[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 1177 Introduced in Senate (IS)]

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116th CONGRESS
  1st Session
                                S. 1177

To establish a congressionally chartered seaway development corporation 
 in the Arctic, consistent with customary international law, with the 
 intention of uniting Arctic nations in a cooperative Arctic shipping 
union, where voluntary collective maritime shipping fees will help fund 
  the infrastructural and environmental demands of safe and reliable 
                        shipping in the region.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 11, 2019

Ms. Murkowski (for herself, Mr. Sullivan, and Mr. King) introduced the 
 following bill; which was read twice and referred to the Committee on 
                 Commerce, Science, and Transportation

_______________________________________________________________________

                                 A BILL


 
To establish a congressionally chartered seaway development corporation 
 in the Arctic, consistent with customary international law, with the 
 intention of uniting Arctic nations in a cooperative Arctic shipping 
union, where voluntary collective maritime shipping fees will help fund 
  the infrastructural and environmental demands of safe and reliable 
                        shipping in the region.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Shipping and Environmental Arctic 
Leadership Act'' or the ``SEAL Act''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Arctic.--The term ``Arctic'' has the meaning given the 
        term in section 112 of the Arctic Research and Policy Act of 
        1984 (15 U.S.C. 4111).
            (2) Arctic sea routes.--The term ``Arctic Sea Routes'' 
        means the international Northern Sea Route, the Transpolar Sea 
        Route, and the Northwest Passage.

SEC. 3. FINDINGS.

