[Senate Hearing 114-107]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 114-107

                    THE IMPACTS OF VESSEL DISCHARGE
                      REGULATIONS ON OUR SHIPPING
                         AND FISHING INDUSTRIES

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

                                HEARING

                              BEFORE THE

                      SUBCOMMITTEE ON OCEANS, ATMOSPHERE, 
                       FISHERIES, AND COAST GUARD

                                OF THE

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            FEBRUARY 4, 2015

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]



                        U.S. GOVERNMENT PUBLISHING OFFICE
97-448 PDF                   WASHINGTON : 2015                        
       
________________________________________________________________________________________      
For sale by the Superintendent of Documents, U.S. Government Publishing Office, 
http://bookstore.gpo.gov. For more information, contact the GPO Customer Contact Center,
U.S. Government Publishing Office. Phone 202-512-1800, or 866-512-1800 (toll-free).
E-mail, [email protected].  
 
       
       
       
       
       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                   JOHN THUNE, South Dakota, Chairman
ROGER F. WICKER, Mississippi         BILL NELSON, Florida, Ranking
ROY BLUNT, Missouri                  MARIA CANTWELL, Washington
MARCO RUBIO, Florida                 CLAIRE McCASKILL, Missouri
KELLY AYOTTE, New Hampshire          AMY KLOBUCHAR, Minnesota
TED CRUZ, Texas                      RICHARD BLUMENTHAL, Connecticut
DEB FISCHER, Nebraska                BRIAN SCHATZ, Hawaii
JERRY MORAN, Kansas                  EDWARD MARKEY, Massachusetts
DAN SULLIVAN, Alaska                 CORY BOOKER, New Jersey
RON JOHNSON, Wisconsin               TOM UDALL, New Mexico
DEAN HELLER, Nevada                  JOE MANCHIN III, West Virginia
CORY GARDNER, Colorado               GARY PETERS, Michigan
STEVE DAINES, Montana
                    David Schwietert, Staff Director
                   Nick Rossi, Deputy Staff Director
                    Rebecca Seidel, General Counsel
                 Jason Van Beek, Deputy General Counsel
                 Kim Lipsky, Democratic Staff Director
              Chris Day, Democratic Deputy Staff Director
       Clint Odom, Democratic General Counsel and Policy Director
                                 ------                                

            SUBCOMMITTEE ON OCEANS, ATMOSPHERE, FISHERIES, 
                          AND COAST GUARD \1\

MARCO RUBIO, Florida, Chairman       CORY BOOKER, New Jersey, Ranking
ROGER F. WICKER, Mississippi         MARIA CANTWELL, Washington
KELLY AYOTTE, New Hampshire          RICHARD BLUMENTHAL, Connecticut
TED CRUZ, Texas                      EDWARD MARKEY, Massachusetts
DAN SULLIVAN, Alaska                 BRIAN SCHATZ, Hawaii
RON JOHNSON, Wisconsin               GARY PETERS, Michigan


  

    \1\ On March 3, 2015 the Committee finalized Member assignments for 
its subcommittees. The list below reflects March 3, 2015 assignments. 
When this hearing was held, on February 4, 2015, formal assignments had 
not yet been made.
                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on February 4, 2015.................................     1
Statement of Senator Rubio.......................................     1
Statement of Senator Sullivan....................................    24
Statement of Senator Cantwell....................................    32
Statement of Senator Ayotte......................................    34
Statement of Senator Nelson......................................    36
    Prepared statement...........................................    36
Statement of Senator Wicker......................................    37

                               Witnesses

James F. Farley, President, Kirby Offshore Marine, LLC...........     3
    Prepared statement...........................................     4
James H. I. Weakley, President, Lake Carriers' Association.......     9
    Prepared statement...........................................    10
Claudia Copeland, Specialist in Resources and Environmental 
  Policy, Resources Science and Industry Division, Congressional 
  Research Service...............................................    17
    Prepared statement...........................................    19
Robert F. Zales II, President, National Association of 
  Charterboat Operators (NACO); Owner, Bob Zales Charters........    25
    Prepared statement...........................................    27

                                Appendix

Letter dated February 18, 2015 to Hon. Marco Rubio from Hon. Gary 
  Doer, Ambassador, Canadian Embassy.............................    41
Response to written questions submitted by Hon. Marco Rubio to 
  James F. Farley................................................    42

 
                    THE IMPACTS OF VESSEL DISCHARGE.
                      REGULATIONS ON OUR SHIPPING.
                         AND FISHING INDUSTRIES

                              ----------                              


                      WEDNESDAY, FEBRUARY 4, 2015

                               U.S. Senate,
Subcommittee on Oceans, Atmosphere, Fisheries, and 
                                       Coast Guard,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:39 p.m. in 
room SR-253, Russell Senate Office Building, Hon. Marco Rubio, 
presiding.
    Present: Senators Rubio [presiding], Wicker, Ayotte, 
Sullivan, Johnson, Cantwell, Nelson, and Manchin.

            OPENING STATEMENT OF HON. MARCO RUBIO, 
                   U.S. SENATOR FROM FLORIDA

    Senator Rubio. This hearing will come to order.
    I would like to welcome everybody here today to our first 
Subcommittee hearing of the new Congress. In particular, I 
would like to welcome Captain Bob Zales, who has flown up from 
Florida to be with us here today. And thank you all for taking 
the time to join us. I really appreciate it.
    I wanted to briefly discuss a few housekeeping issues.
    First of all, Senator Nelson will be here momentarily, my 
colleague from Florida, our Ranking Member. He will be here at 
the hearing.
    For everyone's awareness, it is my understanding that our 
colleagues on the other side of the aisle are still working to 
confirm who will serve as our Ranking Member on this 
subcommittee. But, in the interim, the Ranking Member of the 
full committee, Senator Nelson, will be here in that regard.
    And congratulations to him, of course. We have a great 
working relationship, and we look forward to working with him 
on these issues in the full committee, as well. We have always 
worked well together, especially on policies such as these that 
are important to Florida. So I am looking forward to both my 
leadership role on this subcommittee and to Senator Nelson's 
leadership role on the full committee as we continue to address 
the issues such as these that are so important for our state.
    In fact, I am pleased to announce that we started this new 
Congress with a great bipartisan bill. As we know, today we are 
here to discuss vessel discharge regulations on our shipping 
and our fishing industries--two very large and important 
industries in our state of Florida.
    Last year, Chairman Thune, myself, and Senator Nelson were 
cosponsors to the Vessel Incidental Discharge Act, legislation 
that streamlines the regulatory framework regarding incidental 
discharge from large commercial vessels and permanently exempts 
smaller commercial vessels from Federal regulation altogether.
    So today we will reintroduce that same legislation--
legislation that had the support of 32 bipartisan cosponsors in 
the last Congress.
    Currently, commercial vessels are subject to EPA 
regulations regarding discharge incidental to their normal 
operations, Coast Guard regulations regarding introduction of 
invasive species and ballast water discharge, and, 
additionally, are subject to 25 different state regulations 
that require additional permit conditions, 14 of which relate 
specifically to ballast water discharges.
    Thankfully, in the last Congress, we were able to secure a 
3 year exemption from the EPA regulations for vessels smaller 
than 79 feet. And I would be remiss if I didn't thank my 
colleagues Senator Murkowski and Senator Vitter for their help 
in securing that exemption.
    However, I think everyone will agree that we would like to 
make that exemption permanent, while also ensuring that we 
address the regulatory duplicity for larger vessels. So, today, 
myself, Chairman Thune, and Ranking Member Nelson will be 
reintroducing the Vessel Incidental Discharge Act to address 
this regulatory quagmire, and it includes a permanent exemption 
for the smaller commercial vessels.
    Getting this legislation enacted into law is a top priority 
of this subcommittee, and I am thankful to both Senator Thune 
and Senator Nelson for their leadership roles as we work to get 
this legislation across the finish line this year.
    And I look forward to hearing from each of our witnesses as 
they highlight the importance of addressing this issue.
    Last, I would like just to add two things.
    Senator Schatz will be stopping by shortly after we begin 
and has asked to say a few words regarding this issue. However, 
due to scheduling conflicts, Senator Schatz will only have a 
few minutes, so I would ask that we just pause when the Senator 
arrives for a few comments from him, and then we will 
immediately resume.
    We are also expecting a roll call, one vote at 2:45. We 
will take a brief recess or, if the opportunity presents 
itself, perhaps rotate the chairmanship so all the members can 
go vote and then return. And either way, we either will keep 
this going or we will come back quickly and keep going.
    So Senator Nelson has not yet arrived. I know he is on his 
way, so we will reserve his opening statement for his arrival. 
And, with that, I will recognize the witnesses for their 
testimony.
    Mr. Farley, do you want to begin? Do you have testimony?
    Mr. Farley. I do.
    Senator Rubio. Thank you, sir.

           STATEMENT OF JAMES F. FARLEY, PRESIDENT, 
                   KIRBY OFFSHORE MARINE, LLC

    Mr. Farley. Good afternoon, Chairman Rubio and members of 
the Subcommittee. My name is Jim Farley, and I work for Kirby 
Corporation. Thank you for the opportunity to testify on behalf 
of our company and the American Waterway Operators, the 
national trade association of the U.S. tugboat, towboat, and 
barge industry.
    Kirby is the Nation's largest operator of inland and 
coastal tank barges. The regulation of ballast water and other 
vessel discharges is a critical area in which the current 
regulatory regime serves neither the environment, our industry, 
the economy, or the American taxpayer well.
    Today, the Coast Guard and EPA regulate ballast water and 
other vessel discharges under two differing statutory 
authorities. And because neither Federal law preempts state 
action, 25 states have established their own state-specific 
requirements for vessel discharges--over 150 of them in all.
    This overlapping patchwork of Federal and state regulations 
makes compliance confusing and complicated for Kirby and all 
vessel operators, fishermen, and mariners. It is 
counterproductive to the goal of enhanced environmental 
protection, as companies, including my own, have delayed 
investment in costly treatment technologies because we lack 
assurance that such systems will be acceptable wherever a 
vessel calls.
    And it has forced Federal and State agencies to duplicate 
efforts and expend significant time and taxpayer money on an 
unsuccessful effort to harmonize these requirements.
    In the operational world, this regulatory patchwork is a 
nightmare for companies like Kirby that operate vessels in 
interstate commerce. Today, crewmembers on a Kirby tug barge 
unit moving petroleum from a refinery in Anacortes, Washington, 
to a fuel distribution center in Los Angeles must comply with 
requirements for vessel discharges established by both the 
Coast Guard and the EPA. They must also comply with 25 state-
specific conditions added to EPA's Vessel General Permit by the 
states of Washington and California. In addition, they must 
comply with state ballast water requirements established by 
Washington, Oregon, and California outside the framework of the 
VGP. That is five distinct Federal and State regulatory regimes 
over the course of a single voyage.
    Our inland tows face an even more egregious situation, 
traveling through the waters of as many as 10 states on a 
voyage from Minneapolis to New Orleans.
    The situation is untenable, it is unnecessary, and 
congressional leadership is badly needed to fix it.
    I hope these examples make clear why the current situation 
is such a problem for the Nation's maritime industry. Let me 
explain why it is also unnecessary.
    There now exists a national scientific consensus about the 
capabilities of currently available ballast water treatment 
technology. Unfortunately, this scientific consensus does not 
solve the problem faced by vessel operators.
    Federal and state regulators have been unable to eliminate 
overlap and inconsistency between their regulations because 
they are accountable to different laws, which they believe 
limit their flexibility to act. It is not too much to say that 
these governmental agencies have been set up to fail by a 
statutory framework that does not work. This should be 
unacceptable to all of us.
    The only way to fix this broken system is for Congress to 
act and act soon. You can establish a single national framework 
for the regulation of vessel discharges that preempt state 
regulation and make vessel operators such as ourselves subject 
to one set of scientifically based, environmentally protective, 
and technologically achievable vessel discharge rules.
    You can pass legislation that provides us with the 
certainty that our multimillion-dollar investments in ballast 
water treatment technology will be acceptable wherever our 
vessels call. You can also save the American taxpayer the 
wasteful expense created by duplication of effort among Federal 
and state agencies.
    Kirby and the maritime community represented by AWO is not 
interested in avoiding a high standard for incidental vessel 
discharges. We just need a single standard, a Federal standard, 
a standard based on the available technology.
    Chairman Rubio, we know that you understand the problem and 
the urgent need for a solution. The news you have just 
announced speaks directly to that. We thank you.
    [The prepared statement of Mr. Farley follows:]

