[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


 
                         FISCAL YEAR 2009 BUDGET
                  REQUESTS FOR THE UNITED STATES COAST
                      GUARD AND THE UNITED STATES
                        MARITIME ADMINISTRATION

=======================================================================

                               (110-103)

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                COAST GUARD AND MARITIME TRANSPORTATION

                                 OF THE

                              COMMITTEE ON
                   TRANSPORTATION AND INFRASTRUCTURE
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                           FEBRUARY 26, 2008

                               __________


                       Printed for the use of the
             Committee on Transportation and Infrastructure




                   U.S. GOVERNMENT PRINTING OFFICE
41-004 PDF                  WASHINGTON : 2008
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             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                 JAMES L. OBERSTAR, Minnesota, Chairman

NICK J. RAHALL, II, West Virginia,   JOHN L. MICA, Florida
Vice Chair                           DON YOUNG, Alaska
PETER A. DeFAZIO, Oregon             THOMAS E. PETRI, Wisconsin
JERRY F. COSTELLO, Illinois          HOWARD COBLE, North Carolina
ELEANOR HOLMES NORTON, District of   JOHN J. DUNCAN, Jr., Tennessee
Columbia                             WAYNE T. GILCHREST, Maryland
JERROLD NADLER, New York             VERNON J. EHLERS, Michigan
CORRINE BROWN, Florida               STEVEN C. LaTOURETTE, Ohio
BOB FILNER, California               FRANK A. LoBIONDO, New Jersey
EDDIE BERNICE JOHNSON, Texas         JERRY MORAN, Kansas
GENE TAYLOR, Mississippi             GARY G. MILLER, California
ELIJAH E. CUMMINGS, Maryland         ROBIN HAYES, North Carolina
ELLEN O. TAUSCHER, California        HENRY E. BROWN, Jr., South 
LEONARD L. BOSWELL, Iowa             Carolina
TIM HOLDEN, Pennsylvania             TIMOTHY V. JOHNSON, Illinois
BRIAN BAIRD, Washington              TODD RUSSELL PLATTS, Pennsylvania
RICK LARSEN, Washington              SAM GRAVES, Missouri
MICHAEL E. CAPUANO, Massachusetts    BILL SHUSTER, Pennsylvania
TIMOTHY H. BISHOP, New York          JOHN BOOZMAN, Arkansas
MICHAEL H. MICHAUD, Maine            SHELLEY MOORE CAPITO, West 
BRIAN HIGGINS, New York              Virginia
RUSS CARNAHAN, Missouri              JIM GERLACH, Pennsylvania
JOHN T. SALAZAR, Colorado            MARIO DIAZ-BALART, Florida
GRACE F. NAPOLITANO, California      CHARLES W. DENT, Pennsylvania
DANIEL LIPINSKI, Illinois            TED POE, Texas
DORIS O. MATSUI, California          DAVID G. REICHERT, Washington
NICK LAMPSON, Texas                  CONNIE MACK, Florida
ZACHARY T. SPACE, Ohio               JOHN R. `RANDY' KUHL, Jr., New 
MAZIE K. HIRONO, Hawaii              York
BRUCE L. BRALEY, Iowa                LYNN A WESTMORELAND, Georgia
JASON ALTMIRE, Pennsylvania          CHARLES W. BOUSTANY, Jr., 
TIMOTHY J. WALZ, Minnesota           Louisiana
HEATH SHULER, North Carolina         JEAN SCHMIDT, Ohio
MICHAEL A. ARCURI, New York          CANDICE S. MILLER, Michigan
HARRY E. MITCHELL, Arizona           THELMA D. DRAKE, Virginia
CHRISTOPHER P. CARNEY, Pennsylvania  MARY FALLIN, Oklahoma
JOHN J. HALL, New York               VERN BUCHANAN, Florida
STEVE KAGEN, Wisconsin               ROBERT E. LATTA, Ohio
STEVE COHEN, Tennessee
JERRY McNERNEY, California
LAURA A. RICHARDSON, California
VACANCY

                                  (ii)

  
?

        SUBCOMMITTEE ON COAST GUARD AND MARITIME TRANSPORTATION

                 ELIJAH E. CUMMINGS, Maryland, Chairman

GENE TAYLOR, Mississippi             STEVEN C. LaTOURETTE, Ohio
RICK LARSEN, Washington              DON YOUNG, Alaska
CORRINE BROWN, Florida               HOWARD COBLE, North Carolina
BRIAN HIGGINS, New York              WAYNE T. GILCHREST, Maryland
BRIAN BAIRD, Washington              FRANK A. LoBIONDO, New Jersey
TIMOTHY H. BISHOP, New York, Vice    TED POE, Texas
Chair                                JOHN L. MICA, Florida
LAURA A. RICHARDSON, California        (Ex Officio)
JAMES L. OBERSTAR, Minnesota
  (Ex Officio)

                                 (iii)

                                CONTENTS

                                                                   Page

Summary of Subject Matter........................................    vi

                               TESTIMONY

Bowen, Charles W., Master Chief Petty Officer, United States 
  Coast Guard....................................................     5
Connaughton, Sean T., Administrator, United States Maritime 
  Administration.................................................     5
Papp, Vice Admiral Robert J., Junior Chief of Staff, United 
  States Coast Guard.............................................     5

          PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS

Cummings, Hon. Elijah E., of Maryland............................    37
Oberstar, Hon. James L., of Minnesota............................    55

               PREPARED STATEMENTS SUBMITTED BY WITNESSES

Bowen, Charles W.................................................    58
Connaughton, Sean T..............................................    65
Papp, Vice Admiral Robert J......................................    74

                        ADDITIONS TO THE RECORD

Fleet Reserve Association, written statement.....................    89

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   HEARING ON FISCAL YEAR 2009 BUDGET: COAST GUARD, FEDERAL MARITIME 
                  COMMISSION & MARITIME ADMINISTRATION

                              ----------                              


                       Tuesday, February 26, 2008

                   House of Representatives
     Committee on Transportation and Infrastructure
   Subcommittee on Coast Guard and Maritime Transportation,
                                                    Washington, DC.
    The Subcommittee met, pursuant to call, at 10:00 a.m., at 
2167 Rayburn House Office Building, the Honorable Elijah E. 
Cummings [Chairman of the Subcommittee] presiding.
    Mr. Cummings. The Subcommittee will come to order. It is 
10:00 o'clock.
    Today the Subcommittee on the Coast Guard and Maritime 
Transportation convenes to examine the Fiscal Year 2009 budgets 
for the United States Coast Guard and the United States 
Maritime Administration.
    The President has requested $8.8 billion to fund the Coast 
Guard in Fiscal Year 2009, an increase of approximately $459 
million over the Fiscal Year 2008 enacted budget. Included in 
that overall budget request is a request of $1.2 billion for 
Coast Guard's capital account, which just over $990 million is 
requested which is to continue the Deep Water Acquisitions 
Program. Admiral Allen, the Commandant of the Coast Guard is 
not able to be with us today. We are joined instead by Vice 
Admiral Robert J. Papp, the Chief of Staff of the Coast Guard.
    We are also honored to be joined by Master Chief Charles W. 
Bowen, the Master Chief Petty Officer of the Coast Guard.
    Last year the Coast Guard achieved many notable 
accomplishments. In August, the Coast Guard celebrated the 
saving of a million lives through actions taken both by the 
Service and by the precursor agencies which were folded into 
the modern Coast Guard.
    In 2007, the Coast Guard also removed some 355,755 pounds 
of cocaine with an estimated street value of more than $4.7 
billion from circulation either by directly seizing the drugs 
or by causing those who were attempting to smuggle the drugs to 
the United States, to destroy them before the Coast Guard could 
seize them. This was an achievement that I marked by hosting a 
press conference attended by Vice Admiral Papp in my district 
in Baltimore, a city that knows first-hand the harm caused by 
illegal drugs.
    While we commend the Coast Guard for these achievements, 
the Service must always be striving forward to meet emerging 
challenges, and the post 9/11 world has certainly brought 
significant challenges. Commandant Allen has often said that he 
is a transition commandant, and he noted in his 2008 State of 
the Coast Guard address that his Service is at an inflection 
point.
    Before I speak in more detail about specific elements of 
the Coast Guard's transition, let me note that I firmly believe 
that the transition must include growing the Coast Guard from 
an active duty force of just under 42,000 individuals, and it 
must include modernizing the assets which the Coast Guard 
utilizes to conduct its missions. The Coast Guard is 
undertaking a critical new effort to improve its ability to 
manage major acquisitions. A new acquisitions directorate has 
been created under the leadership of Rear Admiral Gary Blore. 
The President's Fiscal Year 2009 budget requests $9 million for 
65 new acquisitions positions to increase the professional 
staff in that directorate.
    I support this request wholeheartedly and believe that the 
establishment of the Acquisitions Directorate was a significant 
step towards creating within the Coast Guard a system that can 
ensure both that taxpayers' money for the Coast Guard 
Acquisitions is spent effectively and efficiently, and that the 
Coast Guard can be held and can hold its contractors fully 
accountable for the use of these precious funds.
    That said, I continue to believe that the head of the 
acquisition function should be a civilian with long 
professional experience in acquisitions management as called 
for in the Integrated Coast Guard Reform Act, H.R. 2722, which 
passed the House by a vote of 426 to nothing. The Subcommittee 
also continues to be deeply concerned about the achievement of 
balance between the Coast Guard's critical new Homeland 
Security missions and its traditional missions as it enters 
this new era.
    As security responsibilities are implemented, safety 
responsibilities must also be fully met. The Coast Guard 
indicates that it has requested some 276 new billets for marine 
inspectors and investigators in the Marine Safety Program. 
These positions are to be funded with an increase of $20 
million in operating funding.
    The budget also requests $2.6 million to pay for support to 
be obtained on a contractual basis to help the Coast Guard 
complete nearly 100 pending rulemakings. We have been waiting a 
long time for that rulemaking, and it is something that both 
sides have been trying to push the Coast Guard to get done, and 
hopefully this will help.
    Obviously, completing the regulatory backlog is a top 
priority for this Subcommittee. Of particular and personal 
concern to me is a completion of the rulemaking pending since 
2005 that will increase weight standards used to calculate 
stability on smaller passenger vessels, a proposal that grew 
out of the tragic capsizing of the Lady D in the Baltimore 
Harbor in March 2004 that killed five passengers and seriously 
injured four more.
    The addition of the billets to the marine safety is long 
overdue, and the Subcommittee is eager to understand how these 
billets will be filled, whether by civilians, uniformed 
personnel, or some combination of these two, and how 
individuals filling these billets will be trained to the 
required standards for that investigator or an inspector 
position.
    In light of the recent report on marine safety issued by 
Admiral James C. Card, we are also eager to understand what 
steps the Coast Guard will take to ensure that all inspectors 
and investigators will meet the highest professional standards, 
and to ensure that Marine Safety is not treated as a stepchild 
to operations or other Coast Guard missions.
    We will also hear today from the United States Maritime 
Administration regarding its Fiscal Year 2009 budget request. 
The Administration is represented by Administrator Sean 
Connaughton. The President has requested just over $313 million 
for MARAD's Fiscal Year 2009 budget, a slight decrease of just 
$21,000 below the enacted Fiscal Year 2008 budget. MARAD is 
responsible for promoting the United States maritime industry. 
In fulfillment of that charge, I note with particular interest 
that MARAD has been taking significant steps to promote the 
development of short sea shipping, which is a priority for this 
Subcommittee.
    The Energy Independence and Security Act, which passed 
Congress last year, included a critical new short sea shipping 
initiative which makes vessels built under the Jones Act in the 
United States eligible for assistance from the Capital 
Construction Fund administered by MARAD. I look forward to 
hearing from the Administrator what MARAD is doing to implement 
this program.
    It is critical that our Nation takes every possible step to 
make water a mode competitive with roads and rails by 
supporting the development of short sea shipping. To that end, 
I strongly believe that we should exempt these voyages from the 
harbor maintenance tax, as would be accomplished by H.R. 1499. 
I look forward to continuing to work with Congressman Rangel, 
Chairman of the Committee on Ways and Means, to advance this 
legislation.
    As we examined in a Subcommittee hearing last year, MARAD 
is also studying the extent of shortages in the maritime labor 
force, and we look forward to working with MARAD this year to 
develop legislative initiatives to promote maritime education 
and training programs. MARAD has recently developed innovative 
programs with shipping lines to provide training opportunities 
for American Maritime Academy cadets on board both a U.S. and 
international vessels. I applaud MARAD for its many creative 
new initiatives to fulfill its charge of promoting the U.S. 
maritime industry.
    Finally, the Subcommittee had planned to examine the Fiscal 
Year 2009 budget request for the Federal Maritime Commission 
today. At this time the FMC's chairperson's position is vacant, 
and four current commissioners are collectively exercising 
executive authority in managing the commission's business. Due 
to the illness of a commissioner, we have postponed that part 
of today's hearing until March. However, as the Subcommittee 
begins its work of reauthorizing the FMC, we eagerly look 
forward to examining the Commission's recent work.
    With that, I recognize the distinguished Ranking Member of 
this Subcommittee, Congressman LaTourette.
    Mr. LaTourette. Thank you very much, Mr. Chairman, and 
thank you for having this hearing today to review the 
Administrations Fiscal Year 2009 budget request for the Coast 
Guard and the Maritime Administration.
    I also want to thank you, Mr. Chairman, for your 
cooperation and your staff's cooperation and Mr. Oberstar's, as 
we continue to work out our final differences on the Coast 
Guard Reauthorization Act.
    At last year's budget hearing, I said that 2008 was shaping 
up to be a critical year for the future of the Coast Guard. 
Since that time the Coast Guard has taken responsibilities of 
the lead systems integrator for the Deepwater Program and has 
made organizational changes to enhance the Service's in-house 
acquisition staff.
    In the coming year the Coast Guard will also be required to 
take actions that will impact the capabilities of the Service 
to carry out all of its many missions. The Coast Guard's 
proposed budget includes funding to begin the acquisition of 
the Fast Response Cutter B which will replace the aging and 
deteriorating 110-foot patrol boat class.
    The budget also includes funding to create 276 new marine 
inspection positions to improve the Service's rulemaking 
program and to begin planning for the acquisition of new 
vessels to replace the Coast Guard's inland waterways fleet. I 
am encouraged that the Coast Guard has recognized these needs 
in its traditional mission areas, and I look forward to working 
with them to take these first steps as part of a larger plan to 
improve mission performance across the Service's entire mission 
scope.
    I am also encouraged by the Administration's request for 
nearly $1 billion for the Deepwater Program in Fiscal Year 
2009. It is extremely important that we continue to fund the 
Service's Recapitalization Program. Otherwise the Coast Guard 
will continue to incur rising maintenance and overhaul costs 
for its legacy assets, and Coast Guard personnel will continue 
to work on platforms that are deteriorating in condition and 
less capable to support operational missions.
    Despite these improvements, there remains concern that the 
Coast Guard's traditional missions are not getting the full 
support they need from the Department of Homeland Security. The 
Administration's Fiscal Year 2009 budget document estimates 
that the Coast Guard will spend less on operating expenses for 
marine safety, aids to navigation, ice operations, marine 
environmental protection, living marine resources protection, 
and drug and migrant interdiction than was spent in Fiscal Year 
2007.
    On the other hand, the breakdown reveals that the Service 
is expected to spend $1 billion more on operating expenses for 
port security in Fiscal Year 2009 than in 2007. I understand 
the importance of port security, and I understand that 
assigning the use of the Coast Guard's multi-mission assets to 
a specific mission for budget purposes is as much art as it is 
science. However, these numbers appear to show a disturbing 
trend away from traditional missions that we know are important 
day in and day out, year in and year out. I hope that the 
witnesses will address the perceptions of many in the maritime 
industries that these numbers reflect the Coast Guard's 
decreased priority on these mission areas.
    The Coast Guard is a multi-mission service and is unique in 
the way that it leverages resources and assets across its many 
missions. I look forward to working with the Coast Guard to 
vigilantly maintain balance across the Service's missions to 
assure that safety, security, and stewardship all receive their 
fair allocation of resources.
    I still also have concerns over the funding levels that are 
proposed for non-Deepwater acquisitions and construction and 
funding to address the more than $1 billion backlog in 
shoreside facility projects and the Administration's continued 
proposal to transfer ice-breaking funding to the National 
Science Foundation.
    The Subcommittee will also review the request for the 
Maritime Administration. I look forward to hearing more about 
how the proposed funding levels will impact MARAD's efforts to 
establish a Short Sea Shipping Program, as the Chairman has 
mentioned, that will increasingly utilize our Nation's water 
highways to move freights and goods. I am concerned that the 
Agency has not requested any funding for the Title XI loan 
guarantees for ship construction or grants for capital and 
infrastructure improvements of small U.S. ship board carriers.
    A strong U.S. merchant fleet operated by U.S. merchant 
mariners enhances our national security and is vital in 
supporting maritime commerce. I look forward to the witnesses' 
testimony on how the Administration will continue to support 
domestic shipbuilding efforts with this request, and I thank 
you, Mr. Chairman, and I yield back.
    Mr. Cummings. Thank you, Mr. LaTourette. It is my 
understanding that there are no opening statements from our 
other Members, so therefore we will proceed directly to the 
testimony.
    We now welcome today's panelists Vice Admiral Robert J. 
Papp, Junior Chief of Staff, United States Coast Guard; Master 
Chief Charles W. Bowen, Master Chief Petty Officer of the 
United States Coast Guard; and Sean Connaughton, Administrator 
of the United States Maritime Administration.
    Welcome, gentlemen. We are very happy to have you. We will 
first hear from Vice Admiral Papp.

