Upper Mississippi River - Illinois Waterway Navigation Expansion: An Agricultural Transportation and Environmental Context

Upper Mississippi River - Illinois Waterway Navigation Expansion: An Agricultural Transportation and Environmental Context

Order Code RL32470
CRS Report for Congress
Received through the CRS Web
Upper Mississippi River - Illinois Waterway
Navigation Expansion: An Agricultural
Transportation and Environmental Context
July 15, 2004
Randy Schnepf, Coordinator
Specialist in Agricultural Policy
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

Upper Mississippi River - Illinois Waterway
Navigation Expansion: An Agricultural Transportation
and Environmental Context
Summary
The Upper Mississippi River-Illinois Waterway (UMR-IWW) navigation system
provides a vital export outlet for the agricultural bounty of the upper midwestern
states of Minnesota, Iowa, Wisconsin, Illinois, and Missouri. The waterway is also
a vital means for shipping other bulk commodities important to the regional
economy. Commercial navigability on the UMR-IWW is dependent on a system of
locks and dams built, maintained, and operated by the U.S. Army Corps of Engineers.
Commercial users of the UMR-IWW navigation system — primarily shippers
and agricultural producers — claim that, since the 1980s, the UMR-IWW has been
beset by increasing traffic congestion and delays related to its aging infrastructure and
limited lock capacity. These groups advocate that the federal government should
invest in major modernization and lock expansion on the UMR-IWW’s navigation
system. They argue that the economies of the UMR-IWW basin states, as well as
U.S. export competitiveness, depend on navigation system improvements.
In contrast, budget watchdogs, environmentalists, and other interest groups
argue that improving navigation must not needlessly damage river ecology; less
expensive alternatives should first be fully exploited, and major spending on UMR-
IWW improvements is not fully justified on economic grounds. Advocates of
alternate transportation modes, particularly rail, question further federal support for
barge transportation to the detriment of rail and truck transportation. Furthermore,
considerable uncertainty surrounds projections of future barge demand and
contributes to concern about the economic viability of large investments.
In 1993, the Corps began a multiyear feasibility study (called the Navigation
Study) to assess navigation efficiency improvements for the UMR-IWW system over
a 50-year planning horizon. Following a review of the Corps’ draft feasibility study
by the National Research Council (sparked by controversy over the economic
justification for lock expansion), the economic analysis was reformulated, and the
Navigation Study was restructured to include ecosystem restoration.
In April 2004, the Corps announced its preliminary recommendation for
integrated investments in navigation and ecosystem restoration. The Corps’
recommended navigation improvements are estimated at $2.4 billion; they would be
funded 50% from federal general revenues and 50% from the Inland Waterways
Trust Fund. The plan includes building seven new 1,200 ft. locks and possibly five
lock extensions, as well as implementing helper boats and moorings while new locks
are designed and constructed. The Corps also recommended a $5.3 billion, 50-year
ecosystem restoration plan — approximately $4.25 billion federal and $1.05 billion
nonfederal. For current status of UMR-IWW authorization, see CRS Issue Brief
IB10133, Water Resources Development Act (WRDA): Army Corps of Engineers
Authorization Issues in the 109th Congress, coordinated by Nicole T. Carter.
This report is unlikely to be updated.

Key Staff
CRS
Area of Expertise
Name
Division
Telephone
U.S. Army Corps of Engineers
Nicole Carter
RSI
7-0854
Transportation
John Frittelli
RSI
7-7033
Ecosystem restoration
Kyna Powers
RSI
7-6881
Agricultural markets and trade
Randy Schnepf
RSI
7-4277
RSI = Resources, Science, and Industry Division.

Contents
Purpose of this Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
I. Background on Debate Over Expanding UMR-IWW Navigation Capacity . . . 2
System of Locks and Dams . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Infrastructure Reliability Concerns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
II. Authorization of UMR-IWW Investments: Issues Before Congress . . . . . . . . 8
Corps’ Recommended Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Competing Views on Large-Scale Navigation Investments . . . . . . . . . . . . 10
III. Freight Traffic on the UMR-IWW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Agricultural Commodities Constitute Majority of Traffic . . . . . . . . . . . . . . 15
Variations in Traffic by River Reach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
IV. Outlook for Agriculture-Related Barge Demand . . . . . . . . . . . . . . . . . . . . . 21
Corps’ Long-Run Outlook Questioned . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Two Questions Underlie the Outlook for Barge Demand . . . . . . . . . . . . . . 22
V. Transport System Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Why Transportation Costs Matter to Agriculture . . . . . . . . . . . . . . . . . . . . 27
Modal Shifts in Grain Transport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Environmental and Social Impacts of Travel by Mode . . . . . . . . . . . . . . . . 34
VI. Environmental Impacts of Barge Navigation . . . . . . . . . . . . . . . . . . . . . . . . 37
UMR-IWW Ecosystem and its Decline . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Environmental Impacts of Expanding UMR-IWW Capacity . . . . . . . . . . . 39
Environmental Impacts of Ongoing Navigation Operations . . . . . . . . . . . . 40
Ecosystem Restoration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
VII. For More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
General Information on the Corps and the UMR-IWW . . . . . . . . . . . . . . . . 43
Navigation and Economic Studies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Proponents for Major Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Critics of Current Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Appendix A: UMR-IWW Description . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Appendix B: Early History of Corps Involvement in UMR-IWW . . . . . . . . . . . 50

List of Figures
Figure 1. Upper Mississippi River - Illinois Waterway Navigation System . . . . . 3
Figure 2. UMR Freight by Lock, 2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Figure 3. IWW Freight by Lock, 2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Figure 4. UMR-IWW Navigation System Freight Traffic, by Major Category . 14
Figure 5. Upper Mississippi River Freight Traffic by River Reaches . . . . . . . . . 17
Figure 6. U.S. Domestic and Export Demand for Corn,
Historical and Projected . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Figure 7. U.S. Domestic and Export Demand for Soybeans,
Historical and Projected . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Figure 8. Trade Route Alternatives to UMR-IWW out of Upper Midwest . . . . . 23
Figure 9. Traditional Flow of Grain for Export . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Figure 10. U.S. Grain Modal Shares, 1978-1995 . . . . . . . . . . . . . . . . . . . . . . . . . 32
Figure 11. Upper Mississippi River and Illinois Waterway Floodplain . . . . . . . 49
List of Tables
Table 1. Average Cumulative Lock Delays, 1990 to 2001 . . . . . . . . . . . . . . . . . . 6
Table 2. UMR-IWW Five-State Region: Corn, Soybean, and Wheat Production
and Trade, Annual Average for 1998-2002 . . . . . . . . . . . . . . . . . . . . . . . . . 16
Table 3. Average Annual Growth in Freight Traffic for UMR-IWW Reaches:
1945-1983 Compared with 1983-2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Table 4. Comparisons of UMR-IWW Average Annual Agricultural Freight
Export Growth Rate Projections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Table A1. Physical Characteristics of Illinois Waterway Locks . . . . . . . . . . . . . 47
Table A2. Physical Characteristics of Upper Mississippi Locks . . . . . . . . . . . . . 48
Table A3. Timetable of Navigation Development Activities on
Upper Mississippi River and Illinois Waterway . . . . . . . . . . . . . . . . . . . . . 51
Table A4. Upper Mississippi River - Illinois Waterway Freight by Category,
Volume and Share, 1990 to 2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

Upper Mississippi River - Illinois Waterway
Navigation Expansion: An Agricultural
Transportation and Environmental Decision
Purpose of this Report
This report is intended as an aid to congressional staff new to discussions about
the Upper Mississippi River - Illinois Waterway (UMR-IWW) navigation system and
proposals for its improvement. In six sections, this report describes the major
infrastructure and environmental issues associated with the UMR-IWW, reviews
proposals by the U.S. Army Corps of Engineers to address these issues, evaluates the
uncertainty surrounding the benefit of improving the rivers’ navigation infrastructure,
and points out the views of various stakeholders.
The first section of this report briefly describes why the UMR-IWW is a
significant navigation system. It also discusses how disagreement over the extent and
nature of waterway congestion underlies much of the debate over whether the Corps
should undertake infrastructure investment to expand the capacity of some locks.
The second section briefly describes the decision-making process for the UMR-
IWW, along with the Corps’ proposal for a joint navigation and ecosystem
restoration project. It also presents views of various stakeholders.
The third section describes the nature of freight movements on the UMR-IWW
and how freight volume has varied over time and by river reach. Closely related to
the third section, the fourth section explains why future agricultural demand for
transportation on the UMR-IWW is important to investment decisions, but also an
important uncertainty. It discusses how changes in domestic and international
agricultural demand could cause the region’s agricultural goods to be shipped via
other transportation routes. Because these shifts in demand are difficult to forecast,
the net benefit to agriculture of improving the navigation infrastructure is unclear.
The fifth section of this report places the UMR-IWW’s barge transport in a
multi-modal system context. It discusses how federal lock-expansion projects could
affect rail and truck modes and how, in the absence of navigation improvements,
alternative modes might cope with additional traffic. It also compares the different
environmental and social effects of transportation by barge, rail, and truck.
The sixth section discusses how river management decisions on the UMR-IWW
affect the environment. It describes both the environmental impacts of expanding the
system’s navigation capacity and the cumulative effects of ongoing navigation
operations and the Corps’ proposal for ecosystem resotration.

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I. Background on Debate Over Expanding
UMR-IWW Navigation Capacity
System of Locks and Dams
The Upper Mississippi River-Illinois Waterway (UMR-IWW) system is a multi-
purpose river system that provides a variety of benefits to the communities and states
that lie within its basin, including low-cost commercial transportation, hydropower
production, recreation, wildlife habitat, floodplain management, and water supply for
a range of users.
The UMR-IWW navigation system extends from Minneapolis, MN, to the
mouth of the Ohio River. It contains nearly 1,200 miles of at least 9-foot deep
channels, 37 lock and dam locations (with 43 locks), and thousands of channel
training structures. (See Figure 1.) The UMR-IWW’s system of locks and dams
makes commercial traffic possible on the Mississippi River between Minneapolis and
St. Louis, and allows the upper midwestern states of Minnesota, Iowa, Wisconsin,
Illinois, and Missouri to tap into the potential benefits of low-cost barge
transportation. This system of locks and dams is operated and maintained by the U.S.
Army Corps of Engineers. The Corps is also responsible for maintaining a minimum
channel depth of not less than 9 feet and a minimum channel width of not less than
300 feet at low water, with additional widths in river bends. In recent years the
annual cost of lock and dam operations, dredging, maintenance, engineering, and
other costs has averaged about $115 million.1
Barge transportation is a low-cost method for long-distance transport of bulk
commodities such as grains and oilseeds, coal, petroleum, various ores, and primary
manufactured products. (See Appendix Table A4 and Section III, “Freight Traffic
on the UMR-IWW.”) From 1990 to 2002, more than 74.3 million metric tons (mmt)
of freight moved annually within the UMR-IWW (both upriver and downriver)
between Minneapolis and the mouth of the Missouri River.2 Most of this volume
(about 70%) traveled downriver to domestic processors located within the lower
Mississippi River system or to Gulf ports for export to international markets. Freight
volumes fall off sharply at lock locations further up the Mississippi. (See Figures
2 and 3.) The two locks furthest downriver, Locks 26 and 27, experience the largest
share of river freight.
1 U.S. Army Corps of Engineers, Rock Island District, Draft Integrated Feasibility Report
and Programmatic Environmental Impact Statement (April 29, 2004), p. ii. Hereafter
referred to as Corps Draft Feasibility Report and PEIS.
2 Corps, Waterborne Commerce of the United States. UMR-IWW data refers to freight
shipped on the Mississippi River above the mouth of the Missouri River, including the
Illinois River between Chicago and the Mississippi River. This region encompasses those
locks and dams presently under consideration by the Corps for modernization and/or
expansion to 1,200 ft. Freight shipped on the Mississippi River below St. Louis is not
included. Freight is presented in metric tons (one metric ton equals 1.1023 U.S. short tons)
to permit comparisons with international trade data.

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Figure 1. Upper Mississippi River - Illinois Waterway
Navigation System
Source: U.S. Army Corps of Engineers, Alternative Formulation Briefing Pre-Conference Report
(Feb. 9, 2004), p. 5.

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Figure 2. UMR Freight by Lock, 2001
80
70
60
50
40
30
20
10
0
L1
L5
L10
L15
L20
L25
Note: Appendix Table A2 has a list of corresponding UMR locks.
Source: Corps, Draft Feasibility Report and PEIS (April, 29 2004), p. 45.
Figure 3. IWW Freight by Lock, 2001
35
30
25
20
15
10
5
0
O'Brien
Brandon Rd Marseilles
Peoria
Note: Appendix Table A1 has a list of corresponding IWW locks.
Source: Corps, Draft Feasiblity Report and PEIS (April 29, 2004),
p. 45.

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Infrastructure Reliability Concerns
Aging Infrastructure. Most of the locks and dams within the UMR-IWW
navigation system were built by the Corps in the 1930s, with an initial projected life
span of about 50 years. Commercial shippers and Corps officials estimate that delays
due to the continuous degradation of the UMR-IWW system’s aging lock-and-dam
infrastructure have increased over the past 25 years. As a result, they argue that the
Corps has had to continually decrease allowable traffic passing through the locks.
Environmental and other groups contend that the Corps has spent over $900 million
on UMR-IWW rehabilitation projects since 1975, extending the productive life of
existing locks and dams for at least 30 years.3 For example, in 2001 the Corps
completed a major $25.9 million rehabilitation of the Lock and Dam 25.4
Lock Length Limits Capacity. Most of the locks in the UMR-IWW
navigation system were originally designed to accommodate 600-foot-long barge
tows. Twenty-six of the UMR’s 29 lock locations have chambers that are 600 feet
(ft.) in length. (See Appendix Tables A1 and A2 for lock details.) The upper and
lower St. Anthony Falls locks are 400 ft. and 500 ft., respectively. Three locks —
Lock 19, Lock 26 (renamed as the Melvin Price Lock and Dam), and Lock 27 — are
1,200 ft. in length. With a 1,200 ft. lock chamber, a 1,100 ft. barge tow can pass
through in about 45 minutes. In contrast, it generally takes between 90 and 120
minutes for an 1,100 ft. barge tow to pass through a 600 ft. lock due to the need to
double-lock the barge tow. Double-locking is a procedure whereby a barge tow is
broken into two sections; each is passed through the lock chamber separately; then
the two sections are rejoined before continuing.
Commercial users argue that, not only do barge tow backups tend to occur at the
600 ft. locks where extensive double-locking causes delays, but double-locking
increases the potential for work-related hazards associated with manipulating the
binding and guide ropes, etc., while in the narrow lock chamber.5 As a result, barge
companies and corn and soybean producer groups have lobbied actively for the
expansion of several of the lower locks. In contrast, budget watchdogs — such as the
National Taxpayers Union and Taxpayers for Common Sense — and environmental
groups have argued that inexpensive small-scale measures like traffic scheduling,
congestion tolls, helper boats, and moorings could reduce lockage times by 20
minutes or more; and that, unlike new or expanded locks that will take decades to
build, small-scale measures can be implemented right away at a fraction of the cost.6
3 Twice-Cooked Pork: The Upper Mississippi River-Illinois Waterway Navigation Study, a
report prepared by a coalition of interest groups in opposition to large-scale lock expansion;
available at [http://www.iatp.org/enviroag/]on June 28, 2004. Hereafter referred to as
Twice-Cooked Pork.
4 Ibid, p. 8.
5 American Soybean Association, Soybean Trade Expansion Program (STEP), Moving
America’s Harvest by Barge, available at [http://www.soygrowers.com/step/barge.htm] on
Feb. 11, 2004.
6 Twice-Cooked Pork, p. 3.

