H.R. 1297: LPOE Modernization Trust Fund Act

This bill, titled the LPOE Modernization Trust Fund Act, proposes the establishment of a new fund within the U.S. Treasury called the Land Port of Entry Modernization Trust Fund (Trust Fund). This Trust Fund is intended to finance improvements and enhancements at U.S. ports of entry. Here are the primary components of the bill:

Creation of the Trust Fund

The Trust Fund will consist of:

• Twenty-five percent of specific fees collected under existing laws related to customs and immigration.
• Up to $1.6 billion from merchandise processing fees collected annually.
• Twenty-five percent of certain surcharges on immigration fees.

Investment and Use of the Trust Fund

Amounts in the Trust Fund will be invested in U.S. government obligations, with any interest earned credited back to the Fund. These funds can be used only with prior approval from Congress for the following purposes:

• Construction of new ports of entry.
• Expansion and improvement of existing port infrastructure to handle increased traffic.
• Acquisition of technology and infrastructure to enhance inspection and processing capabilities.
• Major repairs and alterations to existing ports.
• Hiring additional staff for U.S. Customs and Border Protection (CBP) and agricultural specialists to support operations.

Oversight and Reporting

The bill establishes a Land Port of Entry Modernization Oversight Board to advise on prioritizing and reviewing spending from the Trust Fund. This Board will consist of nine members, including various government representatives and stakeholders from the trucking and transportation industries. Members are expected to meet annually to discuss and report on the Trust Fund's activities.

Limits on Fee Increases

Importantly, the bill specifies that the Secretary of Homeland Security shall not seek to increase fees related to customs and immigration to fund the Trust Fund.

Mandatory Reporting

The Secretary of Homeland Security will be required to report annually to Congress on the Trust Fund's status, detailing how funds have been used and what remains in the Trust Fund, along with any upcoming plans for expenditures.

Implementation Timeline

Funds from the Customs User Fee Account must be transferred to the Trust Fund no later than 60 days after the bill's enactment. The bill also outlines the specific fees and surcharges applicable to various immigration and customs processes.

Definitions

The bill provides several definitions, including clarification on the roles of various secretaries and what constitutes appropriate congressional committees involved in oversight.

Relevant Companies

• CSX (CSX Corporation) - As a major transportation provider, changes in port operations and improvements could significantly affect CSX's logistics and supply chain capabilities.
• UPS (United Parcel Service) - This logistics and package delivery company relies heavily on ports for international shipping; enhancements or delays could impact operations and delivery schedules.
• XPO (XPO Logistics) - As a global provider of supply chain solutions, XPO may see both opportunities and challenges based on how ports modernize and adapt to increased traffic and technologies.