           Prepared Statement of James F. Farley, President, 
                       Kirby Offshore Marine, LLC
    Good afternoon, Chairman Rubio and Members of the Subcommittee. I 
am Jim Farley, President of Kirby Offshore Marine, a division of Kirby 
Corporation, headquartered in Houston, Texas. Kirby, which has been in 
the maritime transportation business since 1969, is now the Nation's 
largest operator of inland and coastal tank barges, employing some 
4,600 Americans. On behalf of Kirby and its employees, thank you for 
the opportunity to testify at this very important hearing.
    I am also speaking on behalf of the American Waterways Operators, 
the national trade association for the inland and coastal tugboat, 
towboat, and barge industry. Kirby is one of the almost 350 companies 
that enjoy membership in AWO, and serves on its Board of Directors and 
Executive Committee.
    Thank you for your leadership in holding this hearing to explore 
the impacts of vessel discharge regulations on the U.S. shipping and 
fishing industries so early in the 114th Congress. The regulation of 
ballast water and other vessel discharges is a critical area in which 
the current regulatory regime serves neither the economy, the 
environment, nor the American taxpayer well. Today, two Federal 
agencies regulate ballast water and other vessel discharges under two 
differing statutory authorities. And, because neither Federal statute 
preempts state action, more than two dozen states have established 
their own state-specific requirements for many of those same 
discharges. This overlapping patchwork of Federal and state regulations 
has made compliance complicated, confusing, and costly for vessel 
owners and mariners. It has been counterproductive to the goal of 
enhanced environmental protection as companies have delayed investment 
in costly treatment technologies because they lack assurance that such 
systems will be acceptable wherever a vessel calls. And, it has forced 
resource-constrained Federal and state agencies to duplicate efforts 
and expend significant time and taxpayer money in a well-intentioned 
but unsuccessful effort to harmonize their requirements.
    Your leadership is badly needed to fix this unacceptable situation. 
Indeed, this Congress has an unprecedented opportunity to enact 
legislation that improves the efficiency and effectiveness of our 
maritime transportation system while enhancing the protection of our 
Nation's waterways. A scientific consensus now exists about the 
capabilities of currently available ballast water treatment technology, 
and there is strong bipartisan congressional support for legislation to 
resolve redundant and conflicting regulatory authorities in this area. 
The establishment of a uniform Federal framework for the regulation of 
vessel discharges will be good for the maritime industry and the men 
and women who work in it, good for shippers who rely upon marine 
transportation, good for the marine environment, and good for the 
American taxpayer. We were pleased to see the Committee act on this 
issue last year when it reported out S. 2094, the Vessel Incidental 
Discharges Act. The leadership of the Commerce Committee will be 
crucial if we are to seize the opportunity to enact legislation that 
accomplishes these objectives in the 114th Congress.
    Let me tell you a bit about our company and our industry, which 
will help to explain why this legislation is so critical. The tugboat, 
towboat, and barge industry is the largest segment of the U.S. maritime 
fleet. Our industry operates 4,000 towing vessels and 27,000 dry and 
liquid cargo barges on the commercially navigable waterways that run 
through America's heartland, along the Atlantic, Pacific, and Gulf 
coasts, on the Great Lakes, and in ports and harbors around the 
country. Each year, towing vessels and barges safely, securely, and 
efficiently move more than 800 million tons of critical cargo, 
including agricultural products for export, coal to electrify our homes 
and businesses, petroleum products to fuel our cars, chemicals for 
manufacturing facilities, cement and sand for construction projects, 
and other building blocks of the U.S. economy. Tugboats also provide 
essential services in our Nation's ports and harbors, including 
shipdocking, tanker escort, and bunkering.
    For our part, Kirby operates over 1,300 vessels throughout the 
Mississippi river system, on the Gulf Intracoastal Waterway, along all 
three U.S. coasts, and in Alaska and Hawaii. Kirby transports bulk 
liquid products by tank barge, including petrochemicals, black oil, 
refined petroleum products, and agricultural chemical products, as well 
as dry-bulk commodities by oceangoing tug-barge units.
    More than 30,000 American mariners are employed as crewmembers on 
towing vessels; these are good, family-wage jobs that offer great 
potential for career and economic advancement. I can testify to that 
from personal experience. Over half of Kirby's employees--some 2,500 
Americans--work as crewmembers on our vessels. Their salaries range 
from about $45,000 a year for a deckhand in our inland fleet to over 
$130,000 a year for our captains and pilots, and our company provides 
them with comprehensive benefits and training and career development 
opportunities. Kirby can hire a high school graduate with no experience 
and, within a span as short as three to five years, provide him or her 
with the paid training and experience needed to climb our career ladder 
to a job paying six figures.
    The current regulatory regime for ballast water and other vessel 
discharges places our mariners and our company in the difficult 
position of having to comply with overlapping and inconsistent 
regulations. The U.S. Environmental Protection Agency regulates ballast 
water and other vessel discharges under the Clean Water Act's National 
Pollutant Discharge Elimination System (NPDES) permit program; the U.S. 
Coast Guard regulates discharges of ballast water and hull fouling 
organisms under the National Invasive Species Act; and more than two 
dozen states have established their own requirements for various vessel 
discharges already covered by the EPA and Coast Guard regulations.
    Since 2009, commercial vessels over 79 feet in length have been 
required to obtain coverage under EPA's Vessel General Permit in order 
to operate in U.S. waters. The VGP contains Federal requirements for 27 
types of vessel discharges, including ballast water, as well as 
federally enforceable state- and waterbody-specific discharge 
conditions added to the permit by states as part of the NPDES state 
certification process. In addition to Federal and state VGP 
requirements, vessels must meet Federal standards for ballast water and 
hull fouling discharges established by the Coast Guard. Vessels are 
also required to act in accordance with the state laws and regulations 
for vessel discharges applicable to the waters they transit.
    This regulatory patchwork is a nightmare for a vessel operating in 
interstate commerce. A Kirby tug-barge unit moving petroleum from a 
refinery in Anacortes, Washington, to a fuel distribution center in Los 
Angeles must traverse the waters of three states: Washington, Oregon, 
and California. In addition to EPA limits on ballast water and other 
vessel discharges found in the VGP, the tug and the barge must comply 
with 25 supplementary, state-specific conditions added to the permit by 
Washington and California. They must also comply with Coast Guard 
regulations to manage and discharge ballast water and hull fouling 
organisms. Finally, in each of the three states they transit, the 
vessels are subject to state laws and regulations, necessitating the 
submission of ballast water management reports to every state in which 
they will discharge ballast water (in addition to the reports required 
by the Coast Guard) and requiring the implementation of ballast water 
management practices in addition to those prescribed by EPA and the 
Coast Guard. That is five distinct regulatory regimes, and all of their 
attendant requirements, that the Kirby employees onboard the tugboat 
must be aware of and in compliance with over the course of a single 
voyage. Our inland tows face an even more egregious situation, 
traveling through the waters of as many as seven states on a voyage 
from Chicago to New Orleans. These examples, and the graphic attached 
to my testimony, underscore why clear, consistent Federal rules for 
ballast water and other vessel discharges are desperately needed.
    They also demonstrate why, as a matter of sound public policy, the 
NPDES permit program is the wrong framework for the regulation of 
discharges from vessels. The program, as EPA has acknowledged, was 
designed to control pollution from land-based, stationary sources, and 
has been largely administered and enforced by individual states--the 
basis of the state certification process. This process makes the 
program particularly ill-suited to regulate discharges from commercial 
vessels, which by their nature are mobile sources that operate and 
discharge in multiple states. For the first 35 years of the NPDES 
program's existence, vessel discharges were explicitly exempted by EPA 
regulation. EPA went to court to defend its exclusion of vessel 
discharges from the program, but in 2008 the Ninth Circuit Court of 
Appeals ordered EPA to regulate vessel discharges through the issuance 
of NPDES permits.
    As a result, EPA proposed the VGP, a first-of-its-kind nationwide, 
general permit for vessel discharges to be administered and enforced by 
the agency and certified by individual states. The state certification 
process resulted in over 100 new, substantive requirements that were 
incorporated by EPA into its final permit, which it issued without 
allowing the regulated community an opportunity to comment on the state 
conditions and without considering the impact of the state conditions 
collectively. A group of maritime trade associations, including AWO, 
challenged EPA's management of the VGP state certification process in 
court. In 2011, the U.S. Court of Appeals for the D.C. Circuit ruled 
that EPA had no authority under the Clean Water Act to alter or reject 
state conditions, even if they are infeasible or in direct conflict 
with other Federal or state requirements. Recognizing the problem, the 
Court suggested that Congress must act to provide the maritime industry 
with a viable solution. We wholeheartedly agree.
    I want to be clear that the broken regulatory regime for vessel 
discharges is not a problem of EPA's making. It is not a problem of the 
Coast Guard's making. It is a situation in which well-meaning agencies 
have been effectively set up to fail as they seek to harmonize 
regulations promulgated pursuant to different statutory authorities 
and, in EPA's case, to make the square peg that is the NPDES permit 
program fit the round hole that is mobile sources engaged in interstate 
and international commerce. With no relief available from the courts, 
it is up to Congress to lead and establish a uniform Federal framework 
for the regulation of ballast water and other vessel discharges. There 
is no better time than now for Congress to take action on this very 
important issue.
    Several years ago, faced with overlapping Federal and state 
authorities and the absence of uniform national standards for the 
management and discharge of ballast water, the maritime industry was 
witnessing a competition among states to establish the most stringent 
ballast water treatment standards on the books. Under the logic of this 
competition, if the International Maritime Organization standard was 
good, a standard 100 or 1,000 times more stringent than the IMO 
standard must be better--even if those standards could not be achieved, 
or even measured, with existing technology. However, there is now a 
national consensus about the capability of current ballast water 
treatment technology. This consensus provides a strong scientific 
foundation for Congress to move forward with legislation to establish 
uniform national standards for vessel discharges.
    In June 2011, an independent and expert panel of the EPA Science 
Advisory Board completed its study of the efficacy of current ballast 
water treatment systems and concluded that no current treatment 
technology can meet a standard 100 or 1,000 times more stringent than 
the IMO standard. The panel further concluded that wholly new treatment 
systems and measurement techniques would need to be developed to meet 
more stringent standards than IMO's.
    Shortly after the EPA SAB report was published, the state of New 
York agreed to withdraw one of its state conditions to the VGP, which 
would have required vessels operating in New York waters to install 
ballast water treatment systems meeting a standard 100 times more 
stringent than the IMO standard beginning in 2013. In an October 2011 
letter to the EPA Administrator, the New York Department of 
Environmental Conservation wrote that the state believes ``a strong, 
uniform national standard is the best approach to our mutual goal of 
ensuring that vessels install and use achievable and cost-effective 
technology to treat ballast water discharges that will dramatically 
limit the introduction and spread of aquatic invasive species.'' The 
letter continued, ``A national approach to this ballast water issue is 
clearly preferable to a plethora of potentially conflicting state 
standards.''
    In 2012, the Coast Guard published a final rule establishing a 
ballast water treatment standard equivalent to the IMO standard. Citing 
the EPA SAB report, the Coast Guard wrote that ``[t]he numeric 
limitations in today's final rule represent the most stringent 
standards that [ballast water treatment systems] currently safely, 
effectively, credibly, and reliably meet.'' EPA also relied on the EPA 
SAB's conclusions to develop the 2013 Vessel General Permit, in which 
it set a ballast water treatment standard corresponding to the IMO and 
Coast Guard standards.
    Since the Coast Guard and EPA aligned their ballast water treatment 
standards, the states have quickly followed suit. None of the states 
that certified the 2013 VGP with conditions added a more stringent 
ballast water treatment standard than that established by EPA within 
the permit. Most notably, in 2013, the California State Lands 
Commission officially acknowledged that California's statutory ballast 
water performance standards--which called for the implementation of a 
standard 1,000 times more stringent than the IMO standard beginning in 
2014--could not be met with current ballast water treatment technology. 
Acting on the Commission's recommendation, the California legislature 
acted to delay implementation of these standards. Of the states that 
have established or proposed to establish state-specific ballast water 
discharge standards, California was the last to concur with the 
findings of the EPA SAB.
    This consensus changes not only the regulatory landscape, but the 
legislative landscape as well. Congress can capitalize on this accord 
among the scientific community, the Federal Government, and the states 
to improve the regulation of vessel discharges by enacting a single set 
of uniform national standards that preempt state regulation, with a 
requirement for the Federal standards to become increasingly stringent 
as treatment technology improves over time. Such legislation would 
improve the maritime industry's ability to deliver the Nation's 
waterborne commerce efficiently and effectively by providing 
consistency and certainty, and would enhance our Nation's commitment to 
the continued protection of its waterways. It would also benefit the 
American taxpayer by ending the costly duplication of effort by Federal 
and state agencies that results from the current statutory and 
regulatory patchwork.
    Kirby and the other member companies of AWO are partners in a 
shared commitment to environmental stewardship. Maritime transportation 
is the safest and most energy-efficient mode of freight transportation. 
AWO's members are dedicated to building on these natural advantages and 
leading the development of higher standards of marine safety and 
environmental protection. Twenty years ago, AWO became the first 
transportation trade association to adopt a code of safe practice and 
environmental stewardship for member companies, the AWO Responsible 
Carrier Program. Since 2000, third party-audited compliance with the 
RCP, which exceeds Federal regulatory standards, has been a condition 
of membership in the association.
    I share this with you to emphasize that our goal in urging 
congressional action is not to avoid high standards. Our company and 
our industry have established a strong and continuously improving 
environmental record, and we recognize that making responsible 
environmental practice a top priority is both good policy and good 
business. The problem is not that vessel discharges are regulated; it 
is how they are regulated. The current unclear and inconsistent 
regulatory system makes compliance confusing and investment decisions 
uncertain.
    Let me emphasize again that the only way to fix this broken 
regulatory regime is for Congress to act, and act soon. Although the 
Coast Guard, EPA, and state regulators are currently in agreement about 
achievable standards for ballast water treatment, the way that they 
administer and enforce that standard is at best duplicative, and at 
worst incompatible. The strong bipartisan support for the Vessel 
Incidental Discharge Act introduced last Congress--which was sponsored 
by Chairman Rubio and cosponsored by more than one-third of the Senate, 
including the Chairman and Ranking Member of the Commerce Committee--
demonstrates that the problem, and the urgent need for a solution, is 
well understood. Today's hearing is another encouraging affirmation of 
the understanding of the leadership of this Subcommittee, and of your 
commitment to bring clarity and certainty to the regulation of vessel 
discharges.
    On behalf of Kirby and all of the other the businesses that operate 
vessels that carry the cargo that drives our economy, that provide 
high-quality jobs for men and women across the United States, and that 
seek to protect the marine environment in which they operate, I 
respectfully urge the Committee to lead the introduction and passage of 
legislation in the 114th Congress that establishes a uniform, science-
based, consensus-driven Federal framework for the regulation of ballast 
water and other vessel discharges.
    Thank you again for the opportunity to testify today on a matter of 
great importance to our company, our industry, to the U.S. economy, and 
to the Nation's marine environment. We appreciate your leadership and 
we look forward to working with you to advance our mutual goal of a 
safe, secure, environmentally sound maritime transportation system that 
is good for America, for American businesses, and for the Americans who 
work in our industry.
                               Attachment

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]


    Senator Rubio. Thank you.
    And I apologize for not introducing the witnesses 
beforehand. Mr. Farley is the President of Kirby Offshore 
Marine, headquartered in Houston, Texas.
    Mr. Weakley, the President of the Lake Carriers' 
Association, from Rocky River, Ohio.
    Welcome, sir.

         STATEMENT OF JAMES H. I. WEAKLEY, PRESIDENT, 
                   LAKE CARRIERS' ASSOCIATION

    Mr. Weakley. Thank you.
    Lake Carriers' Association has represented U.S.-flag 
vessels operating exclusively on the Great Lakes since 1880. 
Last year, my members moved more than 90 million tons of cargo 
on the Great Lakes.
    These cargos are the very foundation of America's 
industrial economy: Michigan and Minnesota iron ore for steel 
produced in Indiana, Ohio, Pennsylvania, and Michigan; Michigan 
limestone and cement for construction; coal from Illinois, 
Wisconsin, and Ohio docks for power generation; Ohio salt to 
de-ice our wintry roads; and Midwest grain from Wisconsin and 
Minnesota docks for New York flour mills.
    The Army Corps of Engineers has estimated that my members 
annually save their customers billions of dollars compared to 
the next least-cost mode of transportation.
    We believe in a uniform national ballast water discharge 
standard. It is critical to waterborne commerce.
    Ships sailing the Great Lakes transit many states and 
Canadian waters on a single voyage. For example, iron ore mined 
in Minnesota and destined for a steel mill in Pennsylvania 
starts out in Minnesota waters, passes through Wisconsin, then 
Michigan, and is offloaded to a railhead in Ohio. Midwest grain 
loaded in Minnesota and bound for Buffalo add Pennsylvania and 
New York waters to that list.
    While transiting the Detroit-St. Clair River on those 
voyages, we cross the international border 17 times, in 
addition to the many international crossings in the St. Marys 
River, which connects Lake Superior to Lake Huron.
    Inflexible, inconsistent, and sometimes conflicting 
regulations have the ability to shut down shipping and the 
industries we support.
    Adding to the current patchwork quilt of eight state and 
two Federal regulators, the government of Canada and the 
province of Ontario have proposed invasive species regulations.
    Canada even proposes requiring vessels that only transit 
Canadian waters, and not discharging ballast water into Canada, 
to install treatment systems, which they emphatically opposed 
when New York proposed it in 2008. Canada's transit standard 
would impose a regulatory blockade preventing our vessels from 
calling on Canadian ports and sailing between American ports.
    The U.S. regulatory process is mind-boggling. Every 5 
years, the EPA and each state conduct a VGP rulemaking. 
Although it takes place simultaneously, the process and 
duration varies by state. After months of being told by one 
state that they would not develop their own requirements, the 
Wednesday before Thanksgiving they published a proposal. That 
comment period ended the Monday after Thanksgiving.
    Each rulemaking is also subject to years of legal 
challenges. In many instances, we have defended the regulatory 
agencies against challenges filed by environmental 
organizations.
    The Great Lakes and St. Lawrence River are a single 
interconnected freshwater body, so aquatic nuisance species 
introduced by oceangoing vessels move freely about. Most of our 
vessels cannot leave the upper four Great Lakes, and even the 
smaller ones can't go outside the St. Lawrence River. Vessels, 
such as lakers, whose operations are confined to a 
geographically limited area should not need to treat their 
ballast water, as they do not introduce aquatic nuisance 
species from other ecosystems.
    Both the EPA and the Coast Guard concluded that there are 
no treatment systems capable of operating on lakers. Our unique 
environmental challenges include wide temperature variations, 
very fresh water, heavy sedimentation, and strong tannins. Our 
engineering challenges include extremely high pumping rates, 
limited machinery space, short voyages, and icy conditions. It 
is clear that best management practices remain the most 
appropriate way to regulate our ballast water discharges.
    LCA supports ballast water regulation. We support 
regulation that sets a uniform national ballast water treatment 
regime.
    We recommend, consistent with the IMO ballast water 
convention, that legislation include the critically important 
distinction that vessels, such as lakers, that confine their 
operation to a geographically limited area need not treat their 
ballast water.
    Thank you.
    [The prepared statement of Mr. Weakley follows:]

                                 Lake Carriers' Association
                                  Rocky River, OH, January 29, 2015
Senator John Thune,
Chairman,
Senate Committee on Commerce, Science, and Transportation,
Washington, DC.
Executive Summary
    Lake Carriers' Association believes a uniform, national ballast 
water discharge standard is critical to waterborne commerce. Ships 
sailing the Great Lakes transit many States' and Canadian waters on a 
single voyage. Inflexible, inconsistent and sometimes conflicting 
regulations have the ability to shut down shipping and the industries 
we support. Adding to the current patchwork quilt of U.S. regulations 
(eight Great Lakes States and two Federal Agencies) both the Government 
of Canada and the Province of Ontario have proposed invasive species 
regulations on vessel operators. Canada has even proposed a ``transit 
standard,'' which they opposed when offered by the State of New York. 
Canada's transit standard would put in place a regulatory embargo 
preventing our ships from calling on Canadian Great Lakes ports and 
impose a regulatory blockade preventing U.S.-flag vessels from trading 
between American Great Lakes ports. Vessels--such as lakers--that 
confine their operations to a ``geographically limited area'' should 
not need to treat their ballast water, as they do not introduce aquatic 
nuisance species (ANS) by moving from one ecosystem to another. The 
Great Lakes are a single interconnected body of freshwater; ANS 
introduced by oceangoing vessels move freely about. After ten years of 
studying the problem, both the U.S. Coast Guard and U.S. Environmental 
Protection Agency have concluded that there are no treatment systems 
capable of operating in the Great Lakes environment (wide temperature 
variations, very fresh, heavy sediment, strong tannins . . .), nor are 
there system meeting lakers' operational requirements (high flow rates, 
limited space, short voyages, icing conditions . . .). Best Management 
Practices remain the most appropriate way to regulate lakers' ballast 
water discharges.
Written Testimony
    I am James H.I. Weakley, President of Lake Carriers' Association 
(LCA), the trade association that has represented U.S.-flag vessels 
operating exclusively on the Great Lakes since 1880. Last year, my 
members moved more than 90 million tons of cargo on the Great Lakes. 
Those cargos are the very foundation of America's industrial economy:

   Michigan and Minnesota iron ore for steel production in 
        Indiana, Ohio, Pennsylvania and Michigan;

   Limestone and cement for construction throughout the Great 
        Lakes basin;

   Coal from Wisconsin and Ohio docks for power generation 
        basin-wide;

   Salt to de-ice wintry roads throughout the region; and

   Midwest grain from Wisconsin and Minnesota docks for New 
        York flour mills.

