10 Minutes With … Jim McCarville

The Waterways Journal
25 April 2011
By Tom Gladders
Special Contributor To The Waterways Journal

James McCarville has served as executive director of the Port of Pittsburgh since 1994. He previously served as executive director of the Port of Superior, Wis. (1977–84), and Richmond, Va. (1984–90). As a port consultant (1990–93), he advised the governments of Brazil, Uruguay and Mexico on matters concerning port organization, operational efficiency and privatization and, for the governments of the United States and Panama, he was one of two permanent experts hired to develop the strategic transition plan for the transfer of the Panama Canal.

Pittsburgh is the nation’s second-largest inland river port, serving 12 southwestern Pennsylvania counties; 200 river miles on the Ohio, Allegheny and Monongahela rivers; 17 sets of locks and dams; and 200 privately owned river facilities. Annual tonnage runs from 30 million to 40 million tons a year, bringing an estimated $800 million in economic benefits to the region.

In the past 17 years, McCarville has secured significant federal funds for rebuilding aging infrastructure in the Port of Pittsburgh and developed new technologies for river transportation. Among these is “SmartLock,” for which the port obtained a patent. He was a moving force in creating the “SmartRivers” conferences, a benchmarking exercise for U.S. and European inland ports. After SmartRivers 2011, to be held in September in New Orleans, the conference will be picked up by PIANC International to benchmark best river transportation practices worldwide.

McCarville has been active on the boards of numerous national waterways-related groups over the years, including Waterways Council Inc. and the National Waterways Conference, and serving as a past president of Inland Rivers Ports & Terminals. In 2007 he was elected eastern region vice-president of PIANC-USA.

A native of Wisconsin, McCarville is a graduate of Regis College in Denver and holds advanced degrees in foreign service from Georgetown University and urban studies from Roosevelt University, Chicago.

WJ: Growing up in Wisconsin, did you have a mentor or two? What life lessons did they impart?
McCarville: My best coaches were my father and mother. He was a focused engineer and she was an eclectic writer, one a Republican and one a Democrat. They might switch sides from time to time, to vote for the best person, but it wasn’t unusual for them to switch at the same time. What I learned from them was that it was OK for me to make up my own mind, but to always respect the person who holds the opposite view.

WJ: Pittsburgh has been transformed over the past 30 years from an industrial powerhouse to a city focused on finance, medical services, research and innovation. How has the port changed over this period? How does it continue to contribute to the economy of southwestern Pennsylvania?
McCarville: Perhaps surprisingly, except for this recent downturn, the Port of Pittsburgh has grown consistently over the years. The Clean Air Act, requiring coal blending, was a big boon to the tonnage. But, credit is also due to the entrepreneurs who took over old steel yards and converted them into waterway-oriented industrial parks. Now those same entrepreneurs are looking at coal exports and new cargoes related to the natural gas developments with the Marcellus Shale. According to an economic impact study done by Martin Associates, the waterways support 45,000 direct jobs in transportation, manufacturing and logistics. Today the port is engaged not only in promoting transportation, but in promoting new technologies and best practices as well.

WJ: How do you foresee the outlook for infrastructure investment on the inland waterways system given the current budget issues facing Congress and the administration?
McCarville: It’s a cultural problem, it runs deep and it is contrary to the traditions that have made us what we are. People once believed that good infrastructure and good transportation led to prosperity. I wish we still did. Today, we are not even maintaining the infrastructure that a short time ago was touted as the envy of the world. The same complaint might go for much of our electrical grid, underground water pipes and sewage disposal systems. If we wait for everything to fall apart, we may never be able to fix it. So, until we wake up, I am in the pessimistic camp for improving our waterway infrastructure. …But we have to wake up!

WJ: Citing budget pressures, the Corps of Engineers recently reduced operational hours at several locks on the Allegheny. Will this have a material effect on the port’s operations or a negative impact on the image of the port in attracting new industry?
McCarville: When the Corps learned they would have to make operations and maintenance cuts on the Allegheny River, they spent a lot of time with industry and with recreational boaters to minimize the operational impacts. Not everyone was happy, but the cargo will be able to get through, even if it requires appointments. “Rec” users will have some weekend activities curtailed. Two of the uppermost locks, with little to no commercial traffic, will be put in “caretaker status.” For practical purposes, they will be closed. Armstrong County commissioners are investigating a “voluntary Corps,” to assist in the grass cutting and limited operations, but it will require resolution of legislative and liability issues. This limited reduction in hours of operations, however, does not scare me nearly as much as the cuts to maintenance throughout the system. With virtually no maintenance on the Allegheny and grossly inadequate maintenance on many other rivers, are we creating problems for generations to come. And next year it may be a river near you.