    Congress finds the following:
            (1) The Arctic seas have historically been considered 
        impassable and impractical maritime routes, but diminishing 
        Arctic sea ice, better icebreaking technology, and global 
        demand for Arctic resources has opened up opportunity for 
        international trade routes through Arctic Ocean waters.
            (2) According to the National Oceanic and Atmospheric 
        Administration, over the last 20 years atmospheric temperatures 
        have increased at a rate at least 3 times the global average, 
        and as of 2011 sea ice thickness was 42 percent below what it 
        was in 1979. If trends continue, summers may produce ice-free 
        waters in the Arctic Ocean by the late 2030s.
            (3) The Bering Strait is experiencing significant increases 
        in international traffic from vessels using the Arctic Sea 
        Routes. Increases in international traffic are projected to 
        continue.
            (4) While the Arctic Council's agreements on search and 
        rescue, spill prevention and response, and initiatives through 
        the International Maritime Organization to bring about a 
        mandatory polar code are significant, little or no cooperation 
        yet exists in the Arctic region to bring about needed maritime 
        infrastructure, nor do Arctic coastal states and user states 
        cooperate in establishing common seaway administration. 
        International coordination and investment in infrastructure for 
        shipping routes, icebreaker service and refuge, ports, spill 
        prevention and response, salvage, and LNG bunkering, would be 
        collectively beneficial for all associated states, the 
        environment, and global commerce.
            (5) Trans-Arctic shipping brings substantial commercial 
        benefits. Shipping distance between Europe and Asia could be 
        reduced by 4,500 nautical miles, saving a week's time and 40 
        percent in freight shipping distances compared to alternative 
        routes. Through a voluntary tariff model, user nations from the 
        remainder of the world can be invited to share with Arctic 
        nations the capital and operating costs necessary for safe and 
        reliable infrastructure in the Arctic Ocean and its approaches.
            (6) As this new frontier emerges, the United States should 
        assume leadership to ensure safe, secure, and reliable Arctic 
        seaway development, and further to ensure that the Arctic 
        becomes a place of international cooperation rather than 
        competition or conflict.
            (7) Setting precedent for cooperative infrastructure 
        investment and greater reliability in domestic and 
        international shipping is the St. Lawrence Seaway between the 
        United States and Canada, which links the Great Lakes to the 
        Atlantic Ocean. The Seaway operates in internal waters, rather 
        than international waters, but offers ship operators a 
        coordinated suite of services, similar to what is needed in the 
        Arctic Ocean and its approaches.
            (8) The St. Lawrence Seaway Development Corporation, 
        established in 1954, is a model for a United States Government 
        corporation that constructs, operates, and maintains sea 
        passage infrastructure in water bodies shared with another 
        nation. It corresponds with its Canadian counterpart, the St. 
        Lawrence Seaway Management Corporation. In 2010 the Great 
        Lakes-Seaway system generated--
                    (A) 226,833 United States and Canadian jobs;
                    (B) $33,600,000,000 in business revenue from 
                maritime activity; and
                    (C) $4,600,000,000 in Federal, State, provincial, 
                and local tax revenue from maritime activity.
            (9) In 2012 the Russian Duma passed legislation to create a 
        single management agency called the Northern Sea Route 
        Administration, to manage all infrastructural and navigational 
        services across what Russia claims to be its Arctic territorial 
        waters. This is a claim the United States and many other 
        nations do not recognize. Russia is investing heavily into 
        Northern Sea Route infrastructure, anticipating an increase in 
        cargo transport from 1,800,000 tons in 2010 to 64,000,000 tons 
        by 2020. The Russian Northern Sea Route Administration charges 
        escort fees for international cargo ships as high as $500,000, 
        and aims to collect a share of revenues that might otherwise be 
        paid as tariffs on the Suez Canal where collections totaled 
        $5,300,000,000 in 2017.
            (10) The Russian Federation has considered legislation to 
        require all energy traffic on the Northern Sea Route to be 
        carried by Russian-flagged ships.
            (11) Rising transit in United States Arctic region waters 
        necessitates a management agency and infrastructure investment 
        in a transportation system. As identified in the Ten-Year 
        Prioritization of Infrastructure Needs in the United States 
        Arctic prepared by the United States Committee on the Marine 
        Transportation System Arctic Transportation Integrated Action 
        Team for the United States Department of Transportation, there 
        is a significant infrastructure gap in the Arctic in the areas 
        of--
                    (A) navigable waterways, such as waterway 
                coordination with international stakeholders;
                    (B) physical infrastructure, such as infrastructure 
                around Port Clarence and Port of Nome in Alaska to 
                support commercial activity;
                    (C) informational infrastructure, such as up-to-
                date nautical charts and electronic aids to navigation;
                    (D) MTS Response Services, such as emergency 
                response and rescue capabilities; and
                    (E) vessel operations, such as United States 
                icebreaking capabilities.
            (12) The Arctic offers economic value to the United States 
        through commercial shipping and international trade routes, 
        energy, mining, commercial fishing, tourism, and tug and barge 
        operations. The Arctic offers environmental and cultural value 
        through ecological significance, unique wildlife, indigenous 
        peoples and Alaskan communities, and scientific research. The 
        Arctic offers security value to the United States as a way to 
        move United States vessels and forces between the world's 
        oceans, and through other waters. While the United States does 
        not support mandatory tariffs in this region, it does not 
        currently have a way to collect voluntary tariffs for providing 
        assistance to vessels crossing through the Bering Strait or the 
        Arctic Ocean.
            (13) Reinvesting into infrastructural and environmental 
        demands with funds collected from international shipping fees 
        will be essential to the long-term viability of the Arctic.
            (14) Environmental protection of the Arctic takes the form 
        of pollution prevention, clean-up, and accident response.
            (15) Arctic prevention and clean-up involves all feasible 
        efforts to remove or mitigate pollutants from the environment. 
        Arctic ecosystems are more susceptible to biological damage 
        from pollutants than more temperate climates. Existing 
        removable hazards, such as dumped radioactive waste and other 
        toxic substances, must be handled.
            (16) Arctic pollution prevention takes collective adherence 
        to regulations and best practices. United States leadership on 
        clean practices in the Arctic will be essential in the 
        ecosystem's sustainability. Provision of bunkering facilities 
        to enable the use of clean LNG fuels for ships will strengthen 
        pollution prevention.
            (17) Environmental response capabilities in the Arctic are 
        weak, sparse, and have only begun to be internationally 
        coordinated. Transportation of oil and gas and maritime traffic 
        is expected to increase significantly in the Arctic, which will 
        increase the risk of accidents. The Arctic region is 
        particularly vulnerable to pollution from oil and gas shipping. 
        Because oil spills in ice are considerably more complicated to 
        address than oil spills in open waters, effects of oil spills 
        could remain in the region for periods of 50 years or more. In 
        2010 the International Maritime Organization passed Guidelines 
        for Ships Operating in Polar Waters, citing, ``the need to 
        ensure that all ship systems both are capable of functioning 
        effectively under anticipated operating conditions and provide 
        adequate levels of safety in accident and emergency 
        situations''.
            (18) In June 2014, the Government Accountability Office 
        (GAO) reported that the Coast Guard was experiencing a gap in 
        its heavy icebreaking capacity and was without a heavy 
        icebreaker from 2010 to 2013. Tariffs collected through this 
        system can help United States public and private icebreaker 
        capacity grow, and induce additional private investment in 
        marine safety and services.
            (19) During the most recent United States Chairmanship of 
        the Arctic Council, May 2017, the Arctic Council's Protection 
        of the Arctic Marine Environment Working Group established an 
        Arctic Shipping Best Practices Information Forum to help serve 
        as a resource hub of information, guidance, and guidelines that 
        aid decision-makers involved in Arctic maritime navigation and 
        those affected by maritime operations related to the Polar 
        Code. Insurers of Arctic shipping encouraged this Forum to help 
        bring about safer and more reliable shipping in the Arctic 
        region, and to reduce losses. This Act is in support of the 
        same goals.