    The vessels my members operate were built in the United States, are 
crewed by American mariners, and are owned by American corporations. 
Those are, of course, the tenants of the Jones Act, the foundation of 
America's domestic maritime policy since 1920. The U.S. Army Corps of 
Engineers has estimated that my members annually save their customers 
billions of dollars in freight costs compared to the next least costly 
mode of transportation, so clearly the Jones Act has achieved its goal 
of a vibrant American merchant marine.\1\
---------------------------------------------------------------------------
    \1\ Great Lakes Navigation System: Economic Strength to the Nation, 
February 2009.
---------------------------------------------------------------------------
    Waterborne commerce, particularly that on the Great Lakes, 
desperately needs a uniform, Federal standard for the regulation of 
ballast water and other vessel discharges. No disrespect to the eight 
Great Lakes states is intended, but shipping cannot operate efficiently 
while trying to comply with inflexible, inconsistent and sometimes 
conflicting state regulations.
    Let me give you a couple of examples. An iron ore cargo mined in 
Minnesota and destined for a steel mill in Pennsylvania starts out in 
Minnesota waters, then passes through Wisconsin, Michigan, and is 
offloaded to an Ohio railhead. A cargo of Midwest grain loaded in 
Minnesota and bound for Buffalo adds Pennsylvania and New York waters 
to that list. While transiting the Detroit St. Clair River on those 
voyages our sailors cross the international border seventeen times, in 
addition to many border crossings in the St. Marys River, which 
connects Lake Superior to Lake Huron.
    Now, imagine having to comply with a different set of regulations 
each time the vessel enters a State's waters, not to mention all of the 
times we crisscross between U.S. and Canadian waters during a single 
voyage. Assuming the regulatory requirements were achievable, and many 
State regimes are not, the additional expense would surely drive cargo 
to our already crowded rail lines and highways, or worse, bring an end 
to some mining and manufacturing in the Great Lakes states.
    The regulatory process is mind-boggling. Every five years, the 
Environmental Protection Agency (EPA) and each Great Lakes state (in 
addition to other states and jurisdictions delegated authority under 
the Clean Water Act) commence a full rulemaking process to reissue the 
Vessel General Permit (VGP). Although many of these rulemakings take 
place simultaneously, the process and duration varies for each 
jurisdiction. Perhaps the most frustrating process took place in 
Illinois. After months of being told that the state would not be 
conducting a VGP rulemaking process, we were informed that it was the 
Wednesday before Thanksgiving when the proposed rule was published that 
they were issuing state requirements. The comment period for the 
Illinois proposed rule ended the Monday after Thanksgiving.
    Each VGP rulemaking, at both the state and Federal level, is also 
subject to legal challenges. In some cases, we have challenged state 
and Federal requirements. In other instances we have intervened and 
defended the regulatory agencies against challenges filed by 
environmental organizations. Currently, the Canadian Shipowners 
Association is simultaneously challenging the EPA on some of its VGP II 
requirements and has joined LCA in its defense of the EPA in a suit 
brought by an environmental group. After the first VGP, we defended the 
decisions made by the States of Wisconsin, Minnesota and Michigan. We 
also challenged the EPA's final rule and supported the legal challenge 
to the State of New York. Currently, we are defending New York's VGP II 
decisions after our successful defense of Minnesota's decision.
    The Canadian government has further muddied the waters by proposing 
ballast water regulations that include vessels merely transiting their 
waters. This is puzzling, as Canada vehemently opposed a ``transit 
standard'' when it was proposed by the State of New York. To New York's 
credit, they have since dropped their requirement for vessels simply 
transiting their waters to have ballast water treatment systems 
installed. In Attachment C, the Canadian Transport Minister cites the 
Boundary Waters Treaty of 1909 in Canada's opposition to the New York 
transit standard proposal and notes ``that neither the Canadian nor 
U.S. domestic fleet is a likely vector for the introduction of invasive 
species.'' The Canadian Foreign Minister, in Attachment D, states 
``further, as currently proposed, the state of New York's amendments to 
the EPA's National Pollutant Discharge Elimination System are contrary 
to the Canada-U.S. Boundary Waters Treaty of 1909.'' He then goes on to 
point out that ``New York's proposed rules inappropriately classify 
Canadian ships operating in the St. Lawrence Seaway as foreign 
shippers, categorizing them with shippers operating outside of North 
America.''
    Please keep in mind that the International Maritime Organization 
(IMO) has developed a ballast water discharge standard, as have the EPA 
and U.S. Coast Guard (USCG), not a transit standard. We believe Canada 
is the only country in the world to require vessels that have no 
intention of discharging ballast water in that country's waters to 
require ballast water treatment systems to be installed to meet a 
numeric discharge standard. Knowing full well that U.S.-flag lakers 
don't currently the ability to meet the Canadian requirement, nor will 
our vessels in the near future, Transport Canada proposed their transit 
standard in a 2012 discussion paper. This would have the practical 
impact of denying our vessels entry into Canadian ports or waters on 
the Great Lakes, even for voyages when our vessels are not discharging 
ballast water in Canadian waters. In essence, the Canadian Government 
is proposing a regulatory embargo on U.S.-flag lakers sailing the Great 
Lakes. Since Great Lakes navigation channels straddle the international 
border, it is physically impossible for our vessels to make a domestic 
voyage without entering Canadian waters. We would not be able to 
deliver iron ore from Duluth to the steel mills of Indiana Harbor. We 
would not even be able to transport Michigan iron ore from Marquette to 
Detroit. Through its regulatory blockade, the Canadian government would 
claim the authority to control cargo movements not only between U.S. 
states, but also to halt commerce within a single state.
    Any ballast water legislation needs to make a critically important 
distinction, namely that vessels--such as ``lakers''--that confine 
their operations to a ``geographically limited area'' need not treat 
their ballast, since they do not move between ecosystems. The Great 
Lakes are interconnected and ANS introduced by oceangoing vessels can 
and do migrate independent of commercial navigation. For example, the 
ruffe, first discovered in Duluth/Superior Harbor at the western end of 
Lake Superior in late 1980s, is slowly migrating along Superior's 
southern shore. This range expansion will continue even if no 
commercial vessels ever sail Lake Superior again. That's why it's 
appropriate that the USCG and EPA regulations governing lakers' ballast 
water require Best Management Practices (BMPs) rather than treatment of 
ballast water for our vessels. LCA supports these USCG regulations.
    The Great Lakes need protection from oceangoing vessels' ballast 
water, not from lakers. More than half of our fleet is too large to 
transit from Lake Erie to Lake Ontario via the Welland Canal and all of 
our vessels are prohibited by the USCG from sailing beyond Anticosti 
Island in the Gulf of St. Lawrence. As demonstrated in Attachment B, 
U.S.-flag lakers trade primarily in the upper four Great Lakes 
(Superior, Michigan, Huron and Erie) from the port of Duluth/Superior 
to Indiana Harbor or Buffalo and all points in between. On occasion, 
the smaller LCA vessels venture into Lake Ontario and the St. Lawrence 
River. Canadian-flag lakers trade between the St. Lawrence River and 
all five Great Lakes. Oceangoing vessels or ``salties'' enter the St. 
Lawrence River and Great Lakes from the Atlantic Ocean and hail from 
ports throughout the world.
    There has been an intensive effort worldwide to develop treatment 
systems that will end the introduction of ANS via vessels' ballast 
water. I am proud to say that LCA was among the pioneers in such 
efforts. Back in the late 1990s, we partnered with the Northeast 
Midwest Institute to test a ballast water treatment system that 
employed filtration and ultraviolet (UV) light and could be installed 
on the oceangoing vessels that trade to and from the Great Lakes. That 
research helped lay the groundwork for the ballast water treatment 
systems that are now coming into the global market and being installed 
on vessels sailing the oceans.
    The USCG and EPA have independently concluded, however, that if 
regulations were to require lakers to treat their ballast water to IMO 
discharge standards, our vessels would be unable to comply, and thus, 
waterborne commerce on the Great Lakes would cease to exist. There is 
no ballast water treatment system that has been proven capable of 
meeting U.S. lakers' operational requirements. U.S. lakers' ballast 
water must be pumped out at rates that approach 80,000 gallons per 
minute when loading cargo. No ballast water treatment system is 
effective at that flow rate. Our vessels lack the electrical capacity 
to simultaneously handle cargo, operate ballast pumps and treat the 
ballast water. Nor do they have the machinery space necessary to 
install enough treatment systems and additional electrical generators 
to treat our ballast water.
    Another obstacle is that the voyages on the Great Lakes are of very 
short duration compared to the ocean trades. A vessel hauling iron ore 
from Two Harbors, Minnesota, to Gary, Indiana, is underway for 62 
hours. A vessel moving limestone from Marblehead, Ohio, to Cleveland, 
Ohio, is underway for 6 hours. The ballast water treatment systems that 
use biocides are effective on an ocean voyage that stretches for weeks 
or a month or more, but not on the short hauls that characterize Great 
Lakes shipping. There is not sufficient ``contact time'' for the 
biocide to sterilize the water and then be rendered safe with a 
neutralizing agent prior to discharge. Many ballast water treatment 
systems designed for oceangoing vessels require saltwater as a catalyst 
to create the biocide. Our freshwater is significantly fresher than the 
IMO definition, so even systems certified for use in freshwater may not 
work in the Great Lakes.
    Other problems that would need to be solved before lakers could 
treat their ballast water include the frigid water temperatures and 
filter-destroying ice chunks at the opening and close of the shipping 
season and the high level of sediment suspended in the water at many 
Great Lakes ports. The levels of tannins in the Great Lakes impede the 
effectiveness of ballast water treatment systems using UV light.
    The preceding comments are largely academic because the need to 
treat lakers' ballast water is questionable at best. Most LCA vessels 
confine their operations to Lakes Superior, Michigan, Huron, and Erie. 
Only a few LCA vessels occasionally transit the Welland Canal and trade 
to a Lake Ontario port. By law, none may sail on the oceans, so their 
ballast water originates in the Great Lakes. Add the fact that ballast 
water is but one of 64 vectors identified by the U.S. Geological Survey 
for introduction of ANS into the Great Lakes and there is even less 
reason to treat lakers' ballast water.
    My members implement BMPs to lessen the risk that their ballast 
water might spread an ANS introduced by oceangoing vessels. In fact, 
LCA implemented those BMPs before they were required by USCG and EPA 
regulations.
    In summary, LCA shares everyone's desire that vessel ballast water 
introduction of ANS be a thing of the past. On the Great Lakes, that 
goal will be best met with uniform Federal regulations that recognize 
that lakers, operating in a ``geographically defined route,'' need not 
treat their ballast water, as it is oceangoing vessels, not lakers, 
which introduce ANS to the Great Lakes. We ask Congress to unravel the 
patchwork quilt of ballast water regulations while recognizing the 
technological impracticability of environmentally unnecessary laker 
ballast water treatment.
            Very respectfully,
                                       James H. I. Weakley,
                                                         President.
                              Attachment A
U.S.-Flag Carriage on the Great Lakes: 2009-2014 and Long-Term Average 
                               (net tons)
  
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
 


                                 ______
                                 
                                 [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
                                 
                                 ______
                                 
                              Attachment C
      Minister of Transport, Infrastructure and Communities
                                   Ottawa, Canada, December 4, 2008

Mr. David Paterson,
Governor of New York,
State Capitol,
Albany, NY.

Dear Governor Paterson:

    I am writing to convey the Government of Canada's serious concerns 
with the State of New York's proposed amendments to the ballast water 
provisions of the United States (US) Environmental Protection Agency's 
National Pollutant Discharge Elimination System. These amendments will 
have a damaging effect on the Great Lakes' economy, severely impeding 
Canada's domestic trade by the Canadian Fleet, and fail to establish a 
higher level of environmental protection for the Great Lakes Region.
    Ongoing scientific research, statistics from the enforcement of 
Canada's Ballast Water Control and Management Regulations, and 
scientific advice from both Canada and the U.S. suggest that neither 
the Canadian nor U.S. domestic fleet is a likely vector for the 
introduction of invasive species. As such, Canada would like to express 
its concern that there is no scientific rationale for the type of 
measures prescribed in New York's amendments to require Canadian-
flagged vessels, which operate beyond Lake Ontario, to undergo ballast 
water exchange.
    The Great Lakes and St. Lawrence Seaway system is a strategic 
waterway, shared by Canada and the United States, and is an essential 
part of North America's transportation system. The efficient flow of 
goods by ship on this system is vital to the economies one of both 
Canada and the United States, including the state of New York. The 
combined Canadian and U.S. fleets move goods worth approximately $80 
billion each year, including primary resources that are essential to 
the industrial infrastructure of both countries. In 2007, Canada 
purchased nearly one-fifth of New York's foreign-bound goods, making it 
the state's largest foreign export market. Statistics indicate that 
Canada-US trade supports nearly 500,000 jobs in New York State.
    The Canadian domestic fleet when subject to the New York's proposed 
ballast water amendments will cease to be able to continue with its 
domestic trade between Regions of Canada and to the US. These 
amendments will significantly increase costs to carry cargo across the 
border, resulting in possible modal shifts away from the most 
environmentally efficient means of transport, as well as in a reduction 
of capacity and competitiveness in the Great Lakes Region. New York as 
well as all other Great Lakes ports and industry will suffer a major 
disruption to the supply of raw materials: the U.S. steel and 
automotive sectors, for example, would be significantly affected.
    In addition, Article I of the Canada-US Boundary Waters Treaty 
(1909) obliges both countries to ensure that all navigable boundary 
waters are to be equally free and open to commercial navigation for 
ships from either side of the border, and both fleets are to be equally 
treated by laws and regulations of both countries. In addition to this 
agreement, the Great Lakes Water Quality Agreement calls for 
coordinated regulations in these shared waters.
    Canada's Ballast Water Control and Management Regulations came into 
effect in June 2006. These regulations apply to all vessels entering 
waters under Canadian jurisdiction from outside Canada's Exclusive 
Economic Zone. All ships entering the Great Lakes are targeted in the 
current enforcement protocol. Enforcement takes place before ships 
enter the locks of the St. Lawrence Seaway at Montreal and is carried 
out by a joint enforcement team of the United States Coast Guard, the 
St. Lawrence Seaway Development Corporation (US), the St. Lawrence 
Seaway Management Corporation and Transport Canada. Boarding teams test 
ballast tanks to ensure a minimum salinity of 30 parts per thousand 
exist in each tank onboard each vessel. Further, the Canada--US Joint 
Ballast Water Enforcement Program operated out of Montreal, is 
internationally recognized as a prime example of coordination and 
cooperation between both countries to harmonize regulations in the 
interest of protecting the Great Lakes Region while promoting the 
efficient flow of goods by ship.
    We strongly hold that the Great Lakes and the St. Lawrence Seaway 
are our shared waters and the best approach to protect them is through 
cooperation. As both our countries and your States face challenges to 
deal with environmental issues in our shared waters, I am pleased to 
see over the years cooperation between our governments and institutions 
has been excellent. The joint ballast water inspections in Montreal is 
one example, our collaboration to provide marine search and rescue, ice 
breaking, marine security and scientific research are a few other 
examples.
    Building on this history of cooperation, and on sharing our 
waterways, the Government of Canada kindly requests that your 
administration exempt the Canadian domestic fleet trading in waters 
under Canadian jurisdiction, from New York's proposed amendments to the 
ballast water provisions of the United States (US) Environmental 
Protection Agency's National Pollutant Discharge Elimination System. 
This exemption will provide an opportunity for Canada and the United 
States to develop harmonized ballast water provisions prior to the 
2009-shipping season. Canada specifically requests the exemption be 
granted in the interest of protecting the environment of the Great 
Lakes Region while promoting the efficient flow of goods by ship 
between both countries.
    To this end, I am pleased to announce Canada is taking steps to 
ratify the International Convention for the Control and Management of 
Ships' Ballast Water and Sediments, 2004, under the auspices of the 
International Maritime Organization, as a baseline. Canada played a key 
role in initiating the development of this Convention, which will 
require ships install equipment to treat ballast water by 2016.
    I thank you in advance for your ongoing efforts to support and 
protect our shared waterways and to continue the development of our 
mutually dependent economies.
    Please do not hesitate to contact me if you have any questions or 
concerns.
            Sincerely,
                                                John Baird,
                                                         P.C., M.P.

c.c.:

Dr. Stephen Johnson, Administrator of the United States Environmental 
Protection Agency

Admiral Thad Allan, Commandant of the United States Coast Guard

Ms. Mary E. Peters, United States Secretary of Transportation

Mr. Collister Johnson, Jr., Administrator, St Lawrence Seaway 
Development 
Corporation

The Honourable Lawrence Cannon, Minister of Foreign Affairs and 
International Trade

Mr. Jim Bradley, Minister of Transport for Ontario

Mme. Julie Boulet, Minister of Transport for Quebec

Mr. Richard Code, President, St Lawrence Seaway Management Corporation 
(Canada)

Mr. Donald Morrison, President, Canadian Shipowners Association
                                 ______
                                 
                              Attachment D
                                Minister of Foreign Affairs
                           Ministre des Affaires etrangeres
                                  Ottawa, Canada, December 11, 2008

Hon. Condoleezza Rice,
Secretary of State,
The United States of America,
Washington, DC.