WJ: “Cap and Trade” may yet rear its head through Environmental Protection Agency regulatory fiat, despite ongoing efforts to kill it through Congressional appropriation bans on implementation funding for EPA. Should Cap and Trade eventually be implemented, what impact would it have on the port?
McCarville: “Cap and Trade,” as far as I can tell, is dead. I am not sure what may take its place, but whatever it is, coal is going to remain a big part of the nation’s electricity supply for a long time to come and waterway transportation is still going to be the cheapest way to move it.

WJ: “SmartLock”—what is it and is the Corps looking at using it systemwide?
McCarville: Think of SmartLock as a GPS on steroids for river pilots entering lock chambers. It is a virtual navigation system that we developed with Carnegie Mellon University.
SmartLock is only one part of a strategy to bring new technologies to river transportation.
We are now working to develop a wireless broadband test bed for the rivers. We are only at the beginning of what applications may develop out of this. The Corps, partially in anticipation of this, has already conducted high-accuracy surveys of its locks and is digitizing all its information for commodities and locations on the river. Once completed, not only the Corps, but towing companies, river terminals, cargo interests and many others will be able to have inexpensive real-time visibility via secure, broadband Internet services.

WJ: You’ve been involved in strategic planning for the Panama Canal and its transition to Panamanian control. What were the most difficult issues facing each country as this transition took place?
McCarville: The biggest problem was simply getting the two sides to start talking. Remember, our mission was shortly after the U.S. invasion to arrest President Noriega. Almost every historical event, including key traffic arrests, had two very different versions.
After the talking started, there was a genuine interest at getting to solutions. People on both sides recognized the complexity of going from one set of laws (regulating accounting, labor relations and environmental protection, etc.) to another completely different set. Take the example of the “sexual harassment” issue. Panamanians viewed it quite differently than many Americans. The compromise was beautiful in its simplicity. They agreed to recognize any precedent in U.S. legislation or case law decided before December 31, 1999, and only new Panamanian legislation or case law decided after that date.

WJ: With the pending expansion on the Panama Canal, should we anticipate benefits flowing to the inland river system in the U.S.? What commodity flows would likely most benefit?
McCarville: The expansion of the Panama Canal will have a beneficial impact on trade flowing on the inland rivers, especially for grain and possibly even coal exports to China and India.

WJ: For decades, it seems, the industry has been talking up “Container on Barge” development, and you have had an interest in that topic. What will it take to bring some juice to growing that market? Are the infrastructure needs to develop that market so great that progress will be nigh on unobtainable?
McCarville: The No. 1 obstacle to developing inland waterway container-on-barge is that of organizing a very large and complex marketplace, including multiple ports, commodities, schedules, shippers, rates, origins and destinations, especially if we are to organize the domestic container-on-barge market. Shippers want to talk to one person who can speak to door-to-door deliveries anywhere within the river system. New information technologies are now available to organize what would have been very difficult in the past.
The second, and perhaps more difficult, obstacle, especially for the upper rivers, is the poor condition of locks and dams that could create unexpected delays in deliveries.
The third obstacle is expertise. Terminals that do not have experience in handling containers find it hard to estimate and quote rates.
The fourth obstacle is equipment. Existing vessels could be used to start a system, but may not be as efficient as “Rhine” type vessels used in Europe. Terminal handling equipment, especially for terminals capable of handling steel coils, could also start a system of COB. Improvements in vessels, yard equipment and mobile cranes could be added as the cargo grows.
Fifth, we don’t think about transport the same way they do in Europe. They have learned to translate the public benefits of reducing road congestion and air pollution into market incentives to move goods in the most socially efficient manner. We haven’t reached that concept yet.

Unfortunately, many parties want to start with building a new facility. This is the least important obstacle to container-on-barge growth.

WJ: If you could spend one hour with President Obama, what advice might you offer?
McCarville: If we don’t find a way to fix our inland waterway infrastructure now, it will cost much, much more to do so later;
•    and  later on, the accumulated cost will be so great that we may or may not be able to afford to fix it;
•    and  in the process of delaying the fix, we risk destroying a lot of wealth-generating waterway transportation activities that make this nation prosperous, and the jobs that go with it.

WJ: What is your favorite cable channel and why?
McCarville: C-SPAN, or anything but the cable news networks.

WJ: What will you be doing 10 years from now?
McCarville: There are a lot of things I would like to do for myself. I would like to write and travel, a little consulting and a lot of grandparenting. If I am really lucky, I will still be looking for a job to do, but perhaps not looking all that hard.