SEC. 4. CREATION OF THE ARCTIC SEAWAY DEVELOPMENT CORPORATION.

    There is hereby created, subject to the direction and supervision 
of the Secretary of Transportation, in conjunction with the Secretary 
of State, the Secretary of Defense operating through the Secretary of 
the Army, and the Secretary of the Department in which the Coast Guard 
is operating, a body corporate to be known as the Arctic Seaway 
Development Corporation (hereinafter referred to as the 
``Corporation'').

SEC. 5. SERVICES.

    (a) In General.--The Secretary of Transportation, in conjunction 
with the Secretary of the Department in which the Coast Guard is 
operating, the Secretary of Defense acting through the Secretary of the 
Army, and the Secretary of State, shall approve services for which the 
Corporation established under section 4 may charge a toll to vessels.
    (b) Management.--
            (1) Board of directors.--
                    (A) Establishment.--There is established the Board 
                of Directors of the Corporation (hereinafter referred 
                to as the ``Board of Directors''), which shall be 
                composed of 9 members as described in subparagraph (B).
                    (B) Composition.--The Board of Directors shall 
                consist of--
                            (i) the Chair of the Board of Directors to 
                        be appointed and designated by the President of 
                        the United States;
                            (ii) the Administrator of the National 
                        Oceanic and Atmospheric Administration;
                            (iii) the Secretary of State;
                            (iv) the Secretary of Transportation;
                            (v) the Secretary of the Department in 
                        which the Coast Guard is operating; and
                            (vi) 4 senior representatives nominated by 
                        the Governor of Alaska and designated by the 
                        Secretary of Transportation, of whom--
                                    (I) 1 shall represent the 
                                government of the State of Alaska;
                                    (II) 1 shall represent the Alaska 
                                business community;
                                    (III) 1 shall represent the Alaskan 
                                coastal and subsistence communities 
                                affected by the Corporation; and
                                    (IV) 1 shall represent Alaskan 
                                maritime labor organizations.
                    (C) Terms.--Each member of the Board of Directors 
                described in subparagraph (B)(vi) shall serve for a 4-
                year term or until a new member is designated.
                    (D) Meetings.--The Board of Directors shall--
                            (i) meet at the call of the Chair, not less 
                        often than once every 90 days; and
                            (ii) conduct an annual meeting of the 
                        Corporation in the State of Alaska.
                    (E) Functions.--The Board of Directors shall 
                develop a set of policy recommendations regarding the 
                facilities and infrastructure necessary to provide 
                services related to safety and environmental protection 
                and response for vessels transiting the Arctic Sea 
                Routes, including--
                            (i) the establishment of rules of 
                        measurement for vessels and cargo on which 
                        rates of charges or tolls for the services 
                        provided by the Corporation are based; and
                            (ii) all other matters which the Board of 
                        Directors determines to be relevant.
            (2) Administrator.--The management of the Corporation shall 
        be vested in an Administrator who shall be appointed by the 
        Board of Directors with the approval of the Secretary of 
        Transportation.

