MARITIME SECURITY PROGRAM (MSP) FUNDING
The Maritime Security Program (MSP) and its 60-ship maritime security fleet of privately-owned militarily useful U.S.-flag commercial vessels provide the Department of Defense with the U.S.-flag commercial sealift capability, access to the private shipping companies’ global intermodal and logistics systems, and to the U.S. civilian mariners needed to support American troops and to protect America’s security interests around the world, all at a fraction of what it would cost the Federal government to provide this capability itself.
A 2006 report prepared for the National Defense Transportation Association – Military Sealift Command concluded that “the likely cost to the government to replicate just the vessel capacity provided by MSP dry cargo vessels would be $13 billion. In addition, the United States Transportation Command has estimated that it would cost the U.S. Government an additional $52 billion to replicate the global intermodal systems made available to DOD by MSP contractors.
Since 2009, U.S-flag commercial vessels and their civilian crews have carried more than 90 percent of the cargo needed to support U.S. military operations and rebuilding programs in Afghanistan and Iraq, and vessels enrolled in the MSP carried 99 percent of those cargoes.
Significant reductions in the amounts of defense and other government cargoes available to U.S.-flag vessels; the proliferation of tax and other economic incentives available to foreign flag vessels and foreign crews but not to U.S.-flag vessels and crews; the regulatory compliance requirements imposed only on U.S.-flag vessels by the U.S. government; and the growing competition for cargoes from foreign flag of convenience vessels operation all necessitate full funding for the MSP. Congress has authorized $299.997 million for the MSP in FY’17 and $300 million for the MSP in FY’18.
We believe the choice is simple: does the United States continue to entrust the security of our Nation and the safety of American troops to U.S.-flag vessels crewed by United States citizens that have always responded to our Nation’s call, or turn over America’s security interests and the well-being of American troops stationed around the world to foreign flag, foreign crewed vessels which may or may not choose to support the United States by sailing into harm’s way when needed.
We urge Congress and the Administration to support full FY’2017 and full FY’2018 funding for the Maritime Security Program at the authorized levels.
CARGO PREFERENCE SHIPPING REQUIREMENTS
U.S.-flag cargo preference shipping requirements ensure that at least a portion of taxpayer financed United States government cargoes will be carried on U.S.-flag vessels crewed by American mariners. Cargo preference helps to ensure the continued availability of the privately-owned U.S.-flag commercial fleet which, along with its associated American maritime manpower, is a critical national defense asset. These requirements further help guarantee that American maritime jobs will not be outsourced to the benefit of foreign maritime workers.
All too often in the past, Federal shipper agencies and departments have failed to comply with U.S.-flag shipping requirements, denying American vessels their rightful share of these cargoes, denying American maritime workers important job opportunities aboard these vessels, while instead spending American taxpayer dollars exclusively on foreign flag shipping services.
We urge Congress and the Administration to express their support for the full implementation of U.S.-flag cargo preference shipping requirements and to restore the longstanding requirement that U.S.-flag vessels carry no less than 75 percent of U.S. government financed food aid cargoes.
In addition, we urge Congress and the Administration to ensure that all Federal agencies and departments use privately-owned U.S.-flag commercial vessels for the carriage of U.S. government generated cargoes as required by law.
In addition, we urge the Administration to oppose proposals that would transform the Food-for-Peace (PL 480) Program into a program that sends taxpayer dollars instead of American produced agricultural commodities overseas to help feed the world’s neediest peoples.
We urge Congress and the Administration to support the existing PL 480 Program so that American taxpayer dollars continue to benefit American farmers, American shipping, and American jobs.
REAUTHORIZATION OF THE EXPORT-IMPORT BANK
Since 1934, the Export-Import Bank has provided direct loans, loan guarantees, working capital guarantees and credit insurance to encourage the foreign purchases of U.S.-made products. It helped to facilitate more than $37 billion in export sales in FY 2013, supporting more than 200,000 American jobs.
Equally important, a percentage of Export-Import Bank financed exports must be shipped on U.S.-flag commercial vessels, providing an important source of cargo for the U.S.-flag fleet. The U.S.-flag vessels supported by Export-Import Bank cargoes are crucial to protecting America’s security and economic interests.
In short, the full resumption of actions by the Export-Import Bank represents a smart and sound investment in America and in our U.S.-flag fleet.
We urge Congress and the Administration reauthorize the Export-Import Bank as a way to generate jobs for American workers in the U.S. manufacturing and service industries, including the U.S. maritime industry.
THE JONES ACT
The Jones Act requires that cargo transported by water between ports in the United States is carried on vessels owned and crewed by American citizens and built in American shipyards. According to a recent study by PricewaterhouseCoopers, the Jones Act generates 500,000 high-quality American jobs, produces an economic output in the U.S. of more than $100 billion annually, and provides critical homeland security, economic, environmental, and safety benefits to our nation. An additional U.S. Maritime Administration study concluded that the American shipbuilding and repair industry supports annual employment in the U.S. for more than 400,000; generates annual labor income of about $24 billion; and creates an annual gross domestic product of $36 billion.
The full enforcement of the Jones Act is essential to ensure that vessels carrying cargo along our coasts, in our non-contiguous trades, on our rivers and on the Great Lakes are not controlled by foreign shipping interests and foreign citizen crews. We urge Congress to continue to support this critically important national maritime policy.
NATIONAL SECURITY MULTI-MISSION SHIP FUNDING
The 2017 National Defense Authorization Act (NDAA) directed the Secretary of Transportation to complete the design of a National Security Multi-mission Vessel (NSMV) for the National Defense Reserve Fleet in order to allow construction of the NSMV to commence in fiscal year 2018. Toward this end, $36 million was authorized in the 2017 NDAA to support the NSMV program. Now it is essential that $36 million also be appropriated in the 2017 budget to fund the authorized design of the NSMV. READ MORE (PDF)
ELIMINATING CONFLICTING VESSEL DISCHARGE REGULATIONS
We urge Congress to enact legislation to eliminate an overlapping patchwork of federal and state ballast water discharge regulations that has made compliance confusing and costly for vessel owners and mariners and has impeded new investments by the maritime industry in environmentally protective ballast water treatment technologies. Support for such legislation is widespread throughout the maritime industry – U.S. and international vessel owners and operators; fishing vessel, passenger vessel and charter boat operators; labor unions; the Navy League of the United States; marine terminals and port authorities – as well as national business organizations and industries that rely on commercial vessels to transport essential cargoes.
We urge Congress to provide much-needed regulatory certainty for vessel owners and mariners.