USA Maritime, Coalition Members Participate in Maritime Strategy Symposium

National Maritime Strategy Symposium: Cargo Opportunities and Sealift Capacity

USA Maritime, a coalition of ship-owning companies, maritime labor organizations, and maritime trade associations, respectfully submits the following comments for consideration during the development of the U.S. Maritime Administration’s (MARAD) National Maritime Strategy policy document. USA Maritime directly and indirectly represents virtually every one of the privately-owned U.S.-flag oceangoing commercial vessels operating regularly in the U.S.-foreign trade and engaged in programs like cargo preference and the Maritime Security Program that enhance the competiveness of U.S.-flag vessels in the global marketplace.

Maritime Security Program

USA Maritime urges the Federal Government to reaffirm its support for the Maritime Security Program (MSP). Specifically, positive, public and vocal support for this program is needed from the highest levels of the Administration, along with a clear demand for full funding for MSP in order to prevent the loss of U.S.-flag vessels, American maritime jobs and sealift readiness. Such support is essential to ensure the resources are in fact available to maintain the MSP fleet of 60 militarily useful ships. The program was recently reauthorized by Congress through 2025, in recognition that it remains the most cost-effective means of sealift available to the U.S. government.

Cargo Preference

USA Maritime also urges the Federal Government to reaffirm its support for existing U.S.-flag shipping cargo preference requirements. More specifically, the need for a Presidential Directive to all Federal shipper agencies reaffirming the policy of the United States that privately-owned U.S.-flag vessels should, and must, be used for the carriage of U.S. government-generated exports and imports as required by law. The cargo preference laws (the 1904 Act, the 1954 Act, P.R.-17 (1934), and the Food Security Act) maintain the economic viability of the nation’s maritime industry and bolster national security by ensuring that U.S.-flag vessels and U.S. crews are available during wartime. Given the importance of U.S.-flag sealift to meeting government shipping requirements in peacetime and wartime, federal agencies should maximize the use of U.S.-flag vessels wherever possible. USA Maritime also urges MARAD to ensure and enforce full compliance with existing cargo preference requirements. Specifically, in order to achieve full compliance as well as the timely and efficient transportation of U.S. government cargoes, MARAD should exercise its statutory authority as the final arbiter when questions regarding the applicability and implementation of cargo preference requirements arise.

Regulatory & Taxes

USA Maritime urges MARAD to consider the factors that impede the increase in the amount of U.S. commercial cargoes transported by U.S.-flag commercial vessels. The U.S.-flag international fleet should not be put at further competitive disadvantage through expanded or unreasonable regulation by the Federal Government, and should be regulated no more harshly than vessels under flag-of-convenience registries. MARAD should consider issues like: preserve and enhance the existing tonnage tax for U.S.-flag vessels in international trades; the inapplicability of section 911 of the Internal Revenue Code to American mariners. The differences between the regulatory and tax treatment of U.S.-flag vessels and their American crews as compared to that of foreign-flag vessels and foreign crews should be considered as part of the comprehensive strategy, including what can and should be done by the Administration and/or Congress to eliminate such economic disincentives for the utilization of U.S.-flag vessels and the employment of American mariners.

Transportation of Energy

USA Maritime also encourages MARAD to support the utilization of U.S.-flag vessels for the carriage of Liquefied Natural Gas (LNG) and Liquefied Petroleum Gas (LPG) exports from the United States, and the employment of American mariners on foreign flag LNG and LPG vessels operating in the U.S – foreign trades. More specifically, we recommend elimination of regulatory and tax measures that discourage the operation of LNG and LPG vessels under the U.S.-flag and adoption of measures that enhance the economic and competitive viability of U.S.-flag LNG and LPG ships and American mariners. James H. Henry Chairman USA Maritime   MM&P and MEBA Submission  (PDF)