Others, however, see a more limited government role and  argue that government officials should focus their efforts on addressing  regulatory provisions that may interfere with the development of SSS  operations. For the two operations we examined, the effect of these  potential obstacles varied. General reluctance to try new modes. Port infrastructure. For example, DOT has not thoroughly  assessed key issues, such as  the potential impact of federal involvement in developing SSS on the  competitive balance among all transportation modes;  lessons learned from new SSS services, such as the Gulf Coast and  Northeast services that we examined; and  obstacles and mitigating actions necessary to developing SSS,  particularly with respect to the reluctance by shippers and logistics  providers to using this option. The Complexities of the Transportation System and Growing Fiscal Constraints Present Challenges for State and Local Decision Makers

Improving the efficiency of the nation’s surface transportation system is a  particularly complex challenge because it encompasses many modes— water, highway, transit, and rail—on systems owned, funded, and operated  by both the public and private sectors. A Public Investment Approach Can Help Public Decision Makers Guard against an Inefficient Use of Public Resources

As calls for increased transportation investments come amid growing  concerns about the size of federal and state budget deficits, state and local  decision makers must guard against any waste of limited public resources  when making transportation investment decisions. Using the work of transportation  experts and our own experience in evaluating freight mobility projects, we  have developed a public investment approach to guide public decisions  about freight improvement projects. As can  be seen in figure 4, this approach encourages public decision makers to  consider four steps: (1) establish a rationale for public involvement in a  project, (2) develop a systematic framework to evaluate the merits of  projects, (3) determine the level and type of public support to be provided,  and (4) evaluate projects to ensure that intended benefits have been  achieved. However, there is no federal or other mechanism that would  require its use or even ensure that it is considered in evaluating  transportation investment decisions. DOT has made the development and  implementation of SSS a national priority for enhancing freight mobility  and has undertaken numerous activities but has not articulated a clear  rationale for what the federal role, if any, should be. Objectives, Scope, and Methodology

To determine why short sea shipping (SSS) is being considered as an  alternative method for transporting freight and factors that may affect its  viability as an approach, we conducted a literature review of reports and  studies related to freight transportation issues; interviewed freight  transportation stakeholders representing all levels of government;  interviewed private-sector stakeholders involved in various aspects of the  freight transportation system; and examined two existing SSS operations.
Why GAO Did This Study

A dramatic increase in freight moving on the nation's highways and rail lines, coupled with growing congestion and infrastructure limitations, has prompted DOT to explore new mobility-enhancing options like short sea shipping (SSS)--transporting freight by water between domestic ports, either along the coast or on inland waterways. This report describes (1) why SSS is being considered and factors affecting its viability, (2) the department's role in the development of this option, and (3) issues that should be considered by public transportation decision makers when making investment decisions about this option or other types of projects for addressing freight mobility challenges. This report is based on a review of pertinent studies, federal activities, and an examination of two new SSS operations.

What GAO Found

Transportation experts have cited numerous benefits, such as congestion mitigation, for developing short sea shipping, but they have also noted numerous obstacles, such as shippers' reluctance to try a different mode for transporting their cargo, that impede its development. Absent in-depth information on the benefits and obstacles, opinions vary on how to proceed. Some stakeholders favor extensive public involvement, including federal funding for projects while others see a more limited public role, such as addressing regulatory provisions that may interfere with its development. The two new services GAO examined provide insights--but no clear answers--about the viability of this approach. The Department of Transportation (DOT) has made short sea shipping a high-priority option to enhance freight mobility and has drafted a policy proposal to provide potential federal funding. So far, the department's efforts have been too narrowly focused. Before determining that federal funding should be applied to its development, a thorough understanding of key issues is required, such as the potential effect of federal involvement on the competitive balance among all transportation modes, lessons to be learned from recent start-up services, and actions that could mitigate identified obstacles, particularly with respect to reluctance to use this option. Public transportation decision makers are also actively considering short sea shipping in the context of a range of other options to address freight mobility challenges in their jurisdictions. Improving freight mobility, however, is a particularly complex challenge because the freight transportation system encompasses many modes on systems owned, funded, and operated by both the public and private sectors. In light of growing budget deficits, public decision makers must guard against waste of limited public resources when making investment decisions. This report contains a four-step approach for helping public decision makers define the rationale for public involvement, assess the merits of projects, determine the appropriate level and type of public support, and evaluate project results.