Dear Madam Secretary:

    I am writing to convey the Government of Canada's serious concerns 
with the State of New York's proposed certification of the United 
States Environmental Protection Agency's (EPA) National Pollutant 
Discharge Elimination System. The proposed requirements for ballast 
water discharges will have a damaging effect on the highly integrated 
economy of the Great Lakes region as a whole by severely impeding the 
movement of Canadian ships, while failing to achieve environmental 
benefits.
    New York's proposed rules inappropriately classify Canadian ships 
operating in the St. Lawrence Seaway as foreign shippers, categorizing 
them with shippers operating from outside North America. Under these 
amended requirements, Canadian domestic ships entering the Great Lakes 
from the Seaway, all of which must pass through New York waters, will 
be forced to undergo ballast water exchange in the Atlantic Ocean 
before each entry. This would cause illogical and untenable situations.
    Of additional concern to Canada is the patchwork of ballast water 
regulations emerging in the Great Lakes, as each state in the region 
introduces differing requirements under the EPA's permit system. The 
Government of Canada shares the U.S. Great Lakes States' concerns 
regarding the impact of invasive species on our shared waters. Canada 
has a comprehensive national regulatory regime for ships that addresses 
environmental issues. This regime includes rules that ships must follow 
to prevent both pollution and the introduction of invasive species, 
consistent with global rules under the International Maritime 
Organization. We support the development of compatible rules in the 
United States and in the Great Lakes States.
    The Great Lakes and St. Lawrence Seaway system is one of the 
world's greatest and most strategic waterways. It has always been an 
essential part of North America's transportation infrastructure and is 
critical for the economies of both Canada and the United States. It is 
a landmark achievement of our two countries working together. In 2007, 
the St. Lawrence Seaway handled an estimated 43 million tonnes of 
cargo, and it is particularly important for the transport of bulk 
commodities, such as iron ore, steel and coal. If Canadian ships were 
subjected to the proposed measures, it would significantly increase 
costs to carry cargo across the border, resulting in possible modal 
shifts away from the most environmentally efficient means of transport, 
as well as in a reduction of capacity and competitiveness in Great 
Lakes shipping.
    Further, as currently proposed, the state of New York's amendments 
to the EPA's National Pollutant Discharge Elimination System are 
contrary to the Canada-US Boundary Waters Treaty (1909). Article I of 
the treaty obliges both countries to ensure that all navigable boundary 
waters are to be equally free and open to commercial navigation for 
ships from either side of the border, and both fleets are to be equally 
treated by laws and regulations of both countries. In addition, the 
binational Great Lakes Water Quality Agreement calls for compatible 
regulations in these shared waters.
    The Government of Canada supports continued and enhanced 
cooperation with U.S. authorities to combat invasive species in our 
shared waters. As both our countries face challenges to deal with 
environmental issues in our shared waters, I am pleased to see that 
over the years cooperation between our governments and institutions has 
been excellent. The Great Lakes and St. Lawrence is a shared waterway 
and the best approach for effective environmental management is through 
cooperation, not through unilateral measures, especially those which 
unfairly penalize one party.
    Accordingly, the Government of Canada requests United States 
Federal engagement on this issue, to seek an exemption of Canadian 
domestic shippers from these regulations and to ensure that regulations 
compatible with international standards are adopted to the maximum 
extent possible in the Great Lakes. I thank you in advance for your 
ongoing efforts to support the Canada-U.S. relationship and to continue 
the development of our mutually dependent economies and the protection 
of our shared waterways. Please do not hesitate to contact us if you 
have any questions or concerns.
            Sincerely,
                     Honourable Lawrence Cannon, P.C., M.P.

    Senator Rubio. Thank you.
    Next is Ms. Claudia Copeland, Congressional Research 
Service, Washington, D.C.
    Welcome.

          STATEMENT OF CLAUDIA COPELAND, SPECIALIST IN

              RESOURCES AND ENVIRONMENTAL POLICY,

            RESOURCES SCIENCE AND INDUSTRY DIVISION,

                 CONGRESSIONAL RESEARCH SERVICE

    Ms. Copeland. Thank you.
    Mr. Chairman and members of the Subcommittee, I am Claudia 
Copeland, a Specialist in Environmental Policy with the 
Congressional Research Service. Thank you for the opportunity 
to testify about issues concerning regulation of ballast water 
and other discharges from vessels.
    Today there is wide agreement on the need for strong 
measures to manage vessel discharges that may harm marine 
environment, especially ballast water, but differing views on 
how best to do that.
    As my written statement describes, two Federal agencies 
regulate vessel discharges. The first is the Coast Guard, 
which, pursuant to the National Invasive Species Act, regulates 
ballast water discharges from about 3,000 vessels. And the 
second is EPA, which, pursuant to the Clean Water Act, 
regulates ballast water and other discharges from about 70,000 
vessels under a national permit.
    My statement also describes how 25 states also regulate 
vessel discharges. It is the combination of Federal and state 
requirements that is at issue, and I would like to highlight 
four aspects of the topic.
    The first is overlapping Federal requirements.
    The Coast Guard's rule and EPA's vessel permit are similar 
but not identical. Both include numeric ballast water discharge 
standards, generally the same numeric standards, but, among the 
differences, the Coast Guard can grant temporary exemptions 
from its standards if technology isn't available, while EPA 
doesn't have that authority. EPA's permit regulates many types 
of discharges in addition to ballast water.
    The maritime industry, some states, and some environmental 
groups favor a uniform national ballast water discharge 
standard out of concern that the overlapping requirements make 
implementation costly and confusing. Many industry groups want 
to centralize responsibility with the Coast Guard.
    Now, centralizing with the Coast Guard might reduce 
confusion about ballast water, but questions would still 
remain. For one, what would happen to regulation of the more 
than two dozen non-ballast water discharges that are also 
covered by EPA's permit? Options could include eliminating 
regulation of them entirely or centralizing everything with the 
Coast Guard or having EPA continue to regulate non-ballast 
water discharges. However, if the Coast Guard regulated ballast 
water and EPA regulated other discharges, vessel owners and 
operators would still be dealing with two agencies.
    Most environmental groups want EPA to continue with a role 
of some sort for all types of discharges, because, in their 
view, EPA's sole mission is protecting the environment, while 
the Coast Guard has multiple missions.
    A second related issue is the role of states. Minnesota, 
Wisconsin, Michigan, and Hawaii have enacted their own ballast 
water permits, separate from EPA's permit. And California and 
New York have adopted numeric ballast water discharge standards 
that are more stringent than the Coast Guard's and EPA's. And, 
in addition, as you have heard, 25 states, including Alaska, 
Connecticut, Missouri, Nebraska, New Hampshire, and Washington, 
have adopted non-ballast water requirements that also are 
enforceable conditions of EPA's permit.
    Industry groups object to the additional requirements that 
are imposed by states, which, they argue, create a patchwork of 
inconsistent requirements that are problematic for vessels that 
travel between jurisdictions. While many of them would favor 
Federal preemption of the states in this area, the courts so 
far have supported the states' actions.
    Not surprisingly, the states that have adopted additional 
requirements strongly oppose proposals to preempt their 
authority, arguing that this would be contrary to Congress's 
intention in both the Clean Water Act and the National Invasive 
Species Act.
    A third issue is the ballast water discharge standards 
themselves. The Coast Guard and EPA have adopted similar 
requirements, but questions do remain. First is whether the 
current standards are even achievable and affordable.
    In addition, there is the view of some states and 
environmental groups that more stringent standards should be 
required. For example, New York argues that its uniform 
national standard would be desirable, as that is more stringent 
than the Coast Guard and EPA rule. And California continues to 
support its standards, which are the most stringent in the 
country.
    The final issue concerns commercial fishing and small 
vessels. In 2008, Congress enacted legislation to restrict the 
types of vessels that are subject to EPA's permit and provided 
a temporary moratorium for all commercial fishing vessels and 
nonrecreational vessels less than 79 feet in length. That 
moratorium will expire in 2017.
    Many believe that the discharges from these vessels don't 
significantly harm marine life and that they should be 
permanently exempted from permitting. However, others believe 
that even if there is a small potential risk of environmental 
harm, discharges from these vessels should still be regulated.
    My final point is that the issues that I have discussed are 
complicated, and while CRS can't recommend solutions, we can 
help you analyze the options for them.
    This concludes my remarks, and thank you for the 
opportunity to testify.
    [The prepared statement of Ms. Copeland follows:]

  Prepared Statement of Claudia Copeland, Specialist in Resources and 
    Environmental Policy, Resources Science and Industry Division, 
                     Congressional Research Service
    Mr. Chairman and Members of the Subcommittee, on behalf of the 
Congressional Research Service, thank you for the opportunity to appear 
before you. I am Claudia Copeland, Specialist in Resources and 
Environmental Policy. The Committee requested that CRS discuss the 
legislative and regulatory history of vessel discharge, the current 
regulatory schemes, and issues addressed in recent vessel discharge 
legislation. In serving the U.S. Congress on a non-partisan and 
objective basis, CRS takes no position on legislation.
Introduction
    As part of their normal activities, vessels may discharge a wide 
range of wastes and contaminants into U.S. and international waters, 
including nutrients, pathogens, oil and grease, metals such as copper, 
toxic chemical compounds, and non-native aquatic nuisance, or invasive, 
species. The discharges can include shower and laundry facility water, 
deck washdown and runoff, bilgewater, motor fuel, machinery wastewater, 
and ballast water, among others. Contaminants in these discharges can 
have a broad array of effects on aquatic species and human health, many 
of which can be harmful.
    Similarly, the universe of vessels that may release these 
discharges is diverse and includes commercial fishing vessels, cruise 
ships, ferries, barges, mobile offshore drilling units, tankers, cargo 
ships, container ships, research vessels, emergency response vessels 
such as firefighting and police vessels. Including recreational 
vessels, the universe of vessels is in the millions.
    Ballast water discharges from vessels have been a particular 
concern, because invasive species entering U.S. waters cause social, 
recreational, and ecological disturbances and result in significant 
economic losses. National attention was drawn to the invasive species 
problem with the arrival of zebra mussels in the Great Lakes in the 
late 1980s. Since then, virtually all coastal and Great Lakes states 
have experienced ecological change and loss from aquatic nuisance 
species. For example, zebra mussels attach to hard surfaces such as 
water intake pipes that are used for cooling water and municipal water 
supply. When this occurs, the infestation can cause significant 
reduction in pumping capacity and occasionally has caused plant 
shutdowns.
    Ballast water has been identified as a major pathway for 
introduction of aquatic nuisance species. Ships use large amounts of 
ballast water to stabilize the vessel during transport. Ballast water 
is often taken on in the coastal waters in one region after ships 
discharge wastewater or unload cargo, and then discharged at the next 
port of call, wherever more cargo is loaded, which reduces the need for 
compensating ballast. The practice of taking on and discharging ballast 
water is essential to the proper functioning of ships, because the 
water that is taken in or discharged compensates for changes in the 
vessel's weight as cargo is loaded or unloaded, and as fuel and 
supplies are consumed. However, ballast water discharge typically 
contains a variety of biological materials, including non-native, 
nuisance, exotic species. If these species are released into lakes or 
rivers as part of ballast water discharge, they can alter aquatic 
ecosystems.
    Today there is wide agreement on the need for strong measures to 
control vessel discharges, especially ballast water discharges, but 
there are differing views on how to do that. Vessel discharge 
requirements in the United States are a result of U.S. Coast Guard 
regulations, U.S. Environmental Protection Agency (EPA) permits, and 
individual state rules, limitations, and requirements. Vessels also are 
subject to a number of international agreements, in particular to 
Conventions adopted by the International Maritime Organization 
(IMO),\1\ which apply to vessels operating under flags of countries 
that are Parties to the Conventions. It is the combination of 
regulations and standards that is at issue today.
---------------------------------------------------------------------------
    \1\ The IMO, a body of the United Nations, sets international 
maritime vessel safety and marine pollution standards.
---------------------------------------------------------------------------
Coast Guard Regulation: Ballast Water Discharges
    Federal authority to address ballast water concerns in the United 
States is contained in the Nonindigenous Aquatic Nuisance Prevention 
and Control Act of 1990 (NANPCA, P.L. 101-646), as amended by the 
National Invasive Species Act of 1996 (NISA, P.L. 104-332),\2\ and is 
administered by the Coast Guard. Initially this authority required a 
program to prevent the introduction and spread of invasive species into 
the Great Lakes by managing vessel ballast water discharge, a program 
that subsequently was extended to all U.S. ports and waters. Ships that 
have operated outside the U.S. Exclusive Economic Zone \3\ were 
directed to undertake high seas ballast exchange before entering U.S. 
waters. However, ballast water exchange is believed to be only 
partially effective to reduce the spread of aquatic organisms and 
pathogens and is often not carried out due to safety consideration.\4\
---------------------------------------------------------------------------
    \2\ 16 U.S.C. Sec. Sec. 4701-4741.
    \3\ The Exclusive Economic Zone (EEZ) means the area established by 
Presidential Proclamation Number 5030, dated March 10, 1983, which 
extends from the baseline of the territorial sea of the United States 
seaward 200 miles, and the equivalent zone of Canada.
    \4\ Ballast water exchange involves replacing water that has been 
taken on in coastal areas with open-ocean water during a voyage. This 
process reduces the density of coastal organisms in ballast tanks, 
replacing them with oceanic organisms with a lower probability of 
survival in nearshore waters.
---------------------------------------------------------------------------
    In 2012 the Coast Guard promulgated a rule establishing new 
requirements for ballast water management.\5\ The Coast Guard amended 
its existing requirements to include numeric standards that establish 
allowable concentrations of living organisms in ballast water that is 
discharged in U.S. waters. The rule specifies that ballast water to be 
discharged must contain fewer than 10 organisms per cubic meter for 
organisms larger than 50 micrometers and fewer than 10 organisms per 
milliliter for smaller organisms, those that are between 10 and 50 
micrometers in size. It also establishes numeric limits on indicator 
microorganisms, such as intestinal pathogens. The rule applies to all 
U.S. and foreign vessels that are equipped with ballast tanks and are 
operating in waters of the United States, unless specifically exempt, a 
number estimated by the Coast Guard to be 3,046 vessels over a 10-year 
period. Under the rule, the standards would apply to new vessels--
meaning those constructed on or after December 1, 2013--on delivery and 
would apply to vessels constructed before December 1, 2013, according 
to a phased schedule beginning January 1, 2014, depending on a ship's 
ballast water capacity.
---------------------------------------------------------------------------
    \5\ Department of Homeland Security, Coast Guard, ``Standards for 
Living Organisms in Ships' Ballast Water Discharged in U.S. Waters,'' 
77 Federal Register 17254-17320, March 23, 2012. The regulations are 
codified at 33 CFR Part 151 and 46 CFR Part 162.
---------------------------------------------------------------------------
    Under the Coast Guard rule, vessel owners and operators have 
several compliance options.

   They can eliminate ballast water discharge.

   They can discharge to an onshore facility or to another 
        vessel for the purpose of treatment.

   They can use ballast water that is only drawn from a U.S. 
        public water system.

   Or, they can install a ballast water management system that 
        has been approved by the Coast Guard. For this option--
        installation of treatment technology--the rule details 
        procedures for land-based and shipboard testing and Coast Guard 
        approval.

    The numeric standards in the Coast Guard rule overlap with 
standards specified in a 2004 Convention of the IMO.\6\ Like the Coast 
Guard rule, the IMO ballast water performance standard identifies 
organisms of various sizes and also identifies concentrations of 
indicator microbes in ballast water that management systems are 
required to achieve prior to discharge. And the numeric standards in 
the Coast Guard rule and the IMO Convention are the same.
---------------------------------------------------------------------------
    \6\ International Maritime Organization, International Convention 
for the Control and Management of Ships' Ballast Water and Sediment, 
2004. Numeric discharge performance standards in the IMO ballast water 
convention, referred to as the D-2 standards, will enter into force 12 
months after ratification by 30 nations representing 35 percent of the 
world shipping tonnage. As of January 2015, this convention has been 
ratified by 43 nations, representing 32.5 percent of the world merchant 
shipping tonnage. The United States has not ratified the convention.
---------------------------------------------------------------------------
EPA Permit for Vessel Discharges
    EPA also has authority to regulate vessel discharges, including 
ballast water, but for many years the agency mostly chose not to do so. 
This authority stems from the Clean Water Act, which prohibits the 
discharge of pollutants from a point source into U.S. waters without a 
permit.\7\ Vessels are defined in the statute as point sources. In 
1973, EPA promulgated a regulation that excluded discharges incidental 
to the normal operation of vessels--including ballast water (but not 
including vessel sewage discharges, which are regulated)--from Clean 
Water Act permitting requirements. EPA's position was that, because 
vessels are mobile and move between jurisdictions, the traditional 
Clean Water Act mechanism of regulating through state-issued permits is 
problematic, because state requirements can vary widely.
---------------------------------------------------------------------------
    \7\ Clean Water Act Section 301(a); 33 U.S.C. Sec. 1311(a).
---------------------------------------------------------------------------
    This long-standing regulation was challenged in Federal district 
court by environmental advocacy groups who wanted EPA to address 
ballast water as a source of aquatic nuisance species in U.S. waters. 
The court found that the 1973 regulation contradicted Congress' 
intention that discharges from vessels be regulated under the Clean 
Water Act, and it vacated, or revoked, the regulatory exclusion. In 
2008, this ruling was upheld.\8\
---------------------------------------------------------------------------
    \8\ Northwest Environmental Advocates v. U.S. Environmental 
Protection Agency, 537 F.3d 1006 (9th Cir. 2008).
---------------------------------------------------------------------------
    EPA initially estimated that the court's ruling could affect and 
would require permits for as many as 98,000 commercial fishing, 
passenger, cargo and other vessels, plus over 13 million recreational 
boats. Congress responded to that estimate by enacting two bills to 
restrict the population of vessels subject to regulation. The first, 
the Clean Boating Act of 2008, provided a permanent exemption for 
discharges incidental to the normal operation of recreational vessels 
of all sizes from Clean Water Act permitting requirements.\9\
---------------------------------------------------------------------------
    \9\ P.L. 110-288.
---------------------------------------------------------------------------
    The second measure provided a two-year moratorium on Clean Water 
permitting for certain discharges from commercial fishing vessels of 
all sizes and non-recreational vessels less than 79 feet in length.\10\ 
This moratorium has been extended three times, most recently through a 
three-year extension, until December 18, 2017, which was enacted in 
December 2014 as part of a Coast Guard reauthorization bill.\11\
---------------------------------------------------------------------------
    \10\ P.L. 110-299.
    \11\ P.L. 113-181.
---------------------------------------------------------------------------
    Following Congress' actions, in 2008 EPA issued a national Clean 
Water Act permit called the Vessel General Permit (VGP), giving permit 
coverage to an estimated 72,000 vessels including tankers, freighters, 
barges, and cruise ships that were not exempted by the two bills. It 
applied to 26 types of pollutant discharge types or waste streams, 
including but not limited to ballast water, that result from the normal 
operation of covered vessels. The ballast water requirements of the 
2008 VGP were minimal, largely requiring what was required by then-
existing Coast Guard rules--primarily use of ballast water 
exchange.\12\ Like Coast Guard rules that had been in effect since 
2004, EPA's permit mandated mid-ocean ballast water exchange for ships 
traveling outside the 200-nautical-mile exclusive economic zone (EEZ) 
of the United States.
---------------------------------------------------------------------------
    \12\ Infra note 4.
---------------------------------------------------------------------------
    Some stakeholder groups urged EPA to include numeric ballast water 
discharge standards in the 2008 VGP, arguing that discharge standards 
would encourage adoption of technology that is more effective for 
controlling living organisms than ballast water exchange. But EPA did 
not do so. Requiring a numeric effluent limit for the discharge of 
living organisms was not practicable, achievable, or available because 
adequate treatment technologies were not then commercially available, 
EPA said. Instead, the VGP specified ballast water best management 
practices, such as regular cleaning of ballast tanks in mid-ocean to 
remove sediment, as well as recordkeeping and monitoring requirements.
    Because the VGP and other Clean Water Act permits are authorized 
for five-year periods and then must be renewed, in 2013 EPA re-issued 
the VGP. It is similar to the 2008 permit in many respects, but departs 
from the previous permit by specifying ballast water numeric discharge 
limits. Based on reports from the National Research Council and the 
agency's own Science Advisory Board since issuance of the 2008 permit, 
EPA concluded that ballast water treatment technologies are now 
available to meet numeric limits in the new VGP, and that the 
requirements are economically practicable and achievable.
    The numeric limits in the 2013 VGP are the same as the performance 
standards in the Coast Guard's 2012 regulation and also the same as the 
standards in the IMO's ballast water Convention. Likewise, the VGP 
matches the implementation time-frame in the Coast Guard rule for new 
and existing vessels.
    While they are similar in many respects, the Coast Guard rule and 
the EPA permit differ in several ways.