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Estimated Traffic Delays. The Corps reports that the UMR-IWW system
has over half (19 of 36) of the most delayed lock sites in the country’s system of
inland waterways.7 Existing delays vary based on the location in the system, but are
generally greatest at the locks furthest downstream. (See Table 1.) These delays
result from traffic backups due to congestion as well as closures for operation and
maintenance. From 1990 to 2001, the Corps estimated cumulative average delays
per tow of 48.5 hours (more than two days) on the UMR and 10.6 hours on the IWW.
For perspective, a barge trip between Minneapolis and St. Louis is estimated to take
about 11.4 days, on average, including delays.8 In effect, the estimated average
delays add about two days to what would otherwise be a nine-day trip. Completion
of the Corps’ recommended navigation improvements are not expected to completely
eliminate all delays since a portion of delays are attributable to variability in demand9
— more than one boat arriving at the same time results in delay, and the seasonality
of crop harvesting assures strong autumn demand. Corps data suggest that Locks 26
and 27 experience some of the largest delays despite having undergone fairly recent
renovation and having 1,200-ft. lock capacity. The Corps has not published an
estimate of the proportion of delays expected to be eliminated by proposed
investments.
Table 1. Average Cumulative Lock Delays, 1990 to 2001
Locks
Ave. Hours per Tow
Upper Mississippi River (UMR): cumulative total
48.5
Locks 1-7
3.9
Locks 8-13
5.2
Locks 14-18
10.8
Lock 19
0.9
Locks 20-25
17.0
Locks 26-27
10.8
Illinois Waterway (IWW): cumulative total
10.6
Peoria Lock
2.5
Lagrange Lock
1.3
Other 6 Locks
6.7
Source: Corps, Draft Feasibility Report and PEIS, pp. 52-54.
7 Corps, Draft Feasibility Report and PEIS, pp. 52.
8 Discussion with Richard Kreider of the Minneapolis-based barge shipper Cargo Carriers,
Apr. 16, 2004. According to Mr. Kreider, his firm estimates that a barge traveling either up
or down river between Minneapolis and St. Louis moves at an average speed of about 75
miles per day. Thus, a barge would average 11.4 days to make the 854 miles voyage.
9 David Ronen, Robert Nauss, and Matthew Doughty, Upper Mississippi River and Illinois
Waterways: How to Reduce Waiting Times of Vessels While Using the Current
Infrastructure, Univ. of Missouri-St. Louis, Center for Transportation Studies, Feb. 3, 2003.

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Commercial interests complain that existing delays are excessive and
significantly raise the cost of barge transportation on the UMR-IWW. Opponents of
lock expansion argue that building longer locks will result in only minor time and
cost savings for shippers — well below the cost of actually building the locks.10
10 Public Employees for Environmental Responsibility (PEER), PEER Looks at the
Numbers: Upper Mississippi and Illinois Waterway, June 7, 2004; available at
[http://www.peer.org/corps/] on July 2, 2004. Hereafter referred to as PEER Looks at the
Numbers.

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II. Authorization of UMR-IWW Investments:
Issues Before Congress11
This chapter briefly describes the Corps’ proposal for a joint navigation and
ecosystem restoration project, then focuses on the major details of the navigation
efficiency improvements component of the proposal. (The ecosystem restoration
plan is discussed in Section VI, “Ecosystem Restoration,” later in this report.) This
chapter also briefly reviews the decision-making process for authorizing large-scale
investments in UMR-IWW. Finally, it presents views of various stakeholders.
Corps’ Recommended Proposal
To inform the congressional decision on whether to authorize investments in
navigation improvements and ecosystem restoration activities on the UMR-IWW, the
Corps has been studying the long-run navigation needs of the UMR-IWW system
since 1993.12 Several supporting reports and analyses have been released as part of
the Corps’ Navigation Study concerning proposed infrastructure alternatives. The
Corps’ Navigation Study itself has been the subject of controversy. In 2001, in
response to criticism, the Corps reformulated its economic analysis and added
ecosystem restoration to the study.13
In April 2004, the Corps released a draft preferred investment alternative after
having analyzed multiple options for navigation and ecosystem restoration. The
Corps’ recommended 50-year plan integrates investments in both navigation
efficiency and ecosystem restoration. The navigation improvements component
would cost an estimated $2.4 billion, while the ecosystem restoration plan would cost
an estimated $5.3 billion. The Corps recommends that Congress authorize a first
increment of the navigation plan at $1.9 billion and a first increment of the ecosystem
restoration plan at $1.5 billion.
Authorization, if it occurs, may be part of a Water Resources Development Act
(WRDA),14 which is the typical legislative vehicle for authorizing Corps projects to
proceed with construction after a favorable feasibility study and Chief’s report.
Following authorization, the project would be contingent on Congress remaining
11 Prepared by Nicole Carter, Analyst in Environmental Policy, Resources, Science, and
Industry Division.
12 For more information see CRS Congressional Distribution Memorandum, UMR-IWW
Project History, by Kyna Powers, May 3, 2004.
13 The National Research Council (NRC) of the National Academies of Science (NRC,
Transportation Research Board, Inland Navigation System Planning: The Upper Mississippi
River — Illinois Waterway (Washington, DC: National Academy Press, 2001)), along with
envrionmental organizations, criticized the Corps’ UMR-IWW Navigation Study for limiting
its environmental analyses to the incremental effects of navigation improvements.
14 For more information on WRDA and current status of UMR-IWW authorization, see CRS
Issue Brief IB10120, Army Corps of Engineers Civil Works Program: Issues for Congress,
by Nicole T. Carter and Pervaze A. Sheikh.

CRS-9
involved in the UMR-IWW project through the annual appropriations process for the
Energy and Water Development Appropriations Act.
Corps’ Preferred Navigation Plan. The $2.4 billion, 50-year navigation
improvement plan would be paid 50% from federal general revenues and 50% from
the Inland Waterways Trust Fund.15 The Corps recommends initial authorization of
a subset of the 50-year plan at $1.9 billion.
This first increment of measures would include:
! authorization and immediate implementation of small-scale and
nonstructural measures ($218 million) — mooring facilities at seven
locks and phased in switchboats at five locks;16
! authorization and immediate implementation of seven new 1,200 ft.
locks ($1.66 billion); and
! authorization of continued study and monitoring of the market and
traffic conditions of UMR-IWW system and a lock appointment
scheduling system.
According to the Corps, analysis has been sufficient to support this initial
investment decision if implemented using an adaptive approach. The Corps’
preferred plan would give it the authority to proceed with the planning, design, and
construction of the seven new locks, but the Administration and Congress would be
provided with opportunities to continue, stop, or delay work at three checkpoints.17
The only activities of the 50-year plan not authorized by the first increment proposed
by the Corps are the lock extensions and use of switchboats on the five locks upriver
from the seven new locks.
15 The IWTF is funded by a 20 cent per gallon diesel tax paid by barge operators of vessels
engaged in commercial transportation on designated waterways. The IWTF pays half the
cost of new construction and major rehabilitation of barge infrastructure. In recent years,
collections have exceeded expenditures, so there is a growing unspent balance in the fund.
For further information on the IWTF, see CRS Report RL32192, Harbors and Inland
Waterways: An Overview of Federal Financing, by Nicole T. Carter and John F. Frittelli.
16 Moorings are tie-off facilities, such as buoys, that provide a closer location to the lock for
tows waiting for a turn through the lock, thereby decreasing lockage time. Switchboats
would be used to assist tows, by managing the second half of their hauls as they move the
first half through the 600-foot locks, resulting in a shorter lockage time. Switchboats would
be employed as hired vessels permanently stationed on both the upstream and downstream
sides of a lock.
17 According to the Corps, Draft Feasibility Report and PEIS, “implementation of any plan
needs to be done in an adaptive framework” (p. x).

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The draft feasibility report also presents the analysis the Corps performed to
support its recommendation; some conclusions from the analysis were:
! First, the preferred navigation alternative depends greatly on two
variables: (1) traffic forecasts derived from future trade scenarios
and (2) the price sensitivity of shippers.18
! Second, no single navigation alternative was a clear best choice
across a range of economic conditions.19
! Third, “the risks are high if no action is taken and high traffic occurs.
Risks are also high if a large investment is made and increases in
traffic do not materialize.”20
The Corps found that every alternative, including no action, contains risk in the
face of an uncertain future. Ultimately, any authorization will likely be based on
expectations for the future of the system, particularly as regards agricultural trade and
transportation demand, as well as on perspectives of the value and likelihood of
success of ecosystem restoration, the weighting of trade-offs among multiple uses,
and the selected approaches to risk and uncertainty.
Competing Views on Large-Scale Navigation Investments
Numerous interest groups have expressed strong opinions about large-scale
UMR-IWW infrastructure investments. Commercial users of the UMR-IWW
navigation system — primarily shippers and agricultural producers — advocate
large-scale investments. Major proponents include the National Corn Growers
Association, state-level corn growers associations (Iowa, Illinois, Minnesota,
Missouri, and Wisconsin), the American Soybean Association, and the shipping
industry.21
Opponents are a collection of interest groups, including environmentalists,
budget hawks, railroads, and truck companies, and economic research institutes who
question the rationale for large-scale federal investment in the UMR-IWW system,
and have questioned the validity of study estimates of the potential benefits and costs
of such projects. Environmentalists argue that at a minimum improving navigation
should be undertaken and funded in concert with ecosystem restoration. In contrast,
navigation and agricultural groups contend that ecosystem restoration should be
funded on its own merits, separate from navigation improvements.
The World Wildlife Federation, Taxpayers for Common Sense, and Public
Employees for Environmental Responsibility (PEER) argue that the economic and
environmental costs of large-scale capacity expansion on the UMR-IWW system
would outweigh the potential benefits, and that many important non-market costs
18 Ibid., p. 447 and 500.
19 Corps, Draft Feasibility Report and PEIS, p. x, 426-427, 435, and 500.
20 Ibid., p. 501.
21 The websites for proponents, opponents, and interested parties are provided in the “For
More Information” section at the end of this report.

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have been excluded from the Corps’ benefit-cost analyses. PEER estimates potential
cost savings from proposed lock expansions at about $10 million annually compared
with an annual implementation cost of about $191 million.22 In addition, the Institute
for Agriculture and Trade Policy argues that substantial efficiencies remain to be
captured from improved management of existing infrastructure, which should be
fully exploited before large investments are made in permanent infrastructure.23
Alternative transportation modes are less organized in their opposition or
support for federal involvement in potential UMR-IWW projects. However, rail
interests have argued that the barge industry already receives a disproportionate share
of federal support relative to other transportation modes. This support includes the
initial lock and dam construction undertaken by the Corps and financed entirely from
federal general revenues, and Corps operation and maintenance of the lock and dam
system financed 50% from general revenues.
Stakeholders’ views on how to proceed with investments vary based on
perspectives on the urgency of large-scale investments, its analysis of a range of
measures for navigation demand and congestion management, and the sufficiency
and credibility of the Corps’ analysis of the economic conditions used to compare
alternatives.
Urgency of Large-Scale Investments. Proponents of large-scale measures
argue that investments need to be made now because the current locks are antiquated
and dilapidated, to provide time for the new locks to come online, and for the United
States to compete in world markets. They argue that making investment decisions
now allows for the most efficient and cost-effective way to modernize the system by
taking advantage of ongoing rehabilitation investments for maintenance. The Inland
Waterways Users Board — an 11-member advisory committee made up of barge and
towboat operators and shippers established by WRDA 1986 to advise the Corps on
construction and rehabilitation priorities — places the UMR-IWW projects among
its top five capstone projects, which it strongly urges the Administration and
Congress to complete.24
Other stakeholders, such as the U.S. Environmental Protection Agency and the
NRC, disagree about the urgency of such large investments; these stakeholders
propose testing the need for large-scale improvements by first exhausting small-scale
measures.25 Environmental groups advocate waiting to make an authorization
decision until more information is available. In particular, they argue that the
decision should not be made before (1) the independent review of the draft feasibility
report being conducted by a National Research Council panel is complete, (2) a
22 PEER Looks at the Numbers.
23 Institute for Agriculture and Trade Policy, Simple Steps Could Improve Mississippi River
Barge Traffic, Dec. 1, 2003; available at [http://www.iatp.org/iatp/library/admin/
uploadedfiles/Simple_Steps_Could_Improve_Mississippi_River_B.pdf] on July 14, 2004.
24 Inland Waterways Users Board, 18th Annual Report to the Secretary of the Army and the
United States Congress (Washington, DC: Army Corps of Engineers, March 2004).
25 Twice-Cooked Pork.

CRS-12
complete economic-transportation model is available to analyze the costs and
benefits of investments, and (3) a final Corps report is available. Those opposed to
expanding lock capacity argue that the locks are not in disrepair, citing that the Corps
has an ongoing rehabilitation program and that the existing locks are incorporated
into the design of the new locks.26 They also argue that the cost of new locks exceeds
the value of the reduction in barge waiting time.27
Congestion Management and Other Small-Scale Alternatives. Small-
scale measures to manage waterway congestion — for example, congestion tolls,
tradable arrival slots, and industry self-help — have been discussed for use on the
UMR-IWW. Small-scale measures can be either structural or nonstructural and are
smaller in scope and cost than new locks or lock extensions. Some small-scale
measures have been considered, independent of large-scale measures, either to better
manage demand or to better operate existing infrastructure; other measures were
analyzed for use in combination with large-scale improvements. The draft navigation
plan recommended by the Corps includes the immediate implementation of two
small-scale measures — moorings and switchboats — and the study of a lock
appointment scheduling system as well as large-scale measures.
Some stakeholders, primarily environmental interests, have questioned whether
large-scale investments could be delayed, or avoided, by implementing congestion
management and other small-scale measures. These stakeholders criticize the Corps’
analysis of small-scale measures as incomplete. Supporters of new locks argue that
small-scale measures are impracticable and that they would provide only incremental
benefits over existing operations. They argue that existing operations have serious
shortcomings and question the logic of investing resources in small-scale measures
when, they argue, large-scale measures are needed.
Analysis of Benefits and Costs. As part of a navigation feasibility study,
the Corps generally forecasts demand for navigation movements over 50 years on a
waterway and then uses this information to calculate benefits and costs for multiple
investment alternatives. Creating long-term forecasts to support long-term decisions
is an analytic challenge; long-term forecasts inherently contain large uncertainties.
Consequently, traffic demand forecasting has been a contentious element in the
development of the UMR-IWW feasibility study.
Rather than forecast demand over 50 years, the Corps’ draft report used a
scenario-based approach. Specifically, the Corps examined movements on the UMR-
IWW for five future traffic scenarios that are based on differing world trade, crop
area, crop yield, and consumption patterns. Then, it combined the five scenarios with
26 Twice Cooked Pork. In response, Midwest River Area Coalition 2000 (MARC 2000) —
a coalition of shippers, carriers, agricultural, industrial, environmental and government
interests to promote Midwest economic growth by responsibly developing and improving
the UMR-IWW — released a report available at [http://www.marc2000.org/Documents/
Twice_Cooked_Pork_vs_Reality_Final.pdf] on July 7, 2004. The Army Corps of Engineers
has also responded; see [http://www.mvr.usace.army.mil/NewsReleases/newsform.asp?
SEQNO=396], visited July 7, 2004.
27 PEER Looks at the Numbers.

