House approves defense budget bill that boosts U.S. maritime
The House of Representatives December 8 voted 335-78 to approve a comprehensive defense budget measure that includes significant support of the U.S. merchant fleet and American merchant mariners.
The legislation was a House-Senate conference report marking agreement between the House and Senate Armed Services Committees on H.R. 6395 - the National Defense Authorization Act for fiscal year 2021, which began October 1, 2020.
The conference report also includes provisions from separate bills authorizing budgets for the Maritime Administration and for the U.S. Coast Guard.
The conference report authorizes $494 million for the 60-ship Maritime Security Program "for expenses necessary to maintain and preserve a United States-flag merchant marine to serve the national security needs of the United States."
The annual stipend for each of the ships participating in the Maritime Security Program would increase gradually from $5.2 million to $6.2 million, beginning in fiscal 2021. The ships and all intermodal and logistics support systems owned by the participating U.S.-flag companies would remain available on demand to the Department of Defense for sealift services in national security emergencies.
During the long wars in Afghanistan and Iraq following the airborne terrorist attacks on the World Trade Center in New York City and the Pentagon on September 11, 2001, ships enrolled in the MSP's Maritime Security Fleet delivered nearly 95 percent of the vehicles, heavy equipment and other defense cargoes to U.S. Armed Forces in Southwest Asia and in the Middle East.
The conference report's authorized funding of the Maritime Security Program at $494 million is $180 million more than the President had requested for the fiscal year. The additional funding would offset the potential economic harm of the COVID-19 pandemic on the MSP fleet and "enable MSP carriers to keep their ships fully crewed despite the lack of cargo as a result of COVID."
The legislation also expresses persuasive specific support of the Jones Act.
"It is the sense of Congress that the United States coastwise trade laws promote a strong domestic trade maritime industry, which supports the national security and economic vitality of the United States and the efficient operation of the United States transportation system, and a strong commercial maritime industry makes the United States more secure," the conference report said.
The measure tightens the criteria under which the Jones Act can be waived with the approval of the Department of Defense.
Jones Act waivers would be permitted only when the Secretary of Defense determines that such exemptions are "necessary in the interest of national defense to address an immediate adverse effect on military operations."
The Defense Secretary would be required to inform Congress of the reason for a waiver and to certify "there are insufficient Jones Act vessels to meet the needs of national defense without a waiver."
Jones Act waivers would be permitted for no more than 10 days but may be expanded for additional 10-day periods as necessary up to a maximum of 45 days.
Addressing the U.S.-flag cargo preference laws, the conference report directs the Comptroller General of the United States to "conduct an audit regarding the enforcement of the laws," which set aside 100 percent of defense cargoes and at least 50 percent of all other government-financed imports and exports for U.S.-flagged merchant ships.
The Comptroller General would be required to report to Congress on this audit within one year and to recommend "actions that should be taken by agencies and organizations to fully comply with the United States cargo preference laws and other measures that may compel agencies and organizations and their contractors and subcontractors to use United States flag vessels in the international transportation of ocean cargoes as mandated by the United States cargo preference laws."
The report's summary specifies direct interest in the 1904 defense cargo preference law, but the 1954 law applicable to non-defense cargoes serves the same purpose - to make U.S. merchant ships available for defense missions.
The measure authorizes $142 million "for sealift readiness to help address shortfalls found during a turbo activation exercise in 2019" and $120 million for "the acquisition and conversion of two additional used sealift vessels."
In addition, the conference report establishes a Tanker Security Fleet Program modeled after the Maritime Security Program "to fill the gaps in at-sea logistics." It authorizes $388.7 million for a fourth multipurpose maritime academy training ship that would also be available for defense shipping or humanitarian missions and $9.7 million for "Marine Highway" projects.
Under the relevant portion of the conference report, MARAD is authorized to assist the maritime industry and protect the supply lines during the COVID-19 crisis.
The measure classifies COVID-19 as "an emergency," and authorizes MARAD grants to vessel operators, shipyards and suppliers for "maritime education and training" and for "emergency response, cleaning, sanitization, janitorial services, staffing, workforce retention, paid leave, procurement and use of protective health equipment, testing and training for employees and contractors, debt service payments, infrastructure repair projects, fuel and other maritime transportation system operations as determined by the Secretary of Transportation."
MARAD would be required to set a five-year plan "to recruit, train and retain merchant mariners."
MARAD and the Secretaries of Education, Labor and Veterans' Affairs "shall conduct a study to identify federal financial assistance available for the training of merchant mariners and to develop and improve licensed and unlicensed merchant mariner access to such assistance," the conference report said.
Money authorized for the Coast Guard through the conference report supports border protection, safety at sea, curbing the overseas influx of illegal narcotics and easing commercial waterborne commerce.
The conference report is expected to pass the Senate. The President has threatened to veto the measure for reasons unrelated to the provisions outlined here, but Congressional leaders believe they have support sufficient to override a veto.