   Number and types of vessels. The Coast Guard rule applies to 
        about 3,050 vessels that are equipped with ballast tanks, while 
        the EPA permit applies to about 72,000 vessels, including many 
        that do not discharge ballast water. The Coast Guard rule 
        exempts crude oil tankers engaged in coastwise trade (i.e., 
        essentially referring to a voyage that begins at any point 
        within the United States and delivers a type of commercial 
        cargo to any other point within the United States); the EPA 
        permit has no such exemption.

   Covered discharges. The Coast Guard rule focuses just on 
        ballast water discharges. The EPA permit authorizes discharges 
        of ballast water and 26 other waste streams incidental to the 
        normal operation of vessels.

   Ballast water requirements are similar but not identical. 
        Both adopt the ballast water discharge standards in the IMO 
        ballast water convention, but they include somewhat different 
        monitoring, recordkeeping and reporting requirements. For 
        example, the EPA permit regulates discharges of biocides that 
        vessels may use as part of ballast water management; the Coast 
        Guard rule has no such requirements.

   Ballast water management technology. The Coast Guard rule 
        requires use of approved ballast water management technology. 
        The EPA permit requires use of ``best available technology,'' 
        but does not require technology certification.

   Exemptions. The Coast Guard has authority to grant temporary 
        exemptions from its ballast water management standards if 
        technology is not available. Because no technological system 
        has yet received Coast Guard approval, the Coast Guard has 
        granted two-year exemptions to nearly 350 vessels. EPA does not 
        have authority to grant exemptions from requirements of the 
        VGP.

   Enforcement. Under NISA and the Clean Water Act, 
        respectively, the Coast Guard and EPA have enforcement 
        authority, such as civil and criminal sanctions. Only the Clean 
        Water Act authorizes citizen suits, that is, the ability of 
        citizens to bring a lawsuit to enforce effluent limitations in 
        a permit.
State Regulation of Vessel Discharges
    The role of states in regulating vessel discharges is a 
controversial issue, because, beyond Federal requirements, vessel 
discharges also are subject to regulation by nearly one-half of the 
states. The states' authority to do so derives in part from provisions 
of the Clean Water Act. First, Section 510 allows states to adopt 
standards, discharge limitations, or other requirements no less 
stringent than Federal rules. States often want the flexibility to 
require standards more stringent than federal, and this general 
authority in the statute gives states the ability to tailor their 
implementation of Federal water quality programs by adopting 
requirements under state law to address local conditions and 
circumstances.
    Several states, including Minnesota, Wisconsin, Michigan, and 
Hawaii, have used their authority to issue state permits independent of 
the VGP to regulate ballast water discharges.
    Second, under Clean Water Act Section 401, an applicant for a 
Federal license or permit to conduct any activity that may result in a 
discharge to waters of the United States must provide the Federal 
agency with a certification that the discharge will comply with 
applicable provisions of the Federal law, including state-established 
water quality standards. Section 401 gives states two distinct powers: 
one, the power indirectly to deny Federal permits or licenses by 
withholding certification; and two, the power to impose conditions on 
Federal permits. Where states impose conditions on a Federal permit--
such as the VGP--the permittee must meet the additional state 
limitations as conditions of the Federal permit.
    Twenty-five states and Tribes certified the 2013 re-issued permit 
with additional permit conditions covering one or more of the 27 
effluent streams. Of the 25, 14 states certified the permit with 
supplementary conditions applicable to ballast water discharges, 
including specific numeric discharge standards that are more stringent 
than those in the EPA permit (or the Coast Guard rule), state permit 
requirements such as Michigan's, or with more general language 
prohibiting nuisance or other conditions in order to protect state 
waters. Some states certified with conditions for specific pollutant 
discharges, such as chlorine, which can harm aquatic life. States that 
have used their state authority to adopt more stringent ballast water 
standards include New York, which are 100 times more stringent than 
EPA's and the Coast Guard's, and California, which has established 
numeric standards 1,000 times more stringent than those in the Coast 
Guard rule and the EPA permit. Both New York and California have 
temporarily deferred their more stringent standards, but expect to 
implement them when technology to do so is available.
    The commercial shipping industry and environmental groups 
challenged several separate state permits, on differing grounds, but 
courts have generally upheld the permits. A Minnesota court upheld that 
state's permit despite challenges from an environmental group over the 
state's failure to impose numeric limitations on ballast water 
discharges. Also, Michigan's permitting program and New York's 
certification of the 2008 EPA permit were upheld after challenges by 
shipping industry groups.
Issues in the Regulation of Vessel Discharges
    The combination of multiple Federal requirements, plus state 
requirements, presents several closely related issues, some of which 
have been addressed in recent legislation, including S. 2094, which 
this committee approved in the 113th Congress.\13\
---------------------------------------------------------------------------
    \13\ S. 2094 would have established a single Federal ballast water 
management standard, specifying the Coast Guard's 2012 numeric 
standards as the baseline. Under the legislation, these standards would 
supersede existing state standards or permits and also would supersede 
EPA's ballast water management requirements under the Clean Water Act. 
The Coast Guard would be directed to adopt more stringent ballast water 
standards within eight years, unless a feasibility review determines 
that the specified more stringent standards are not attainable. The 
Coast Guard could establish lower or higher revised performance 
standards with respect to classes of vessels, if appropriate. Following 
enactment of the bill, manufacturers of ballast water treatment 
technology could only sell, deliver, or import technology that has been 
certified by the Coast Guard as meeting criteria in the legislation. 
Finally, a state could enforce a more stringent ballast water 
performance standard if the standard is in effect on the date of 
enactment of the legislation and if the Coast Guard determines that 
compliance with the state standard is achievable and is consistent with 
obligations under relevant international treaties or agreements. Also 
in the 113th Congress, the House passed a bill with similar, but not 
identical, provisions (H.R. 4005).
---------------------------------------------------------------------------
Overlapping Federal Requirements
    For some time, the maritime industry has argued for harmonization 
of what it views as duplicative Federal rules for vessel discharges, 
especially for ballast water discharges, through a single set of 
requirements. Shipping and other industry groups have long raised 
concerns that EPA's permit overlaps with mandates in the Coast Guard 
rule, making implementation costly and confusing for vessel owners. 
Many in these groups have called for centralizing responsibilities with 
the Coast Guard, which has long had administrative and regulatory 
authority over the industry.
    Centralizing ballast water management with the Coast Guard might 
reduce confusion about ballast water, but questions would still remain. 
One question concerns, how would the more than two dozen non-ballast 
water waste streams that also are included in EPA's permit be 
regulated? Options could include eliminating regulation of them 
entirely, or centralizing everything with the Coast Guard, or having 
EPA continue to regulate non-ballast water discharges. If EPA were to 
continue regulating other discharges such as shower and laundry water, 
bilgewater, and machinery waste, vessels would still be subject to 
those portions of the VGP, and vessel owners and operators would still 
be dealing with two agencies. Some interest groups, especially some 
environmental advocacy groups, would prefer that if ballast water 
regulation is centralized with one Federal agency, they favor EPA. 
These groups prefer EPA because its sole mission is protecting public 
health and the environment, while for the Coast Guard, regulating 
pollutant discharges is one of several of its existing missions and 
responsibilities. The maritime industry is concerned about any 
continuing regulation under the Clean Water Act, because of the 
potential for citizen suit enforcement, which that law allows.
State Role and Federal Preemption
    Shipping and other industry groups have also objected to the 
conditions that states attach to EPA's permit, which they argue create 
a patchwork of inconsistent requirements that are economically 
inefficient and cumbersome to implement. A group of commercial shipping 
operators challenged state certifications under the 2008 VGP, 
contending that the shipping industry is placed in the difficult 
regulatory position of being subject to a single Federal permit with 
multiple state requirements. The Federal court rejected the challenge, 
ruling that under the Clean Water Act, EPA does not have the power to 
amend or reject state certifications under Section 401, which must be 
attached to and become conditions of the Federal permit.\14\
---------------------------------------------------------------------------
    \14\ Lake Carriers' Association v. EPA, 652 F.3d 1, 10 (D.C. Cir. 
2011).
---------------------------------------------------------------------------
    Similar concerns were raised about the Coast Guard's 2012 rule. A 
number of commenters on the rule requested that the Coast Guard preempt 
all state ballast water treatment standards and requirements in favor 
of a uniform, national standard. Some argued that states with 
conflicting regulations burden interstate commerce and create confusion 
and would delay eliminating invasions of aquatic nuisance species. In 
the final rule, the Coast Guard responded that it cannot legally 
preempt state action to regulate discharges of ballast water within 
state waters, citing a provision of NANPCA, as amended by NISA, that 
saves to the states or their political subdivisions their authority to 
``adopt or enforce control measures for aquatic nuisance species, [and 
nothing in the Act would] diminish or affect the jurisdiction of any 
State over species of fish and wildlife.'' \15\
---------------------------------------------------------------------------
    \15\ 16 U.S.C. 4725. See 77 Federal Register 17279-17280, March 23, 
2012.
---------------------------------------------------------------------------
    States that have adopted additional requirements, such as their own 
permits or more stringent standards, strongly oppose proposals to 
preempt this authority, arguing that doing so would be contrary to 
Congress' clear intention in both the Clean Water Act and the National 
Invasive Species Act.
Ballast Water Discharge Standards
    Previous Coast Guard rules and EPA's 2008 VGP did not include 
numeric standards to control ballast water discharges, largely because 
effective and economical technology was not available. This changed in 
the Coast Guard's 2012 rule and EPA's reissued permit in 2013. While 
the issue of numeric ballast water discharge standards would seem to 
have been resolved through these more recent actions, that's not 
necessarily the case. Both the Coast Guard and EPA believe that the 
standards specified in the IMO ballast water Convention, which their 
rules endorse, are technically and economically achievable, although 
some industry groups disagree. At the same time, some states and 
environmental advocacy groups continue to favor more stringent numeric 
standards in order to eliminate invasions of aquatic invasive species. 
For example, while New York agrees that a uniform, national standard is 
desirable, that state would like such a standard to match what it has 
adopted. Likewise, California continues to support its standards, which 
are the most stringent in the country.
    The Coast Guard's rule calls for a review of its standard in 2016, 
and EPA will review its standard before the current VGP expires in 
2018. Whether the agencies will see a need to adopt more stringent 
ballast water standards in the future is unknown for now.
Permit Moratorium for Small Vessels
    A final issue is how to resolve the current temporary moratorium 
that Congress enacted in December on EPA permitting of commercial 
fishing and small vessels.\16\ That moratorium expires in December 
2017. Many believe that discharges incidental to the normal operation 
of these vessels are not a significant source of harm to aquatic life 
in U.S. waters--compared with discharges from larger vessels--and that 
it would be appropriate, both administratively and environmentally, to 
exclude them permanently from Clean Water Act permitting. On the other 
hand, some may argue that, even if there is small potential risk of 
environmental harm from discharges from these vessels, it still 
warrants improved management and regulation.
---------------------------------------------------------------------------
    \16\ Extension of the moratorium was included in The Howard Coble 
Coast Guard and Maritime Transportation Act of 2014 (P.L. 113-281).
---------------------------------------------------------------------------
    That concludes my statement. Thank you again for the opportunity to 
testify. I would be glad to respond to questions at the appropriate 
time.

                STATEMENT OF HON. DAN SULLIVAN, 
                    U.S. SENATOR FROM ALASKA

    Senator Sullivan [presiding]. Thank you, Ms. Copeland.
    Our next witness is Captain Robert Zales, President, 
National Association of Charterboat Operators.
    Captain Zales?

      STATEMENT OF ROBERT F. ZALES II, PRESIDENT, NATIONAL

          ASSOCIATION OF CHARTERBOAT OPERATORS (NACO);

                   OWNER, BOB ZALES CHARTERS

    Captain Zales. Mr. Chairman and members of the Committee, 
my name is Robert F. Zales II, and I appear today on behalf of 
the National Association of Charterboat Operators and as owner 
of Bob Zales Charters in Panama City, Florida.
    My charter fishing business is a family business started by 
my mother and father in 1965. My parents--father, 88; mother, 
82--are still involved, and the three of us have struggled for 
50 years to keep this small business viable.
    I want to thank Chairman Thune, the Committee, and Senator 
Rubio for your invitation to present testimony on this critical 
issue.
    The charterboat industry provides a variety of on-the-water 
services, from recreational charter fishing to kayak ecotours. 
We are grateful to Congress for extending the current exemption 
from the NPDES permit requirements on our industry as well as 
the commercial fishing industry.
    I mention the commercial fishing industry because a 
substantial number of charter-for-hire fishing businesses hold 
dual permits to allow them to commercial-fish during the off-
season and during recreational fishery closures in order to 
help their business survive.
    The charterboat industry has been inundated with Federal, 
state, and local permitting, regulations, and requirements. The 
permits have monetary fees and burdensome reporting and 
recordkeeping requirements and provide for penalties, which 
include monetary fines, permit sanctions, and possible 
imprisonment associated with failing to properly report.
    Requirements placed on our industry range from Federal 
fishery overly restrictive fishing seasons, bag limits and 
quotas, to closed areas to boating and fishing, to engine 
exhaust emission regulations. The U.S. Coast Guard regulates 
life-saving, crew licensing, medical fitness review, and drug-
testing processes. We have similar state and local requirements 
that also include clean-water standards and anti-pollution 
requirements.
    Clean water is paramount to the successful operation of 
these small family businesses. No one is more concerned about 
our environment and the condition of our natural marine 
resources than the families who make their living on the water.
    Regulations and requirements to ensure our waters are clean 
are already in place, with the majority being enforced by the 
Coast Guard. Even with their expanded role due to homeland 
security and limited budget and personnel, the U.S. Coast Guard 
does a tremendous job ensuring our waters are clean.
    Recreational charterboats are operated as uninspected six 
or less passengers and as U.S. Coast Guard-certified seven or 
more passenger inspected vessels. The Coast Guard COI vessels 
have mandatory yearly topside inspections and biyearly out-of-
the-water inspections. And many uninspected vessels participate 
in Coast Guard voluntary inspection programs.
    In all cases where Coast Guard personnel check a vessel, 
whether at sea, a dock, or routine inspection, one of the first 
things they look for is a clean bilge and pollution-free 
vessel.
    In April 2007, the EPA Fact Sheet provided information from 
data from the Coast Guard that, as of 2005, there were 13 
million state-registered recreational boats, 81,000 commercial 
fishing vessels, and 53,000 freight and tank barges operating 
in U.S. waters. The 13 million recreational boats have since 
been exempted from the permit.
    The charterboat fleet consists of vessels from 15 foot 
center console outboards up to 120 foot triple engine 
headboats, and, of those, the majority are the same type 
vessels as the millions of recreational boats already exempt. 
The difference between the two is one is used for pleasure and 
the other used for business.
    Many of the Coast Guard COI vessels are also typical 
recreational boats that have been modified to meet U.S. Coast 
Guard's COI standards. In cases where vessels are purpose-built 
for Coast Guard's COI standards, the normal operation of the 
vessels is similar to recreational boats except they are 
equipped with Coast Guard-required equipment and built to Coast 
Guard standards, which include standards for fuel and oil tanks 
and purpose-built pollution-prevention devices.
    Few, if any, charterboats have ballast tanks, meaning any 
ballast water regulation is a moot point for charterboats.
    The EPA permit will add a substantial regulatory and 
financial burden to an already overly burdened small family 
business. In addition, the potential liability with associated 
costs of fines, possible lawsuits, and possible imprisonment 
due to failure to comply with reporting requirements could be 
the final nail in the coffin to drive many small families out 
of business.
    Here is a copy of the current 194 page VGP rules and 
regulations. The permit requires daily logging of discharges, 
with estimated amounts and condition. The VGP authorizes civil 
and criminal penalties for violations of the prohibition 
against the discharge of a pollutant without a permit and also 
allows for citizen suits against violators. Deck wash, 
including rain runoff, and fish hold effluents are among the 
discharges requiring a permit to discharge.
    The small family charterboat owners handle all business 
issues from their home or vessel. They do not have a staff, 
large business file capacity; handle all daily paperwork and 
keep up with licensing and permit schedules. They try their 
best to keep up with current regulations while trying to 
provide safe and enjoyable services to the public.
    You can imagine my 82 year old mother trying to stay on top 
of the 194 page VGP permit rule book to ensure compliance with 
recording how much rain runoff from the deck of our vessel 
occurred on any day.
    Our industry is concerned, compliant, safe, and diligently 
works to maintain a clean environment. There is no significant 
difference between our type vessels and those recreational 
vessels already permanently exempt. We have worked since 2006 
to gain a permanent exemption and greatly appreciate the help 
from Congress. While you just gave us 3 more years, we 
encourage you to approve legislation as soon as possible 
providing a permanent exemption for the multiple thousands of 
small family businesses so we are more confident in our future.
    Mr. Chairman, this concludes this portion of my testimony. 
Again, I truly appreciate the invitation and opportunity to 
provide you and the Committee with this information. I am 
pleased to respond to any questions.
    [The prepared statement of Captain Zales follows:]