CRS-13
three different economic conditions to model the uncertainty in waterway traffic
demand.
Both elements of this analysis — the five scenarios and the three conditions —
have been criticized by stakeholders opposed to proceeding with large-scale
measures, as well as by a National Research Council review committee. They argue
that four of the five scenarios are unrealistically optimistic, which is inconsistent with
export levels over the last 20 years. Regarding the economic modeling conditions,
they argue that the conditions are based on either discredited or incomplete models.
They also criticize the Corps for not assigning probabilities to the various scenarios.
These same critics argue that the Corps has a history of overestimating barge traffic
when justifying investments in inland waterways.28 The Corps has defended its
approach as an attempt to address the uncertainties and weakness of available tools.
The Corps also states that it is actively engaged in improving its economic modeling
capability, but that the results of this research are years away from application.
28 Twice-Cooked Pork; and National Research Council, Transportation Research Board,
Inland Navigation System Planning: The Upper Mississippi River — Illinois Waterway
(Washington, DC: National Academy Press, 2001).

CRS-14
III. Freight Traffic on the UMR-IWW29
As noted in the previous section, the Corps found that its analysis of navigation
imvestment alternatives was greatly dependent on two factors; one of these was the
traffic forecasts derived from future trade scenarios. To appreciate the uncertainties
surrounding what the future demand for navigation traffic on the UMR-IWW might
be, it is useful to review the historic and current traffic.
Figure 4. UMR-IWW Navigation System
Freight Traffic, by Major Category
90
1983
75
60
Non-
Agriculture
45
Other Agr
30
Soybean &
Products
15
Corn
0
1960
1970
1980
1990
2000
Note: Traffic includes upward and downward freight movement on the
Mississippi River and its tributaries between Minneapolis and the mouth of
the MissouriRiver.
Source: Corps, Waterborne Commerce of the United States.
For most of the UMR-IWW’s early history (1930 to 1970), agricultural
commodities constituted a minor, albeit growing, share of freight transport on the
Mississippi River. Instead, non-agricultural commodities such as coal, petroleum,
various ores, lumber, and primary manufactured products accounted for the largest
share of freight. However, by the 1970s agricultural bulk commodities caught up to
and surpassed non-agricultural products as the dominant source for barge freight.
(See Figure 4.) As a result, the linkage between the UMR-IWW region’s
agricultural sector and barge transportation on the Mississippi River system has been
growing in economic importance. However, over the past decade domestic and
international developments have gradually been changing the nature and intensity of
29 Prepared by Randy Schnepf, Specialist in Agricultural Policy, Resources, Science, and
Industry Division.

CRS-15
that linkage. This chapter provides background on the linkage between U.S.
agriculture and the UMR-IWW navigation system.
Agricultural Commodities Constitute Majority of Traffic
During 1990 to 2002, an annual average of nearly 74.3 million metric tons
(mmt) of freight moved on the UMR-IWW each year. (See Appendix Table A4.)
Grain, oilseeds, and other agricultural products averaged 40.1 mmt or 54% of total
barge traffic. Corn, soybeans, and soybean products composed the bulk of annual
agricultural trade, averaging a combined 37.3 mmt — representing 93% of all
agricultural freight or 50% of total freight. Corn constituted the largest share of
agricultural bulk freight with an annual average of 25.2 mmt, while whole soybeans
averaged 8.8 mmt, animal feeds (primarily soymeal) averaged 2.8 mmt, and
vegetable oil (primarily soy oil) averaged 0.5 mmt.
In addition, the UMR-IWW system provides an important conduit for non-
agricultural commodities that directly supports regional economic activity. During
the 1990-2002 period, about 34.2 mmt of non-agricultural freight moved annually
within the UMR-IWW. As with agricultural freight, total non-agricultural freight has
shown no growth since the early 1980s. However, within the total non-agricultural
freight category, both primary manufactured goods (such as cement, pig iron, and
metal sheets) and non-energy raw materials (such as sand and gravel) freight volume
has shown slow steady growth, while energy freight (i.e., coal and petroleum) has
declined. In addition to energy and raw materials, the UMR-IWW system provides
an inward conduit for fertilizers, fuel, and other non-agricultural commodities that
are directly important as inputs to the region’s agricultural sector. For example,
during 1990-2002 more than 3 mmt of agricultural fertilizers moved annually within
the UMR-IWW system in support of U.S. agricultural production.
Regional Agricultural Exports Moved on the UMR-IWW. The Upper
Mississippi River basin encompasses large portions of the central and western Corn
Belt and the eastern fringes of the Northern Great Plains. Five of the nation’s top
agricultural production states — Iowa, Minnesota, Illinois, Missouri, and Wisconsin
— have traditionally relied on the UMR-IWW navigation system as their principal
conduit for export-bound agricultural products — mostly bulk corn and soybeans.
Together, these states accounted for over half of U.S. corn and soybean production,
and nearly half of the value of U.S. corn and soybean exports during 1998-2002.
(See Table 2). The region accounted for only about 10% of U.S. wheat production
and exports.
While the UMR-IWW is an important transportation mode for regional corn and
soybean exports, it is not the only carrier. In terms of total volume, the UMR-IWW
carried about 53% of total U.S. bulk corn exports and 38% of bulk soybean exports
during the 1998-2002 period. Only about 3% of U.S. bulk wheat exports moved via
the UMR-IWW during the same period.30
30 Corps, Waterborne Commerce of the United States; and USDA, Foreign Agricultural
Service, Production, Supply and Distribution (PSD) online database, available at
(continued...)

CRS-16
Table 2. UMR-IWW Five-State Region: Corn, Soybean, and
Wheat Production and Trade, Annual Average for 1998-2002
Production
Exportsa
Crop/State
Planted
Output
Price
Value
Value
Share of Prod
Million
Million
acres
bushels
$/bu.
$ million
$ million
%
CORN
Feed grains
Five-state region
36.7
5,050
2.02
10,219
3,066
30%
Share of U.S.
47%
53%
—
54%
46%
SOYBEANS
Soybean & products
Five-state region
35.0
1,406
5.12
7,200
3,797
53%
Share of U.S.
48%
51%
—
55%
52%
ALL WHEAT
Wheat & products
Five-state region
4.1
191
2.81
538
487
91%
Share of U.S.
7%
9%
—
9%
10%
Source: Crop production data is from USDA, National Agricultural Statistics Service, Agricultural
Statistics Database, available online at [http://www.nass.usda.gov:81/ipedb/], visited on March 8,
2004; export data is from USDA, Economic Research Service, “State Export Data,” available at
[http://www.ers.usda.gov/data/stateexports/], visited on March 8, 2004.
aExport totals include the value of products. As a result, exports expressed as a share of the value of
production represent an upper bound on the true bulk export share. Note also that not all of these
exports are made via the UMR-IWW. See Section IV for more information on export outlets.
Variations in Traffic by River Reach
Agricultural barge freight on the UMR-IWW between Minneapolis and the
mouth of the Missouri River grew rapidly for several decades in the post-WWII era,
but has leveled off since the early 1980s. (See Figure 5.) There is disagreement over
the cause for this lack of growth in barge demand. Is the fall-off in barge traffic a
supply problem resulting from a shortage of lock infrastructure? Or is it a demand
problem due to a stagnation in foreign demand for U.S. feedstuffs?
Shipping and agricultural interests argue that stagnant UMR-IWW barge traffic
is due to delays associated with aging infrastructure and limited lock capacity; that
the costly delays are increasingly forcing grain shippers to switch to alternate
transportation modes to ensure timely arrival at downriver processing plants or Gulf
ports; that the declining efficiency of the UMR-IWW is hurting both U.S.
competitiveness in international markets and U.S. farm incomes at home; and that
new investment is needed to modernize and expand the capacity of the locks.31 In
support of these arguments, officials from the Corps report that unplanned closures
30 (...continued)
[http://www.fas.usda.gov/psd/] on April 8, 2004. The percentages represent a comparison
of UMR-IWW freight as a share of total U.S. exports for each commodity.
31 The websites for proponents, opponents, and interested parties are provided in the “For
More Information” section at the end of this report.

CRS-17
due to aging infrastructure have increased, thus reducing the number of days annually
that locks are open to traffic.32
Figure 5. Upper Mississippi River Freight Traffic
by River Reaches
140
Minneapolis to m outh of Ohio
120
100
80
Minneapolis to
60
mouth of Missouri
40
Illinois
Waterway
20
0
1945
1955
1965
1975
1985
1995
Note: Traffic includes upward and downward freight movement.
Source: Corps, Waterborne Commerce of the United States.
According to the Corps, commodity shippers under contract delivery deadlines
are increasingly shifting to alternate, often more expensive transportation modes to
ensure timely delivery. The Corps contends that this contributes to stagnant levels
of freight traffic on the UMR-IWW system above the mouth of the Missouri River.
The two remaining locks located below the mouth of the Missouri River — the
Melvin Price Lock and Dam (formerly Lock and Dam 26) and Lock and Dam 27 —
are both 1,200 ft. long. Below Lock and Dam 27, the Mississippi River is free-
flowing to the Gulf ports. In contrast to the stagnant traffic flows on the UMR-IWW,
freight traffic measured between Minneapolis and the mouth of the Ohio River
(which excludes Ohio River traffic) has continued to grow during the past two
decades, albeit at a much slower pace than during the four decades following World
War II. (See Table 3.)
32 Telephone conversation with Arlene Dietz, Director of the Navigation Data Center, U.S.
Army Corps of Engineers, April 16, 2004.

CRS-18
Table 3. Average Annual Growth in Freight Traffic for
UMR-IWW Reaches: 1945-1983 Compared with 1983-2002
Average annual growth rate
UMR-IWW region
1945 to 1983
1983 to 2002
Minneapolis to mouth of Ohio
7.7%
1.4%
Minneapolis to mouth of Missouri
7.2%
0.0%
Illinois Waterway
4.8%
-0.1%
Source: Growth rates were calculated by CRS using data from Corps, Waterborne Commerce of the
United States.
Other interest groups contend that growth in domestic demand, as well as
international market conditions, have changed substantially since the period of rapid
growth in barge demand experienced during the 1960s and 1970s.33 Global events
as reported in numerous USDA publications appear to support this conclusion.34
Several of the more salient historical market phenomena include:
! Since most corn and soybeans traded in global markets are
ultimately used for animal feed, international demand is highly
dependent on general economic conditions. Global economic
conditions were positive in the 1970s, but stagnated during the
1980s. (See Figures 6 and 7.) U.S. corn and soybean exports
echoed this pattern as the weak economic growth translated into
weak international demand for animal feeds.
! Widespread growth in foreign grain production during the 1980s and
1990s contributed to the general decline in U.S. corn exports.
! The early 1990s witnessed the loss of a major demand source for
U.S. feedstuffs, particularly corn, with the breakup of the former
Soviet Union (FSU) and the wide scale liquidation of Soviet animal
herds.
! China entered world corn markets as a major exporter in 1984, just
as the FSU was preparing to leave the market. Since 1984, China’s
corn exports have displaced U.S. corn in many Asian markets that
had traditionally imported U.S. corn (e.g., South Korea, Taiwan,
Philippines, and Indonesia).
! In the late 1980s, three major U.S. corn importers — Japan, South
Korea, and Taiwan — began to import increasing amounts of beef,
displacing their internal beef production and lowering their demand
for feed grains. This trend continued through the 1990s and had the
effect of reducing feed demand.
33 Mark Muller, Comments on the U.S. Army Corps of Engineers’ Upper Mississippi River
— Illinois Waterway System Navigation Study (Minneapolis: Institute for Agriculture and
Trade Policy, Oct. 28, 2003); available at [http://www.iatp.org/enviroag/publications.cfm],
visited on Feb. 17, 2004.
34 See CRS Report RL32401, Agriculture as a Source of Barge Demand on the Upper
Mississippi and Illinois Rivers: Background and Issues, by Randy Schnepf, for a discussion
of these events and USDA information sources.

CRS-19
! U.S. corn exports have been effectively shut out of EU markets since
1998, when the EU, in a dramatic policy reversal, imposed a de facto
ban on agricultural products originating from genetically engineered
seeds.35
! In the early 1980s, policy changes in the EU — the primary market
for U.S. soybeans — expanded EU rapeseed production and
curtailed EU oilseeds imports.36
! Increasing competition from Argentina and Brazil since the mid-
1990s has cut into U.S. market share in international markets for
soybeans and soybean products.
The net sum of these changes has been heightened competition in a demand-
weakened international feedstuffs market, and volatile but essentially flat U.S. corn
and soybean exports since the early 1980s.
35 CRS Report RS21556, Agricultural Biotechnology: The U.S.-EU Dispute, by Geoffrey
S. Becker and Charles E. Hanrahan.
36 USDA, Economic Research Service, Background for 1995 Farm Legislation, AER 715
(Washington, DC: May 1995), p. 21.

CRS-20
Figure 6. U.S. Domestic and Export Demand for Corn,
Historical and Projected
250
200
Domestic
150
100
Exports
50
0
1965
1975
1985
1995
2005
Source: 1965 to 2003 data: USDA, Production, Supply, & Demand online
database (March 10, 2004); 2004 to 2013 data: USDA Agricultural Baseline
Projections to 2013 (Feb. 2004).
Figure 7. U.S. Domestic and Export Demand
for Soybeans, Historical and Projected
60
50
Domestic
40
30
Exports
20
10
0
1965
1975
1985
1995
2005
Source: 1965 to 2003 data: USDA, Production, Supply, & Demand online
database (March 10, 2004); 2004 to 2013 data: USDA Agricultural Baseline
Projections to 2013 (Feb.2004).