   TESTIMONY OF VICE ADMIRAL ROBERT J. PAPP, JUNIOR CHIEF OF 
  STAFF, UNITED STATES COAST GUARD; CHARLES W. BOWEN, MASTER 
     CHIEF PETTY OFFICER, UNITED STATES COAST GUARD; SEAN 
      CONNAUGHTON, ADMINISTRATOR, UNITED STATES MARITIME 
                         ADMINISTRATION

    Admiral Papp. Good morning, Mr. Chairman, Mr. LaTourette, 
and distinguished Members of the Subcommittee. It is a pleasure 
for me to be here this morning. I have submitted my written 
testimony for the record, and I would like to open with just a 
few brief comments.
    I would like to acknowledge my panel mates. Master Chief 
Bowen is our senior enlisted member, and he will focus his 
testimony on the performance and needs of our Coast Guard 
workforce. The courage, devotion, and commitment of our Coast 
Guard shipmates to our many missions inspires me and is worthy 
of the Nation's full support for compensation and benefits 
commensurate with our Service partners in the Department of 
Defense.
    I would also like to acknowledge the sacrifices of our 
Coast Guard families who are so supportive while their loved 
ones serve in harm's way aboard Coast Guard cutters, aircraft, 
and small boats literally around the world.
    We are blessed to have a solid partner in the Maritime 
Administration under the steady hand of its leader, 
Administrator Sean Connaughton. Sean is putting together his 
vision for the maritime industry into action for strong and 
tested leadership. As a former Coast Guard shipmate, I cannot 
imagine a better relationship or more supportive colleague. 
More than anything else, I am grateful for Sean's leadership in 
support of the U.S. Merchant Marine Academy both as the 
Maritime Administrator and as a King's Point graduate himself.
    I know I speak for all Coast Guard Academy graduates in 
sharing my gratitude for the existence of at least one college 
we can beat on the football field. Thank you very much, Sean.
    [Laughter.]
    Admiral Papp. The Coast Guard has an extensive and storied 
history of outstanding service to our Country. Our value to the 
Nation resides in our multi-mission authorities, resources, and 
capabilities. The Coast Guard's ability to field versatile 
platforms and adaptable people with broad authorities is 
perhaps our Country's most important strength in the maritime 
environment.
    Two thousand seven, as the Chairman noted, was a very good 
year for us. We saved over 5,000 lives, removed a record $4.7 
billion of cocaine from the global narcotics stream, rescued 
over 6,000 migrants on the high seas, and co-sponsored one of 
the largest oil spill exercises ever conducted. And we 
celebrated our one-millionth life saved since Congress passed 
the Revenue Cutter Act, and President Washington signed it into 
law on August 4th, 1790.
    Despite our successes, we have much to do to prepare for 
the future. The rapidly growing global maritime transportation 
system, expanded coastal development, and changing conditions 
in the Arctic challenge our current capacity and capabilities. 
Added to this is the specter of transnational terrorism, 
increased sophistication in human smuggling and drug 
trafficking, and expeditionary demands to support the global 
war on terror. These conditions form the basis of Admiral 
Allen's call to create a Coast Guard that is more appropriately 
sized, structured, and adaptable to meet our modern 21st 
century mission demands and responsibilities.
    Our Fiscal Year 2009 budget seeks the resources needed to 
continue our efforts, and I urge your support. Admiral Allen 
recently stated that one of the biggest challenges facing the 
Service is capacity. We have multi-mission authorities, 
capabilities and competencies, but what we need is greater 
capacity on many fronts. Our budget request starts building 
that capacity in key areas, most notably our marine safety 
program.
    Despite our robust multi-mission capabilities, the 
effectiveness of our Service remains threatened by our 
increasing reliance on outdated, rapidly aging ships, aircraft, 
and boats and shore infrastructure. The budget request before 
you sustains service delivery while continuing critical ship, 
aircraft, and boat-building projects, and focuses on three 
strategic areas: first, enhancing our marine safety capacity; 
second, improving command and control; and third, establishing 
a comprehensive intelligence and awareness regimes.
    Our request for 276 additional marine safety personnel will 
help us meet our growing demand for services that is being 
driven by the expansion of the marine transportation system, 
and a mandate to begin inspecting the Nation's fleet of 
commercial towing vessels. Additionally, we are requesting 
funding to help reduce our marine safety and environmental 
protection regulatory backlog by increasing rulemaking 
capacity.
    The Coast Guard is also requesting continued improvements 
to our command and control systems, including continued funding 
of Rescue 21 as well as an increase in multi-mission watt 
standards to increase our capacity at our Nation's 15 busiest 
Coast Guard sectors to meet the growing around-the-clock demand 
for multi-mission services in our busiest ports.
    Finally, our request includes new initiatives to both 
expand and improve our intelligence program and awareness 
regimes, establishing minimum levels of organic counter-
intelligence and cryptologic service capability that are 
critical to our future success as members of the intelligence 
community.
    In closing, our first Secretary Alexander Hamilton once 
said, ``There is a certain enthusiasm in liberty that makes 
human nature rise above itself in acts of bravery and 
heroism.`` The Coast Guard family, the active-duty civilian 
auxiliary and reserve embodies Secretary Hamilton's sentiments 
daily in their actions and through their deeds, brings forth 
the best in service to America and the best in our human 
spirit.
    I thank you for this opportunity to testify today, and I 
look forward to your questions.
    Mr. Cummings. Thank you very much.
    Mr. Bowen.
    Chief Bowen. Good morning, Mr. Chairman, and distinguished 
Members of the Subcommittee. I have prepared a written 
statement that has been submitted for the record.
    On behalf of the over 49,000 men and woman who make up the 
active and reserve components of the U.S. Coast Guard, I would 
like to thank Congress for their support and continued efforts 
to position America's Coast Guard to be ready to answer the 
call and execute the mission. I think that the events of the 
last few years have forced us, all of us, to become more 
vigilant. Every minute of every day members of our Service are 
on watch, seven by twenty-four, somewhere on the globe. To 
stand these watches, to man the boat, ships, and aircraft 
necessary to execute the mission, to be able to respond to all 
threats, all hazards, in all environments, we must focus on our 
people.
    Two thousand seven was another exceptional year for the 
U.S. Coast Guard. The personnel performing our Coast Guard 
missions did so in demanding conditions beyond precedent. Our 
men and women performed with courage, sacrifice, and dignity. 
Over the course of the last year, I have personally visited 
thousands of Coast Guardsmen all over the world, and I know 
first-hand what they do.
    In the frigid waters off Alaska, Petty Officer Will Milam 
rescued four terrified survivors despite 15-foot seas and a 
rupture to his dry suit that allowed freezing water to threaten 
his own life.
    Master Chief Mike Levitt survived the full brunt of a 20-
foot ocean wave that tore a full-face helmet completely off his 
head but still managed to complete the rescue of a man who had 
been swept off of a jetty in Humboldt Bay, California.
    Petty Officer James Huddleston miraculously escaped injury 
when the military base in Iraq where he was located suffered a 
mortar attack, but as soon as the attack was over, immediately 
sprang into action to render aid and comfort to his fellow 
warriors.
    Everyone has a role, whether through mission support or 
mission execution. It is our people who rise to meet every 
challenge, and the challenges include our aging infrastructure, 
including aging cutters and housing. These are quality of life 
issues that affect the morale and well-being of every member of 
our Service.
    The U.S. Coast Guard is operating a fleet of ships that is 
on the average extremely old. We have people assigned to 40-
year-old ships that still have 30-man berthing areas. Our crews 
live aboard these ships at least 185 days every year or, in 
other words, for every year that they are assigned to these 
cutters, they spend over half of their lives aboard. From a 
quality of life perspective, living areas aboard these ships 
must be maintained at least to the standard to which it was 
built. As these cutters age, that is becoming more and more of 
a challenge and will require additional funding to accomplish.
    Family housing is an important issue for our members and 
their families. Providing safe, suitable, and affordable 
housing directly impacts our mission readiness. Inattention to 
our family and unaccompanied housing units will ultimately lead 
to health safety and morale concerns that are unacceptable to 
our members.
    At almost every all-hands meeting I hold at unit, someone 
asks me about transferring their Montgomery G.I. Bill benefits 
to their family. If this benefit could be transferred to 
spouses and children, it would be considered a huge step 
forward for our families' welfare.
    In addition, like all military spouses, the unemployment 
rate of Coast Guard spouses is higher than the general 
population. Frequent permanent change of station moves often 
prevent laying down the community roots necessary to obtain 
good jobs. A Federal Government hiring preference would be a 
great step forward.
    Thank you for the opportunity to appear before you, and 
thank you for all that you do for the men and woman of the U.S. 
Coast Guard. I look forward to answering any questions that you 
might have.
    Mr. Cummings. Thank you very much.
    Administrator Connaughton?
    Mr. Connaughton. Mr. Chairman, Mr. LaTourette, Mr. Larsen, 
and Mr. LoBiondo, it is a great pleasure for me to be here this 
morning to give an overview of the Maritime Administration's 
budget. And it is a great honor for me to be here as well with 
Vice Admiral Papp and Master Chief Petty Officer Bowen. We are 
partners, and we do work very, very closely with the Coast 
Guard as well as some of the other agencies, Federal agencies 
involved in maritime transportation and safety and 
environmental protection.
    This has been a very, very busy year for the Maritime 
Administration. We have attempted to realign some of our 
offices and programs; we have tried to change direction to make 
sure that we are a better agency to serve the needs of the 
industry as well as needs of the United States. I think in many 
ways we are starting to see the fruits of that reorganization, 
that realignment, as well as seeing some success in some of our 
efforts.
    I can go through and give you some idea about some of the 
initiatives, and you have noted some of them, Mr. Chairman. The 
fact that we have LNG facilities that are coming online that 
for the first time are committing to put American seafarers on 
board the vessels serving those LNG facilities.
    We have commitments for U.S.-flag LNGs, and in fact we are 
going to be announcing just in the next couple weeks another 
company that is going to commit for U.S.-flag LNG. We are 
actually starting to have companies come forward even with 
those who are not directly dealing with, but actually 
committing to put American seafarers on board their vessels 
coming here to our Country, which we think is very good for our 
economy, obviously good for our seafarer base, but also good 
for security as well.
    We have been working very aggressively to increase the 
number of cadet billets. What we are finding right now is there 
is a tremendous demand. As you know, Mr. Chairman, you held a 
hearing late last year about the fact that we need more 
mariners serving the U.S. industry as well as internationally. 
So we have been trying to find cadet berths aboard mostly 
American companies that have foreign-flag vessels. We have 
already had three sign up, and we have had two more that are 
pending, which will provide us with several hundred new cadet 
berths which will obviously assist both the U.S. Merchant 
Marine Academy and the State maritime schools.
    We have also been working very aggressively with you, Mr. 
Chairman, as well as other interested parties, in trying to 
retain or recruit young men and women right from the very 
beginning of high school programs to try to get them interested 
in the maritime industry and/or any of the military services 
and naval services.
    I think some of the success rate, something I have never 
seen before from our State schools and U.S. Merchant Marine 
Academies is the fact that here we are only eight months after 
graduation from the class of 2007, and we are seeing that over 
90 percent of our students are at sea or in the military, which 
is some of the highest we have ever had. So it is a great 
story, and it is a great opportunity for us as a Nation.
    As you noted, Mr. Chairman, we have been working to 
actually implement the legislation that you were a leader on, 
and that is the Marine Highway Program. We found an enormous 
amount of support among State and local governments as well as 
within the industry. We are working to implement the 
legislation that was just recently passed and have draft 
regulations actually, interim draft regulations, being reviewed 
right now within the Department of Transportation. Also, we are 
moving forward on establishing the work group that the 
legislation ends up calling for.
    But we do think this is a great opportunity to not only 
help the maritime industry but also to help relieve shoreside 
congestion.
    We have also been very, very active on implementation, 
actually enforcement of the Jones Act, and working very closely 
with our partners at the Customs and Border Protection as well 
as the Coast Guard.
    We have been very aggressive in dealing with our ship 
