The federal government will contribute another $41.4 million toward the Charleston Harbor deepening that's designed to keep big container ships visiting the Port of Charleston, the Army Corps of Engineers said Wednesday.
The money is coming from the Army Corps' work plan, which provides funding for waterway navigation and other projects in addition to what is included in President Donald Trump's annual budget.
This year's funding adds to previous disbursements of $49 million and $17.5 million over the past two fiscal years.
"This is truly one of the most important infrastructure projects that our state has undertaken and to keep that funding on track is really paramount," said Barbara Melvin, senior vice president of operations and terminals for the State Ports Authority, which operates the Port of Charleston.
"To have a consistent stream of funding as we have in the work plan so far to match the very large commitment that our (state) legislature has put forward is extremely reassuring to us," Melvin said.
Even more federal funding could be announced in a few months for the $558 million dredging project, which will dig the harbor's shipping channel to a 52-foot depth.
The SPA announced last month that the dredging's benefit-to-cost ratio — a mathematical formula used to determine federal funding — has been revised upward. The change pushed the project past the threshold needed to be included in the president's next budget, expected to be released in February.
The ratio, last calculated in 2012, was revised because of record cargo growth at the port. It means that for every $1 the government spends on the project, it can expect a return of $6.40 in economic benefits. Until now, the ratio had been too low, which limited the funding sources.
"We have had no indication whether we'll be in (the president's budget) or not, but the good news for us that we are now eligible for that consideration," Melvin said.
Jim Newsome, the ports authority's president and CEO, said "we should be competitive for the president's budget" with the higher ratio.
The Charleston Harbor deepening was the only South Carolina project included in the roughly $7 billion work plan announced Wednesday.
Newsome said a deeper harbor "is vitally important for significant long-term volume growth and the deployment of large container ships" at the port.
Since the Panama Canal expansion was completed in 2016, shipping lines have been sending vessels capable of carrying up to 14,000 cargo boxes to East Coast ports, and Newsome said ships carrying as many as 18,000 containers is likely next year. A 52-foot depth will let those ships call on the Port of Charleston at any time regardless of tides.
Bill Stern, the authority's chairman, called the latest funding "tremendous for the continued construction" of a deeper harbor. Gov. Henry McMaster called it "an investment in our entire state's future" that will help drive more business to South Carolina.
The Army Corps last year awarded two contracts to Great Lakes Dredge & Dock to start digging Charleston Harbor to a 52-foot depth. Work began in February.
The first contract, for $47 million, is to remove 6 million cubic yards of material from the entrance channel. The second contract — at $213 million the largest awarded by the local Army Corps office — is to remove nearly 8 million cubic yards of material.
The project’s next contract — to dig the harbor from its entrance channel to the Wando Welch Terminal in Mount Pleasant — will be awarded in the coming year. That will include widening the turn basin by about 200 feet to 1,650 feet so that large container ships can more easily navigate the terminal.
The dredging costs are paid by both the state and federal governments, with the feds picking up the biggest portion at about $308 million.
South Carolina legislators in 2012 set aside $300 million toward the project — about $50 million more than the state's share — to make sure dredging is completed by 2021, when the port's new container terminal at the former Navy base in North Charleston is scheduled to open.
The state money has kept the project on track as federal dollars trickle in, and the excess set aside by legislators eventually will be refunded through federal appropriations. To date, the federal government has committed $107.9 million to the project.
The Port of Charleston is the nation’s ninth-largest seaport in terms of containerized cargo volume and has grown at a faster rate — 8 percent annually — than any other port since 2009. The port handled a record 2.2 million cargo containers in its latest fiscal year, which ended June 30.