CRS-21
IV. Outlook for Agriculture-Related Barge Demand37
According to the National Research Council (NRC) of the National Academies
of Science, “Good decisions regarding investments in large civil works projects such
as lock extensions on the Upper Mississippi River require some consideration of the
future demands for those projects.”38
This chapter briefly discusses the Corps’ long-run barge demand projections.
Because UMR-IWW agriculture-related barge demand showed robust growth during
the 1960s, 1970s, and early 1980s relative to non-agriculture demand, most economic
analyses of future barge demand have focused on agriculture as the most likely
source of long-run growth, driven primarily by expectations for expanded
international trade. In contrast, non-agricultural freight movement on the UMR-
IWW — inasmuch as it represents raw material for construction and industrial
processing — is expected to ebb and flow with the regional economy. As a result,
this chapter focuses on key issues and uncertainties behind evolving trade patterns
and projections for future agricultural freight traffic on the UMR-IWW. A
preliminary conclusion is that there appears to be substantial potential for future
agriculture-related barge demand to fall short of the expectations of proponents of
large-scale investment in the UMR-IWW.
Corps’ Long-Run Outlook Questioned
As previously noted, one of the Corps’ objectives under the UMR-IWW
navigation study has been to evaluate the potential barge demand over a 50-year time
horizon (specifically, 2000 to 2050). However, the primary studies undertaken either
by or for the Corps to examine projected UMR-IWW traffic flows and barge demand
have met with skepticism from investment critics as well as from the NRC.39 In
particular, major shortcomings cited by the NRC include:
! The various models used by the Corps to estimate the benefits of
UMR-IWW infrastructure investments have been characterized by
flawed assumptions and data, and have relied on inadequate
methodologies.
! Corps analyses have tended to ignore or minimize the potential for
alternate routes to evolve based on international market conditions.
37 Prepared by Randy Schnepf, Specialist in Agricultural Policy, Resources, Science, and
Industry Division. For a more detailed discussion of agriculture-related barge demand, see
CRS Report RL32401, Agriculture as a Source of Barge Demand on the Upper Mississippi
and Illinois Rivers: Background and Issues, by Randy Schnepf.
38 National Research Council, Review of the U.S. Army Corps of Engineers: Restructured
Upper Mississippi River - Illinois Waterway Feasibility Study (Washington, DC: National
Academy Press, 2004), p. 7.
39 References for Corps’ economic studies and NRC reviews are in Section VII, “For More
Information,” at the end of this report.

CRS-22
! Corps studies supporting new lock investments have relied on very
optimistic growth projections for both international demand for bulk
commodities and U.S. exportable surpluses of bulk commodities.
Other critics have also questioned the strong barge demand growth projections
given that U.S. corn exports have shown no growth during the past two decades,
while soybean exports have grown slightly but with substantial variability. At the
same time, projections for global population and income growth would suggest that
demand for agricultural products will increase. However, this alone is insufficient
to justify projections for strong growth in bulk commodity flows on the UMR-IWW
system. Any comprehensive analysis must consider the evolution of specific market
forces and the potential shifts in trade flows and patterns that they are likely to
engender. The following discussion considers these points.
Two Questions Underlie the Outlook for Barge Demand
Given the UMR-IWW basin’s likelihood of remaining a major corn and soybean
producer for the next several decades, projections of significant growth in barge
demand on the UMR-IWW system hinge on the outlook for two aspects of U.S. corn
and soybean production and trade:
1.
Prospects for Exportable Surplus. How will growth in U.S. production
compare with domestic use? In other words, what are the prospects for
exportable supplies?
2.
Mode and Route Choices for Exportable Surplus. What is the likelihood that
such exportable surpluses, if realized, will demand barge transportation on the
UMR-IWW navigation system rather than alternate transportation modes and
routes? This hinges on the projected evolution of international demand and
supply conditions.
Prospects for Exportable Surplus. Strong growth in domestic demand —
from the livestock sector, the food and industrial processing sector, and the biofuels
industry (particularly corn-based ethanol production) — has steadily reduced the
share of production that is available for export to international markets. (See
Figures 6 and 7.) While the long-term outlook for corn production may be
optimistic, the trend of the past five years suggests that domestic consumption, driven
by growth in meat and dairy products, as well as increasing ethanol production, will
continue to capture a growing share of total use. The introduction of a renewable
fuels standard (RFS), as proposed in pending energy legislation, could accelerate this
process.40 Strong growth in domestic use as a share of total production tends to limit
growth in exportable supplies for two reasons.
! Domestic users generally offer higher returns over international
markets. As a result, exports are generally supplied as a residual
outlet after domestic users have been satisfied.
40 For more information, see CRS Report RL30369, Fuel Ethanol: Background and Public
Policy Issues, by Brent D. Yacobucci and Jasper Womach.

CRS-23
! Strong domestic demand has traditionally kept U.S. prices at a slight
premium with respect to other international exporters, hindering
U.S. competitiveness, particularly as compared to foreign producers
with heavier export orientations like Argentina and Brazil.
Mode and Route Choices for Exportable Surplus. In addition to the
volume of exportable surplus, agriculture-related demand for barge transportation on
the UMR-IWW is highly dependent on international market conditions and on the
availability and cost of alternate transportation modes and routes. Considerable
uncertainty surrounds long-run international market projections. Many of the
projected long-run commodity trade outcomes hinge on policy decisions made by
foreign countries, such as China, rather than the economic forces driven by supply
and demand conditions. This is particularly true for the two major agricultural
commodities historically shipped on the UMR-IWW — corn and soybeans.
Figure 8. Trade Route Alternatives to UMR-IWW
out of Upper Midwest
4
2
3
St. Lawrence Seaway
1
Truck or Rail
5
1 = Gulf ports. 2 = St. Lawrence Seaway. 3 = Pacific Northwest ports.
4 = Canada feed demand. 5 = Mexican feed demand.
Source: Congressional Research Service.
A review of historical evidence suggests that shifts in the sources and nature of
international demand — resulting from population and income dynamics, increasing
competition from South American exporters, evolving bilateral and multilateral trade
agreements, and trade disputes related to U.S. production and use of biotech crops
— have induced exporters to seek nontraditional routes to new and expanding export
markets, and have drawn exportable supplies of corn and soybeans away from the

CRS-24
UMR-IWW system. (See Figure 8.) Several factors have contributed to shifts
toward other trade routes and suggest that this trend is expected to continue.41
First, the North American Free Trade Agreement (NAFTA) among the United
States, Mexico, and Canada, beginning in 1994, increased market access for U.S.
agricultural products to Mexican and Canadian markets. Overland truck and rail
routes to the NAFTA partners — Mexico and Canada — have expanded rapidly
during the past 10 years, particularly for perishables, but also for grains and oilseeds.
In addition, both Mexico and Canada have made major changes in their domestic
agricultural policies that have contributed to growing imports of U.S. agricultural
products. Together, the two NAFTA partners import a sizable share of U.S. corn and
soybean shipments. During 2000-2003, Canada and Mexico accounted for about
19% of U.S. corn exports, up sharply from a 6% share during 1989-1993. U.S.
exports of soybeans and soymeal to Canada and Mexico have shown similar growth
increasing from a 17% share to a 26% share during the same time periods.
Second, as mentioned earlier, competition from Argentina and Brazil in
international agricultural markets has increased sharply since the mid-1990s.
Between 1995 and 2003, the two South American countries expanded their
production by about 250% and their combined exports of soybeans and products
expanded by 256%.42 The U.S. share of the international market for soybean and
products has declined from 72% in 1986 to less than 25% in 2003. This trend is
expected to continue. U.S. exports that move via the UMR-IWW system to Gulf
ports and the Atlantic directly confront growing South American competition. In
contrast, overland routes to major ports on the West Coast offer direct access to the
Pacific Ocean and Asian markets and are beginning to compete with the traditional
UMR-IWW-to-Gulf-Ports-to-Panama-Canal route to Asia.
Third, phenomenal growth in soybean import demand from China in recent years
has spurred the growth of rail shipments out of the Northern Plains and the UMR-
IWW basin to the Pacific Northwest (PNW). Dramatic income growth since the mid-
1980s has been accompanied by sharp increases in China’s demand for meat
products. One of several policy responses by China’s government has been to permit
increased soybean imports starting in the late 1990s. By 2002 more than one-third
of all soybeans traded in international markets was destined for China. USDA
projects that China will account for 73% of global soybean import growth over the
next decade. As a result, U.S. soybean shippers are looking for the most cost-
effective routes to China. Higher costs associated with the UMR-IWW system plus
rising fees to pass through the Panama Canal have made the PNW route increasingly
attractive, particularly for soybeans from the Dakotas.
Finally, two other factors have contributed to the development of an overland
PNW route for soybeans from the western Corn Belt. First, recent genetic
advancements have produced hardier soybean varieties that have pushed their
41 USDA, Office of the Chief Economist, USDA Agricultural Baseline Projections to 2013,
Staff Report WAOB-2004-1 (Feb. 2004).
42 USDA, Foreign Agricultural Service, Production, Supply and Distribution (PSD) online
database, available at [http://www.fas.usda.gov/psd/] on April 8, 2004.

CRS-25
production into the Plains states at the expense of traditional small grains crops.
Soybean production in the Dakotas is located far enough from the UMR-IWW
system to make a PNW route more cost effective. Once the Midwest-to-PNW route
becomes established and economies of scale ensue, more soybeans from the western
Corn Belt could potentially be diverted from the UMR-IWW. A second factor has
been the increased use of 110-car shuttle trains to the PNW. These longer trains are
designed to capture the economies of scale inherent in shipping larger volumes of a
commodity long distances.
Considerable Uncertainty Clouds Long-Run Barge Demand. If a
continuation of the evolving trade patterns described in the preceding section are
realized, then future growth in barge demand from the agricultural sector may fall
short of levels anticipated by proponents of large-scale investments in the UMR-
IWW. Table 4 compares the growth rates for agriculture-related barge demand on
the UMR-IWW from the four scenarios developed for the Corps by Sparks
Companies, Inc. (SCI) with a hypothetical scenario developed by CRS based on
USDA’s long-run baseline projections (the adjusted UMR-IWW scenario).43 Since
USDA does not project port shares for U.S. exports, the CRS scenario adjusts
USDA’s total export growth rates for the potential effects of increased trade flows
via the non-UMR-IWW routes suggested in the preceding section.
Table 4. Comparisons of UMR-IWW Average Annual
Agricultural Freight Export Growth Rate Projections
Weighted
Scenarios
Corn
Soybeans
Average
Sparks Companies, Inc. (SCI)a
UMR-IWW (Most favorable scenario)
1.8%
0.4%
1.5%
UMR-IWW (Central scenario)
1.3%
1.0%
1.2%
UMR-IWW (Hypoxia scenario)
1.1%
0.8%
1.0%
UMR-IWW (Least favorable scenario)
-7.0%
0.2%
-2.0%
Adjusted UMR-IWWb
1.4%
-2.4%
0.3%
a Sparks Companies, Inc., Upper Mississippi River and Illinois Waterway Navigation Study: Economic
Scenarios and Resulting Demand for Barge Transportation, May 1, 2002.
bAdjustments are made by CRS based on USDA’s long-run market outlook and potential trade shifts
as described in CRS Report RL32401, Agriculture as a Source of Barge Demand on the Upper
Mississippi and Illinois Rivers: Background and Issues, by Randy Schnepf.
In every SCI scenario, with the sole exception of the SCI-least-favorable
scenario, the average annual growth rates for UMR-IWW barge demand from corn
and soybeans exceeds the adjusted UMR-IWW freight projections. For example, the
SCI-central scenario assumed an average weighted annual growth rate of 1.2% for
43 USDA, Office of the Chief Economist, USDA Agricultural Baseline Projections to 2013,
Staff Report WAOB-2004-1 (Feb. 2004). Projections for 2003/04 to 2013/14 are available
at [http://www.ers.usda.gov/publications/waob041/waob20041.pdf], visited April 29, 2004.

CRS-26
corn and soybean freight on the UMR-IWW. In contrast, the adjusted UMR-IWW
growth rate was significantly smaller, at 0.3%.
Outlook Summary. The eventual UMR-IWW barge traffic will depend on
corn and soybean production growing faster than domestic demand, and on whether
the evolution of international market conditions favors or disfavors the UMR-IWW
over alternate trade routes and transportation modes. While it is likely that
investments in the UMR-IWW navigation system would result in lower barge freight
rates and increased demand for barge services, the magnitude of these outcomes will
depend on the interplay of the many forces affecting U.S. agricultural export markets.
Based on an evaluation of USDA’s long-run outlook for international commodity
markets, there appears to be substantial potential for future agriculture-related barge
demand to fall short of investment proponents’ expectations.

CRS-27
V. Transport System Issues44
This chapter examines the infrastructure needs of grain carriers and shippers
from a systemwide perspective that considers the interplay of barge, rail, and truck
transport markets. First, it describes the role of transportation costs in U.S. and
international markets; in particular, it explains how changes in barge rates might
affect grain producers. Then it briefly describes how grain is delivered to market,
including major changes taking place across transport modes and the underlying
reasons for those changes. Next, it discusses emerging rail issues and relates them
back to barge transportation. Finally, it compares some of the environmental and
social effects of transport by barge, rail, and truck.
Why Transportation Costs Matter to Agriculture45
In competitive grain and oilseed markets, transfer costs — handling and
transportation charges — are a major factor in determining market price differentials.
Agricultural producers are concerned about transportation costs because the price that
they receive for their agricultural commodities is derived from the price established
in major markets (whether a processing plant, feedlot, or export terminal) less
transportation and handling costs. The more it costs to transport a commodity to a
buyer, the less the producer will receive and vice versa. As a result, any process that
reduces the cost of moving a commodity to a buyer likely benefits producers by
raising the amount that they receive, which subsequently benefits the local economy
by generating greater farm income and associated economic activity.46
In contrast, raising domestic transportation costs widens the farm-to-market
price differential. A widening differential generally compels exporters to offer the
products in international markets at higher prices — that is, less competitively.
Higher U.S. export prices relative to international competitors will lower the demand
for U.S. exports of corn and soybeans. Lower export demand reduces total demand,
and consequently lowers the prices and income received by farmers for a given level
of production.
Barge Transport Generates Cost Savings. Barge transportation
represents a low-cost method of moving bulk commodities long distances. Most
economists and market analysts agree that inexpensive barge transportation helps
check rates charged by the rail and truck transportation industries. Low internal
44 Prepared by John Frittelli, Analyst in Transportation; Nicole T. Carter, Analyst in
Environmental Policy; and Randy Schnepf, Specialist in Agricultural Policy, Resources,
Science, and Industry Division, as noted.
45 Prepared by Randy Schnepf, Specialist in Agricultural Policy, RSI Division.
46 For a discussion of the economy-wide economic costs associated with higher agricultural
transportation costs (including higher consumer food prices, as well as local, state, and
national tax revenue and employment losses), see Dr. Michael Evans. Determination of the
Economic Impact of Increased Congestion on the Upper Mississippi River - Illinois River
Waterway (Evans, Carroll & Associates, March 2002).