disposal problems. We still have problems in Suisun Bay out in 
California, but that has actually, through working with the 
states of Virginia as well as Texas, we have been able to 
continue moving ships out of those two fleets, and last year I 
think we have almost 23 vessels that were moved out last year, 
which is close to a record of our other two fleets. We continue 
to move down the number of obsolete vessels in our fleets.
    The Maritime Security Program is continuing to be a 
success. We have seen a turnover in some of the older tonnage 
coming out and newer tonnage coming in. Part of our 
Administration's request is for the full funding. That is an 
additional $18 million into the program to keep that program 
alive and keep those vessels in the U.S. flag.
    In addition, we continue to have a very strong national 
security role. Last year we added eight new vessels, Fast 
Sealift Ships to our ready reserve fleet and that, I think from 
the view of the military has been a very, very big success.
    And finally, on the Cargo Preference Programs, obviously, 
the Maritime Administration continues to have a very strong 
role in cargo preference. I think if anything, we have been 
seeing greater and greater utilization of U.S.-flag vessels and 
making sure that everyone complies with the Cargo Preference 
Programs.
    So we are trying to, in this budget request, Mr. Chairman 
and Members of the Subcommittee, to actually build on these 
successes. One of the things I will mention to you is 
obviously, when we look at the State Maritime Schools, we are 
trying to double the amount of money that we provide to the 
students there so we can end up getting more students 
interested in going to sea and getting licenses. We are 
obviously asking for additional money into the Maritime 
Security Program. We continue to add and invest in the U.S. 
Merchant Marine Academy and, obviously, we do have some money 
that has been set aside for the Marine Highway Program, at 
least to set up the program, but that is only $311,000, the 
least of our budget request.
    So thank you very much.
    Mr. Cummings. Thank you very much.
    Admiral Papp, let me start with you. Just a general 
question that follows up on what Admiral Allen stated, the 
Coast Guard speech. Do you believe that the Coast Guard should 
grow and, if so, what should be the size of the Service to 
enable it to conduct the missions it is currently expected to 
perform?
    Admiral Papp. Thank you for that question, sir. I do not 
know how big the Coast Guard should be, but I certainly think 
it is time to open up the dialogue in talking about how big the 
Coast Guard should be. I certainly know that it is too small, 
and if I can illustrate that with just a small example that is 
very personal to me, my last assignment before coming here was 
District Commander in the 9th District, which covers our Great 
Lakes Region.
    The total uniformed force that I had available up to me as 
the district commander was 2,000 people. Now, that stretches 
across eight States, about 6,500 miles of shoreline, 1,500 
miles of international border carrying out the full mission set 
of the Coast Guard with 2,000 people. Some people might think 
that is a lot, but by comparison the city of Cleveland where I 
had my headquarters had a police force almost the same size for 
that one city.
    The city of Chicago, which is the biggest city up on the 
Lakes had almost 20,000 first responders between police and 
fire for one city. We had 2,000 to carry out the full spectrum 
of Coast Guard missions up there on the Lakes.
    Admiral Allen made the statement the other day that the 
entire uniformed Coast Guard force could fit in the new 
National Stadium, I corrected him in the press he was short by 
200. I guess we leave about 200 people standing room only in 
the stadium. But the fact of the matter is, we are about the 
same strength when I came into the Service over 30 years ago. 
In fact, we went through reductions in the mid-1990s which took 
about four or five thousand of our people, and since 9/11 we 
have grown back to the same size we were in the mid-1990s, yet 
we have picked up all these additional responsibilities, most 
notably the security mission that has been put on top of all 
the traditional Coast Guard missions.
    Mr. Cummings. The Coast Guard's Fiscal Year 2009 request 
includes some $20 million for 276 additional marine inspectors. 
Can you tell us how these billets will be filled, and will they 
be filled by civilians, uniformed military personnel, or both? 
And how long would it take to train these folks so that they 
can be fully prepared to meet the challenges that they face?
    Admiral Papp. Well, it is a significant challenge, and it 
is a good start; 276 is a good start. I think as Administrator 
Connaughton appropriately notes in his comments, the marine 
industry is under stress. We are going to be going after the 
same people that the marine industry is going after to put out 
on the ships. For instance, the maritime school graduates are 
important to our program, and the Administrator correctly notes 
that industry wants those people as well.
    So it is going to be a challenge for us, but we hope to 
begin the hiring process throughout 2009. We have already 
committed, we harvested 30 billets within Coast Guard 
headquarters to put immediately out into the field through this 
reorganization process that Admiral Allen has directed.
    The 276, there will be a split. I can get you the exact 
split for the record, but I think it is close to 164 or so 
military and 51 civilian. Some of the additional billets will 
go toward staffs and support for those billets.
    We believe firmly that we need to increase the number of 
civilians for stability and continuity in our prevention 
departments across the Coast Guard. So it will be a mix. It 
will be a challenge for us to hire those people, but we are 
committed to doing it and we are about the business of getting 
on with it.
    Mr. Cummings. Do you know offhand the number of cadets that 
we have at the Academy?
    Admiral Papp. At the Coast Guard Academy?
    Mr. Cummings. Yes.
    Admiral Papp. It is a little shy of 1,000 people, sir.
    Mr. Cummings. A thousand?
    Admiral Papp. Yes, sir.
    Mr. Cummings. And do we have the capacity to take on more? 
With the things that you just said anticipating that you may 
increase your enlisted means you are going to have to have more 
officers and people coming out of the academy, are we prepared 
to take on more folk in the Academy?
    Admiral Papp. Well, sir, we could probably take on more 
folks at the Academy, but we also have officer candidate school 
that we draw people from. We already do have established 
programs with the maritime academies. We are looking to try and 
double the number of people that we get from the maritime 
academies because, quite frankly, those are people who have an 
expressed interest in working in the industry, working with the 
industry, and they pick up some very good experience through 
their curriculum and their underway times while they are in 
training.
    So it would be a mix of all the above. The Coast Guard 
Academy, the loading of cadets at the Academy, because it is a 
four-year process, that is sort of our stability, our baseline 
of officers. We augment when we have additional needs through 
officer candidate school, direct commissions, and going out to 
the maritime academies.
    Mr. Cummings. Have you read the report on the Coast Guard's 
marine safety program completed by Admiral Card?
    Admiral Papp. Oh, yes, sir.
    Mr. Cummings. You said that with great enthusiasm.
    Admiral Papp. Well, I respect Vice Admiral Card greatly. I 
was chief of congressional affairs when he was the Vice 
Commandant, and I worked very closely with him. When Admiral 
Allen became acutely aware of the problems and the complaints 
and the concerns of the marine industry, Admiral Card was one 
of the first people we went to because he has a tremendous 
reputation with the community and is deeply respected within 
the Coast Guard as well. He was our first choice, and he went 
out, this was not Admiral Card going out by himself, he was 
asked by Admiral Allen to go out there, pull no punches, speak 
to the industry, get direct feedback, and then come back and 
report to us.
    So not only have I read the report, I have sat down and I 
talked with Admiral Card. Admiral Card has come in and 
addressed our senior leadership. We have had multiple meetings 
with industry and brought Admiral Card into those meetings as 
well. In fact, just two weeks ago we had senior members from 
across the industry come in for a two-hour session with the 
Commandant behind closed doors. Admiral Card was there and 
helped facilitate a little bit, and then we had dinner with all 
these gentlemen and ladies as well.
    Mr. Cummings. I am going to ask just a few more questions, 
and then I want to go on to Mr. LaTourette, and then I will 
come back later to you, Mr. Bowen and Mr. Connaughton.
    I know that this is something that Chairman Oberstar, is 
very, very interested in, but let me just ask you about this 
report, and I am sure he will have more detailed questions.
    This report raises many of the criticisms of the program 
than have been of concern to the Subcommittee, including the 
loss of professional competence which is very, very important, 
as I know you are aware. The limitations that frequent 
transfers place on the ability of marine safety personnel to 
develop technical and geographic expertise, and the fact that 
the industry believes that the Coast Guard marine safety 
inspectors have lost a desire to work in partnership with them 
to achieve safety and what should be complimentary security 
goals.
    How do you, since you had so much interaction and spent, 
like you said you have had many discussions, how do you respond 
to Admiral Card's assessment? And what can be done to 
strengthen the maritime industry as a career, and to ensure 
that those who choose this career believe, as it is considered 
by the Coast Guard leadership, to be equal to other career 
paths?
    Admiral Papp. Well, I go back to my own personal experience 
that I spoke of up in the Great Lakes, which has a tremendous 
maritime community up there, some very proud companies that 
have worked up there and carried on commerce on the Lakes as 
well as our Canadian partners up there.
    A lot of the concerns that were expressed through Admiral 
Card's report started to come forth during the couple of years 
that I was up there on the Lakes, and I think that is just a 
microcosm of what we are experiencing across the entire 
Country. I do not think it comes as a surprise to folks that 
our focus shifted at September 11th, 2001. It was not just the 
Coast Guard shifting its focus. We were given assets, 
resources, and direction under the Maritime Transportation 
Security Act to improve security in our ports. I do not think 
anybody complains about the level of effort and concentration 
that we gave that over the ensuing six years.
    However, we probably did lose sight of our marine safety 
mission during that time period as well. And while we gained 
tremendous additional resources, some of those 4,000 to 5,000 
people that we gained since September 11th, 2001, many of those 
were directed at the security missions.
    The Coast Guard within our culture takes great pride with 
getting all our jobs done well, and it embarrasses us when we 
are both publicly and behind the scenes notified that, hey, you 
have lost sight of a mission, and you are not doing so well at 
it. But I think, as you have experienced, once something is 
called to our attention, it gets concentrated effort by the 
Coast Guard.
    We have called in, like calling in Admiral Card, we have 
called in some of our own active duty people who were raised 
within the marine safety program, and we have come up with a 
very clearly defined plan to work into the future to restore 
the emphasis on the marine safety program, to honor our U.S. 
mariners and make sure that they are appropriately served by 
the Coast Guard and to set in motion career paths within the 
Coast Guard that will indicate to our people that this is a 
valued and important mission for the Coast Guard.
    Now, that doesn't happen overnight, sir. We did not get 
into this situation overnight, but I am confident that we have 
the wherewithal, the dedication and the commitment, to do that. 
And I, myself, I have been a ship driver all of my career, I 
have an appreciation for the marine safety program having been 
a district commander with regulatory captain of the port, 
officer in charge, marine inspection authorities resident in 
me, it became abundantly clear that that is a significant 
important mission, and we need to have experts that can advise 
senior decision-makers within our Service.
    We will do a number of things besides bringing in the 
people that I talked about. We are going to increase post-
graduate studies; we are going to increase industry studies, 
getting people assigned to industry to work; we are creating 
centers of excellence where we will develop our young people. 
And, more importantly and as importantly, the Commandant has 
looked to me to find ways that we can get more of our young 
officers out to sea, gaining that at-sea experience so they can 
apply it, they can learn as mariners, and have an appreciation 
for it so when they go into their assignments working in the 
marine industry, they carry that credibility and that 
experience.
    Mr. Cummings. Just as a last thing, listening to what you 
just said, first of all, let's go back to Katrina. There is 
absolutely, unequivocally, no doubt that one of the finest 
moments of the United States Coast Guard was during Katrina. No 
doubt about it.
    There were expectations of Government, and from what I 
could see the one agency that did exactly what the people 
expected Government to do was the United States Coast Guard, 
rescuing over 30 some thousand, 20,000 of whom would have died 
if it were not for the Coast Guard. I have said that many 
times.
    Where am I going with this? There was an expectation, a 
high expectation, and the Coast Guard met it. But in other 
