[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[S. Res. 115 Introduced in Senate (IS)]

103d CONGRESS
  1st Session
S. RES. 115

  Expressing the sense of the Senate regarding the need to eliminate 
   price-gouging in the transportation of food assistance to Russia.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                May 28 (legislative day, April 19), 1993

Mr. Brown (for himself, Mr. Pressler, Mr. Durenberger, Mrs. Kassebaum, 
   Mr. Grassley, Mr. Nickles, and Mr. Craig) submitted the following 
 resolution; which was referred to the Committee on Commerce, Science, 
                           and Transportation

_______________________________________________________________________

                               RESOLUTION


 
  Expressing the sense of the Senate regarding the need to eliminate 
   price-gouging in the transportation of food assistance to Russia.

Whereas on April 3, 1993, in Vancouver, Canada, the President of the United 
        States and the President of the Russian Federation announced a 
        $1,600,000,000 aid package for Russia, including $700,000,000 in food 
        assistance;
Whereas the provision of food assistance announced at the Vancouver summit is a 
        vital sign of United States support for Russia's continued movement 
        toward democracy and transition to a market economy;
Whereas on May 3, 1993, the United States Government and the Government of 
        Russia reached initial agreement on the $700,000,000 in food assistance 
        to be extended by the United States to Russia;
Whereas the agreement stipulated that while $500,000,000 of the United States 
        food aid package will be used for Russia to purchase United States 
        agricultural commodities, the remaining $200,000,000, as estimated by 
        the Administration, will be used solely to cover the cost of 
        transportation;
Whereas the Administration announced that 75 percent of the commodities would be 
        shipped on United States-flag commercial vessels under United States 
        cargo preference requirements;
Whereas United States cargo preference laws require at least 75 percent of 
        United States food assistance shipped overseas to be shipped on United 
        States-flag commercial vessels;
Whereas this requirement eliminates competition and encourages shippers to 
        charge the United States Government rates two or three hundred percent 
        above world market shipping rates;
Whereas the current world market shipping rate is between $25 and $35 per metric 
        ton;
Whereas shippers, anticipating the elimination of competition, have offered bids 
        for shipping the grain to Russia between $75 and $138 per metric ton;
Whereas these bids are up to 4 times greater than comparable world rates;
Whereas the cost of the grain itself is approximately $100 per metric ton;
Whereas the effect of the cargo preference requirements is to increase the cost 
        of transportation so that it nearly equals or exceeds the cost of the 
        grain itself; and
Whereas the effect of the cargo preference requirements increases the taxpayer 
        cost of assistance to Russia: Now, therefore, be it
    Resolved, That it is the sense of the Senate that--
            (1) the food assistance provided by the United States 
        Government to Russia has been supported and approved to meet 
        the dire humanitarian needs of the Russian people;
            (2) the increased cost of assistance to Russia resulting 
        from cargo preference requirements could adversely affect the 
        progress of democracy and market development in Russia;
            (3) at a minimum, the President should not permit Federal 
        agencies to accept bids from any carrier that are more than 50 
        percent above competitive world market rates; and
            (4) the President should immediately exercise the temporary 
        waiver authority of the cargo preference requirement in section 
        901(b)(1) of the Merchant Marine Act of 1936 and permit Federal 
        agencies to accept only bids that are competitive on the world 
        market, thereby eliminating price-gouging for the 
        transportation of Russian food assistance and ensuring that the 
        greatest possible amount of assistance is provided to Russia.

                                 <all>