CRS-28
transport costs relative to export competitors such as Argentina and Brazil have
helped U.S. products compete in international corn and soybean markets.47
Because barge rates are generally significantly lower than either rail or truck, the
UMR-IWW navigation system provides considerable transportation cost savings to
the regional and national economy. An evaluation of transportation costs for the
UMR-IWW system commissioned by the Corps indicated that rate savings to
waterway users averaged about $8.08 per ton (1994 prices) over the best possible all-
land routing alternative.48 The rate savings varied by commodity and included, for
example, $0.18/bushel for corn (8% of the 1994 season average farm price (SAFP)
of $2.26/bushel) and $0.35/bushel for soybeans (6% of the 1994 SAFP of
$5.48/bushel).49 Based on these cost savings relative to alternate transportation
modes, the Corps estimates that the existing UMR-IWW system generates
transportation cost savings of $0.8 billion to $1.2 billion (2001 prices) per year, based
on 2000 traffic levels.50 These benefits compare with average annual operation and
maintenance costs of about $115 million.51
Barge Delays Increase Costs. Shippers of bulk commodities rely on
volume to make a profit. For a barge plying the inland waterways, a key determinant
of the amount of freight that can be carried in a season52 is the time it takes to make
each haul. The shorter the haul time, the more total hauls that can be made and the
more freight that can be moved. As a result, delays associated with aging locks and
dams represent lost time, lost potential freight, and lost profits. Waiting delays also
represent lost fuel. Towboats on the UMR-IWW burn about 80 gallons of diesel fuel
per hour.53 The engines are kept running while each towboat waits for its turn
through the lock.
An economic study found that lock delays on the UMR-IWW are associated
with higher barge rates; however, the effect was not large — a 10% increase in delay
at any given lock was estimated to increase barge rates by 0.16% to 0.59%.54
47 Randall D. Schnepf, Erik N. Dohlman, and Christine Bolling, Agriculture in Brazil and
Argentina: Developments and Prospects for Major Field Crops, USDA, Economic Research
Service, Agriculture and Trade Report No. WRS013, (Washington: Dec. 2001), pp. 53-60.
48 U.S. Army Corps of Engineers and the Tennessee Valley Authority, Transportation Rate
Analysis: Upper Mississippi River Navigation Feasibility Study (July 1996).
49 Corps, Draft Feasibility Report and PEIS, p. 52. These data were reported on a per ton
basis as $7.08/ton for corn and $12.85/ton for soybeans.
50 Ibid., p. 55.
51 Ibid., p. ii.
52 The Upper Mississippi River closes for nearly four months every winter above the Quad
Cities near Lock and Dam 15. This increases the time pressure to move a maximum
quantity of the fall’s harvest before the winter freeze occurs.
53 American Soybean Association, STEP, Moving America’s Harvest by Barge, available
at [http://www.soygrowers.com/step/barge.htm] on Feb. 11, 2004.
54 Tun-Hsiang Yu and Stephen Fuller, Evaluation of Factors Affecting Lock Delays on the
(continued...)

CRS-29
Furthermore, simultaneous lock delays at all 27 locks including the three 1,200-ft.
locks (a generally unlikely event) would lead to about a 6% increase in the total barge
rate between Minneapolis and Gulf ports. Using the April 2004 barge freight rate
from Minneapolis to Gulf ports of about $0.27 per bushel of corn and $0.29 per
bushel of soybeans (or about $10.71 per metric ton), a delay-induced 6% rise in the
barge freight rate would push per-bushel costs for corn and soybeans up by
approximately 1.6 and 1.7 cents, respectively, or less than 1% of the average farm
value.55 Even so, this represents an upward bound of potential costs given the
unlikely simultaneous delay at all 27 locks.
As barge rates for corn and soybean freight rise, the demand for barge services
declines. However, the decline is generally by a less-than-proportional amount.
Economists have estimated a -0.5% decline in grain barge demand on the UMR and
a -0.2% decline on the IWW in response to a 1% increase in barge freight rates.56 In
other words, a 6% rise in the barge freight rate would likely result in a 3% decline in
the volume of corn and soybean freight (or about 1.2 mmt out of 40 mmt) on the
UMR. The barge price rise would shift these commodities to alternate uses (feed,
food, industrial, or storage), to alternate transport modes (rail or truck), or to alternate
trade routes (e.g., Canada, Mexico, or the Pacific Northwest).
A possible effect of a sustained rise in barge transport rates is a rise in rail freight
costs, due both to rising demand for rail as freight shifts away from barge and
towards rail transport, and to decreased efficiency resulting from longer rail delays
as more traffic moves over the same mileage of freight track and through the same
number of terminals. The degree, if any, to which rail rates would rise in response
to greater demand would depend on the level of slack capacity available to
immediately absorb the agricultural freight that is being diverted from barge
transportation. The level of rail slack capacity is seasonal, but tends to be near zero
(i.e., near full capacity of rail use) at harvest time when barge demand is highest. In
a study sanctioned by the National Corn Growers’ Association, the barge-rail cross-
price effect was found to be very small — it was estimated that railroad freight rates
for farm products increase 0.25% for every 1% increase in UMR barge freight rates.57
In other words, a 2-cents-per-bushel rise in barge freight rates for corn and soybeans
would result in about a half-cent per bushel rise in rail freight rates for those
commodities as some freight transport demand shifts from barge to rail.
54 (...continued)
Upper Mississippi and Illinois Rivers and the Effect of Lock Delay on Barge Rates, prepared
for USDA, Agricultural Marketing Service (2002).
55 USDA, Agricultural Marketing Service, Transportation and Marketing Service, Grain
Transportation Report (Washington: April 29, 2004).
56 Tun-Hsiang Yu and Stephen Fuller, Estimated Grain Barge Demands for the Upper
Mississippi and Illinois Rivers: Tentative Findings, prepared for USDA, Agricultural
Marketing Service (no date).
57 Dr. Michael Evans, Determination of the Economic Impact of Increased Congestion on
the Upper Mississippi River - Illinois River Waterway (Evans, Carroll & Associates, Mar.
2002), p. 39.

CRS-30
Modal Shifts in Grain Transport58
An Interdependent Transport Network. Barges are only one component
of the grain-handling network. Trucks, railroads, and grain elevators are the other
key components. A coordinated and comprehensive investment strategy requires
examining the grain supply chain in its entirety, rather than concentrating on any one
mode or segment of infrastructure. A General Accounting Office report on grain
transportation recommends this approach, stating: “Efforts to improve grain
transportation tend to concentrate on individual transportation modes rather than on
the transportation network as a whole,” and without “an integrated analysis that
considers interrelationships between the various components of the grain
transportation system ... implementing wise policies is difficult.”59
The high degree of intermodal functioning in the grain supply chain essentially
means that policy decisions affecting one mode affect all other modes. Any major
capital project, even if mode-specific, is likely to affect the interrelationship among
all the modes, as well as their grain customers. Optimizing a particular component
of the grain delivery system without considering the whole system could merely
reroute traffic rather than improving the system’s overall performance. In addition,
significant changes (described below) are taking place in the grain-handling network
and these changes have important implications for the infrastructure that supports it.
Modal Specialization Based on Distance. Grain elevators are used to
accumulate a critical mass of product that allows for economies of scale in shipping
bulk grain. (See Figure 9). Trucks, trains, and barges compete and complement one
another in moving grain to successively larger elevators — shipping distance often
determines each mode’s particular role.
Trucks traditionally have an advantage in moving grain for shorter distances
(less than 250 to 500 miles) and therefore function primarily as the short haul
gatherers of grain product. Railroads have a cost advantage in moving grain long
distances, but barges have an even greater cost advantage where a waterway is
available. However, barges cannot compete with trucks and trains in transit time, and
waterways are not always available due to ice, floods, or drought.
To reach seaports, a large portion of U.S. grain exports must travel more than
1,000 miles, so rail and barge traffic is heavily dependent on the export grain market.
A large share of exported corn and soybeans moves by barge since a significant
portion of production acreage is located relatively close to either the Upper
Mississippi, Illinois, or Ohio River waterways. Trucks are used for the initial leg of
a grain export move (to the rail served elevator or barge served river port), as well as
for the movement of grain domestically to a processor or feed lot.
58 Prepared by John Fritelli, Analyst in Transportation Policy, RSI Division.
59 General Accounting Office, U.S. Grain Transportation Network Needs System Perspective
to Meet Future World Needs, CED-81-59 (April 8, 1981).

CRS-31
Figure 9. Traditional Flow of Grain for Export
Source: U.S. Grains Council, VEG Exporter M anual (n.d.), p. 44.
Modal Share Shifting Over Time. Over the last two decades, there has been
a substantial shift in the relative importance of modes in moving grain to market.
(See Figure 10.) Barge modal share decreased slightly, rail share decreased
substantially, and truck share made up the difference. The relative importance of
modes has shifted because of farm consolidation (fewer but larger farms), Class I
railroad rationalization60 (fewer miles of track but more trains), and the doubling of
domestic demand for grain while export demand has stagnated.
Truck Share Rising. Increasing domestic demand and static export demand
has favored truck transport because, as mentioned above, trucks generally have an
advantage over rail and barge for shorter haul shipments. Also, domestic buyers tend
to buy grain in smaller volumes because they operate throughout the year.
Rail and Barge Share Declining. Class I railroads are more interested in
long distance, trainload-size shipments, which suits the export market more than the
domestic market. Barge transport is heavily dependent on exports from the corn belt
60 Class I railroads are those with operating revenue of at least $272 million in 2002.

CRS-32
(upper Midwest) to the Port of New Orleans. Barges transport 90% of the corn
moving to Center Gulf ports while railroads transport only 10%.61 The static grain
export market is reflected in the slight decrease in modal market share for barge
transportation.
Figure 10. U.S. Grain Modal Shares, 1978-1995
5 0
R ail
4 0
T ruck
3 0
B arge
2 0
1 0
0
1 97 8 1 98 1 1 98 4 1 98 7 1 99 0 1 99 3
N ote : D ata are based on the fina l le g of a shipme nt.
S ource : U SD A , Agri cult ural Ma rketing Se rvice , T ransportat ion of
U .S. Grains: a M odal Share Anal ysis, 1978-95 (M arc h 1998).
Part of the growth in domestic demand for feed grains is due to increased Asian
demand for livestock and poultry products, which are exported in refrigerated
containers.62 Despite the long inland hauls to seaports, a large share of chilled and
frozen meat product exports are moved by truck rather than railroad because of the
product’s high value and high service requirements (in terms of transit time and
temperature control). To the extent this trend continues, one can view it as the
displacement of bulk grain exports moved by barge down the Mississippi with
containerized meat exports moved by truck to coastal ports.
Emerging Rail Issues. As railroads are the primary competitors to barge
transportation, it is informative to review market trends in this sector more closely.
61 Center Gulf ports include New Orleans and other Louisiana ports. In contrast, Western
Gulf ports are located along the Texas coastline, while Eastern Gulf ports are found along
the Mississippi, Alabama, and eastern Florida coastline.
62 Chris Hurt and Lee Schrader, Long-Term Structural Shifts in Grain, Oilseed, and Animal
Industries in the United States (USDA, Agricultural Marketing Service, Nov. 2000).

CRS-33
Class I rail consolidation is a contributing factor to the overall consolidation of the
grain handling network. This consolidation affects barge transportation as well. As
a result of consolidation, smaller capacity elevators and short line railroads are
increasingly being bypassed in the grain supply chain. One survey of industry experts
predicted that of the more than 10,000 grain elevators in today’s network, one in four
of these elevators will no longer be in existence a decade from now.63
Class I railroads are exploiting operating efficiencies by consolidating their
trackage and rolling stock around larger, sub-terminal grain elevators. These larger
elevators have enough grain to load not only longer trains but also trains using higher
capacity hopper cars. The rail consolidation process emphasizes unit and shuttle
trains, de-emphasizing carload service in favor of shipment sizes that can fill entire
trains, and operating from single origins and destinations rather than multiple origins
and destinations. These tactics are designed to reduce switching costs and improve
car cycle times.64 The railroads offer rate incentives for unit-grain-trains, which
encourages centralization of the grain-elevator network and contributes to the
diminishing role of country elevators and short line railroads.65 While Class I rail
rate incentives reduce the cost of rail hauls, consolidation of grain elevators may
require longer and therefore more costly truck hauls. Trucks, because of their
geographic flexibility, are more easily able to adapt to Class I rail consolidation than
are short line railroads.
The increasing role of truck transport, to the disadvantage of short line rail
transport, has raised debate over infrastructure constraints in these sectors as well.
Key policy questions include whether rural roads and bridges leading to grain
elevators are adequate to accommodate the increased traffic of heavy grain hauling
trucks. Alternatively, would it be more cost effective (or environmentally
sustainable) to assist short line railroads in upgrading their infrastructure to handle
the heavier hopper cars that mainline railroads are increasingly using?
An emerging policy question that relates rail transport dynamics to UMR-IWW
infrastructure investments is: “Will railroad rationalization and the growing use of
unit and shuttle trains slow the decline of rail’s modal share of grain transport, and
thereby alter the long-run outlook, as projected from Figure 10?”66 If the answer
63 Kimberly Vachal, The Long-term Availability of Railroad Services for U.S. Agriculture,
paper presented at the Transportation Research Board’s 81st Annual Meeting, Jan., 2002,
Washington, DC.
64 William W. Wilson, U.S. Grain Handling and Transportation System: Factors
Contributing to the Dynamic Changes in the 1980s and 1990s (North Dakota State Univ.,
Nov. 1998).
65 Marvin E. Prater, “The Implications for U.S. Agriculture of Long-Term Trends in
Railroad Service,” Journal of The Transportation Research Forum, Vol. 40, No. 4 (Fall
2001).
66 A unit train refers to shipments of at least 52 cars. A shuttle train refers to shipments of
more than 100 cars. For information on transport mode rate comparisons and brief reports
on transport market developments refer to Grain Transportation Report, USDA,
Agricultural Marketing Service, Transportation Services Branch; available at [http://
www.ams.usda.gov/tmdtsb/grain/] on July 8, 2004.