SEC. 6. FUNCTIONS OF THE ARCTIC SEAWAY DEVELOPMENT CORPORATION.

    The functions of the Corporation are to provide services related to 
safety and environmental protection and response approved by the 
Secretary under section 5, including--
            (1) constructing deep water port facilities in the Arctic 
        to provide services necessary to manage and facilitate 
        increased marine traffic, including cargo, tugs, commercial 
        fuel bunkering, and icebreaker vessels in the Arctic;
            (2) maintaining a relationship with east and west coast 
        ports serving Arctic trade;
            (3) collaborating with the State of Alaska and the United 
        States Coast Guard in the provision of icebreaker services, 
        including the provision of facilities, necessary for safe 
        navigation of the Arctic;
            (4) leasing private icebreakers and cooperating in offering 
        services with icebreakers of other nations;
            (5) where necessary, constructing places of refuge and aids 
        to navigation within the Arctic;
            (6) making charts showing the locations of places of refuge 
        readily available to all vessels operating in the Arctic; and
            (7) establishing strong ties among United States residents 
        of the Arctic region, Arctic shippers, and the maritime 
        insurance industry by creating a system of maritime 
        transportation in the Arctic that prevents loss of life, 
        vessels, and cargo, and increases reliability of shipping in 
        the Arctic.

SEC. 7. GENERAL POWERS OF THE CORPORATION.

    For the purpose of carrying out its functions under this Act, the 
Corporation--
            (1) shall have succession in its corporate name;
            (2) may adopt and use a corporate seal, which shall be 
        judicially noticed;
            (3) may sue and be sued in its corporate name;
            (4) may adopt, amend, and repeal bylaws, rules, and 
        regulations governing the manner in which its business may be 
        conducted and the powers vested in it may be exercised;
            (5) may make and carry out contracts or agreements as are 
        necessary or advisable in the conduct of its business;
            (6) shall be held to be an inhabitant and resident of the 
        third judicial district of the State of Alaska within the 
        meaning on the laws of the United States relating to the venue 
        of civil suits;
            (7) may appoint and fix compensation, in accordance with 
        the provisions of subpart D of part III of title 5, United 
        States Code, for such officers, attorneys, and employees as may 
        be necessary for the conduct of its business, defining their 
        authority and duties, and delegating to them such powers vested 
        in the Corporation as the Administrator may determine;
            (8) may acquire, by purchase, lease, property, and any 
        interest therein, and may sell, lease, or otherwise dispose of 
        such property, as the Administrator deems necessary for the 
        conduct of its business;
            (9) shall determine the character and necessity for its 
        obligations and expenditures, and the manner in which they 
        shall be incurred, allowed, and paid, subject to provisions of 
        law specifically applicable to government corporations;
            (10) may impose, retain and expend a toll to provide for 
        safety and environmental protection and response services 
        provided by the Corporation and to carry out services approved 
        by the Secretary under section 5;
            (11) may provide services and facilities, at reasonable 
        prices, to vessels operating in the Arctic;
            (12) if the United States portion of the revenue from the 
        tolls charged to the users of any services provided under this 
        section is applied solely towards the safety and environmental 
        protection and response services to vessels operating on the 
        Arctic Sea Routes as specified in paragraph (11), may 
        participate with international entities in the ownership and 
        operation of a tolling company, and may lease icebreakers, and 
        enlist and return assets;
            (13) shall be credited with amounts received from any of 
        the activities authorized under paragraphs (10) and (11);
            (14) shall publish charts of locations of places of refuge 
        to be made readily available to all vessel voyaging north of 
        the Bering Straight in the interest of ensuring vessel safety; 
        and
            (15) shall carry out other functions considered relevant by 
        the Secretary of Transportation, in conjunction with the 
        Secretary of the Department in which the Coast Guard is 
        operating, the Secretary of Defense acting through the 
        Secretary of the Army, and the Secretary of State.