agencies we had situations where, when the rubber met the road, 
we discovered there was no road. And I think that when you come 
to marine safety, which is a very, very significant part of 
what the Coast Guard, part of your mission, I am wondering how 
do we make sure that we do not fall asleep.
    Do you understand what I am saying? Because I want 
everything to be done the way you all did it with Katrina, I 
mean, so that you can be what I know you want to be, the best 
in every single thing that you do. We understand that you are 
being stretched to the Nth degree. And Mr. LaTourette and all 
of our Committee Members are trying to figure out every way 
that we can to make sure that we are not demanding more of you 
than you can handle.
    But I just do not want us to be in a position where maybe 
in another area that is very important to us you have to get a 
wake-up call, but the wake-up call then comes after some 
catastrophe, and then everybody is saying, boy, why didn't we 
know that? Why weren't we aware of that?
    And I just want to make sure--and I think this of all 
Government agencies, I feel that strongly about this--I want to 
make sure that we have the mechanisms by which we are 
constantly reevaluating where we are. Are we up to date? Do we 
have the kind of equipment that we need? Do we have the 
personnel? Have we moved to a culture of mediocrity, or where 
are we so that we do not fall in that hole, that black hole 
that I saw with Katrina?
    And I do not think that any member of our--nobody in this 
Country, any of our citizens would have been more pleased with 
what happened other than during Katrina than other than with 
the Coast Guard. Do you follow me?
    Admiral Papp. Yes, sir, exactly. When something like 
Katrina happens, it is an all hands on deck effort by the Coast 
Guard. I talked about the 2,000 people I had up in the 9th 
district. I sent 300 people down to Katrina, helicopter crews, 
boat crews, et cetera. I short-changed myself in the 9th 
district in order to respond to the urgent need in the 8th 
district. And I was like all the other districts around the 
Coast Guard, there was the need, we sent our forces to where 
that need was.
    However, when we perform like that, we create the 
misperception in the minds of the public that we can do that as 
a service on a sustained basis which takes us back to the 
capacity problem that I talked about in response to your first 
question, sir.
    So the wake-up call in terms of dealing with the marine 
industry is, in a form, Katrina, and we have created over time 
this misperception that we can do everything with the little 
bit of resources that we have. We can do the marine safety 
function. I do not think there is a better agency to be able to 
perform the mission; however, we also need the capacity to do 
that. This budget request sets us down that course by getting 
276 people into the system to start responding to that.
    We have experts. We have people with experience that we can 
call upon. They are over-subscribed. We need to start filling 
the system with new people moving through the pipeline to 
replace those pros that we have right now and build the 
capacity to take us into the future.
    Mr. Cummings. Thank you very much.
    Mr. LaTourette?
    Mr. LaTourette. Thank you very much, Mr. Chairman. Thank 
all of you for your testimony and, Admiral, I last saw the 
Chairman of the Full Committee, Mr. Oberstar, in Akron, Ohio, 
last Wednesday, and, just sort of a blast from your past, I 
asked him if he wanted to go up to the Grand River to see the 
Neah Bay working, and, sadly, he had other things to do and 
could not join us, but, as usual, the Neah Bay and the folks in 
Cleveland do a great job.
    Master Chief, I want to start with you. Last year the 
authority of the Coast Guard to enter into public/private 
partnerships relative to the acquisition of housing expired. 
Now the construction of housing depends upon a direct 
appropriation to the Service. The President's budget, I think, 
has $13 million for the acquisition of housing in New York and 
Alaska.
    I guess the first question would be, is the expiration of 
the Coast Guard's authority under Title XIV, have you seen an 
impact on the ability to house people in the Coast Guard? And, 
secondly, if you have, I would ask you how it affects 
operational readiness, retention, and morale.
    Chief Bowen. Well, first, our housing inventory itself is 
over 40 years old. It is old, it costs a lot of money to 
maintain, it is difficult to maintain. So our folks, while our 
housing people do a great job with what they have, and I think 
it is adequate, in some places it is just barely adequate. And 
when you look at other places, the other military services, for 
instance out in Hawaii, I was just recently out there, and we 
transferred a whole bunch of houses to the Army because they 
were going to be able to go into a PPV situation. And because 
of that PPV situation we are going to be able to enter into 
that with them.
    These houses that are being built, I took tours of them, 
these things are beautiful, for our junior petty officers. I 
mean, absolutely gorgeous places that are safe, a huge quality 
of life for all of the folks out there in Hawaii. But Coast 
Guard-wide we cannot do that. And even though the public/
private venture authorities, they lapsed, we were never able to 
take part in that because of the CBO scoring that has impacted.
    But I will tell you, PPV, I have looked at military bases 
all over the world where that is going on, it is absolutely a 
success, and I would love to see our Coast Guard people be more 
involved with that.
    Mr. LaTourette. Thank you very much, Chief. I'll just tell 
you on my last visit to the station in Fairport, they took me 
down into the basement, and you have to have a lantern on your 
head, and I think it was built about the time that that part of 
the world was facilitating the Underground Railroad. It was an 
old station.
    Admiral, I heard what you said in response to the 
Chairman's question, and I know that you heard what I said 
during my opening remarks that there is at least a perception 
when the budget request has a billion dollars less for what 
would be traditional Coast Guard missions and a billion dollars 
more than in 2007 was the year I referenced for port security 
and more homeland security.
    And so I think what the Chairman was talking about and what 
I was attempting to get at, there is at least a perception that 
again, and the Chairman cited Katrina, and I think that a lot 
of Members of this Committee did not think it was the right 
decision when FEMA was wrested from the jurisdiction of this 
Committee and put over into the Department of Homeland 
Security.
    I do not know that it caused all the problems that we saw 
relative to FEMA's response, but I do think it caused some of 
the problems. And I think the perception and what we are 
worried about is that the same thing is occurring because of 
the demands of homeland security, potentially, on the Coast 
Guard's missions. I would just ask for your thoughts.
    Admiral Papp. Yes, sir. What you are seeing is a forward 
projection of our mission cost model. Now, the mission cost 
model was developed to be able to demonstrate that we are 
spending our money across the various missions. We, of course, 
get our money from various appropriations, but because the 
Coast Guard is so multi-mission in comparison to almost every 
agency within the Service, we then have to be able to go back 
and demonstrate where we have been spending our money across 
these various mission areas.
    So this model was developed in order to demonstrate past 
spending and how it was allocated and distributed across those 
mission areas. Unfortunately, what we have been asked to do is 
then use that to project ahead where we are going to spend.
    I do not believe that that is an accurate way of portraying 
it, because what it does is it takes trends that have developed 
over the past five or six years and projects them into a future 
year, which is not necessarily the case because, obviously, 
post-9/11 we spent a lot of money on security operations. We 
spent a lot of money on high-value assets--boats, aircraft, 
ships, et cetera--which elevates the costs in comparison to 
something which is people-centric like the marine safety 
program. The cost of sending a cutter to sea with various 
missions for security is much higher than paying for a marine 
inspector. So if you project those costs that have been 
developed over the last five years ahead, it is going to 
disproportionately give you an impression that we are not 
spending as much money on a certain program.
    The way to really get into it is, where are we directing, 
where are our new starts, where are we spending the money? And 
I would say spending money on 276 people, that is the largest 
block of people that we are buying in this 2009 budget for the 
marine safety program.
    Mr. LaTourette. It is a little akin, I think, if you are a 
homeowner, and if your roof was leaking and this year you had 
to put a new roof on it, and it was a $12,000 expense that 
would not necessarily be reflected that every year you spend 
$12,000 with roofs.
    But although I have heard and I understand your answer, I 
think that I agree with you that the marine safety bump-up of 
276 is a wonderful thing, but you still have to have money to 
do things. I think you get the point, and I get the point.
    I thank you and I thank the Chairman.
    Mr. Cummings. We are very pleased to have the Chairman of 
our Full Committee, Mr. Oberstar.
    Mr. Oberstar. Mr. Chairman, since Mr. Larsen was here 
first, I would like you to call on him.
    Mr. Cummings. Mr. Larsen.
    Mr. Larsen. Thank you, Mr. Chairman, and thank you, Mr. 
Chairman, both.
    Mr. Connaughton, the first question is for you. In the 
Northwest, the marine industry total economic output is about 
$362 million. It supports about 4,000 jobs, total wages about 
$148,500,000. Part of that, not all of it--certainly, a part of 
that is the existence of small, relatively smaller shipyards, 
smaller, certainly, than the ones I saw in Mr. Taylor's 
district a few weeks back.
    Yet the budget that has been proposed is zero dollars for 
assistance for small shipyards. But I think I recall in the 
staff memo there was $10 million approved in the Fiscal Year 
2008 budget and zero for 2009. Can you talk a little bit about 
why there is zero this year, $10 million last year, what is 
going on with that?
    Mr. Connaughton. Yes, sir, Mr. Larsen. The program, 
actually this is the first year that we have had appropriations 
actually for this program. So as you understand, obviously, our 
budget request overall went in through our department, through 
up to OMB back in September, August, September of last year.
    Mr. Larsen. Sure.
    Mr. Connaughton. So our authority to actually implement 
this program predated that; however, the first appropriations 
that we saw was this December.
    So we have moved very quickly, sir, to implement the 
program, and we have issued Federal Register notices announcing 
the program. Yesterday, we had the deadline for submitting 
applications. We were still getting quite a few applications. 
Yesterday, we had the Fed-Ex man and woman waiting out there 
with full boxes of them. So obviously, sir, we are going to see 
how this program works but this is the first time, again, that 
we have ever had it, and this is why there was no money 
requested for it.
    Mr. Larsen. So it is possible that if it is seen as 
successful from a merits point of view in terms of the 
applications that you see this year, and using that $10 
million, that it may catch fire, if you will?
    Mr. Connaughton. Well, sir, I think, obviously, when we are 
putting together our budget request, we are given general 
targets, we are trying to fit within those targets. This is a 
brand new program. We have never had the opportunity to really 
judge whether it is successful now, so we will see how that 
goes, sir.
    Mr. Larsen. Okay, thanks.
    Admiral Papp, questions for you about icebreakers and ice 
operations, might be a surprise hearing from me. In your 
posture statement, your posture statement highlights polar 
presence and capabilities as one of your top five strategic 
priorities. The ice operations in the 2009 budget, as I 
understand it, despite that commitment, actually has a budget 
request for ice operations that is a $15 million decrease from 
Fiscal Year 2008.
    The only evidence in the budget that I am able to see, 
particularly, that is an increase as your polar presence and 
capabilities, it is a line item request for polar high latitude 
study. Am I reading this right, or what can I divine from the 
proposed budget relative to ice operations and the commitment 
from the Coast Guard?
    Admiral Papp. Sir, I am going to have to get back to you on 
that $15 million line item because I am just not certain where 
the comes from. I would have to look into that.
    The fact of the matter is that the National Science 
Foundation still manages the operating funds for our three 
polar breakers. It is a very difficult situation for us to deal 
with. We ended up having polar sea on standby this year. I did 
not get the mission to break out McMurdo, so it was on standby 
in case the commercially-leased icebreaker broke down. And we 
are currently looking for opportunities perhaps in the Arctic 
this summer to do a mission in order to keep that crew trained 
and ready to go.
    Mr. Larsen. Can you be more clear for the Committee about 
what this NSF operations authority has on, the impact that it 
has on the Coast Guard?
    Admiral Papp. Yes, sir. This is about $45 million which 
pays for the operations of the vessels. In other words, the 
Coast Guard pays for the people who are on the ships, but in 
order to get operating funds to take the ship away from the 
pier on any mission, we get mission orders from the National 
Science Foundation which, then, they transfer the money back to 
us to operate the ships.
    Mr. Larsen. To operate the ships for the National Science 
Foundation?
    Admiral Papp. Yes, sir.
    Mr. Larsen. What place in line, then, does the Coast Guard 