CRS-34
proves to be yes, it will likely have important implications for barge demand
prospects and the economic viability of major UMR-IWW infrastructure investments.
Environmental and Social Impacts of Travel by Mode67
Investments in any transportation project will have environmental implications.
Supporters of large-scale navigation improvements on the UMR-IWW argue that
generally barges are more environmentally friendly than rail or truck. Comparisons
of environmental impacts of transportation modes are complicated by data
availability and differences in the types of impacts and significance of ecosystems
affected by land-based transport and water transport. The inability to compare
directly some impacts does not diminish their significance and importance for
decision-making. Because reduced damage to one environmental aspect (e.g.,
terrestrial ecosystem fragmentation) often comes as a tradeoff with environmental
harm increasing for another aspect (e.g., riverine ecosystems), environmental
assessments of alternate modes typically are evaluated within the context of modes’
other advantages and disadvantages (e.g., costs, price, punctuality, and speed).
When modal comparison are made, they are typically limited to travel (i.e.,
vehicle operations to transport goods).68 Supporters of large-scale UMR-IWW
navigation investments have been using three metrics — fuel efficiency, air pollution,
and safety — to make general modal comparisons. Although useful, these metrics
provide only a partial picture of the environmental impacts of each transportation
mode. The analysis below indicates that current data do not conclusively find barges
superior to rail in terms of environmental impacts of travel, but barges are superior
in terms of injuries and fatalities.
Energy Efficiency. Supporters of navigation expansion argue that a barge
generally consumes less fuel to move a ton of cargo than rail or truck. The energy
consumed to move a ton of cargo one mile (i.e., a ton-mile) can be used to compare
the energy resource consumption efficiencies of transportation modes. The
Transportation Energy Data Book: Edition 23, published in October 2003 by Oak
Ridge National Laboratory, tracks energy intensity from 1970 through 2001. The
following cautionary disclaimer appears above the energy intensity table in the data
book: “Because of the inherent differences between the transportation modes in the
nature of services available, routes available, and many additional factors, it is not
possible to obtain truly comparable national energy intensities among modes.” With
that caveat, the table then indicates that the energy required to move one ton one
mile, measured as British thermal units (Btu) expended per ton-mile, in 2001 was
higher for barges at 444 and lower for rail at 346.69 According to Oak Ridge data, the
67 Prepared by Nicole T. Carter, Analyst in Environmental Policy, RSI Division.
68 Travel is only one of five activities in the transportation life-cycle — infrastructure
construction; vehicle manufacture; travel; operation and maintenance; and disposal.
69 Statistics are for domestic waterborne commerce and Class I railroads. Barge transport
efficiency has fluctuated with an average of 420 btu per ton-mile for 1992-2001, varying
from 369 to 508. The modal fuel efficiencies for freight transport as measured in ton-miles
per gallon of diesel fuel — barge 514, rail 202, and truck 59 — commonly cited by groups
supporting navigation, are from a now outdated 1980 report by S. E. Eastman, Fuel
(continued...)

CRS-35
earlier energy efficiency advantage of barge transport has been eliminated; rail energy
efficiency has surpassed barge efficiency by more than 40 Btu per ton-mile since
1996. Although Oak Ridge does not capture truck fuel efficiency in a similar
manner, other data sources suggest trucks are generally less efficient than barges or
rail on a Btu per ton-mile basis.70
Other sources do not agree with the fuel efficiency advantage of rail over barge
shown by the Oak Ridge data. Data provided to CRS by the Tennessee Valley
Authority (TVA) show an average barge fuel efficiency of 535 ton-mile per gallon
(260 Btu per ton-mile) for 1995 through 2002. Industry averages for railroads in
1998 were 384 ton-mile per gallon (361 Btu per ton-mile), according to a report
produced for the Corps by Earth Tech and Tolliver.71 The general trend that is agreed
upon is that “railroads have become more fuel efficient over time and the relative
energy benefits of waterway transportation have become smaller.”72 Detailed
analysis of factors contributing to the improvement of rail energy efficiency has not
been performed; however, increased tonnage per rail carload has been cited as a
major cause, and longer rail hauls as another contributor.73
Air Pollution. Supporters of navigation expansion argue that barges emit
fewer air pollutants per ton-mile than rail or truck.74 Emissions are largely a function
of the fuel efficiency and the emission control equipment employed. A study by Lee
and Casavant in 1998,75 indicates emissions per gallon of diesel fuel (not per ton-
69 (...continued)
Efficiency in Freight Transport (Arlington, VA: American Waterway Operators, 1980).
70 Truck efficiencies are commonly presented in terms of btu per vehicle-mile (not ton-
mile). For 2001, the Transportation Energy Data Book: Edition 23 had a btu per vehicle-
mile efficiency of 23,237. If capacity of a heavy truck is estimated at 20 to 25 tons, the
energy intensity for trucks would be approximately 1,000 btu per ton-mile. The Association
of American Railroads, in a January 2004 publication, Railroads: Building a Cleaner
Environment, compared Oak Ridge’s 2001 data for barge and rail to 3,337 btu per ton-mile
for trucks, while other sources use truck efficiencies closer to 550 btu per ton-mile.
71 Earth Tech and D. Tolliver, Analysis of Energy, Emission, and Safety Impacts of
Alternative Improvements to the Upper Mississippi River and Illinois Waterway (North
Dakota State Univ., March 2000), p. 7. Available at [http://www2.mvr.usace.army.mil/
umr-iwwsns/documents/aug2000-entire%20report.pdf]. Hereafter referred to as Earth Tech
and Tolliver.
72 Ibid., p. vi.
73 D. Greene, Transportation and Energy (Lansdowne, VA: Eno Transportation Foundation,
1996).
74 The statistics comparing emissions for barge, truck, and rail per ton-mile used by groups
supporting navigation show less hydrocarbon, carbon monoxide, and nitrous oxide
emissions for barges than rail or truck; the source for these statistics is typically cited as
being the Emission Control Lab of the U.S. Environmental Protection Agency. CRS was
unable to locate the original document, and therefore, cannot assess whether these statistics
represent current emissions levels for the three modes.
75 N. S. Lee and Ken Casavant, Impacts of a Snake River Drawdown on Energy
Consumption and Environmental Emissions in Transporting Washington Wheat and
(continued...)

CRS-36
mile) are generally comparable for rail and barge. There is not, however, sufficient
data available to reliably compare all three modes. A conclusion that can be drawn
from available data is that any advantages in total emissions that barge transport may
have had in the past is likely to have decreased as a result of converging fuel
efficiencies and emissions standards.
Barge transport, nonetheless, may have an advantage in certain circumstances
because of the location of emissions. Air pollution’s significance as an
environmental impact partially depends on its proximity to urban areas and areas of
significance, such as national parks, and the potential for human exposure,
particularly in nonattainment areas — those areas failing to meet the National
Ambient Air Quality Standards. Highways and rail lines generally pass through more
urban areas than comparable waterways and thus their pollution may have greater
significance than air pollution from barges.76
Safety. Safety of transportation modes can be compared based on accidents,
injuries, and fatalities. The environmental significance of accidents depends on many
factors, including human health exposure, the environment of the accident, and the
ability to contain a spill and/or other damage. Barge traffic generally involves less
urban exposure than either truck or rail, and it operates on a system that has few
crossing junctions. The potential evacuation and human health care costs may be
greater for rail and truck shipments than for barge movements.77 However, a
waterborne hazardous material or other spill has direct implications for water
resources, whereas an overland spill by rail or truck shipment typically has a more
geographically limited impact.78 According to Earth Tech and Tolliver, an Army
Corps study of the UMR-IWW concluded that small changes in risk between barge
and rail should not be a factor in determining a recommendation for waterway
infrastructure investment.
The death rate for barge tows in 1993 was 0.01 death per billion ton-miles,
compared with 0.84 for trucks, and 1.15 for railroads; the injury rate for barges is
reportedly 0.09 per billion ton-miles and 21.77 for railroads.79 These statistics depict
the less congested locks and the natural right-of-way of waterways and the slower
speeds of barge operations in comparison to truck and rail.
75 (...continued)
Barley (Pullman, WA: Washington State Univ., April 1998).
76 Earth Tech and Tolliver. Rail and truck movements’ proximity to urban areas also can
cause more noise pollution, congestion, and social disruption than barges. (U.S. Dept. of
Transportation, Maritime Administration, Environmental Advantages of Inland Barge
Transportation (Washington, DC: Aug. 1994).
77 Earth Tech and Tolliver. Recent legislation requiring all new inland tank barges carrying
liquid cargoes to be double-hulled has decreased the likelihood of barge spills.
78 Earth Tech and Tolliver.
79 C. J. Haulk, Inland Waterways as Vital National Infrastructure: Refuting ‘Corporate
Welfare’ Attacks (Pittsburgh, PA: Allegheny Institute for Public Policy, 1998). The truck
statistics provided by Haulk are limited to the death of truck occupants. More recent modal
comparisons of injuries and deaths were not found, other safety statistics indicate that the
ranking of the three modes in terms of safety has remained steady.

CRS-37
VI. Environmental Impacts of Barge Navigation80
Much of the discussion on UMR-IWW navigation focuses on the effects of
possible investments on agricultural competitiveness and the capacity of alternate
modes of transportation. However, UMR-IWW navigation and its proposed
expansion also have environmental implications. The UMR-IWW ecosystem has
been affected by the construction of the locks and dams, the flow management
practices, and the operation of barges. The Upper Mississippi River and the Illinois
River are managed for maintaining a 9-foot navigation channel rather than following
a natural flow regime,81 and the movement of barges damages the riverine ecosystem
by creating hydraulic impacts and contributing pollutants to the aquatic ecosystem.
The navigation causes these environmental impacts while producing the benefit of
cost-effectively transporting goods long distances. The environmental and social
questions under debate are:
! What would be the environmental impacts of expanding the
navigation capacity of the UMR-IWW?
! What, if any, steps should be taken to address the impacts of the
existing navigation system and ongoing navigation operations and
maintenance?
UMR-IWW Ecosystem and its Decline
The navigation system on the UMR-IWW transformed the free-flowing river
into a series of navigation pools that create a stairstep effect from St. Louis to
Minneapolis and Chicago, inhibiting the movement of some species. The dams
impound water to increase the depth of the main channel to 9 feet or greater and
cause substantial changes in the distribution of surface water.82 Changes in the
rivers’ hydrologic regime subsequently alter water quality parameters, such as
temperature and dissolved oxygen, thereby ultimately affecting fish and wildlife.
In the Water Resources Development Act of 1986, Congress recognized the
national significance of the Upper Mississippi River System (which includes the
UMR-IWW system and the aquatic and terrestrial habitats and species that are
critically important to the river floodplain ecosystem). This ecosystem is considered
significant because it provides habitat and food to at least 485 species of birds,
80 Prepared by Kyna Powers, Analyst in Energy and Environmental Policy, and Nicole
Carter, Analyst in Environmental Policy, Resources, Science, and Industry Division.
81 Alterations of natural waterways to accommodate navigation generally reduce the variety
of natural habitats by controlling the dimensions of the channel, changing the relationship
of the river to its flood plain, and changing river hydrodynamics. Dredging disrupts and
removes benthos, increases turbidity, and resuspends sediments. Dredged material requires
disposal; the magnitude of disposal impacts varies according to the type of disposal, the
disposal site, and the contents of the disposed material. (U.S. Army Corps of Engineers,
Water Resources Support Center, National Waterways Study — A Framework for Decision-
Making — Final Report (Washington, DC: GPO, January 1983)).
82 Corps, Draft Feasibility Report and PEIS, p.34.

CRS-38
mammals, amphibians, reptiles, and fish, including 10 federally listed endangered or
threatened species and 100 state-listed threatened or endangered species. It is a
critical migration corridor for 40% of North America’s waterfowl and shorebirds, and
home to 118 or more species of fish and nearly 50 species of freshwater mussels.83
The Upper Mississippi River System encompasses four National Fish and Wildlife
Refuges, and three national parks lie within or immediately adjacent to the river
system.84 The UMR-IWW ecosystem is also viewed as significant because of its
recreational use and the economic value of recreation. An estimated 12 million
recreational visits to the UMR-IWW occur each day; boating, sightseeing, sports
fishing, hunting, and trapping are some of the more popular recreational uses.85
According to the Crops, current investments in the UMR-IWW ecological
monitoring and habitat rehabilitation and enhancement are inadequate to meet
existing environmental needs and to prevent continued degradation of the UMR-
IWW.86 The ecosystem is in decline, and some groups fear that it may collapse.87
That is, they fear a rapid alteration in environmental quality and ecosystem health
indicators, likely resulting from changes to fundamental ecosystem functions and
processes. In general, ecological health declines are occurring from the upper reach
of the Mississippi River to the lower portions of the UMR.88 The Illinois River is
generally considered unhealthy, although it has experienced some recovery since a
collapse in the 1950s.89
Commercial navigation, its infrastructure, and water management to support
navigation is causing side channels, backwater, and wetlands to fill in with sediment.
This sediment is easily suspended in the water column, thus reducing light
penetration essential for plant growth. Less vegetation reduces aquatic insects, water
fowl, fish, and other animals. For example, a U.S. Geological Survey scientist
explained the impact of sediment on the health of the UMR as follows:
The extent or abundance of many key native biotic communities and organisms
— including submersed plants, unionid mussels, fingernail clams and other
benthic invertebrates, and migratory waterfowl — has decreased along substantial
83 Upper Mississippi River Conservation Committee, Facing the Threat: An Ecosystem
Management Strategy for the Upper Mississippi River (Rock Island, IL: 1993), available at
[http://www.mississippi-river.com/umrcc/Call-for-Action.html].
84 Corps, Draft Feasibility Report and PEIS, pp. 5 and 130-131.
85 Ibid., pp. 134-135.
86 Ibid., pp. iii, 88, 92, 96, and 97. Through WRDA 1986, Congress established the
Environmental Management Program for the UMR-IWW. This Corps program — averaging
about $15 million per year — consists of habitat rehabilitation/enhancement projects and
long-term resource monitoring. The EMP has more than 50 projects, either operational or
under construction, affecting more than 120,000 acres (11% of the UMR-IWW flood plain).
87 Upper Mississippi River Conservation Committee, Facing the Threat: An Ecosystem
Management Strategy for the Upper Mississippi River (1993).
88 B. Carlson, Upper Mississippi River System Environmental Management Program (1998),
available at [http://www.hort.agri.umn.edu/h5015/98papers/carlson.html].
89 Ibid.