     Prepared Statement of Robert F. Zales II, President, National 
 Association of Charterboat Operators (NACO); Owner, Bob Zales Charters
    Mr. Chairman and Members of the Committee, my name is Robert F. 
Zales II and I am appearing today on behalf of the National Association 
of Charterboat Operators (NACO) and as owner of Bob Zales Charters in 
Panama City, Florida. My charter fishing business is a family business 
started by my mother and father in 1965. My parents, father 88 and 
mother 82, are still involved and the three of us have struggled for 50 
years to keep this small business viable. I want to thank Chairman 
Thune, the Committee, and Senator Rubio for your kind invitation to 
present testimony on this critical issue.
    NACO is a non-profit 501 (c) (6) association representing charter 
boat owners and operators across the United States including the Great 
Lakes. The charter boat industry in the United States consist of 
recreational charter fishing, diving and snorkeling tours, sailing 
vessels, sightseeing eco tours, dining cruises, pontoon boat and jet 
ski and kayak rentals, parasailing, and other on the water businesses. 
While we are extremely grateful to Congress for extending the current 
exemption from the NPDES permit requirements on our industry as well as 
the commercial fishing industry, we are acutely aware of the 
devastating impacts of the pending requirements, regulations, and 
potential liability issues on our small family businesses. I mention 
the commercial fishing industry because a substantial number of charter 
for hire fishing businesses hold dual permits to allow them to 
commercial fish during the offseason and during recreational fishery 
closures in order to help their business survive.
    Over recent years the charter boat industry has been inundated with 
Federal, State, and Local government permitting, regulations, and 
requirements. Many of the permits have substantial monetary fees and 
burdensome reporting and record keeping requirements. The requirements 
provide for substantial penalties which include monetary fines, permit 
sanctions, and possible imprisonment associated with failing to 
properly and timely report. Examples of the substantial number of 
agencies and multiple requirements placed on our industry are: Federal 
fishery overly-restrictive fishing seasons, bag limits and quotas, 
closed areas to boating and fishing, fishing gear restrictions, the 
Endangered Species Act, Marine Mammal Protection Act, engine exhaust 
emission regulations, marine protected areas, U.S. Coast Guard 
regulations such as manning requirements, life-saving requirements, 
crew licensing, crew medical fitness review and drug testing processes, 
navigation restrictions, FCC radio licensing and requirements, State 
business licenses, fishing license requirements, fishing and gear 
restrictions, anti pollution requirements, clean water standards, Local 
business license requirements, anti pollution requirements, among a 
host of others.
    Clean water is paramount to the successful operation of these small 
family businesses. No one is more concerned about our environment and 
the condition of our natural marine resources than the families who 
make their living on the water. Regulations and requirements to ensure 
our waters are clean are already in place with the majority being 
enforced by the United States Coast Guard. Even with their expanded 
role due to homeland security and limited budget and personnel the USCG 
does a tremendous job ensuring our waters are clean.
    Recreational charter boats are operated as uninspected 6 or less 
passengers and as USCG Certificated 7 or more passenger Inspected 
vessels. While the USCG COI vessels have mandatory yearly topside 
inspections and biyearly out of the water inspections, many uninspected 
vessels participate in the USCG 5 star and other voluntary programs 
that provides similar inspections. In all cases where USCG personnel 
check a vessel whether at sea, a dock, or routine inspection one of the 
first things they look for is a clean bilge and pollution free vessel.
    In April 2007 the EPA produced a ``fact Sheet'' providing 
information on the impacts of the U.S. District Court decision vacating 
the exclusion of vessel discharges. The information provided as of 2005 
data from the USCG stated there were 13 million State-registered 
recreational boats, 81,000 commercial fishing vessels, and 53,000 
freight and tank barges operating in U.S. waters. The 13 million 
recreational boats have since been exempted from the NPDES permitting 
requirement. Since 2006 NACO has provided information to the EPA and 
Congress about the type boats that comprise the charter boat fleet. The 
vast majority of charter boats consist of vessels from 15, center 
console outboards up to 120, triple engine headboats and of those the 
majority are the same type vessels as the millions of recreational 
boats already exempt. The difference between the 2 is one is used for 
pleasure and the other used for business. Many of the USCG COI vessels 
are also typical recreational boats that have been modified to meet 
USCG COI standards. In cases where vessels are purpose built for USCG 
COI standards the normal operation of the vessels is similar to 
recreational boats except they are equipped with special wiring, 
piping, certified machinery, special safety equipment, and follow USCG 
COI standards for fuel and oil tanks, piping, bilge pumps, and purpose 
built pollution prevention devices. Few, if any, charter boats have 
ballast tanks meaning any ballast water regulation is a moot point for 
charter boats.
    The EPA NPDES permit will add a substantial regulatory and 
financial burden to an already overly burdened small family business. 
In addition, the potential liability with associated costs of fines, 
possible lawsuits, and possible imprisonment due to failure to comply 
with reporting requirements no matter how minor could be the final nail 
in the coffin to drive many small families out of business.
    I am presenting a copy of the current 194 page EPA VGP for 
discharges incidental to the normal operation of vessels (the permit 
rules and regulations). The permit will require daily logging of any 
and all discharges with estimated amounts and condition among other 
issues. The VGP also authorizes civil and criminal penalties for 
violations of the prohibition against the discharge of a pollutant 
without a permit, and also allows for citizen suits against violators.
    Currently deck wash, including rain runoff, and fish hold effluents 
are among the discharges that will require a permit to allow the 
discharge. In the VGP permit, fire main discharges, gray water, 
refrigeration and air condensate discharges, seawater cooling overboard 
discharges (including non-contact engine cooling water, hydraulic 
system cooling water, refrigeration cooling water), boat engine wet 
exhaust, and well deck discharges all will require a permit with the 
required reporting regulations. Discharges of garbage and trash will 
not be eligible for coverage by the permit because discharges of 
garbage are already covered under 33 CFR Part 151, Subpart A. Currently 
vessel owners must provide a detailed vessel garbage plan and post it 
on the vessel.
    The charter boats owners are small family businesses who typically 
handle all of the business issues from their home or vessel. They do 
not have a secretarial staff, do not have a large business file 
capacity, handle all of the day to day paper work and keep up with 
licensing and permit renewal schedules, and try their best to keep up 
with all the current regulations while trying to provide safe and 
enjoyable services to the public. You can imagine my 82 year old mother 
trying to stay on top of a 194 page VGP permit rule book to ensure 
compliance with recording how much rain runoff from the deck of our 
vessel occurred on any day.
    Our industry is concerned, compliant, safe, and diligently works to 
maintain a clean environment. As you can see there is no significant 
difference between our type vessels and those recreational vessels 
already permanently exempt. Since 2006 our and other Associations have 
worked hard to gain a permanent exemption and greatly appreciate the 
help from Congress by continuing the temporary exemption. While you 
just gave us three more years we encourage you to approve legislation 
as soon as possible providing a permanent exemption for the multiple 
thousands of small family businesses so we are more confident in our 
future.
    Mr. Chairman, this concludes this portion of my testimony. Again, I 
truly appreciate the invitation and opportunity to provide you and the 
Committee with this information. I will be pleased to respond to any 
questions.

    Senator Sullivan. Thank you very much, Captain Zales.
    I want to start by just following up on your testimony. I 
find that very powerful testimony.
    Captain Zales. Thank you.
    Senator Sullivan. As you probably know, in Alaska we also 
have a concern about this issue. And one of the things that I 
like to remind people, somehow there is sometimes a disconnect 
between people who see a charterboat captain, a small 
commercial fishing boat, and they don't make the connection 
that the owner of that boat is kind of the ultimate small 
businessman or small businesswoman in America.
    Captain Zales. Exactly.
    Senator Sullivan. They work hard, take risks. They provide 
a great service.
    And one of the things--and I would welcome comments from 
all the panelists, but, Captain Zales, why don't we start with 
you--that concerns me the most is the ever-increasing 
regulatory burden, particularly on the small commercial fishing 
boats and charters.
    Two questions. What do you see as the increasing costs? And 
I know this is kind of a tough question. Maybe we can have you 
kind of get back to us on that. But as the percentage of 
regulations has increased--and I appreciate you putting that 
book out, because that shows people, right? Small family 
business, 184 pages.
    What do you see as the increase in terms of just costs to 
your business? And I know it is hard to quantify, but if you 
can give us a sense of that, I think that that is powerful 
testimony.
    And then, second, in terms of a permanent exemption--and, 
again, this would be for all the panelists, all witnesses--to 
me, that is something that makes a lot of sense. Where is the 
opposition on that?
    Captain Zales. Thank you for your comments.
    And I would agree with you. Clearly, fishing businesses in 
this country, I mean, you know, that is kind of where this 
country started, was from fishing, and moved on.
    And, you know, as I said, my daddy is 88 years old, my 
mother is 82. Daddy does what he can; mother handles most of 
the paperwork stuff now. Mother is not computer-literate, so 
this 194-page book, she would have to read a page at a time, 
rather than getting on a computer and doing that.
    The cost of the permit probably is not that great. The cost 
of the burden of having to keep up with the day-to-day logging 
of discharges that would be reported to her from things like--
like I said, this thing requires you to record the amount of 
rain runoff I had on my deck today. I can't even give you an 
answer to that question on how much rain runs off my deck on 
any particular day. It is rainwater that would have hit the 
water if it hadn't hit my boat. So what is the purpose?
    And, I mean, you know, it is like I said. We already comply 
with a host of rules and regulations. The Coast Guard, every 
time they come on the boat, the first thing they look for is 
any kind of pollutant or any kind of problem, because if they 
see any kind of oil, fuel, anything around there, they 
immediately go to try to find the source of where that came 
from and what happened. So we are constantly working to keep 
everything clean.
    Senator Sullivan. I am going to interrupt you, and I really 
apologize. I have to go cast a vote real quick here, but I will 
certainly be looking at the transcripts of all your answers to 
this. This is a hugely important issue for me. I am very 
pleased and honored that the Committee Chair is already 
focusing on this issue. And I am going to be very interested in 
your answers.
    I don't want to be rude, but I am going to go vote here. I 
have about a minute to get to the floor. So thank you very 
much. But please continue, because I think it is a really 
important issue.
    Thank you.
    Captain Zales. And I will tell you that we have quite a 
number of members from Alaska that are part of our 
organization.
    The real potential here is the liability burden that is 
here. I don't know if my marine insurance company is going to 
charge me more to cover potential liability from this permit, 
if it doesn't get permanently exempted, or what the cost will 
be.
    But I do know, from reading everything that I have read 
about it, that there are going to be penalties and fines set 
up. There are going to be rewards offered to people who happen 
to see something.
    I mean, in the fishing business, especially in Florida 
where we are, people use a lot of suntan oil. You drop suntan 
oil on the water, you immediately have a sheen on the water. It 
is not necessarily a spill, but it looks like a spill.
    So, you know, these kind of problems and this kind of 
unknown future is what really is bothersome to us in trying to 
make it in this.
    And, you know, the benefit to a permanent exemption is--
like I said, we have been working on this since the court 
decision came out in 2005, and since 2006 we have tried to gain 
this permanent exemption.
    And it is like I said, the vast majority of the boats that 
the people that I represent operate are recreational-type 
boats. I mean, it is the same 46 Bertram that you use for 
pleasure that you are just taking a charter out on. They are 
permanently exempted. So there is no difference, in our mind.
    And we continually have kicked this can down the road, and 
we appreciate all the help that Congress has given, but we 
think it is time. Let's permanently stop it so that we can get 
on to other business and concentrate on the issues that affect 
us on a day-to-day basis--whether or not we are going to be 
able to catch a red snapper this year or not.
    Senator Rubio [presiding]. Well, thank you.
    At this time, I am going to ask my questions. And we are 
going to wait for members that are coming in and out, but with 
these votes going on, it will be an ongoing process. Although 
it is just one vote, so I anticipate most of the Members that 
had questions will return.
    Mr. Farley, given the vast amount of agricultural and 
manufacturing products and energy resources shipped by 
organizations such as yours, is it fair to say that a patchwork 
regulatory framework for vessel discharge increases prices for 
U.S. consumers dependent on these products? What is the impact 
that these regulations have on consumers, who ultimately at the 
retail level are buying the products that your members are 
shipping?
    Mr. Farley. Senator, there certainly is a cost, an indirect 
cost if nothing else, in the sense that we have a continuing 
training burden to be sure that the men and women who ride our 
tailboats and offshore vessels are fully versed in the 
regulations of the various states through which we pass. We 
operate on all coasts of the inland river systems, Hawaii, 
Alaska, Gulf Coast, East Coast, West Coast.
    So the very fact that there is this balkanization of rules 
leads us to a higher training burden. And training is not free. 
Eventually, that cost is borne by the shipper at some point in 
time.
    Senator Rubio. I particularly appreciate the point you made 
about upward mobility. One of the challenges we have in this 
country in the 21st century is the rise of the cost of living 
in comparison to wages that have been stagnant.
    And, in particular, the challenge is we are graduating a 
lot of young people out of high school who--the high school 
diploma alone does not certify them, necessarily, to work in 
most industries. But yours is an industry where people who 
graduate from high school can go work if they are properly 
trained by your members or during their graduation.
    How would regulatory streamlining allow you to hire more 
people, particularly people with this sort of background?
    Mr. Farley. Well, it allows us to continue to build our 
fleets, to have more boats, more barges to move the nation's 
product.
    An example of what you are talking about, sir, is a young 
person graduating from high school can come to work for Kirby 
Inland Marine or Inland Towboat Company, that those entry-level 
jobs are in the $40,000 to $45,000 level, and----
    Senator Rubio. I am sorry. The entry-level job is about 
$40,000 to $45,000. That would be potentially for an 18- or 19-
year-old just coming in?
    Mr. Farley. Yes.
    Senator Rubio. OK.
    Mr. Farley. Yes, sir, they are.
    And then someone who can apply themselves diligently to our 
training regime within 5 years can be earning six figures. And 
I wouldn't say that all people do that, but it is possible. We 
have numerous examples of that. In our offshore fleet, there is 
a higher licensing regime, if you will; it takes longer to do 
that. But the captain of an offshore vessel earns $140,000-plus 
a year.
    These are good family jobs. We have 2,500 mariners in our 
company.
    Senator Rubio. Mr. Weakley, would a uniform U.S. standard 
assist in our negotiations with our northern neighbors as they 
create their own standards for the Great Lakes?
    Mr. Weakley. Yes, sir, absolutely. I think that is a 
frustration of the Canadian industry as well as the Canadian 
government. There really isn't a clear mechanism for a foreign 
government to negotiate with an individual state, and the other 
way around, so most of that negotiation takes place indirectly 
via the courts.
    I am embarrassed to tell you how much money I spend on 
attorneys and lobbyists in the U.S. and in Canada and in each 
of the eight Great Lake states. That is how complicated not 
just the patchwork quilt is to deal with from an operational 
perspective that I think Mr. Farley so eloquently described but 
from a cost perspective, keeping up with the compliance, going 
through the process every 5 years. As I said in my oral 
statement, it is mind-boggling.
    Senator Rubio. Does the Vessel Incidental Discharge Act 
that we have refiled today--have you had a chance to review it? 
And if so, do you think that it addresses the unique issues 
faced by the Great Lake carriers?
    Mr. Weakley. To be honest, sir, I haven't read the current 
bill. I read it last Congress.
    We are very supportive of the geographically limited 
routes. If you look at the legislation that was introduced by 
Senator Levin several Congresses ago, it was a little more 
specific toward the Great Lakes. I understand and respect the 
broadness of the geographical limited areas. That gives the 
administration agencies the ability to determine where that 
lake or line would be.
    So we are very supportive of the single national standard, 
sir, and we are very supportive of the bill. And we are very 
appreciative of your leadership on this effort to unravel the 
patchwork quilt.
    Senator Rubio. And, finally, Captain Zales, I think you 
were answering this question as I came in, so I apologize, but 
never take up a good opportunity to restate your case.
    How important is this permanent exemption to not just your 
small business but others in the industry, as well?
    And, by the way, I would take this opportunity of having 
this chairmanship to invite everyone to come to Panama City and 
go fishing. I think it is a--I wanted to take that opportunity 
to let everybody know about that great place.
    Captain Zales. We appreciate it. We invite everybody to 
come. Spring break is fixing to kick off here in----
    Senator Rubio. Well, not during spring break. They will 
probably----
    Captain Zales. But, you know, around the middle of April, 
from then on is really nice. But, yes, Panama City is a great 
place.
    But, clearly, it is just a matter of being to know where 
our future is. Right now we know that we are exempt for 3 
years. At that point in time, we don't know what is going to 
happen, so we don't know what we have to comply with, what we 
don't. We don't know if that 194 pages is going to increase in 
size or what the situation is going to be.
    So it is a matter of having to know that you can take this 
issue and fix it, be done with it, and set it aside and not 
have to be concerned about it anymore, and only be concerned 
about the other regulations that are out there that we comply 
with every day.
    Senator Rubio. Thank you very much.
    Senator Cantwell?