sit with icebreakers when it is NSF or Coast Guard? Who comes 
first?
    Admiral Papp. Well, the polar breakers, primarily Healy, 
which is an Arctic breaker, it was designed to be in the 
Arctic, gets all its missions from the National Science 
Foundation. It was designed for scientific purposes.
    Polar Sea and Polar Star were designed as pure icebreakers 
and primarily for the breakout of McMurdo and any other 
operations in the Arctic as well. National Science Foundation 
manages those missions, and as it stands right now, they have 
the alternative of going to, in this case, a foreign country to 
lease an icebreaker from them rather than using our icebreaker 
for the mission.
    Mr. Larsen. And then you have to sit and wait until NSF 
makes a decision about which asset they might use?
    Admiral Papp. That is correct, yes, sir.
    Mr. Larsen. If I may, Mr. Chairman, just quickly, regarding 
the Arctic, Foreign Affairs magazine has an article this month 
written by a former lieutenant commander of the Coast Guard 
about the Arctic, and I commend it to your reading if you have 
not read it already.
    Can you give us, can you give me an idea of where the Coast 
Guard is headed with the Arctic in terms of concept of 
operations when we might be seeing something more specific on a 
con-ops for the Arctic, and what that might mean for budget 
time frames?
    Admiral Papp. Yes, sir. That is the high latitude study 
that we are talking about there. You know, 14 U.S.C.--I used to 
joke about this on the Great Lakes because we dealt with ice a 
lot up there--14 U.S.C. talks about the waters of the United 
States, and it doesn't say whether it is hard water or soft 
water; it is just the Coast Guard is responsible for it.
    So what we are faced with now is that for years we have had 
hard water up there, and now it is receding and creating soft 
water. Therefore, an increase in activity up there, whether it 
is, you know--we have projections of cruise ships, oil 
exploration and other things, plus other people, whether it is 
fishing, we have responsibilities to carry out our mission sets 
in the Arctic now as well where open water is developing.
    This presents us with new challenges. Both boats and 
aircraft have to be prepared for working in low temperatures. 
We have done some exploration up there in terms of flying a C-
130 to the North Pole. Admiral Gene Brooks, the 17th district 
commander, has been directing various projects. We are going to 
put a couple of small boats, a helicopter and some other 
resources up in the north this year, and we will see what it 
takes for us to operate up in those latitudes and then take 
those results and start projecting for the future in terms of 
what capabilities and capacities we need up there.
    Mr. Larsen. Thank you, and, Mr. Chairman, I would 
appreciate your indulgence. I just wanted to be sure that got 
on the record. I am sure most of us on the Committee are aware 
of all of this, but it is something a few years out we are 
going to be dealing with on the Committee, and special 
interests in the Pacific Northwest as well.
    Mr. Cummings. Thank you very much.
    Mr. Oberstar.
    Mr. Oberstar. Thank you, Mr. Chairman, and thank you Mr. 
Larsen for that very thought-provoking line of inquiry.
    Mr. Chairman, I just want to compliment you on the manner 
in which you have conducted your responsibilities as the Chair 
of this Subcommittee. You have seized the issues and mastered 
the subject matter, done the Committee proud, and the Coast 
Guard, and all of those who depend on the Coast Guard for their 
service. You have done a superb job.
    Admiral Papp, I think one of the previous times you and I 
were together was up in Duluth for the commissioning of the 
Alder, and retirement of its predecessor, resplendent in whites 
on a glorious sunny day in the Harbor of Duluth. Well, the sun 
is not shining much up there this year, and it is a hell of a 
lot colder than it was back then, the retirement of the Sun-Do.
    Now, the Coast Guard budget submission, budget request is 
$8.8 billion, a little bit of an up-tick from previous year, 
$459 million up. But now, if I have the numbers right--I think 
I do--the authorized personnel level for Coast Guard is 45,500, 
and you are at 41,800. Is that correct?
    Admiral Papp. Yes, sir, that is correct.
    Mr. Oberstar. And in response to or a request for a 
statement you made is, we have to increase the size of our 
personnel, but we do not know how much.
    Admiral Papp. Yes, sir, that was my statement.
    Mr. Oberstar. Why don't you know how much?
    Admiral Papp. Well, sir, we have been working incrementally 
and developing those personnel needs that we can fit within our 
budget top-line authority over the last few years. We have not 
projected ahead of what should the maximum size of the Coast 
Guard be. I think that is something that, is a decision that 
has to be made not just within the Coast Guard.
    Certainly, we could put some thoughts to that process and 
come up with numbers. I think we all believe that we are not 
big enough, but how much Coast Guard can we buy? How much Coast 
Guard can the Country afford I think is properly discussed 
between the Administration and the Congress with input from us.
    Mr. Oberstar. Well, with input from the Coast Guard, but 
that input is probably going to be sub rosa, because I think 
you in the Coast Guard know what you need.
    When I came to Congress in 1975, I served on Coast Guard 
Committee, Subcommittee then, and continuously through all 
those years until now, I am Chairman of the Full Committee. The 
Coast Guard authorized level and actual level of personnel in 
1975 was 39,000. Congress has added 27 functions, new 
functions, to the Coast Guard's responsibility in all those 
years, and the Coast Guard has known all along what it has 
needed to do, but each successive Office of Management and 
Budget has prevented the Coast Guard from submitting to the 
Congress its list of needs to be fully operational.
    In years past, we have been able to get blank sheets of 
paper under the door, over the transom as we use to say, there 
are no transoms anymore. Too bad. We need transoms for unsigned 
papers to be sent over. And so I think it is a great disservice 
to the Coast Guard to keep loading new functions on and have 
either Congress either unwilling to fund them, or an 
Administration unwilling to request of the Congress the money 
needed.
    You have roughly 5,000 officers and 35,000-plus enlisted 
personnel. I think there was a higher ratio of, well, certainly 
a different ratio of officers to enlisted 30-plus years ago 
than today. Do you think this is an ideal number? Do you think 
we need more, or one more of the other?
    Admiral Papp. I think we need more across the board, sir. 
Let me start with the enlisted side. Once again, I hate to keep 
going back to my time on the Great Lakes, but that is my 
experience, so I can speak about that with authority.
    Mr. Oberstar. Go back, with relish.
    Admiral Papp. Yes, sir.
    Mr. Oberstar. They were good years.
    Admiral Papp. Yes, sir. And as I recall, I think that was a 
very warm spring day in May in Duluth about 40 degrees, as I 
recall. I had 41 small boat stations up there. Not a one of 
those stations was probably fully resourced to conduct the 
search and rescue mission. And we know that. We have been 
trying to come up with station staffing standards for years 
trying to determine what is the right mix, what is the right 
number. We never got there for search and rescue, and now we 
have added the security operations on top of that.
    So, intuitively, obviously, we do not have enough people to 
do all the things that we want to do. Now, how many should that 
be? Sir, I just do not know.
    Mr. Oberstar. And you are either not prepared or not 
permitted to tell the Committee what that number should be. And 
the spirit of the Coast Guard, semper paratus, I think you are 
always prepared. But I will say, and you need not comment on 
it, but you are not being permitted to tell us what the needs 
are.
    Compare the mission of the Coast Guard pre-Department of 
Homeland Security to its current Department of Homeland 
Security responsibilities. How do you view the changes in the 
mission and responsibilities of the Coast Guard today compared 
to pre-Homeland Security?
    Admiral Papp. Well, sir, as I give you that answer I have 
to not let stand a statement. If I knew how big the Coast Guard 
should be, I would tell you.
    Mr. Oberstar. You would tell us?
    Admiral Papp. Yes, sir.
    Mr. Oberstar. Well, then, tell us in a very short period of 
time.
    Admiral Papp. If there is anybody in the Coast Guard who 
would know how big the Coast Guard should be, as Chief of Staff 
of the Coast Guard, I would know that. We do not have a set 
figure, nor is there anyone who is preventing us from saying 
anything. We have not just been given the task, given the 
resources that we have, the preparations for hearings, budget 
preparation, et cetera, we are devoting all our resources that 
we have within Coast Guard headquarters in preparation for each 
year's budget cycle.
    If given the task to come up with how big should the Coast 
Guard be, we certainly would relish taking on that task. But I 
can assure you that we have not given any brainpower to how 
big, what is the maximum number, nor has anybody directed us 
to, nor has anybody told us not to discuss it. In fact, OMB has 
been in on the meetings and in on the State of the Coast Guard 
speech when Admiral Allen talked about the Coast Guard being 
larger, and we have received no rebukes, no comments, no 
concerns at all.
    I think everybody recognizes that in an unconstrained 
environment, the Coast Guard should be bigger. I think we all 
agree.
    Mr. Oberstar. But now we are in this new era of homeland 
security, you know the Coast Guard should be bigger, you should 
be planning for those new responsibilities and the personnel 
needed. So come back to us soon. The appropriation process is 
beginning. In two weeks we are going to bring a Coast Guard 
authorization bill to the House Floor after a long delay of 
negotiating with Admiral Allen over the marine safety function. 
We are going to move ahead with the bill.
    Admiral Papp. Yes, sir.
    Mr. Oberstar. And I am pleased to see that the budget 
projects 276 new marine inspectors, but we will have standards 
for those inspectors in this legislation when we finally get it 
through the Congress.
    So tell me, come back to my point about how you view the 
mission. What are your changed responsibilities in the homeland 
security era, in just a couple of minutes?
    Admiral Papp. It has been a sea change, sir. As you know, I 
was Chief of Congressional Affairs in the year before September 
11th, 2001. I was up here the week before September 11th 
working with the Appropriations staff. We had already lost 
about 4,000 to 5,000 people during the mid-1990s and, quite 
frankly, the budget that was going forward for us in 2001 was 
going to force us to release even more people from the Coast 
Guard and have us lay up and retire assets. If it was not for 
September 11th, 2001, we would probably have even a more 
reduced Coast Guard with an inability to take up our entire 
mission set.
    Post-9/11, with the additional responsibilities brought on 
by the Maritime Transportation Security Act, has seen immense 
growth. As I stated earlier, approximately 5,000 people 
regained into the Coast Guard, but the direction has been from 
both the Administration and the Congress to focus on security 
operations. And we have taken that on like we take on any other 
mission, with full force.
    And now we are looking back and, with the oversight of your 
Committee and the Subcommittee, have been reminded as well by 
the marine industry that perhaps we lost sight a little bit on 
that mission. So we are devoting significant resources to 
restore our performance in that mission area as well.
    Mr. Oberstar. What I am getting at is that homeland 
security function requires the Coast Guard to have a near 
police-type operation, constant patrol, constant surveillance 
and personnel on the water, at sea, in the ports. And that 
changes the nature of the Coast Guard mission and requires more 
personnel.
    You say you have shifted largely 5,000 personnel. That is 
in response to Mr. LaTourette's comment about FEMA. What 
happened with FEMA is 250 of their top, most seasoned personnel 
were redistributed throughout the new Department of Homeland 
Security, and $500 million of their budget lopped off the top 
and shipped elsewhere. And that made FEMA vulnerable right at 
the time they needed those personnel, they needed the seasoned, 
experienced people the most, at the time of Katrina.
    So we do not want that to happen to Coast Guard. We want 
the Coast Guard to continue. As I cautioned the President in 
the meeting, Mr. Young, at the time Chairman of the Committee, 
and I were at the White House, on a discussion of the Homeland 
Security Department, are you going to provide enough funding 
for the Coast Guard to carry out its historic missions of 
rescue and safety and tending to the navigational needs of our 
maritime community, and this new mission of homeland security? 
And the President was rather surprised and said, well, we'll 
attend to that. Well, they have not. These budgets do not 
reflect this new responsibility.
    On the equipment, you are underway with the 41 utility boat 
construction. You have 14 response boats to replace the 41-foot 
utility boats, and you are underway of a fast response cutters 
arching back to our hearing on Deepwater, so now the plans are 
to scrap eight of those cutters. Is that right?
    Admiral Papp. Those are the eight 123-foot cutters that 
were converted. They were 110-foot cutters, and we added onto 
them.
    Mr. Oberstar. You did.
    Admiral Papp. Yes, sir, and they were found structurally 
unsound for service. And the fast response cutter will be the 
replacement for not only those but the remainder of the fleet 
of 110-foot patrol boats.
    Mr. Oberstar. Now, we have information in Committee that 
the Pacific Area and the Atlantic Area commands have analyzed 