CRS-39
reaches of the Upper Mississippi River in recent years or decades (Wiener et al.
1995, Wiener et al. in press). Recent declines in benthic invertebrates and
submersed aquatic plants constituted a partial — yet significant — collapse in the
benthic food web supporting key migratory waterfowl. The abrupt decline in
submersed aquatic plants in the late 1980’s, which was unprecedented in the
Upper Mississippi, greatly affected migratory canvasback ducks, which feed on
wild celery tubers. Similarly, the use of the river by migrating lesser and greater
scaup, which feed heavily on fingernail clams, decreased greatly after the decline
of this small mollusk.90
The navigation system, however, is not the only cause of ecosystem decline.
The Mississippi River and Illinois River have a long history of impaired water quality
attributable to contamination from agricultural, industrial, residential, and municipal
sources.91 The question of what, if any, ecosystem restoration to undertake in the
context of UMR-IWW improvements is limited to the navigation channel, and is not
inclusive of watershed or basin-wide measures that might address these other sources
of water quality contaminants.
Environmental Impacts of Expanding UMR-IWW Capacity
Some environmental groups are concerned that additional stress, caused by
construction activities and increases in barge traffic above current levels, could
accelerate the decline of the ecosystem and perhaps the onset of a collapse. They
argue that additional barge traffic would destroy aquatic life and fill in remaining side
channels with sediment from wave action. In response, agricultural and navigation
interests argue that the Corps has analyzed the incremental environmental impacts
of new construction and additional barge traffic and that it has devised an “adaptive
mitigation” approach to minimize these impacts.92 These interests argue that,
moreover, any aquatic environmental damage from expansion is offset by
environmental benefits of transport by barge when compared to transport by rail or
truck in terms of fuel efficiency, air pollution, and safety. (See “Environmental and
Social Impacts of Travel by Mode,”from Section V.)
The Corps developed a preliminary Programmatic Environmental Impact
Statement (PEIS) to evaluate the environmental and social impacts of navigation
improvements. Under the PEIS, the Corps would produce site-specific environmental
assessments for any improvements authorized by Congress. Large-scale navigation
improvements would require mitigation (and monitoring) of bank erosion, backwater
and secondary channel sedimentation, degradation of aquatic plant beds, fish loss,
destruction of historic sites, and mitigation of construction site impacts. In its draft
90 J. G. Wiener, “Sediment-related Investigations at the Upper Mississippi Science Center,”
in Proceedings of the U.S. Geological Survey Sediment Workshop, February 4-7, 1997 (La
Crosse, WI).
91 Corps, Draft Feasibility Report and PEIS, p. 114.
92 An adaptive mitigation strategy involves an iterative process of implementing and
monitoring planned individual mitigation projects; then refining and re-implementing
combinations of projects in terms of their timing, their placement, and their component parts
to better meet the goals of the long-run mitigation strategy. Ibid., p. 372.

CRS-40
feasibility report, the Corps concludes that the impacts of large-scale UMR-IWW
measures can be mitigated; it states, “using mitigation, the net effect from both
increased traffic and site-specific impacts would be no loss to the five main areas of
concern — fisheries, submerged aquatic plants, bank erosion, backwater and
secondary channel sedimentation, and historic properties.”93
The Corps’ analysis concluded that navigation improvements probably would
not significantly reduce fuel consumption or air pollution, or raise noise levels on the
UMR-IWW from existing levels.94 The Corps’ analysis did find that increased barge
traffic due to navigation improvements would generate social benefits, such as a
decrease in the number of transportation-related accidents.
Environmental Impacts of Ongoing Navigation Operations
For federal decisions such as investing in new UMR-IWW locks, environmental
impacts are assessed under the National Environmental Policy Act (NEPA). Under
NEPA, environmental impact assessments of incremental increases to transportation
infrastructure are required to consider impacts in the context of cumulative effects
(40 C.F.R. §§1502.14, 1502.116, 1508.8, and 1508.7). In other words, environmental
impact statements are required to analyze both local environment impacts of each
component of a proposed project and the cumulative impacts of all project
components combined. These analyses, however, generally do not evaluate the
damage caused by existing infrastructure with the intention to mitigate for past or
ongoing damage. In other words, the NEPA analyses are limited to the incremental
environmental effects of proposed projects and propose strategies to mitigate that
damage.
Environmental interests, the natural resource agencies of the five basin states,
and the U.S. Fish and Wildlife Service argue that mitigation of incremental impacts
of new navigation infrastructure construction and increased barge traffic is
insufficient. In a 2001 report on an early draft of the UMR-IWW feasibility report,
the National Research Council argued that “as part of the feasibility study, an
analysis of the cumulative effects of the existing navigation system should be
93 Ibid., p. 405. While the Corps has not established a specific mitigation plan, it has
identified potential mitigation measures for each river reach. For example, potential
mitigation measures include dredging, gravel bars, dike alterations, large woody debris
anchors, island building, bank stabilization and protection measures, and replanting. The
planning, engineering, and design phase for mitigation measures would begin prior to
undertaking lock expansion activities and would be adapted as additional studies are
completed. (Corps, Draft Feasibility Report and PEIS, pp. 380 and 390-98.)
94 Corps, April 2004 Feasibility Report and PEIS, p. 207-209 and 333. The Corps did not
perform a modal analysis as part of its navigation study; the April 2004 Feasibility Report
and PEIS states that “an increase in other transportation modes could have greater societal
costs than an increase in navigation transport” (Corps, April 2004 Feasibility Report and
PEIS, p. 335). This conclusion was based on information in the report by Earth Tech and
Tolliver that concluded “there is a relatively small fuel advantage to barge transportation
[for movements from Upper Mississippi region]” (p. vi).

CRS-41
conducted.”95 In response, the Corps restructured the study to include ecosystem
restoration. The Draft Feasibility Report and PEIS satisfies the NEPA requirements
by assessing, and providing for mitigation of, impacts directly associated with the
navigation improvements in its preferred navigation alternative. In addition, it
recommends a plan for ecosystem restoration for the environmental damage resulting
from ongoing navigation operations and maintenance.
Ecosystem Restoration
Corps’ Preferred Ecosystem Restoration Plan. In the Draft Feasibility
Report and PEIS, the Corps recommended a $5.3 billion, 50-year ecosystem
restoration plan. This plan includes 1,009 projects ranging from shoreline protection
measures to fish passage structures. Federal revenues would fund approximately
$4.25 billion of this plan, while the rest would be funded 65% by the federal
government and 35% by nonfederal sponsors. The Corps recommends that Congress
authorize a first increment of this 50-year plan at $1.5 billion. This increment would
consist of 225 projects including:
! specific authorization ($250 million — 100% federal) for fish
passage construction at four dams and planning and design at two
dams, and dam point control at two dams;
! programmatic authority to implement measures that, according to the
Corps, would provide substantial restoration benefits ($925 million,
not to exceed $25 million/measure — 100% federal); and
! acquisition from willing sellers of 35,000 acres for flood plain
connectivity and wetland and riparian habitat protection and
restoration ($277 million total — 65% federal).
The Corps’ analysis of ecosystem restoration alternatives focused on 50-year
plans. According to the Corps, the recommended 50-year plan was selected based
on cost-effectiveness, likelihood of successful implementation, and reasonable
estimate of the potential cost-shared flood plain restoration opportunities.96 This plan
aims to mitigate the historic and ongoing impacts of the navigation projects through
“management practices and cost effective actions affecting a broad array of habitat
types.”97
According to the Corps, the recommended alternative “expands large-scale flood
plain restoration to suitable levels, initiates fish passage measures, and brings off-
channel habitat restoration to a suitable level,” thereby restoring a broad array of
habitats and ecosystem processes.98 The draft feasibility study also states that these
projects will benefit the riverine ecosystem while not affecting commercial
navigation, water supply, or hydro power. However, it states that the ecosystem
95 National Research Council, Inland Navigation System Planning: The Upper Mississippi
River - Illinois Waterway (Washington, DC: National Academy Press, 2001), p. 81.
96 Ibid., p. 509.
97 Ibid., p. 509.
98 Ibid., p. 195.

CRS-42
restoration component, specifically water level fluctuations, would cause limited
harm to recreational boating and livestock watering.
Stakeholder Perspectives. Although few groups have made their formal
positions known on the Corps’ preferred ecosystem restoration plan, it appears that
many environmental groups, some basin-state natural resource agencies, and the Iowa
Department of Transportation are in favor of either the preferred plan or a more
comprehensive restoration effort.99 The Upper Mississippi River Basin Association,
which represents the states that will be the nonfederal sponsors for some of the
restoration costs, has expressed support for ecosystem restoration measures such as
those included in the preferred plan.100 Even so, there is uncertainty about how the
Corps will measure the project’s ecosystem benefits, how the Corps will balance
ecosystem restoration and navigation objectives under a dual-purpose authorization,
and whether long-term ecosystem restoration is compatible with a highly managed
navigation system.
A main area of disagreement among stakeholders over UMR-IWW ecosystem
restoration opinions is the question of how closely investments in navigation
expansion should be tied to investments in ecosystem restoration. Some
environmental groups see ecosystem restoration as necessary to mitigate damage
caused by the ongoing operations and maintenance of the UMR-IWW, and believe
that appropriations should not be made for additional navigation measures without
investing in ecosystem restoration. They propose that appropriations for ecosystem
restoration and navigation funding should be linked. Navigation and agricultural
groups believe that ecosystem restoration should be funded on its own merits,
separate from navigation improvements. In other words, the basic question on which
stakeholders disagree is: why is ecosystem restoration part of the Corps’ preferred
plan — is it mitigation/rehabilitation for the ongoing navigation project, or is it
separable from the navigation improvement project?
99 Ibid., pp. 494, 480, 492, and 476.
100 Ibid., pp. 489-491.

CRS-43
VII. For More Information
General Information on the Corps and the UMR-IWW
CRS Report IB10120, Army Corps of Engineers Civil Works Program: Issues for
Congress, by Nicole T. Carter and Pervaze A. Sheikh.
CRS Report RL32064, Army Corps of Engineers Water Resources Activities:
Authorization and Appropriations, by Nicole T. Carter.
CRS Report RL32192, Harbors and Inland Waterways: An Overview of Federal
Financing, by Nicole T. Carter and John F. Frittelli.
CRS Report RS20866, The Civil Works Program of the Army Corps of Engineers:
A Primer, by Nicole T. Carter and Betsy A. Cody.
General Accounting Office, Marine Transportation: Federal Financing and a
Framework for Infrastructure Investments, GAO-02-1033 (September 2002).
Inland Waterways Users Board, home page at [http://www.iwr.usace.army.mil/
usersboard/Index.htm] on July 7, 2004.
National Academy of Sciences, Transportation Research Board, The Marine
Transportation System and the Federal Role: Measuring Performance,
Targeting Investment, Special Report 279 (2004).
U.S. Army Corps of Engineers, Restructured Upper Mississippi River-Illinois
Waterway Navigation Study website with reports, news releases, and other
related information, at [http://www2.mvr.usace.army.mil/umr%2Diwwsns/
index.cfm?fuseaction=home.welcome] on July 6, 2004.
U.S. Army Corps of Engineers, Rock Island District, Upper Mississippi River
Comprehensive Plan, at [http://www.mvr.usace.army.mil/UMRCP/] on July 6,
2004.
U.S. Army Corps of Engineers, Restructured Upper Mississippi River — Illinois
Waterway System, Study Area Map, at [http://www2.mvr.usace.army.mil/
umr-iwwsns/index.cfm?fuseaction=home.showmap] on July 6, 2004.
U.S. Army Corps of Engineers, Environmental Management Program, homepage at
[http://www.mvr.usace.army.mil/EMP/default.htm] on July 7, 2004.
USDA, Agricultural Marketing Service (AMS), Transportation and Marketing
Programs, Agricultural Transportation Challenges of the 21st Century, a report
prepared for the National Agricultural Transportation Summit, Kansas City,
MO, July 27-28, 1998; available at [http://www.ams.usda.gov/tmd/summit/
contents.htm] on July 7, 2004.

CRS-44
USDA, AMS, Transportation and Marketing Division, Transportation of U.S.
Grains: A Modal Share Analysis, 1978-95, March 1998; at [http://
www.ams.usda.gov/tmd/modal/msh78_95.pdf] on July 7, 2004.
USDA, AMS, Inland Waterborne Transportation — An Industry Under Siege, by
Ken Casavant, November 2000; at [http://www.ams.usda.gov/tmd/LATS/
LATSwaterfin.pdf] on July 7, 2004.
Navigation and Economic Studies
CRS Report RL32401, Agriculture as a Source of Barge Demand on the Upper
Mississippi and Illinois Rivers: Background and Issues, by Randy Schnepf.
Dr. Michael Evans. Determination of the Economic Impact of Increased Congestion
on the Upper Mississippi River — Illinois River Waterway (Evans, Carroll &
Associates, March 2002), at [http://www.ncga.com/transportation/pdfs/
EvansStudy_March2002.pdf] on July 7, 2004.
Jack Faucett Associates, Review of Historic and Projected Grain Traffic on the
Upper Mississippi River and Illinois Waterway: An Addendum (Sept. 20, 2000),
at [http://www2.mvr.usace.army.mil/umr-iwwsns/documents/JFAreport.pdf] on
July 7, 2004.
National Research Council, Transportation Research Board, Review of the U.S. Army
Corps of Engineers: Restructured Upper Mississippi River — Illinois Waterway
Feasibility Study (Washington, DC: National Academy Press, 2004).
National Research Council, Transportation Research Board, Inland Navigation
System Planning: The Upper Mississippi River — Illinois Waterway
(Washington, DC: National Academy Press, 2001).
Sparks Companies, Inc., Upper Mississippi River and Illinois Waterway Navigation
Study, Economic Scenarios and Resulting Demand for Barge Transportation
(May 1, 2002), at [http://www2.mvr.usace.army.mil/umr-iwwsns/documents/
Economic%20Scenario%20Final%2005012002.pdf] on July 7, 2004.
U.S. Army Corps of Engineers, Draft Integrated Feasibility Report and
Programmatic Environmental Impact Statement for the Restructured Upper
Mississippi River — Illinois Waterway System Navigation Study (April 29,
2004), at [http://www2.mvr.usace.army.mil/umr-iwwsns/documents/FES_EIS_
Report_Cover(2004).pdf] on July 7, 2004.
U.S. Army Corps of Engineers, Alternative Formulation Briefing Pre-Conference
Report for the Restructured Upper Mississippi River — Illinois Waterway
System Navigation Study (Feb. 9, 2004), at [http://www2.mvr.usace.army.mil/
umr-iwwsns/documents/AFB%20Pre-Conference%20Report%20(2-9-04).pdf]
on July 7, 2004.

