2:00-2:30PM

Thank you __________________ and good afternoon everyone. It’s a great to be in Kentucky and not in Washington!

I really appreciate the invitation to join you for the second of these very important gatherings of legislators and leaders in the economy of western Kentucky as you rightfully talk about the future of this region.    I think that you can correctly read the importance that we at the maritime administration place on this conference, since my predecessor Chip Jaenichen attended your first WAVE, and now here I am at this year’s installment.

We are paying attention – and getting the attention of Washington is a victory all in itself, so well done.

Speaking of Washington, secretary of transportation, Elaine L. Chao asked me to share her personal greetings with you all.  When I reminded her at our morning meeting yesterday that I was headed here today, she immediately smiled and said to please say hi to all of you.
It is a pleasure to serve as her Maritime Administrator because she is a true champion of the maritime industry.

She is very well acquainted with the dominant role of rivers and waterways to the commonwealth of Kentucky, and its proximity at the confluence of the Mississippi and Ohio rivers.
So therefore, what interests my boss, truely fascinates me!

Hearing what’s taking place in your economic development partnership, i am greatly encouraged by the maritime leadership, expertise and assets you are cultivating and leveraging for the good of the commonwealth of Kentucky, and the states of Illinois, Missouri and Tennessee.

with the state’s more than 1900 miles of designated navigable waterways, Kentucky is genuinely a national maritime ‘center of gravity’ embodying the unrealized potential of our inland rivers and waterways.

What you are doing here in Kentucky is a great model for other states to emulate of the maritime industry’s importance to our nation as a freight and transportation resource.

We’ve all seen the statistics: coming decades will see a dramatic increase in the need for maritime transportation in the U.S.– and the region represented by “WAVE” is poised to play a major role.
I am talking about U.S. domestic and international freight flows expected to rise 45 percent in the next 30 years… and a population projected to grow by nearly 70[i] million over that same period of time.  That means we are going to be moving a lot more stuff!

This alliance is perfectly situated to take advantage of a host of natural and man-made assets and infrastructure.

I see the region’s close proximity to major U.S. population centers — St. Louis, Memphis, Nashville and Evansville, among others –and the fact that 67% of the nation’s population lives within eight hours of this four-county area of southwestern Kentucky.[ii]

Location, location, location – you’ve got it!
Nationally, we have no alternative but to develop, grow, and modernize our ports and inland waterways for our economic health and security.   With land traffic choking our roads and highways, we must find better ways of transporting cargo cheaper and more efficiently.

It seems obvious to me that the natural place to expand, to take advantage of the additional untapped capacity is – maritime.

As an industry we need to follow “WAVE’s” example – assembling leadership and expertise from a multi-state region to work creatively and collaboratively to get us ready.   As you know, we have a big job before us.

We will need to grow revenues and reinvest back into our maritime infrastructure, and then recruit, train and retain talent both shore side and on the water.

Let’s put it in perspective. By 2022, four years from now, the transportation employment sector is projected to add 417,000 jobs simply through industry growth. And another 4.2 million vacancies will need to be filled due to retirement, occupational transfers, and exits of various sorts. [iii]
these statistics get my attention in a big way because part of my statutory mission is to ensure the proper manning and training of a maritime workforce for our us flag merchant marine.

Our piece of the manning shortfall is already being felt:  I’ve already reported to congress that I am 1800 mariners short to sustain a prolonged sealift effort.  Everyone I talk to in the industry tells me the same thing: they are looking for people.

So when I look at “WAVE’s” efforts to provide workforce opportunities for their communities, i see a need and opportunity born from some real pain.

With the disappearance of the manufacturing economy in the last half of the 20th century, this region has taken some big hits – I know you know that all too well.

The recent closing of the West Vaco/Verso paper mill, i understand, cost western Kentucky 390 jobs alone.[iv] what do you replace those with?

Legitimate 21st century economic opportunities for younger workers across the region are at a premium. But look at your incredible assets!   Maritime, in my estimation, has by far the most promise.

Of the top 20 maritime occupations, 87% of future job openings will be in operations, including vessel pilots, material moving workers, crane operators, first-line supervisors.[v]

these high-demand occupations pay well, and have relatively low thresholds for workers entering those sectors. Those opportunities will be well-served by a region that boasts a highly-ranked public school system,[vi] along with excellent educational opportunities at nearby Murray State university and the Western Kentucky Community and Technical College.