SEC. 8. BONDS; ISSUANCE; MATURITY; REDEMPTION; INTEREST; PURCHASE OF 
              OBLIGATIONS BY THE SECRETARY OF TREASURY.

    (a) In General.--To finance its activities, the Corporation may 
issue revenue bonds payable from corporate revenue to the Secretary of 
the Treasury.
    (b) Total Value.--The total value of all bonds issued as described 
in subsection (a) shall not exceed a sum that shall be determined by 
the Secretary of Transportation in conjunction with the Secretary of 
the Treasury.
    (c) Maturity Dates.--Bonds issued as described in subsection (a) 
shall have maturity dates agreed upon by the Corporation and the 
Secretary of the Treasury that shall not be in excess of 50 years. The 
obligations on such bonds may be redeemable at the option of the 
Corporation before the maturity in such a manner as may be stipulated 
in such obligations, but the obligations thus redeemed shall not be 
refinanced by the Corporation.
    (d) Coordination With Title 31.--
            (1) Authority to use proceeds from sale of treasury 
        securities.--For the purpose of purchasing obligations of the 
        Corporation, the Secretary of the Treasury may use as a public 
        debt transaction the proceeds from the sale by the Secretary of 
        any securities issued under chapter 31 of title 31, United 
        States Code, and the purposes for which securities may be 
        issued under such chapter are extended to include such 
        purchases.
            (2) Treatment of transactions.--All purchases and sales by 
        the Secretary of the Treasury of obligations issued by the 
        Corporation under this section shall be treated as public debt 
        transactions of the United States.

SEC. 9. REPORTS.

    (a) In General.--Not later than 1 year after the outset of 
corporate activities of the Corporation, the Corporation shall submit a 
special report to Congress regarding its general operations.
    (b) Additional Reports.--
            (1) New proposals.--In addition to the report described in 
        subsection (a), the Corporation shall submit to Congress a 
        special report whenever there is proposed a new feature, 
        facility, design, or phase of the Corporation involving an 
        estimated value exceeding $1,000,000, that shall include 
        justification for the new feature, facility, design, or phase.
            (2) Progress reports.--The Corporation shall submit reports 
        upon the request of the Board of Directors, the President, or 
        Congress regarding progress of the Corporation, including 
        financial reports regarding expenses or revenues, extreme 
        weather patterns in the Arctic region, or reports as determined 
        necessary by Congress. Such reports shall be submitted not 
        later than 180 days after the date of the initial request.
            (3) Environmental impact reports.--The Board of Directors 
        may direct the Corporation to compile detailed reports 
        regarding the environmental impact of increased marine shipping 
        within the Arctic region. Such reports shall be submitted not 
        later than 180 days after the date of the initial request from 
        the Board of Directors.

SEC. 10. THE ROLE OF THE DEPARTMENT OF STATE IN FACILITATING 
              INTERNATIONAL ENGAGEMENT.

    (a) Promoting International Cooperation.--The Secretary of State 
shall undertake a leadership role in engaging in multilateral dialogues 
with member and observer nations of the Arctic Council with the 
intention of encouraging cooperation in providing coordinated services 
for shipping in the Arctic Ocean and its approaches. The Corporation 
shall encourage cooperative and collaborative relationships with the 
member and observer nations of the Arctic Council in order to establish 
fair and reasonable tolls and, where applicable, joint facilities, as 
described in section 7.
    (b) International Fees and Tolls.--The Corporation is hereby 
authorized and instructed to waive fees and tolls as necessary for 
international cooperation.
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