CRS-45
U.S. Army Corps of Engineers, UMR-IWW System Navigation Study, Preliminary
Economic Findings Released to the Public (Nov. 10, 1998), at [http://www2.
mvr.usace.army.mil/umr-iwwsns/documents/econfind.pdf] on July 7, 2004.
USDA, Office of the Chief Economist, USDA Agricultural Baseline Projections to
2013, Staff Report WAOB-2004-1 (Feb. 2004) available at [http://www.
ers.usda.gov/publications/waob041/] on July 7, 2004.
Proponents for Major Investment
American Soybean Association, “Soybean Trade Expansion Program (STEP),”
available at [http://www.soygrowers.com/step/barge.htm] on July 7, 2004.
Midwest Area River Coalition 2000 (MARC 2000), a self-proclaimed coalition of
agricultural, industrial, shippers, carriers, environmental and government
interests, homepage available at [http://www.marc2000.org/] on July 7, 2004.
National Corn Growers Association, Transportation Home Page, available at [http://
www.ncga.com/transportation/main/index.html] on July 7, 2004.
National Waterways Conference, Inc., a self-proclaimed nationwide organization of
waterways shippers, industry and regional associations, port authorities, barge
lines, shipyards, economic development agencies, and others, available at
[http://www.waterways.org] on July 7, 2004.
Newlocks.org, a website coordinating promotional interests for the “preservation and
modernization of the waterway transportation infrastructure in the upper
Mississippi River basin,” at [http://www.newlocks.org/] on July 7, 2004.
Critics of Current Proposals
Institute for Agriculture and Trade Policy, Environment and Agriculture, contains
several reports referencing the Upper Mississippi River at [http://www.iatp.org/
enviroag/] on July 7, 2004.
National Wildlife Federation, Project Water: What’s at Stake, at [http://action.nwf.
org/campaign/water20040316/explanation] on July 7, 2004.
National Wildlife Federation and Taxpayers for Common Sense jointly maintain a
website regarding Corps activities on the upper Mississippi River entitled,
“Crossroads,” available at [http://www.taxpayer.net/corpswatch/crossroads/
ndex.htm] on July 7, 2004.
Public Employees for Environmental Responsibility (PEER), PEER Looks at the
Numbers: Upper Mississippi and Illinois Waterway, (June 7, 2004), available
at [http://www.peer.org/corps/economicanalysis.html] on July 7, 2004.
Twice-Cooked Pork: The Upper Mississippi River — Illinois Waterway Navigation
Study, prepared by a coalition that includes American Rivers, Environmental

CRS-46
Defense, Illinois Stewardship Alliance, Institute for Agriculture and Trade
Policy, Mississippi River Basin Alliance, National Taxpayers Union, National
Wildlife Federation, Public Employees for Environmental Responsibility, Sierra
Club, and Taxpayers for Common Sense.
Taxpayers for Common Sense, Crossroads: Congress, the Corps of Engineers, and
America’s Water Resources, available at [http://www.taxpayer.net/corpswatch/
crossroads/index.htm] on July 7, 2004.

CRS-47
Appendix A: UMR-IWW Description
Navigation System. The Upper Mississippi River (UMR) system extends
854 miles from the confluence with the Ohio River to Minneapolis and includes the
major tributaries — the Missouri, Illinois, and Wisconsin — that feed into the
Mississippi River. The Illinois Waterway (IWW) extends 327 miles from its
confluence with the Mississippi River at Grafton, IL, to Chicago and the Great Lakes.
The UMR-IWW navigation system contains 1,200 miles of 9-foot deep channels, 37
lock and dam locations (with 43 locks), and thousands of channel training structures.
(See Tables A1 and A2.) The UMR-IWW Navigation System is commonly broken
into four regions:
1.
Upper Impounded Reach: the navigation pools associated with the upper and
lower St. Anthony Falls locks in Minneapolis and Locks and Dams1-13;
2.
Lower Impounded Reach: Navigation Pools 14-26;
3.
Middle Mississippi River: Lock and Dam 26 to the mouth of the Ohio River;
4.
Illinois Waterway: Illinois River; portions of the Desplaines River; Chicago
Sanitary and Ship Canal; the Calumet-Sag Channel; the Little Calumet River;
and the Calumet River.
Freight traffic on the UMR is seasonal due to winter conditions in the region.
Above the Quad Cities (Davenport, IA; Bettendorf, IA; Moline, IL; Rock Island, IL)
at Lock and Dam 15, traffic on the Mississippi River closes in late November and re-
opens in early to mid-March depending on ice and thaw conditions. The Illinois
River is kept open year-round for freight traffic.
Table A1. Physical Characteristics of Illinois Waterway Locks
River
Year
Length
Width
Lift
1999 Util-
Lock
mile
opened
(Feet)
(Feet)
(Feet)
ization %
Illinois Waterway
La Grange
80.2
1939
600
110
10
42
Peoria
157.7
1938
600
110
11
58
Starved Rock
231
1933
600
110
19
n.a.
Marseilles
244.6
1933
600
110
24
n.a.
Dresden Road
271.5
1933
600
110
22
n.a.
Brandon Road
286
1933
600
110
34
n.a.
Lockport
291.1
1933
600
110
40
55
Thomas J. O’Brien
326.5
1960
1,000
110
4
36
Source: U.S. Army Corps of Engineers, Rock Island District, Alternative Formulation Briefing Pre-
Conference Report (Feb. 9, 2004), p. 86.

CRS-48
Table A2. Physical Characteristics of Upper Mississippi Locks
River
Year
Length
Width
Lift
1999 Util-
Lock
mile
opened
(Feet)
(Feet)
(Feet)
ization %
Upper Impounded Reach: Navigation Pools 1-13
Upper St. Anthony Falls
853.9
1963
400
56
49
18
Lower St. Anthony Falls
853.3
1959
400
56
25
19
No. 1 Main Chamber
847.6
1930
400
56
38
20
No. 1 Aux. Chamber
847.6
1932
400
56
38
n.a.
No. 2 Main Chamber
815
1930
500
110
12
39
No. 2 Aux. Chamber
815
1948
600
110
12
n.a.
No. 3
796.9
1938
600
110
8
41
No. 4
752.8
1935
600
110
7
40
No. 5
738.1
1935
600
110
9
35
No. 5a
728.5
1936
600
110
5
34
No. 6
714
1936
600
110
6
42
No. 7
702
1937
600
110
8
43
No. 8
679
1937
600
110
11
44
No. 9
647
1938
600
110
9
44
No. 10
615
1936
600
110
8
47
No. 11
583
1937
600
110
11
52
No. 12
556
1938
600
110
9
53
No. 13
523
1938
600
110
11
51
Lower Impounded Reach: Navigation Pools 14-26
No. 14 Main Chamber
493
1939
600
110
11
76
No. 14 Aux. Chamber
493
1922
320
80
11
6
No. 15 Main Chamber
482.9
1934
600
110
16
73
No. 15 Aux. Chamber
482.9
1934
360
110
16
18
No. 16
457.2
1937
600
110
9
70
No. 17
437.1
1939
600
110
8
75
No. 18
410.5
1937
600
110
10
72
No. 19
364.2
1957
1,200
110
38
47
No. 20
343.2
1936
600
110
10
70
No. 21
324.9
1938
600
110
10
73
No. 22
301.2
1938
600
110
10
80
No. 24
273.4
1940
600
110
15
76
No. 25
241.4
1939
600
110
15
76
Middle Mississippi Reach: Lock and Dam 26 to the mouth of the Ohio River
Melvin Price Main
200.8
1990
1,200
110
24
50
Chamber200.8
Melvin Price Aux.
200.8
1994
600
110
24
20
18Chamber5.5
No. 27 Main Chamber
185.5
1953
1,200
110
21
56
No. 27 Aux. Chamber
185.5
1953
600
110
21
12
Source: U.S. Army Corps of Engineers, Alternative Formulation Briefing Pre-Conference Report
(Feb. 9, 2004), p.86.

CRS-49
UMR-IWW Floodplain. The UMR-IWW ecosystem includes extensive flood
plain habitats. (See Figure 11.) Habitats vary with natural gradients across the four
river reaches. The total acreage of the river flood plain system exceeds 2.5 million
acres of aquatic, wetland, forest, grassland, and agricultural habitats. Also, the
Mississippi Flyway is used by more than 40% of the migratory waterfowl traversing
the United States.
Figure 11. Upper Mississippi River and
Illinois Waterway Floodplain

Source: U.S. Army Corps of Engineers, Rock Island District, Jerry A. Skalak, Regional
Project Manager, Upper Mississippi River Comprehensive Plan, presentation at Tulane
University, November 14, 2002.

CRS-50
Appendix B: Early History of
Corps Involvement in UMR-IWW

For much of the United States’ early history only the lower portion of the
Mississippi River — between St. Louis and the Gulf of Mexico — was navigable.
In its natural state, the Mississippi River above St. Louis was significantly less
navigable due to unpredictable water flows and fluctuations in the channel location
and depth.
Since the mid-1800s, federal intervention on the UMR, primarily under the
auspices of the Corps, has sought to address the problem of navigability.101 (See
Table A3.) In 1878 Congress authorized a 4½-foot channel between Minneapolis
and St. Louis; in 1907, a 6-foot channel. During the next two decades, Locks and
Dams 1 and 2 and what is now Lock and Dam 19 were authorized.102 Federal
intervention was accelerated in 1930 when, in an attempt to promote barge traffic and
stimulate the economy of the Midwest during the Great Depression, Congress
authorized the Corps to maintain a 9-foot channel on the UMR based on a system of
locks and dams. This authorization resulted in a construction project consisting of
26 locks and dams on the UMR that was finished in 1940. Similarly, construction
of the present-day system of locks and dams on the IWW was completed during
1933-1939 under congressional authorization. A surge in wartime river traffic during
the 1940s, aided by the development of a new fleet of diesel towboats, saw the upper
Mississippi River finally emerge as an important route for freight traffic.103
The Corps’ activities on the UMR-IWW slowly grew beyond navigation to
establishing a broader river-basin development plan. A series of flood control acts
— in 1936, 1944, and 1950 — subsequently augmented the Corps’ role in flood
control activities and large multi-purpose projects. Under these various authorities,
the Corps plans and undertakes flood control and navigation activities as part of its
civil works program.104
Many navigation and flood control projects are multi-purpose — they provide
water supply, recreation, and hydro power in addition to navigation and flood control.
During the 1970s, additional legislation and several Executive Orders further
required the Corps to consider the environmental impacts of its projects and
101 U.S. Army Corps of Engineers, Rock Island District, “The Upper Mississippi River
Improvement,” The Landscape Photography of Peter Bosse, by Ronald Deiss (1998);
available at [http://www.mvr.usace.army.mil/Bosse/Introduction/UpperMississippi.htm] on
July 8, 2004.
102 U.S. Army Corps of Engineers, Rock Island District, Alternative Formulation Briefing
Pre-Conference Report, Table 1-1, “Timetable of Navigation Development Activities on
Upper Mississippi River and Illinois Waterway” (Feb. 9, 2004), p. 8.
103 Dennis Brown, “The Nation’s Inland Waterway System and Rural America,” Rural
America, Vol. 16, No. 4, USDA, Economic Research Service (March 2002), pp. 11-17.
104 For the legislative evolution of Congressional demands on the Corps, see CRS Report
RS20866, The Civil Works Program of the Army Corps of Engineers: A Primer, by Nicole
T. Carter and Betsy A. Cody.

CRS-51
activities. It is often the competing objectives of these different uses — commercial,
recreational, hydro power, and environmental — that make proposed changes to
existing projects controversial. Today, the Corps — at the direction of Congress
primarily through Water Resources Development Acts (WRDA) — continues to
undertake water resources development projects under its civil works program.105
Table A3. Timetable of Navigation Development Activities on
Upper Mississippi River and Illinois Waterway
Activity
Year
Upper Mississippi River:
Congress authorizes removal of snags and local obstructions
1824
Congress authorizes 4-½-ft. channel: mouth of Missouri to St. Paul
1878
Congress authorizes 6-ft. channel
1907
Construction of Lock & Dam 19
1914
Construction of Lock & Dam 1
1917
Congress authorizes 9-ft. channel: St. Louis to Cairo, IL
1927
Congress authorizes extension of 9-ft. channel to St. Paul, MN
Construction of 29 locks and dams
1930-1950
Construction of Lock & Dam 27
1953
Construction of 1,200-ft. chamber at Lock & Dam 19
1957
Upper and Lower St. Anthony Falls authorized
1937
Lower St. Anthony Falls constructed
1956
Upper St. Anthony Falls constructed
1963
Congress authorizes dam and 1,200-ft. chamber at Lock & Dam 26
1978
Congress authorizes second chamber (600-ft.) at Lock & Dam 26
1985
Construction of 1,200-ft. chamber at Melvin Price Locks & Dam
1990
Construction of 600-ft. chamber at Melvin Price Locks & Dam
1994
Major Rehabilitation/Maintenance
1986-present
Illinois Waterway:
Congress authorizes construction of Illinois and Michigan Canal
1822
Construction of Chicago Sanitary & Ship Canal and 5 locks and dams
1900
Construction of present-day system of 7 locks and dams
1933-1939
Construction of Thomas J. O’Brien Lock and Controlling Works
1960
Major Rehabilitation/Maintenance
1975-present
Source: U.S. Army Corps of Engineers, Rock Island District, Alternative Formulation Briefing Pre-
Conference Report (Feb. 9, 2004), p. 8.
105 Ibid.

CRS-52
Table A4. Upper Mississippi River - Illinois Waterway Freight by Category,
Volume and Share, 1990 to 2002
Agricultural Freight
Non-Agricultural Freight
Soybean
Pet-
Other
Man-
Fert-
Other,
Total
Sub-
&
Sub-
ro-
raw
ufac-
il-
mostly
Year
Freight
total
Corn
Product
Other
total
Coal
leum
materiala
turedb
izer
chemicals
Volume
Million metric tons
1990
80.2
44.6
29.1
11.2
4.3
35.6
9.8
8.7
6.9
3.5
3.0
3.7
1991
76.3
42.2
26.4
11.5
4.3
34.1
8.7
8.8
6.4
3.5
3.0
3.7
1992
78.2
43.9
27.2
12.7
4.0
34.3
8.7
8.6
6.5
3.5
3.5
3.5
1993
65.5
35.5
21.6
11.5
2.4
30.0
7.3
5.8
6.6
3.2
3.5
3.3
1994
72.0
34.4
20.7
10.8
2.8
37.7
9.3
6.7
7.8
8.7
4.0
1.1
1995
76.6
42.4
28.1
12.1
2.2
34.1
8.2
8..8
7.3
6.3
3.4
0.3
1996
72.9
41.4
26.7
12.2
2.6
31.5
7.8
6.2
7.3
3.8
3.0
3.4
1997
70.6
37.3
22.3
12.4
2.6
33.3
6.8
7.0
8.4
4.7
2.7
3.7
1998
72.3
37.0
23.2
11.4
2.4
35.2
8.0
7.3
7.4
5.7
3.1
3.8
1999
77.7
43.4
27.8
13.3
2.3
34.3
7.8
6.6
7.5
6.0
2.9
3.6
2000
75.6
39.8
24.0
13.4
2.4
35.8
7.2
6.8
8.4
6.7
3.1
3.6
2001
71.5
37.2
23.2
11.7
2.3
34.3
6.9
7.5
8.4
5.2
3.2
3.1
2002
76.3
42.5
27.0
13.2
2.2
33.8
6.7
6.6
8.2
5.9
3.2
3.2
Period average: 1990 to 2002
Volume
74.3
40.1
25.2
12.1
2.8
34.2
8.0
7.3
7.5
5.1
3.2
3.1
Percent
Share
100
54.0
33.8
16.3
3.8
46.0
10.7
9.9
10.1
6.9
4.3
4.1
Source: U.S. Army Corps of Engineers, Waterborne Commerce of the United States, various issues.
aNon-edible, non-energy raw materials such as forest products, sand, gravel, iron and steel scrap, non-metal minerals, etc.
bPrimary manufactured goods such as lime, cement, pig iron, metal plates and sheets, etc.