Posted:
May 2, 2014
In its markup of the National Defense Authorization Act for fiscal year 2015, the House Armed Services Subcommittee on Seapower and Projection Forces at the end of April approved language that would authorize full funding for the Maritime Security Program in the next fiscal year, authorize $70 million for shipbuilding loan guarantees under the Title XI program and provide a strong endorsement of the U.S. domestic shipping industry and its importance to U.S. military sealift capabilities and the national economy.
Led by Chairman Randy Forbes (R-VA), the subcommittee approved the markup of the legislation April 30 and forwarded it to the full Armed Services Committee for consideration. Among other things, the subcommittee's markup would authorize $186 million for the Maritime Security Program, full funding for the 60-ship fleet in fiscal year 2015. The markup would also authorize $73.1 million for the Maritime Administration's Title XI Maritime Guaranteed Loan Program, of which $70 million would be designated for loan guarantees. Title XI is not a subsidy program. Developed to facilitate the construction of merchant vessels in U.S. shipyards, Title XI provides federal loan guarantees for private sector financing of commercial construction projects and eases access to credit for companies planning to build new ships in the U.S.
The markup would also codify the sense of Congress regarding the importance of the domestic shipping industry operating under the Jones Act. The language in the subcommittee's markup reads:
Editor's note: Currently, there are orders placed with U.S. shipyards for the construction of 11 Jones Act tankers and one liquid cargo articulated tug/barge unit to be operated by AMO-contracted companies. These orders collectively include options for an additional nine tankers. Orders have also been placed with U.S. shipyards for a total of four Jones Act LNG-powered dry cargo ships to be operated by AMO-contracted companies. One order includes options for three additional LNG-powered ships. One additional Jones Act combination container and roll-on/roll-off cargo ship to be operated by an AMO-contracted company is due for delivery this year.
Seapower Subcommittee's legislative markup shows strong support for MSP, shipbuilding loan guarantees, U.S. domestic shipping industry
In its markup of the National Defense Authorization Act for fiscal year 2015, the House Armed Services Subcommittee on Seapower and Projection Forces at the end of April approved language that would authorize full funding for the Maritime Security Program in the next fiscal year, authorize $70 million for shipbuilding loan guarantees under the Title XI program and provide a strong endorsement of the U.S. domestic shipping industry and its importance to U.S. military sealift capabilities and the national economy.
Led by Chairman Randy Forbes (R-VA), the subcommittee approved the markup of the legislation April 30 and forwarded it to the full Armed Services Committee for consideration. Among other things, the subcommittee's markup would authorize $186 million for the Maritime Security Program, full funding for the 60-ship fleet in fiscal year 2015. The markup would also authorize $73.1 million for the Maritime Administration's Title XI Maritime Guaranteed Loan Program, of which $70 million would be designated for loan guarantees. Title XI is not a subsidy program. Developed to facilitate the construction of merchant vessels in U.S. shipyards, Title XI provides federal loan guarantees for private sector financing of commercial construction projects and eases access to credit for companies planning to build new ships in the U.S.
The markup would also codify the sense of Congress regarding the importance of the domestic shipping industry operating under the Jones Act. The language in the subcommittee's markup reads:
- The United States domestic maritime industry carries hundreds of million of tons of cargo annually, supports nearly 500,000 jobs, and provides nearly $100 billion in annual economic output;
- The Nation's military sealift capacity will benefit from one of the fastest growing segments of the domestic trades, 14 domestic trade tankers that are on order to be constructed at United States shipyards as of February 1, 2014;
- The domestic trades' vessel innovations that transformed worldwide maritime commerce include the development of containerships, self-unloading vessels, articulated tug-barges, trailer barges, chemical parcel tankers, railroad-on-barge carfloats, and river flotilla towing systems;
- The national security benefits of the domestic maritime industry are unquestioned as the Department of Defense depends on United States domestic trades' fleet of container ships, roll-on/roll-off ships, and product tankers to carry military cargoes;
- The Department of Defense benefits from a robust commercial shipyard and ship repair industry and current growth in that sector is particularly important as Federal budget cuts may reduce the number of new constructed military vessels; and
- The domestic fleet is essential to national security and was a primary source of mariners needed to crew United States Government-owned sealift vessels activated from reserve status during Operations Enduring Freedom and Iraqi Freedom in the period 2002 through 2010.
Editor's note: Currently, there are orders placed with U.S. shipyards for the construction of 11 Jones Act tankers and one liquid cargo articulated tug/barge unit to be operated by AMO-contracted companies. These orders collectively include options for an additional nine tankers. Orders have also been placed with U.S. shipyards for a total of four Jones Act LNG-powered dry cargo ships to be operated by AMO-contracted companies. One order includes options for three additional LNG-powered ships. One additional Jones Act combination container and roll-on/roll-off cargo ship to be operated by an AMO-contracted company is due for delivery this year.