               STATEMENT OF HON. MARIA CANTWELL, 
                  U.S. SENATOR FROM WASHINGTON

    Senator Cantwell. Thank you, Mr. Chairman.
    And I want to follow up on Captain Zales' last point, 
because in the Pacific Northwest, our economy is definitely 
tied to living marine resources, from salmon to crab to tourism 
to maritime transportation. And our recent economy--a report 
showed that the Washington State maritime cluster was worth $30 
billion in economic activity and 57,000 direct jobs.
    So 60 percent of that relies on the fishing industry. So 
our commercial fishing industry is a big driver. And, as you 
said, they have had to deal with this incidental discharge 
issue, which, you know, sounds bad, but when you are referring 
to something as small as rain runoff of a deck, it can be very 
challenging.
    So there is no science showing that these types of 
incidental discharge damage the environment. And, obviously, we 
were able to do, as you said, this 3-year bill, but why not 
make that permanent? So I was a sponsor of 2,963, and I hope my 
colleagues will join in on something that makes it a more 
permanent bill.
    But I had a question for either you or Ms. Copeland. And 
that is that, if I am understanding this correctly, you can 
have, like, two vessels targeting, say, Fraser River sockeye 
salmon in Puget Sound. Both of these vessels built by the same 
yard, both are the same size, both have the same engines, both 
have the same fuel. But is it accurate to say that one of these 
vessels is a commercial vessel and has to comply with the 
regulation and the other one is recreational and doesn't? So is 
that what we are seeing out there?
    Captain Zales. Is that to me?
    Essentially, it is, in our opinion. Because it is like, you 
know, you have $13 million--I don't know what the figure ended 
up being for the recreational vessels that are permanently 
exempt from this. But in most cases, the vast majority of cases 
in the charter business, it is the same boat. In most of the 
cases in the commercial fishing business, it is pretty much the 
same boat.
    I mean, it is converted boats that people buy that have 
already been premanufactured for certain things and then they 
are modified to do things. And I don't know that there is a 
difference.
    I mean, when I catch a red snapper and throw him in my 
fishbox, that fishbox has got a discharge on it to where the 
blood from that red snapper, what little bit is in there, 
filters out into the water. If you take that same red snapper 
and clean him, you use his head for crab bait, part of the fish 
went into the water. There is no permit that you have to have 
for that; you just put him in there.
    So there is no difference there. This is a natural thing. I 
mean, if the red snapper dies in the water, something is going 
to eat him. If he dies on my boat, something is going to eat 
what is out there from that fish.
    Senator Cantwell. Well, I mean, I definitely see a 
difference between this and the ballast water debate. But I 
guess I am asking whether we know of any science that shows 
that fishing vessel regulation on this--I mean, that this is 
negatively impacting the environment.
    Is there any science out there, Ms. Copeland?
    Ms. Copeland. Well, when Congress first passed the 
exemption, the temporary moratorium that is in effect now, it 
asked EPA to do a study about incidental discharges coming from 
the categories of vessels that were covered by this temporary 
moratorium.
    And EPA produced a report in response to that, and it found 
that, yes, there are a number of types of waste streams that 
are discharged by the vessels that are covered by the 
moratorium. And they include pathogens and toxic substances and 
a number of other contaminants that can be of concern.
    But what EPA also concluded was, when those wastes are 
discharged from these vessels in open waters, they don't appear 
to cause violations of water quality standards. Where they may 
be a concern is when the vessel is in a tight area where there 
are multiple vessels present in the same location, all of them 
discharging. Then there may be a water quality issue that 
arises.
    Senator Cantwell. OK.
    Captain Zales, did you want to add anything to that?
    Captain Zales. And I would say that in areas where you are 
going to have--and I am assuming this would be, like, a dock 
area or marina where these vessels would come in. If there is a 
problem there, you probably have some type of local or state 
regulation in addition to Coast Guard regulation for whatever 
the pollutant is.
    My example of rainwater, if it doesn't hit my boat, it is 
going to hit the water. If it is going to my hit my boat and my 
boat has enough pollutants on it to where that is going to be a 
problem to clean water, my boat shouldn't be on the water.
    And the Coast Guard clearly takes care of those kind of 
situations. Like I said, when these boats are looked at by the 
Coast Guard, whether it is a typical inspection at sea or a 
dockside inspection or a routine required inspection, the first 
thing they look at--and this is every case, because I am always 
prepared for this--every case, they look for clean bilges and a 
pollution-free vessel. Because if you have an issue there, they 
require you to fix it.
    Senator Cantwell. Speaking of which, I think Senator 
Murkowski and Senator Boxer are looking for a clean bill just 
on this subject, and I look forward to working with them on 
that.
    Thank you.
    Senator Rubio. Thank you.
    Senator Ayotte?

                STATEMENT OF HON. KELLY AYOTTE, 
                U.S. SENATOR FROM NEW HAMPSHIRE

    Senator Ayotte. Thank you, Chairman, for having this 
important hearing, and thank the Ranking Member.
    I wanted to follow up, Captain Zales, because in my home 
state, in New Hampshire, the catch share limits, frankly, are 
devastating our fishermen. And, you know, it has been dramatic.
    And so, as I look at this piece, I see the permanent 
exemption being very important, because if that is added on 
what they have already just really been dramatically cut, in 
terms of what they can catch, you know, I look at this as a 
burden I don't know how they--I am really worried about their 
ability to stay in business now.
    And if you add this on top of it, for a business like 
yours, what kind of costs do you think would be faced if this 
exemption did not continue and you were required to obtain an 
EPA NPDES permit? Especially as I look at this, as these are 
really, you know, as Senator Cantwell said, things like rain 
runoff.
    But what kind of cost are we talking about on--it is a 
wonderful tradition, the fishermen and what they do, certainly 
in New Hampshire, and I am sure it is the same in Florida as 
well, but I don't think it is a business where your margins are 
really large. So what would this do to a business like that?
    Captain Zales. No, and that is clear. And then catch shares 
are a problem across the country. A catch share program is 
intended--its primary purpose is to reduce fleet capacity. So 
if you have enough catch shares to where you eliminate the 
fleet, then you don't have much of a problem; you don't have 
many people on the water.
    And that is something that we are very concerned with, 
because, clearly, it has a significant potential problem 
because, as you said, you don't get rich in the charter fishing 
business as a small family. I mean, my parents--I am an only 
child. My parents and my family, we have lived for 50 years, 
and, you know, there has been lean times and there has been 
good times.
    When tourism is great, the fishing business is a little 
better, so it is good. But in the past 15 to 20 years, the 
regulatory atmosphere that has come on this business has just 
been tremendous. I mean, it is everything from this proposed 
permitting problem to catch share situations to, you know, red 
snapper.
    We had a 9-day fishing season for red snapper in the Gulf 
last year. You don't make very much--you can't make enough 
money. You know, imagine working as a Senator for the country 6 
months out of the year. What would the country do for the rest 
of the time? So it is a significant problem.
    Senator Ayotte. Yes. We have had the same thing. With cod, 
for example, we had a situation where they could fish, like, 1 
day a year, 2 days a year. It is like, how does anyone make a 
living doing that? I appreciate your comments on that.
    I wanted, Mr. Farley, to follow up with you. In your 
testimony, you had explained that Kirby's concern is not having 
vessel discharges regulated--not the fact that they are 
regulated but the way that they are regulated. And I have heard 
similar concerns from towing companies in New Hampshire 
regarding the uncertainty surrounding the vessel discharge 
regulations.
    Can you explain how you currently reconcile the patchwork 
of Federal and state regulations?
    And, also, how is the legislation that you had testified 
about today, what you would like to see happen, different from 
what Congress enacted last year? What do you need us to do to 
make some certainty here?
    Mr. Farley. Well, thank you about ending up with certainty. 
Certainty is what we need.
    In other words--I will use my company as an example. We 
have been putting off the decision on what type of ballast 
water treatment system we are going to put on our offshore 
vessels for some time. This is going to be roughly a $90 
million decision on our part. We need a Federal standard that 
allows us to make the best decision that we can for the 
shareholders we represent.
    It is a pretty good gamble for us, in a sense, to bet that 
we are going to make it in a system that could at any moment be 
changed. In other words, a vessel that I have just invested 
$1.6 million, $1.8 million in can suddenly by fiat by any of 
the states be changed, and now I can't go there, I can't go to 
New Hampshire, I can't go to Alaska, I can't go off Mississippi 
or off Florida.
    We need certainty and we need consistency so that we can 
make those decisions in the correct manner.
    Senator Ayotte. And how quick do you need us to act on 
this?
    Mr. Farley. As soon as you can, Senator. I mean, we are 
approaching a point in time where we are going to have to make 
those decisions, and I just want to make sure I make the right 
one for all of us, because it is an environmental decision as 
well.
    Senator Ayotte. Right. And if we are going to ask you to 
make a capital investment, then we want you to make sure that 
you make one that complies with the regulations that the 
Government puts in place and there is one standard. That makes 
a lot of sense.
    And I see, as I think about the answer that you gave, Mr. 
Farley, and what Captain Zales--gave a consistent theme of, 
let's get this done so that we can have certainty for all of 
your businesses to thrive and grow, whether larger or smaller. 
So thank you.
    Senator Rubio. Thank you.
    Senator Nelson?

                STATEMENT OF HON. BILL NELSON, 
                   U.S. SENATOR FROM FLORIDA

    Senator Nelson. Mr. Chairman, congratulations on your new 
chairmanship of this subcommittee.
    And welcome to Bob Zales.
    And the opening statement that I had I will just insert in 
the record.
    [The prepared statement of Senator Nelson follows:]

   Prepared Statement of Hon. Bill Nelson, U.S. Senator from Florida
    First, I want to congratulate my fellow Floridian, Senator Marco 
Rubio, on his Chairmanship of the Oceans, Atmosphere, Fisheries, and 
Coast Guard subcommittee. This committee and the work they do is of 
vital importance to this great nation but is also essential to the 
great state of Florida.
    I want to welcome all of our witnesses as I look forward to having 
a discussion with you on the important issue at hand today and I thank 
you for your testimony. I especially want to welcome and thank Captain 
Bob Zales, owner and operator of Bob Zales Fishing Charters in Panama 
City, Florida. Thank you for joining us today.
    I want to be brief in my comments because I want to hear the 
testimony of our witnesses and engage in dialogue on the issue at hand.
    The U.S. economy is reliant on healthy coastal and ocean resources. 
The U.S. maritime transportation system carries 95 percent of U.S. 
foreign trade equating to more than two billion tons of freight in and 
out of our nations ports and three million jobs.
    Tourism and recreation account for 70 percent of the ocean 
economy's total employment and 24 percent of its GDP.
    Florida is heavily reliant on its waters. Florida ranked seventh 
among the Nation's top exporting states in 2013 accounting for $86 
billion. Florida is the world's top travel destination with over 87 
million annual visitors accounting for $67 billion. Many of these 
tourists come to Florida for our beautiful and pristine waters and the 
aquatic life that they support.
    The issue of ship ballast water regulation is important to this 
country, and especially Florida, for the protection of our waters while 
also facilitating commerce in a safe and environmentally sound manner. 
The protection of our environment and the facilitation of commerce are 
two things that this committee cares deeply about.
    Ballast water from ships is the single largest source of 
introductions of aquatic invasive species. These invasive species can 
wreak havoc on local ecosystems and the local infrastructure where they 
are introduced. Making matters worse, these invasive species will not 
typically stay where they were introduced and will cause problems 
elsewhere causing massive amounts of ecological and monetary damage.
    The current patchwork of state and Federal regulations will not 
help in our goal of reducing and hopefully eliminating invasive species 
while allowing for the facilitation of commerce. This is important to 
get right as our aquatic environments are at great risk from many other 
areas while at the same time this Nation relies on shipping for over 95 
percent of our global trade.
    Regardless of our views of which states are active at the state 
levels, the standards and requirements imposed on ships must be based 
on hard science. We cannot afford to ignore science when it comes to 
both the protection of our waters and the protection of our maritime 
industry.

    Senator Nelson. And I wanted to ask Ms. Copeland, does the 
authority that state regulators feel that they have under the 
Clean Water Act, do they have this authority with regard to 
discharges of sewage?
    Ms. Copeland. No. There is a separate provision in the 
Clean Water Act dealing with sewage discharges from vessels.
    Senator Nelson. Right.
    Ms. Copeland. And it is not a permit program. It was a 
provision Congress enacted in 1972 that put EPA and the Coast 
Guard together to develop performance standards for what are 
called marine sanitation devices. And that particular provision 
does preempt states from having their own requirements.
    Senator Nelson. Right. And that is section 312----
    Ms. Copeland. Correct.
    Senator Nelson.--as opposed to the section that we have 
been discussing, 402.
    Ms. Copeland. Right.
    Senator Nelson. Then how has the state preemption language 
of that section 312 impeded states from protecting their waters 
with regard to the discharges of sewage, if at all?
    Ms. Copeland. Well, what section 312 allows states to do is 
to petition EPA to establish what is called a ``no-discharge 
zone.'' Where a state Governor determines that it is necessary 
to protect the local environment or local public water supplies 
or the like, the Governor can ask EPA to do that, to establish 
a no-discharge zone.
    But that is a no-discharge zone, and it has to be 
accompanied by a demonstration that there are adequate on-land 
facilities to handle sewage that is discharged from vessels in 
those locations. So there is an accompanying requirement that 
has to be met through that determination.
    Senator Nelson. With regard to ballast water, some states 
have standards that are much more stringent than others. Does 
it make sense, both from compliance and enforcement, to have a 
single standard that is the most stringent scientifically and 
then ratchet that standard up over time as the technology 
improves?
    Ms. Copeland. Well, that is certainly an option that has 
support in a number of areas. The question really is the 
availability of the technology to meet a more stringent 
standard, either now or in the future. And as my statement 
indicated, there are states that have adopted more stringent 
standards. They have temporarily deferred them because of the 
very question of is there technology that can meet a more 
stringent standard.
    Senator Nelson. In my opening statement, I was talking 
about, of course, the Great Lakes have a real problem on some 
of that ballast water that comes in from foreign ships. But we 
in Florida have had the same thing with regard to some of the 
discharges that come in from foreign ports.
    Thank you all very much.
    And thank you, Bob, for coming up.
    Senator Rubio. Thank you, Senator Nelson.
    Senator Wicker?