Combined with some excellent vocational and technical programs supported by the local community, what you have is a fertile training ground for river-related industries.
I think “WAVE” could lead the charge with thoughtful region-wide coordination and planning– helping to develop a skilled workforce that could mesh beautifully with new maritime opportunities.

The ingredients for a significant maritime resurgence in southwestern Kentucky are apparent, so keep up the good work!

In ten years who knows what can be accomplished for your communities, for future generations, working together, developing your workforce, building upon the region’s abundant maritime assets.

As for me, my life has almost always been about the sea, rivers and waterways, ships and the mariners who sail them.

And if my life has taught me anything – it’s that this nation’s maritime power and prowess is fundamental to our greatness as a nation.

A greatness that has always been grounded in innovation, education, a highly skilled workforce, and visionary, intelligent leadership like I think you have assembled here today.

The progress that made us the most powerful nation on earth depends on staying ahead of the curve in research, development, technology and innovation in the industries native to our local, regional and national economies.

At MARAD we’re focused on supporting your efforts. We recently signed on to a special charter to create what we’re calling a “Highly Automated and Autonomous Vessel Coordination and Action Team (A/VCAT).”

It’s based on the fact that maritime companies in both Europe and Asia are rapidly developing autonomous vessel technologies that could cut deeply into our commercial shipping market.
Our “A/VCAT” team will monitor and collect data and information on both foreign and domestic development and implementation of autonomous technologies.

It will also act as a clearing house for that information and promote inclusion of autonomous technology curricula in U.S. engineering, educational, and maritime institutions.

These are advances that will provide new job opportunities, but will also require new education and training protocols.

MARAD has also entered into a U.S. autonomous vessels consortium agreement with the American Bureau of Shipping (“ABS”) to promote the design, construction, operation and maintenance of autonomous vessels.

Both initiatives will be comprised of key stakeholder groups, including vessel owners/operators, shipyards, OEM’s, ports, regulatory authorities and industry trade associations, to name but a few.  Many in this room today may have an opportunity to participate in how this new frontier manifests in our industry.

We strongly believe that our nation needs the right kind of ports, of the right size, in the right places – with the appropriate advanced technology and infrastructure to compete in domestic and global markets.

To assist, the U.S. Department of Transportation recently released notice of funding opportunity for the FY 2018 Better Utilizing Investment to Leverage Development, or “BUILD transportation discretionary grants,” program.  Formerly, this was known as the Tiger Grant Program.

Funds are to be awarded on a competitive basis for projects that will have a significant local or regional impact. For this round of BUILD grants, the maximum award amount is $25 million, and no more than $150 million can be awarded to a single state.

The $1.5 billion in available funds is three (3) times the historical average.

As the application window closes today, we hope and expect to see an increase in significant project submissions from our stakeholders.

Our marine highway program is another resource.   Right here in Kentucky, with the recent designation of a container on barge project sponsored by Paducah, we are seeing tremendous interest in, and growth of, container movement on the inland waterway system.  This needs to happen.

Our portfolio of resources is abundant. I encourage you to collaborate with our director of inland waterways, Branden Criman, to maximize every opportunity.

She, and the supporting cast back at MARAD HQ are there to help you take full advantage of our funding and assistance programs, and we look forward to working with you all.

So keep up the great work you are doing, it is so necessary to the future of our nation.

Thank you, and if we have time, I’m available to answer a few questions.

1;Beyond Traffic 2045 Report; pg. 4

2;WAVE Phase One Strategic Plan; pg 12; Nov. 7 2016

3;Strengthening Skills Training and Career Pathways Across the Transportation Industry – August 2015 – US Departments of Transportation, Labor and Education – P. 17
4;Released in a statement from the office of Gov. Matt Bevin – 5 April 2016
5;Strengthening Skills Training and Career Pathways Across the Transportation Industry – August 2015 – US Departments of Transportation, Labor and Education – P. 76
6;WAVE: Phase One Strategic Plan – Page 12 – 7 November 2016

Updated: Monday, November 19, 2018