the number of small boats they need. You have not provided that 
information. I request you to submit that information to the 
Committee.
    Admiral Papp. Yes, sir.
    Mr. Oberstar. To the Subcommittee. It will be distributed 
to all Members.
    So we need more, the Coast Guard needs more resources, to 
deal with the LNG and other high-rise facilities that are under 
development. Are you prepared to deal with those needs?
    Admiral Papp. Well, we have numerous needs, and the 
operational commanders should be looking out there for 
potential things that come in the future.
    I think we would make the case that LNG does not 
necessarily equate to a responsibility or a need for increased 
capacities for simply the Coast Guard. This is something that 
should be probably appropriately shared with industry and the 
municipalities that have the facilities. I do not think that a 
Federal solution is necessarily the only solution or should be 
the primary solution; it should be a shared responsibility for 
security.
    Mr. Oberstar. Okay. Now, in 2003, the Coast Guard signed a 
contract for 700 25-foot Defender boats but have acquired only 
409 of that number. Why didn't you follow through with the 
whole contract?
    Admiral Papp. Well, that has been a great contract, and 
that boat has certainly been serving us well. Once again, we 
look at what we can fit into the budget amongst competing needs 
across the entire missions spectrum of the Coast Guard. Now, 
these boats are something that serve multiple missions out 
there. They carry marine inspectors out to do boardings for 
inspections; they carry out law enforcement patrols; they carry 
out search and rescue. It has been a great boat.
    But also along with that comes people. When we order new 
boats, there is also people that come along with it. We ordered 
in Fiscal Year 2008, we are ordering 26 additional boats, but 
that carries with it 238 FTE, and we are also buying some 
additional boats for recapitalization, I think 10 or a dozen 
additional boats.
    We buy out of two funds.
    Mr. Oberstar. Let me interrupt at that point because I 
don't want to keep other Members waiting, but when you did the 
analysis of a need of 700-plus Defender boats, you obviously at 
the same time understood you needed personnel to man those 
vessels, and you had a personnel number in mind. Now you are 
saying that because of personnel limitations we could only get 
up to 409 of those vessels. There is a disconnect between the 
personnel planning and the equipment planning.
    Admiral Papp. I do not think so, sir. I think it is just 
these are management decisions that we are confronted with on a 
yearly basis.
    Mr. Oberstar. Well, subsequently to the decision to order 
700, somebody said, well, we are not going to have enough 
people, so we cannot buy the additional ships.
    Admiral Papp. We enter into a lot of contracts, sir, that 
have a maximum number or options for so many. We do not 
necessarily buy all those. We set up a contract with an initial 
estimate, and then options to continue buying over the course 
of the contract. We just have not reached the maximum number of 
boats on this particular contract.
    Mr. Oberstar. Well, there certainly is a disconnect. Either 
the Administration has failed to provide the funding, Congress 
has failed to appropriate the funds, something has fallen 
short.
    I am going to come back to icebreakers. We have had for a 
change good cold winters in the Great Lakes region. We have 
needed more icebreaking. That is why we have the Mackinaw. But 
just 10, 12 days ago the harbor icebreakers in the Duluth-
Superior harbor were unable to clear a path for taconite-
carrying vessels to move out.
    They asked for the Mackinaw, but we are told that Mackinaw 
cannot be spared, and that the harbor icebreakers would do, and 
they did not. Why was not the Mackinaw available for duty?
    Admiral Papp. Well, I would have to get back to you with 
the specifics on that. I do not know where the Mackinaw is on 
any given day, sir. We have multiple operations going on up 
there. There is Operation Taconite, there is Operation Coal 
Shovel, there are three separate icebreaking operations going 
on, and at any one time the district commander has to decide 
what the best allocation of those resources are. Perhaps she 
was working in the Straits, could not get up to the locks in 
time, or was diverted to another mission. I am not sure, but we 
can certainly find that out for you.
    Mr. Oberstar. Well, the Lakes folks are very unhappy about 
the misallocation.
    And, Mr. Connaughton, I do not want you to feel neglected 
over there.
    Mr. Connaughton. It is okay, sir.
    Mr. Oberstar. Quiet moments, a reflective moment. We have 
an Act at present signed into law, authority for Short Sea 
Shipping Program on the Great Lakes. I would like to know what 
the Maritime Administration is doing to implement that 
legislative directive.
    Mr. Connaughton. Mr. Chairman, first, thank you very much 
for your personal leadership on this item as well as everyone 
on the Subcommittee and the Committee. We appreciate very much 
your showing leadership interest in this.
    This has obviously been a program that we have been working 
on. The passage of this legislation gives us, for the first 
time, some statutory grounding to move this program forward. 
Right now we do have draft regulations. The legislation calls 
for interim rules to be published within, I think, two or three 
months. We do have draft regulations that are in circulation 
right now within the Department. Hopefully, we will be able to 
get those out close to the deadline.
    In addition, we are moving forward in actually establishing 
the working group that your legislation calls for that would 
bring in public and private stakeholders as well as the Federal 
Government agencies interested in this issue. And so we are 
moving forward.
    In this budget request we had already asked for some money 
within our Operations and Training Account for the Short Sea 
Shipping Marine Highway Program. It is our hope that as we move 
forward and we start to show the viability of this program, 
that we will be able to grow this program.
    We have right now had tremendous, tremendous support from 
State and local governments. We have essentially changed our 
focus, reached out to the various metropolitan planning 
organizations, and we have many of them who are actually on 
board trying to help us make some of these projects a reality, 
a way to get trucks off the road, a way to get some of the 
environmental benefits that we think that marine transportation 
brings to the mix, and the fact that, obviously, it is a great 
way to create maritime jobs and, obviously, economic activity.
    So again, we appreciate very much your support and your 
leadership on this. I think we are moving forward in the right 
direction.
    Mr. Oberstar. Thank you. I am very encouraged that you are 
on track on those, on the regulations. There is great interest 
among Great Lakes mariners in shipping activities. One of the 
great benefits is going to be to relieve the congestion in 
Chicago where it takes 48 hours for a trainload of containers 
to move 7 miles through the city of Chicago. Moving containers 
over the Lakes, bypassing the choke point of Chicago, can speed 
the movement of goods, lower their cost, and provide new 
economic activity throughout the Great Lakes. And that's one of 
the benefits of the Short Sea Shipping initiative.
    And I will not elaborate on it at this point but thank you, 
Mr. Chairman. Any information you provide in your next 
benchmark, please send me that information. I will share it 
with my Great Lakes colleagues.
    Mr. Connaughton. Thank you, sir, we will.
    Mr. Cummings. Thank you very much, Mr. Chairman. Mr. 
Taylor?
    Mr. Taylor. [Remarks off microphone.]
    Mr. Cummings. Mr. Bishop?
    Mr. Bishop. Thank you, Mr. Chairman, and Mr. Taylor, thank 
you as well.
    Mr. Connaughton, Shell recently put out a press release in 
which they were announcing that they were going to begin to 
recruit U.S. mariners to staff their growing fleet of LNG 
vessels. In that press release you were quoted as saying ``The 
growing worldwide demand in the LNG industry, including 
domestic proposals like Broadwater, create a significant 
opportunity for U.S. mariners, the U.S. maritime industry, and 
coastal communities throughout the country.'' Should I take 
that as an endorsement on your part for the Broadwater 
proposal?
    Mr. Connaughton. You could take that as an endorsement of 
the concept of putting Americans on LNG no matter what flag, 
sir. Obviously, Shell is a company that we have been working 
with in the context of a fleet that is growing in LNG. One of 
the reasons it is growing is because, obviously, it is starting 
up facilities and importation facilities in different parts of 
the country, most particularly Broadwater.
    But we have been working with Shell, other entities have 
been working with Shell to get Americans on board because we do 
believe, given the statute that exists today, that encourages 
the use of Americans, encourages the use of American vessels, 
is something that is good for safety, it is good for security, 
it is good employment opportunities for U.S. mariners, sir. And 
that is what we are after.
    Mr. Bishop. Thank you. But you are not specifically 
endorsing Broadwater, therefore?
    Mr. Connaughton. Sir, the Maritime Administration is 
responsible for the licensing activities for offshore 
facilities.
    Mr. Bishop. Right.
    Mr. Connaughton. This facility is, obviously, a FERC 
facility. We do not get involved with the FERC facilities. We 
do not endorse or not endorse. Obviously, they are working 
through their process.
    Mr. Bishop. Thank you. In 2006, we amended the Deep Water 
Port Act of 1974 to require the Secretary of Transportation to 
implement a program that would promote the transportation of 
LNG on U.S.-flag vessels, and it also directed that LNG 
facilities that would be serviced by U.S.-flag vessels be given 
priority in licensing decisions.
    Would you recommend the same policy to the FERC? That is to 
say, when the FERC is licensing a facility in State waters, 
would you urge the FERC to give priority in terms of licensing 
decisions to facilities that would be serviced by U.S.-flag 
vessels?
    Mr. Connaughton. Sir, I think that, obviously, we are 
administering the statute you have referred to, and we think 
that uniformity in any of these applications should be one of 
the goals in licensing, whether onshore or offshore facilities. 
We think that at least we have found--because this is not a 
mandate--but simply asking the question to put Americans on 
board, simply asking the questions for them to consider having 
U.S. vessels has actually been very successful because nobody 
has actually asked before.
    By showing them the cost structure, by showing them the 
safety and the security and the environmental benefit that we 
think go along with it, as well as they recognize that the 
various communities that are being looked at for LNG 
facilities, it is different when they know that maybe one of 
their friends, neighbors, or relatives are on those vessels.
    And so we think it makes sense, we have seen great success. 
We are about to announce another company that is going to 
commit to U.S.-flag, and it is just simply asking the question. 
And I think everyone should ask that question.
    Mr. Bishop. I thank you for your efforts in that regard.
    Admiral Papp, I want to sort of pick up on the line of 
questioning that Chairman Oberstar was pursuing, but I want to 
focus it, specifically, on Broadwater. And, by the way, I do 
have interests other than Broadwater, although I suspect that 
at least Mr. Connaughton wonders whether there is anything else 
on my mind.
    The Waterway Suitability Report that the Coast Guard 
produced relative to the Broadwater application said that the 
facility, if it were licensed and constructed, it would require 
the Coast Guard to have either a 87 or 110-foot coastal patrol 
boat. And it said the Coast Guard would need to add 62 
additional people, 62 additional personnel.
    So my question to you is, if, in fact, Broadwater were to 
be licensed and constructed and the Coast Guard was then 
presented with a need for either an 87 or 110-foot vessel, how 
does the Coast Guard handle that? Do you come to us and add to 
your capital procurement request for that vessel? Do you 
redeploy it from within your existing fleet?
    And the same question for the personnel: How do you 
accommodate a new need for 62 additional personnel? Do you 
redeploy, or do you come to us with an increase in your end 
strength?
    Admiral Papp. Well, sir, there are a number of ways you can 
go about that. You are correct, though, it would be a new start 
for us. I would say this is analogous to what we are doing with 
the Navy in terms of providing security for the ballistic 
submarines as they go out of Kings Bay. Out on the West Coast, 
the Navy actually bought us 87-foot patrol boats and provides 
reimbursable money to pay for the crews and for the boats and 
crews that support the security operations for the ballistic 
missile submarines.
    When Captain Boynton did that study, I think he, like any 
other good Coast Guardsman, were looking at, okay, security 
needs provided, the Coast Guard will step up to the plate, and 
this is what we would need to do it. As we have gone through 
the process and we look at additional areas, we really take the 
view at this point that this has to be a shared responsibility.
    Mr. Bishop. Can I engage you on that?
    Admiral Papp. Yes, sir.
    Mr. Bishop. Because in response to one of Chairman 
Oberstar's questions, you talk about a shared responsibility, 
and you talked about industry and the municipalities having a 
piece of the responsibility.
    Now, in the case of the facility with which I am the most 
familiar, the FERC has the sole jurisdiction for deciding 
decisions; local government has no jurisdiction and no say. 
Suffolk County has no say, the towns have no say.
    So wouldn't it be adding insult to injury to go to these 
municipalities that are doing everything they can to fight off 