              STATEMENT OF HON. ROGER F. WICKER, 
                 U.S. SENATOR FROM MISSISSIPPI

    Senator Wicker. Thank you.
    And thank you to the panelists. We are shuttling back and 
forth between various committees today. For me, it is three 
committees. So I am sorry I missed your testimony.
    Let me ask the three gentlemen, first of all, not as 
researchers but as actual people who are out there, what was 
your position, if at all, in the last Congress on the proposed 
legislation, S. 2094, the Vessel Incidental Discharge Act, as 
it was reported from this committee?
    And we will start with Mr. Farley.
    Mr. Farley. Senator, we were in total support. We seek a 
Federal standard, a standard based on the latest science, a 
regulation that we can follow from now and forward, 
particularly the idea that we establish the best science 
currently available to us, with the idea that over time, as 
that science increases, that we would move forward with that 
science. I think that is the way we need to go.
    So my short answer is we were in support, sir, of that 
legislation.
    Senator Wicker. And, Mr. Weakley, did your association take 
a position on that particular mark from the Commerce Committee?
    Mr. Weakey. Senator, we were supportive of that bill. We 
were hopeful that there could have been some more clarity 
around the Great Lakes language, although we were comfortable 
with allowing the administrative agencies to define the 
geographically-defined route.
    So we were supportive of that. I anticipate----
    Senator Wicker. What sort of clarity would have been 
helpful?
    Mr. Weakley. Define a geographically-defined route as to 
include the lakes of Michigan, Superior, Huron, Erie, Ontario, 
out to a point on the St. Lawrence River as far off as 
Anticosti Island.
    Senator Wicker. Would there have been a different standard 
for that area?
    Mr. Weakley. Yes, sir. Let me clarify. It would be the same 
standard that the EPA and Coast Guard have currently accepted, 
and that is the vessels that operate only within the defined 
area don't have to install ballast water treatment systems.
    So that is why I say we are comfortable with letting the 
administrative agencies define that geographically defined 
route. We would be more comfortable if Congress were to define 
that in statute.
    Senator Wicker. And Captain Zales?
    Captain Zales. We were supportive, and we were very hopeful 
that we were going to end up with a permanent exemption before 
the end of the Congress.
    And I appreciate the 3 year exemption, but, as you know, 
coming from your state--you have a large shrimping fleet there 
and commercial fleet, recreational charter fleet. They were all 
of the same opinion to try to get this to where, you know, we 
could get off this page and continue looking at what other 
regulations are coming at us and complying with the things that 
are out there already.
    But we were very supportive of the bill and would hope to 
see this thing get expedited so we can have finality soon.
    Senator Wicker. Why do you think we didn't get the bill 
passed?
    Captain Zales. Coming from a small fishing family, unlike 
most of the people in this room, the organization that I 
represent I do on a volunteer basis. Some of my expenses are 
paid every now and then, some are not, but most of it is out of 
my pocket, and all the times out of my pocket away from my 
business. Because, as a small charter business, I do it all. I 
build engines, I build fiberglass, I do everything. So when I 
am not in Panama City, nothing is getting done.
    And so, had that been done, I wouldn't be sitting here now. 
I would be working on my boat, getting ready for spring break.
    Senator Wicker. Well, Washington is a nice place to visit 
in February, but I do understand that you make your living 
elsewhere.
    Captain Zales. I prefer April when the cherry trees are in 
blossom. It is prettier.
    Senator Wicker. Well, we will put that to a vote, and I 
think we will get a nice show of hands there.
    What technology do you have now? And where is it OK?
    Captain Zales. Technology?
    Senator Wicker. I am still on incidental discharge.
    Captain Zales. The technology that is there is just keeping 
our boats clean and keeping our engines clean and keeping 
everything discharged in a normal fashion.
    Senator Wicker. OK. What about, do you have any treatment 
technology on your vessels?
    Captain Zales. On my vessel, I have a holding tank that 
whenever I get to the dock, you know, I pump into a holding 
tank facility. So that is for sewage discharges.
    For bilge water and whatnot, it is just normal operation of 
the vessel. I mean, all boats typically take on a little bit of 
water, and, you know, if it rains, you get a little bit more. 
But most of your decks are watertight, so, you know, it is 
confined to a small amount; it is not a large amount. If I have 
a large volume of water coming out of my boat, I have a 
problem, so, you know, I am fixing that.
    But other than that, rain runoff and stuff, it just washes 
off. Engine exhaust, cooling water, it goes right out the 
exhaust and cools the mufflers like they are supposed to.
    Senator Wicker. Mr. Farley and Mr. Weakley, do you have 
ballast water treatment technology on your vessels?
    Mr. Farley. No, Senator, not at this time, we do not. That 
is----
    Senator Wicker. If we tell you what to do, you will do it.
    Mr. Farley. Yes, sir. And what we would like to have told 
is the IMO standard, which is achievable at this time. There is 
technology that can achieve that standard. We would like to 
start there, sir.
    Senator Wicker. Mr. Weakley?
    Mr. Weakley. Senator, both the U.S. Coast Guard and the 
U.S. EPA have determined that there is no ballast water 
treatment systems that will work on Great Lakes vessels. Our 
flow rates, our engineering challenges are too great.
    If you combine our fleet, 57 vessels, with the Canadian-
flagged, it is 200 vessels out of 70,000 unique vessels in the 
U.S. So----
    Senator Wicker. Do you think ballast water treatment is a 
problem for your vessels?
    Mr. Weakley. No, sir. We never leave the Great Lakes. We 
rarely leave the upper four Great Lakes. We clearly think the 
problem is the oceangoing vessels that are coming from foreign 
destinations bringing invasive species into the heartland of 
the United States.
    Prevention is the key. Once you prevent those--and I would 
say, sir, that since the no-ballast-water-on-board loophole was 
closed in 2006, there is no unmanaged ballast water allowed 
into the Great Lakes, thanks to the United States Coast Guard. 
Not coincidentally, since 2006, there have been no new 
introductions of invasive species from the ballast water 
vector.
    So, clearly, best management practices have a place. 
Clearly, the toxicity of ocean water on freshwater 
environments, on freshwater critters, is having an impact. So 
prevention is working. Is that as good as the IMO D-2 discharge 
standard? Some would say it is not, some would say it is.
    Senator Wicker. Ms. Copeland, do you want to take issue 
with anything or elaborate or help me out in any way?
    Ms. Copeland. No, just one other point I thought might be 
worth mentioning. The Coast Guard rule requires that compliance 
with its ballast water discharge standard be--one of the 
options for compliance is installing treatment technology. And 
the rule specifies that the Coast Guard must test and approve 
and certify that technology.
    I understand that for a number of vessel operators and 
owners, they are waiting for the Coast Guard to actually go 
through that full certification process before they can install 
technologies. And the Coast Guard has found it necessary to 
issue temporary exemptions from its standard until there is 
technology that has been certified and approved.
    Senator Wicker. Thank you so much.
    Thank you, Mr. Chairman.
    Senator Rubio. Thank you, Senator.
    Well, I want to thank all four of you for being here today. 
And I apologize for the chaos of running in and out. Some of 
you are veterans of testifying, so you know how the process is.
    This is an important issue. It is an important issue for 
multiple states, as evidenced by the senators that came here 
today, a couple who briefly attended and then got pulled in to 
other committee meetings but who I know have an interest in 
this subject matter. And it is one we are going to continue to 
talk about. Your testimony today was incredibly valuable.
    The hearing record is going to remain open for 2 weeks, and 
during this time, Senators are going to be asked to submit any 
additional questions for the record that they might have. Upon 
receipt, our request is that each of you agree to submit 
written answers to the Committee as soon as possible. It will 
be very helpful as we move forward on the proposed legislation 
before us today.
    With that, I want to thank you again for appearing.
    And, with that, this hearing is adjourned.
    [Whereupon, at 3:38 p.m., the hearing was adjourned.]

                            A P P E N D I X

                                           Canadian Embassy
                                                  February 18, 2015
Dear Senator Rubio,

    I am pleased to submit this letter to the U.S. Senate Subcommittee 
on Oceans, Atmosphere, Fisheries, and Coast Guard in light of its 
February 4, 2015 hearing on the impacts of vessel discharge 
regulations, notably with respect to ballast water.
    Canada appreciates the long history of co-operation between our two 
countries to reduce the risks associated with the introduction and 
spread of invasive species from ballast water on the Great Lakes. A 
compatible approach to ballast water regulations is important in order 
to allow Canadian, U.S. and international ships to continue to operate 
together in this region, where they directly support almost 100,000 
jobs and over US$33 billion in annual business revenues in our two 
countries.\1\
---------------------------------------------------------------------------
    \1\ Martin Associates (2011) The economic impacts of the Great 
Lakes-St. Lawrence Seaway system.
---------------------------------------------------------------------------
    In recent years, Canada has sought to maintain compatible bi-
national ballast water requirements, despite challenges from an 
increase in the number of differing U.S. Federal and state regulations 
in the region. As Great Lakes shipping is a global industry, Canada's 
view is that a fair and feasible global approach is the best way to 
address the problem of invasive species there. Canada has strongly 
encouraged U.S. regulators to adopt standards compatible with the 
International Convention for the Control and Management of Ships' 
Ballast Water and Sediments. 2004 (the Convention), which Canada has 
ratified. Canada was encouraged when many U.S. regulators did so, and 
when our two countries agreed through the Great Lakes Water Quality 
Agreement, 2012 to take into account, as appropriate, the standards set 
forth in the Convention in addressing ballast water discharges on the 
Great Lakes.
    In general, Canada welcomes the Vessel Incidental Discharge Act, 
which will greatly assist in the maintenance of a compatible regulatory 
regime on the Great Lakes by establishing a single U.S. regulatory 
regime for ballast water.
    Please allow me to express one concern with the proposed act's 
limitations on ballast water rulemaking for enclosed geographical 
areas, such as in our shared Great Lakes waters. Canada has recently 
determined that Great Lakes ships pose a high environmental risk when 
compared with the low risk posed by international voyages to the Great 
Lakes (to which current ballast water management regulations apply).\2\ 
As many damaging species (e.g., the Zebra Mussel) cannot move long 
distances without help, the movement of non-native species by Great 
Lakes ships can spread invasions (whether from ships or other sources) 
to new sites, multiplying economic and financial damages of a more 
isolated invasion. For this reason, Canada would prefer that any 
limitations on ballast water rulemakings be contingent on a favourable 
risk assessment by the appropriate U.S. Federal agency, considering 
both the introduction and spread of invasive species. Canada would be 
pleased to have the opportunity to participate in any such risk 
assessments involving our shared waters.
---------------------------------------------------------------------------
    \2\ Fisheries and Oceans Canada (2014) Science Advice from the 
National Risk Assessment for Ballast Water Introductions of Aquatic 
Nonindigenous Species to Canada. Report 2013/064.
---------------------------------------------------------------------------
    In light of written testimony provided to your sub-committee on 
January 29, 2015 by the U.S. Lake Carriers Association (LCA), I also 
want to take this opportunity to clarify Canada's position on the 
implementation of the Convention.
    I want to reassure you and your sub-committee that Canada is 
committed to facilitating marine transportation on the Great Lakes-St. 
Lawrence Seaway system, while reducing the introduction and spread of 
damaging invasive species and protecting the safety of ships and crews.
    The Convention will not be applicable in Canada until it enters 
into force and is implemented in Canadian regulations. No Canadian 
ballast water regulations currently apply to Great Lakes ships.
    In preparation for the regulatory process, Transport Canada is 
consulting with U.S. and Canadian stakeholders, taking into account 
legal, scientific, technical, cost, benefit and compatibility 
considerations. Transport Canada has recognized that if the Convention 
entered into force now, technical and regional compatibility 
uncertainties would pose challenges for Great Lakes ships. As the 
Convention has not yet entered into force, Canada will continue to 
monitor these challenges, and is exploring options to address them if 
necessary.
    I would like to clarify three specific issues raised by the LCA in 
its written testimony.
    First, Canada is committed to continued cargo movements on the 
Great Lakes by the Canadian, U.S. and international fleets that operate 
there, in the context of practicable and protective ballast water 
requirements.
    Second, the recent assessment by Canada of the environmental risk 
posed by Great Lakes vessels noted above does not accord with the LCA's 
testimony.
    Third, regarding Canada's earlier opposition to New York State 
ballast water requirements, which applied to transiting ships, Canada 
objected to the application of these state-level requirements to 
Canadian ships because they were unilateral and unachievable, being 
1000 times more stringent than the Convention's ballast water standard. 
Since that time, the U.S. Coast Guard and the U.S. Environmental 
Protection Agency have joined Canada in adopting the internationally-
agreed Convention standard, which Canada and the U.S. have further 
agreed to take into account as appropriate under the Great Lakes Water 
Quality Agreement.
    As the Convention remains at a pre-regulatory stage, Transport 
Canada will continue its discussions with the LCA, U.S. Federal 
agencies and other stakeholders toward fair, practicable and protective 
requirements. Canada looks forward to further co-operation between our 
two countries toward these ends.
            Sincerely
                                                 Gary Doer,
                                                        Ambassador.
                                 ______
                                 
    Response to Written Questions Submitted by Hon. Marco Rubio to 
                            James F. Farley
    Question 1. Absent Federal regulation, another potential solution 
to the issue would be state compacts to harmonize existing state 
regulations. Are you aware of any such effort among the fourteen states 
on the east coast? Or, alternatively, an effort amongst the states 
along the Mississippi river?
    Answer. I am not aware of any such efforts, and I would argue that 
state compacts to harmonize existing state regulations would not be 
adequate to fix the broken system under which our company and employees 
are working. Kirby Corporation operates over 1,300 vessels on all three 
U.S. coasts, throughout the Mississippi River system, on the Gulf 
Intracoastal Waterway, and in Alaska and Hawaii. Even if states that 
share a body of water or coastline were able to eliminate overlap and 
inconsistency between and among their vessel discharge standards, 
nothing in existing law would prevent state compacts from conflicting 
with each other and/or with Federal regulations. We need Congressional 
leadership to establish a single set of nationally consistent and clear 
standards for vessel discharges in order to protect our investments in 
our vessels and preserve our flexibility to deploy those vessels where 
ever they are needed across the country. Only Congress can bring long-
term certainty to Kirby and other vessel operators engaged in 
interstate commerce that the multi-million dollar treatment systems we 
install on our vessels will be acceptable anywhere our vessels may 
operate.

    Question 2. Which is better for the environment--harmonized and 
streamlined Federal standard or a patchwork of Federal and state 
standards addressing vessel discharge?
    Answer. Harmonized and streamlined Federal standards are better for 
the environment because without them, environmental protection will be 
delayed as companies lack assurances that their investments in ballast 
water treatment systems for their towing vessels and barges will be 
protected. To come into compliance with Federal requirements, Kirby is 
planning to invest over $90 million in equipping our vessels with 
ballast water treatment systems. However, the arbitrary regulatory 
regime we are operating under has compromised our ability to make that 
investment decision with confidence because if any state in which we 
operate decides the treatment systems we have selected are not 
acceptable for any reason, our investment will be wasted and we will be 
forced to spend more money on alternative systems. As a result of this 
regulatory uncertainty, rational companies have delayed the 
installation of costly treatment systems.
    Our industry's position as the most environmentally friendly mode 
of freight transportation attracts shippers to move their commodities 
by barge, and our customers rigorously vet companies and vessels, 
rightly demanding that they strive to achieve the goal of zero harm to 
the environment. Harmonized and streamlined Federal standards would 
advance us towards this goal by allowing us to confidently make multi-
million-dollar investments in discharge treatment technology, further 
enhancing environmental protection.
    Finally, it is important to note that establishing a uniform 
Federal framework for the regulation of vessel discharges does not mean 
depriving Americans in any state of the highest standards of 
environmental protection. The solution is to take the highest standard 
that is technologically achievable and economically practicable and 
make that standard the law of the land, so that the waters of every 
state are equally well protected.

    Question 3. You mentioned that the Federal Government and the 
states are in fact harmonized in the regulatory standards at this time. 
Is there anything preventing that harmonization from changing on any 
given day by any given state?
    Answer. No, as it currently stands, there is nothing to prevent a 
state from changing its standard for ballast water or any other vessel 
discharge and thereby create an inconsistency. Neither of the Federal 
statutes under which the Coast Guard and EPA have promulgated their 
regulations preempt state lawmaking or rulemaking in this area. 
Further, while the Federal Government and the states currently agree on 
a harmonized standard for ballast water discharges, this only occurred 
after several states reduced their standards after they finally 
accepted the broad scientific consensus that no currently existing 
ballast water treatment technology can achieve the more stringent 
ballast water standards they had promulgated.
    It is important to note that ballast water is not the only vessel 
discharge for which there are regulatory conflicts among Federal and 
state authorities. Through its certification of the 2013 VGP, 
Connecticut became the first state to prohibit graywater discharges, 
and at least two states, California and Washington, have explored the 
establishment of costly and operationally infeasible hull inspection 
and cleaning programs. Inconsistencies in these areas have as much 
potential to impact the efficiency of our operations as contradictory 
ballast water discharge standards do, and further highlight the need 
for a uniform national approach to the regulation of all vessel 
discharges.

    Question 4. Is this issue important to only coastal states?
    Answer. As a representative of Kirby, which operates both coastal 
and inland vessels, I can assure you that this issue is equally 
important to vessel owners that operate on the major inland waterways--
such as the Mississippi, the Ohio, and the Columbia-Snake River 
systems--and on the Great Lakes, whose vessels cross multiple 
jurisdictional lines in the course of a single voyage and are burdened 
by the same Federal and state regulatory patchwork as those engaged in 
the coastwise trade.
    This issue is also important to the vitality of the entire U.S. 
economy. Vessels operating on the coasts, the inland waterways and the 
Great Lakes are part of an economic lifeline for the shipment of 
critical commodities like export grain, coal, steel, and petroleum 
products, and represent an investment made by our customers in the most 
affordable, fuel-efficient and environmentally friendly mode of 
transportation. If the current state of affairs persists, and 
regulatory burdens increase, barge transportation will become more 
expensive, and those costs may ultimately be passed on to consumers, or 
cargo may be shifted to other more expensive and less efficient modes. 
Establishing a single Federal framework for the regulation of vessels 
in interstate and international commerce is essential to ensure the 
efficient movement of vital commodities on which the U.S. economy 
depends.
    In addition, this issue has real impacts for all American 
taxpayers. The average American taxpayer cannot afford to fund 
duplicative, superfluous regulatory programs, especially at a time when 
many are struggling economically and Federal and state budgets are 
facing overwhelming amounts of debt. Funding the efforts of two Federal 
agencies and 25 states to regulate the same vessel discharges in 
redundant and sometimes conflicting ways is both wasteful and 
inefficient.

                                  [all]