this facility and say, oh, by the way, you now need to help us 
provide for the safety and security of this facility, and you 
have to put this onto the real property tax base of your 
municipality, whatever it is. Isn't that a little tough sell?
    Admiral Papp. Sir, I hate to sit here and give you 
headlines, but as a Coast Guard officer, it is really out of my 
jurisdiction. As a taxpayer or citizen, I think I would agree, 
philosophically, that if the municipalities are not asking for 
it, then the burden should not be placed on them.
    What I am talking about is a more general philosophy that, 
depending upon the circumstances in any given area, whether it 
is industry, whether the State or other locale has come 
together to develop a facility, then it ought to be a shared 
response in terms of providing security.
    Nuclear plants, to me, seem analogous to this. That was a 
big concern of mine when I was a district commander. Once I 
visited the nuclear plants I found out there really was not any 
need for the Coast Guard. They have regulations, they have 
security firms, et cetera, some very strict guidelines that 
they go by that are put out there by the Nuclear Regulatory 
Commission. And I would say that LNG terminals, to me, 
represent a similar thing. There ought to be a set of rules, 
established guidelines, and then that the people who are 
responsible for the facility provide the security.
    Mr. Bishop. Thank you very much. Thank you for indulging my 
extra time, Mr. Chairman.
    Mr. Cummings. Thank you very much.
    Ms. Richardson?
    Ms. Richardson. Thank you very much, Mr. Chairman.
    Building upon our Chairman Oberstar and also now Mr. 
Bishop, I would also concur that your position of partnership 
of responsibility regarding LNG facilities might need to be 
reevaluated. In my district, Long Beach, California, there was 
a potential siting of LNG, and there still is much discussion, 
and I will tell you from those proposals that it is still, 
though, the ultimate responsibility of the Coast Guard to 
protect the coast.
    The provider, the private provider, whether it is Shell, 
whether it is Conoco-Phillips, whether it is Mobil, whoever it 
is, they view and they testify that their responsibility is to 
ensure that their site is safe. But they are not responsible in 
terms of which boats physically come in, whether someone else 
comes in and seeks to attack or put some explosive device or 
whatever it might be on their physical site. So I think for us 
to assume that it is an equal partnership might be very short-
sighted and something for further discussion of this Committee.
    The three questions that I have are, number one, regarding 
the alteration of bridges. Currently, there are no funds that 
are requested for this program in Fiscal Year 2009, whereas in 
Fiscal Year 2008, $16 million was appropriated for this 
program. This is according to the Truman-Hobbs Act of 1940, and 
I will also tell you in my district we have the Gerald Desmond 
Bridge, and that bridge currently has a diaper hanging 
underneath it due to the fact that the larger ships now of the 
size of the ships that are coming in, the bridge is really not 
sufficient in its height to be able to allow for these ships to 
come through.
    So my first question would be, what have you thought about 
in terms of actually having allocations in the Fiscal Year 2009 
budget for the alteration of bridges?
    Admiral Papp. Ma'am, we put nothing in the budget. We had 
no plans for any specific bridges, and that is the budget that 
we put forward, and I do not have much to amplify beyond that.
    Ms. Richardson. Okay. Would you agree, though, that, given 
the larger sizes of the ships, there are going to have to be 
alterations to various bridges across this Country?
    Admiral Papp. Certainly, as a general statement, if we have 
larger ships coming into ports and currently that waterway is 
restricted because there is a bridge there, then the port, the 
locale, should enter into negotiations with whoever owns the 
bridge. The Coast Guard gets involved later on in terms of 
evaluations through our bridges program in determining the 
effects on the waterway, et cetera. And that is where we have 
our involvement.
    Ms. Richardson. Well, according to our document, it says 
that created by the Truman-Hobbs Act of 1940, the Bridge 
Alteration Program provides that the Federal Government will 
share with the bridge owners the cost of altering or removing 
railroad and publicly-owned highway bridges that obstruct 
maritime navigation.
    So I have two other questions, but I would ask that you 
reevaluate what this Act actually states, which says that there 
should be a shared role. And I can tell you, as I said, in my 
area that it is being required from a navigational perspective.
    Admiral Papp. Yes, ma'am, and I would like to look into 
that a little bit further and provide you an answer for the 
record.
    Ms. Richardson. Thank you, sir.
    Mr. Connaughton. Ma'am, if I could just throw one thing in, 
the Administration did request that part of the program be 
split from the Department of Homeland Security back to the 
Department of Transportation regarding some of these issues on 
actual replacement of bridges. That request is still out there 
and, obviously, waiting for authorization.
    Ms. Richardson. Well, according to our notes it says that 
last year the President's budget proposed to transfer the 
responsibility of the Truman-Hobbs Bridge Alteration Program to 
the Department of Transportation; however, that request was not 
renewed this year.
    Mr. Connaughton. Actually, I think it is still the 
Department's, still the Administration's position, but I will 
come back and confirm that to you, ma'am. I think there is 
legislation pending to do that.
    Ms. Richardson. Thank you. I have two other very short 
questions. When we talk about the safety of the harbors, I 
would like to ask you a question about the role of the fire 
boats. Given the larger sizes now of many of the ships that are 
coming through, if we have a disaster again, an explosion, et 
cetera, many of the fire boats within these communities are not 
sufficient to reach completely across over the ships. Have you 
guys had any discussions about that?
    Admiral Papp. I certainly have not had any discussion. I 
suspect that that is something that is done regionally. We have 
area maritime safety committees. Each one of our captains of 
the port gets industry together. We can certainly solicit 
across our captains of the port and see where they have had any 
of these discussions and once again provide information for the 
record for you.
    Ms. Richardson. I would appreciate it.
    And my final question is really, I think, something you 
will like, something to help you. I noted in the testimony it 
said that currently our Coast Guard members are not receiving 
adequate health care responses, meaning that DOD and TRICARE 
managers are aware of an issue, but apparently the access to 
the health care is not appropriate for our members.
    And I am referring to Mr. Bowen's testimony on page 5, and 
you say, ``We have made significant progress with TRICARE over 
the past few years. With your continued support we hope to 
ensure that this positive trend continues.'' What specifically 
are you asking us to do to help you with this matter?
    Chief Bowen. I think I should answer that, ma'am. What we 
have made progress with is boundaries. We have a lot of places 
where Coast Guard people are geographically separated from 
providers. For instance, on islands that may be within the 100-
mile limitation on actually getting paid for dependents to go 
with their loved one if they have to go for some 
hospitalization or something like that.
    Actually, Congress has helped us on that just recently. In 
the future, I will tell you right now, there is a growing issue 
that I am collecting information on with geographic--for 
instance, in Astoria, the providers are across a mountain range 
within 100 miles, yet still it is displaced. We are collecting 
information, and we will be working with our Congressional 
Affairs staff to maybe work towards next year getting it 
changed that it will help those folks out just like you just 
helped us out with the island situation.
    Ms. Richardson. I would just urge you to advise us as 
quickly as possible. Don't wait until next year. Those are 
things we are more than happy to assist you with if we can.
    Chief Bowen. Yes, ma'am.
    Ms. Richardson. Thank you.
    Mr. Cummings. Thank you very much, Ms. Richardson. Mr. 
Taylor?
    Mr. Taylor. Thank you, Mr. Chairman, and thank our panel 
for being with us today.
    Admiral Papp, I am going to start with you. If I hired 
someone to build a house for me, and then I hired that same 
person to put an addition on that house, within the course of 
putting in an addition on that house they ruined my house, made 
it uninhabitable, I would seek redress from the person who 
built it and put that addition on it.
    That's the analogy I am using on your 110 to 123s. I am 
really not happy, for an agency that has really done so well, 
particularly as the Chairman mentioned, starting with Hurricane 
Katrina, and has a history of doing things the right way, as a 
representative of the taxpayers, I certainly cannot be pleased 
with what happened and the lack in what appears to be an effort 
by the Coast Guard to sweep this under the rug and pretend like 
it never happened.
    Now, maybe the ships were old to begin with. If that is the 
case, why did the Coast Guard propose extending them? If they 
were not obsolete to begin with and the same person who built 
them came up with a performance spec, not your spec, but their 
spec, to stretch them--and as I was told by one of your 
captains, literally from the time they engaged the clutches, 
the hull started deforming, the engines no longer lined up with 
the shafts, and they knew almost immediately they had a 
problem. I cannot understand why the Coast Guard has not held 
the contractor accountable.
    The second thing I cannot understand is, the Corps of 
Engineers I know has language where, if they are displeased 
with the action of a contractor, until that first problem is 
resolved, they have the legal authority to ban that contractor 
from bidding on further work with the Corps. I think that is a 
very reasonable approach to take, and I am surprised that the 
Coast Guard has not asked for that in this instance.
    We are talking about what? Eighty million dollars of 
disputed money. We are talking about eight ruined ships. And, 
quite frankly, I have to believe that if it was your money or 
my money, we would be a lot more demanding in straightening 
this out than what I have seen out of the Coast Guard. I really 
do expect you guys to do better, and it is not going to go 
away.
    And yes, I am aware that the person that did the work is a 
major contributor to the President. It is public record. That 
doesn't make it right, and it needs to get fixed. Every time 
you or someone from your organization comes before this panel, 
I am going to ask the same question: what are you doing to make 
it right?
    I have been in touch with Admiral Sullivan of the Navy's 
NAVSEA program, and he says for a million dollars he can do a 
definitive analysis of the 110s, what went wrong, and what it 
would take to fix them. Then we as a Nation, can make a 
judgment whether or not our money is better spent fixing them 
or more appropriately, if the contractor's money is better 
spent fixing them, or if we are better off just having the 
contractor reimburse our money plus the cost of destroying 
those vessels.
    It is my intention to offer that as an amendment when your 
authorization bill comes up. I think the present situation, 
again, you and I would never treat our own money that way; we 
should not treat the taxpayers' money that way.
    Secondly, on your replacement for the 41s, $4.5 million for 
boats sounds like a heck of a lot of money, or at least that is 
according to the brief I have in front of me. So if someone 
could walk me through that, I would appreciate it. Congressman 
LoBiondo, your former Chairman and a great Member of this 
Committee, expresses in a conversation some challenges that 
they are having in his part of the world with abandoned 
vessels, and I know it is not unique to New Jersey. We have a 
problem down my way, certainly, in the bayou country. I was 
curious if the Coast Guard had ever considered some sort of a 
drop-off point where people could present the Coast Guard with 
a quit-claim deed to that vessel and be absolved of it? The 
analogy being it is a heck of a lot easier to have someone 
bring their litter to a common dump than having to go along the 
highway and pick it up, scattered all over the place. I have to 
believe that we, as a Nation, would find it less expensive to 
do things that way, and I am curious if the Coast Guard has 
ever explored that.
    Administrator Connaughton, again, let me start by thanking 
you for working with us on the Wounded Warrior Program. We have 
received, as you know, a favorable letter from the Secretary of 
the Navy. I have a similar request out with the Secretary of 
the Army. I think we can do a lot of good things. I think we 
can help these wounded warriors get their lives back in order, 
give them an opportunity to teach young people at your Academy. 
We would hope that all of the academies would follow suit with 
this. As the Commandant has pointed out, it is not just for 
people with master's degrees, it would be for wrestling 
coaches, baseball coaches. I would certainly encourage the 
other Members of this Committee as they visit people at Walter 
Reed or Bethesda and make them aware of this opportunity. 
Again, it could not have happened without your cooperation. I 
want to thank you for that.
    I see in the memo, and I am going to quote the memo, and 
you tell me whether or not it is correct: ``A Port Act of 1974, 
as amended through the Coast Guard Maritime Transportation Act 
of 2006, directed the secretary of transportation to develop 
and implement a program to promote the transportation of 
liquified natural gas to the U.S. on U.S.-flag vessels. The Act 
also directed the Secretary to give top priority to the 
processing of deep water port licenses to LNG facilities that 
will be supplied with natural gas by U.S.-flag vessels.`` Is 
that an accurate statement?
    Mr. Connaughton. Yes, sir, it is.
    Mr. Taylor. And to what extent are you working to make that 
happen?
    Mr. Connaughton. We are being very aggressive in the 
applications that we receive to implement that law. We have 
right now three companies, three different applications that we 
have approved that have at the minimum committed to 25 percent 
U.S. citizen crew members.
    We have another applicant that has committed to two U.S.-
flag LNGs for their proposed facility off the coast of Southern 
California. And we are working with two other applicants right 
now, one who has already given us in writing a commitment to 
have a U.S.-flag LNG for their proposed application. We will 
announce who that is within the next month or so, sir.
    The other application we are working on for another 
applicant has indicated that they are leaning towards also 
committing to a U.S.-flag application for their application.
    Mr. Taylor. Administrator Connaughton, I am curious when 
you--I mean the law says U.S.-flag vessel. When you agree to 
only 25 percent of the crew and apparently waiving the 
requirement on the vessel, don't you think you are setting the 
bar pretty low compared to what the law says?
    Mr. Connaughton. Well, sir, the law actually says that they 
will get preference. And so what we have been attempting to do 
is work with the applicants for some U.S. presence, some U.S. 
commitment on their applications.
    We were able to do that. That is a minimum of 25 percent. 
We have also gotten commitments from other companies. As Mr. 
Bishop notes, Shell has committed that they will, even though 
they have no applications pending before us to actually put 
American mariners on board their vessels. But, sir, that law is 
not right now a requirement for us to mandate U.S.-flag 
vessels. So everything that we get, we get within the context 
of encouraging these operators to consider American and to 
actually get some commitment for some American content.
    So we have been more recently, I am going to say, 
successful now starting to get U.S.-flag commitment, just 
basically because, I think, they are starting to show, we can 
show the numbers right now, given the strength of the dollar, 
given the various costs involved in the normal LNG operation, 
that there is not a very vast price differential anymore. And 
so that is what we have been trying to show them in an economic 
case as well.
    But, sir, again it is not mandatory. That language is for 
us to encourage them.
    Mr. Taylor. Mr. Chairman, may I ask one last question for 
the record?
    Mr. Connaughton, I am curious, I thought the Jones Act was 
pretty clear about transportation between U.S. ports. I was 
curious how the system of allowing lighters that go between 
super tankers and U.S. ports, how they were allowed to be 
foreign-flag vessels when they, at least in my way of thinking, 
do not make a true foreign voyage. I realize there are a number 
of vessels that are already allowed to do this, and that's 
water under the bridge. But as those vessels need to be 
replaced either under OBRA 90 and just because of obsolescence, 
is there any move within your organization to try to close that 
loophole?
    Mr. Connaughton. Sir, the way the cabotage laws are, well, 
the way they read and the way they have been implemented is, if 
it is a vessel offshore, it is not considered a point or place 
in the United States unless it is within the territorial 
waters. So when you see right now a lightering occurring on a 
larger vessel in the Gulf of Mexico, that larger vessel is not 
considered a U.S. port or place.
    A facility is. And that is why we are starting to see 
contracts going forth for the construction of shuttle tankers 
for some of these new facilities in the deep part of the Gulf 
of Mexico. Because once they have a buoy or once they have any 
sort of fixed structure on the bottom, that fixed structure 
becomes a point or place in the United States. So those vessels 
have to be U.S.-flag to transport the oil into the refineries.
    However, again, a vessel that is just simply lightering or 
hovering off the coast of the United States is not considered a 
point or place under the way the law is written right now.
    Mr. Taylor. Okay. Thank you, Mr. Chairman.
    Mr. Cummings. Thank you.
    Just a few more questions, Admiral Papp, just on Deepwater. 
Can you give us an update on the national security cutter, and 
what are the results of the test and trials being performed on 
the ship?
    Admiral Papp. I would be glad to, sir.
    Mr. Cummings. Briefly.
    Admiral Papp. What a tremendous ship. It is exceeding our 
expectations on the machinery trials. It just completed its 
builders trials, and we will be getting a Navy in-serve team 
aboard during the month of March to do our acceptance trials, 
and we will be accepting it for the Coast Guard probably some 
time late April, early May.
    Mr. Cummings. And what contractual obligations, if any, may 
be unmet at the time of delivery? You know that is something 
that we have been very concerned about.
    Admiral Papp. Yes, sir. Clearly, I think machinery-wise the 
ship is going to be outstanding. It will have very few 
discrepancies compared to most lead ships. We are having some 
small concerns right now about information insurance. We are 
going through the TEMPEST inspections. We suspect that we can 
solve all those problems. They may not be completely solved at 
the time when it comes to make the decision to accept. However, 
you have to balance that against keeping it in the shipyard and 
incurring additional costs.
    We can have the builders come to the ship after delivery 
and continue. The ship is, basically, under warranty, so we can 
continue to get work done, but we need to get that ship and 
that crew underway and start pushing it to the limits and 
seeing what it can do for our Country.
    Mr. Cummings. And what is the status of the TEMPEST 
testing?
    Admiral Papp. They are continuing with the testing right 
now. We have discovered some problems. As I say, we think they 
are all solvable. It may require some minor rerouting of 
wiring, insulation to cabinets, et cetera. But it is stuff that 
is technologically feasible and I think easily resolved.
    Mr. Cummings. Have there been further assessments made of 
the potential problem with the ship's hull fatigue life?
    Admiral Papp. Yes, sir. We have come up with a solution for 
hulls three through eight. It is probably going to cost about 
$5 million per ship, which in the overall cost of the ship is 
not highly significant, a fairly simple design change for those 
ships.
    Now, for hulls one and two, Burtoff and Washee 
[phonetically] we will have to do some work after they are 
delivered. We are continuing to go through the process to 
determine exactly what we will need to do to those two ships. 
In fact, when Burtoff is delivered, she will be instrumented so 
that we can take various readings as she goes through 
exercises. It is something that we do not have to correct 
immediately; it can be done over a series of yard periods 
throughout the life of the ship.
    Mr. Cummings. Mr. Connaughton, back in October during a 
Subcommittee hearing on the Mariner Work Force, you spoke to 
the Subcommittee about a survey that you planned on conducting 
of the entire U.S. vessel operating industry to assess the 
extent of workforce. Back then you were waiting for approval, 
and I am just wondering what is the status of that, and have 
you received approval? Has the survey been sent to the 
industry? If so, can you comment on the results of the survey?
    Mr. Connaughton. Yes, sir. Actually, shortly after the 
hearing, we were given final approval to go forward with the 
survey. It has been sent out to the industry. We are getting 
comments back. We have gotten quite a few responses to the 
survey, not as many as we thought we would get, and we are now 
trying to explore whether there are problems with the mail 
service because all of our mail obviously has to get 
irradiated. And we are trying to track down whether the 
responses are not as heavy as we thought because they are 
potentially still in the pipeline trying to get to us. To be 
very blunt, we quite often do not get mail for two to three 
months after things have been mailed to us, which is probably 
around the time frame we are talking about right now.
    So it is out, sir. We will be very happy to provide you a 
copy of what we sent out to the industry.
    Mr. Cummings. Please do.
    Mr. Connaughton. And we will give you an idea about what, 
so far, the responses are.
    Mr. Cummings. Mr. LaTourette?
    Mr. LaTourette. Thank you, Mr. Chairman. Just two 
questions, one for you, Administrator Connaughton, and then one 
for you, Admiral.
    Customs and Border Protection have announced their 
intention to reinterpret the regulations relative to the 
foreign-flag cruise ships that travel between one or more 
ports. Under the current regulations, foreign-flag vessels can 
call on multiple U.S. ports in voyages that begin and end at 
the same U.S. port and make a qualifying port call.
    The CPB, along with--and you can correct me if I am wrong--
the strong support of MARAD, has proposed to require that 
cruise ships stop at a foreign port for not less than 48 hours 
and that time spent at foreign ports be greater than the time 
spent in the United States ports. The proposals proponents have 
reasoned that the reinterpretation would limit competition to 
three cruise vessels that have been reflagged under the U.S. 
flag and operate exclusively in Hawaii. Of the three vessels, 
only one has already been withdrawn from the U.S. registry, and 
the vessel's operators have also announced their intention to 
remove a second vessel.
    The question is why are we protecting one ship, and it is 
not so much the ships that I am concerned about. Even though I 
do not live in Florida I could see a situation where everybody 
in Miami is happy, but they no longer stop in the smaller ports 
like Key West. And you are going to adversely affect the 
economy.
    So what are you thinking?
    Mr. Connaughton. Sure, sir. The Administration's position 
is a very strong support of the cabotage requirements and very 
strong support of the Jones Act. And the President has said 
that on numerous occasions.
    What essentially transpired in Hawaii was legislation that 
Congress passed in 2003 provided for the allowance of these 
three vessels to come in and join the trade there and become 
U.S.-flag cruise vessels. Shortly after those vessels started 
operating out there, we saw a very large increase in foreign-
flag tonnage operating from the West Coast to Hawaii. Those 
vessels were leaving from places like Los Angeles and San 
Diego, taking, actually advertising Hawaiian cruises, taking 
14-day cruises following the same itinerary against the U.S.-
flag operators when they arrived out in the Hawaiian Islands, 
returned back to the mainland via Encinada. In fact, one of the 
operators actually pulled into Encinada at 2:00 a.m. in the 
morning and left at 3:00 a.m., and that was their regular 
itinerary.
    It was quite obvious at that time that there was an effort 
to avoid the enforcement, in fact, actually to violate the 
Passenger Vessel Services Act. We brought this to the attention 
of the Customs Service. The Customs Service investigated it and 
actually asked both operators who were engaged in these trades 
to cease their operations. They chose not to do so. Customs 
then came forward with this interpretative rule.
    In the process of coming forward with the interpretative 
rule, obviously, there was, I am going to say, now greater 
recognition that there may be other operations that are doing 
similar types of itineraries, although they are very small 
percentages of the overall market. In fact, when we went back 
and took a look, even though there has been a great hew and cry 
about this issue, let's just say out of the California trades, 
those involved in this Hawaiian, West Coast Hawaiian trade, I 
think is only one or two percentage of the total passengers 
actually embarked in California overall.
    So we are working with Customs and Border Protection. They 
are the lead on this. We think they have done an exceptional 
job, sir, in trying to bring this issue to conclusion. There 
are discussions going on in the Administration about how to 
actually move forward for final regulations or a final rule, 
our final interpretative rule, and that is what is being worked 
on right now.
    Essentially, what we have uncovered is that there is a 
violation of the cabotage requirements, and we are attempting 
to close that loophole. But, overall, it is a very small 
percentage of the foreign operators who are operating out of 
U.S. ports for foreign cruises.
    Mr. LaTourette. Thank you very much.
    And to you, Admiral, the Coast Guard still has significant 
mission hour shortfalls for its air patrols. Has the Coast 
Guard looked at interim measures to fill this gap until the 
CASA aircraft are fully on line and delivered?
    Admiral Papp. No, sir. What we are doing is pushing ahead 
with the CASA, which, by the way, is demonstrating great 
capability. Just last week there was a crash of two F-15s in 
the Gulf of Mexico, and we happened to have a CASA, or the Sea 
Guardian aircraft out there on training mission. It identified 
fishing boats in the area through its identification system. It 
controlled a KC-130 tanker, two other F-15s. It vectored a 
fishing boat in to recover one of the Air Force pilots and then 
actually located the second pilot, but had to leave scene.
    It is going to be a tremendous aircraft for us, and we are 
devoting all our efforts in getting them out there as quickly 
as possible to fill the void that we have.
    Mr. Cummings. Thank you. Any other questions? There being 
none, this hearing is called to an end, and thank you very 
much.
    [Whereupon, at 2:01 p.m., the Subcommittee was adjourned.]

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