[House Hearing, 119 Congress]
[From the U.S. Government Publishing Office]
AMERICA BUILDS: MARITIME INFRASTRUCTURE
=======================================================================
(119-4)
HEARING
BEFORE THE
SUBCOMMITTEE ON
COAST GUARD AND MARITIME TRANSPORTATION
OF THE
COMMITTEE ON
TRANSPORTATION AND INFRASTRUCTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED NINETEENTH CONGRESS
FIRST SESSION
__________
FEBRUARY 5, 2025
__________
Printed for the use of the
Committee on Transportation and Infrastructure
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available online at: https://www.govinfo.gov/committee/house-
transportation?path=/browsecommittee/chamber/house/committee/
transportation
__________
U.S. GOVERNMENT PUBLISHING OFFICE
59-733 PDF WASHINGTON : 2025
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COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE
Sam Graves, Missouri, Chairman
Rick Larsen, Washington, Ranking Member
Eleanor Holmes Norton, Eric A. ``Rick'' Crawford,
District of Columbia Arkansas,
Jerrold Nadler, New York Vice Chairman
Steve Cohen, Tennessee Daniel Webster, Florida
John Garamendi, California Thomas Massie, Kentucky
Henry C. ``Hank'' Johnson, Jr., Georgiaott Perry, Pennsylvania
Andre Carson, Indiana Brian Babin, Texas
Dina Titus, Nevada David Rouzer, North Carolina
Jared Huffman, California Mike Bost, Illinois
Julia Brownley, California Doug LaMalfa, California
Frederica S. Wilson, Florida Bruce Westerman, Arkansas
Mark DeSaulnier, California Brian J. Mast, Florida
Salud O. Carbajal, California Pete Stauber, Minnesota
Greg Stanton, Arizona Tim Burchett, Tennessee
Sharice Davids, Kansas Dusty Johnson, South Dakota
Jesus G. ``Chuy'' Garcia, Illinois Jefferson Van Drew, New Jersey
Chris Pappas, New Hampshire Troy E. Nehls, Texas
Seth Moulton, Massachusetts Tracey Mann, Kansas
Marilyn Strickland, Washington Burgess Owens, Utah
Patrick Ryan, New York Eric Burlison, Missouri
Val T. Hoyle, Oregon Mike Collins, Georgia
Emilia Strong Sykes, Ohio, Mike Ezell, Mississippi
Vice Ranking Member Kevin Kiley, California
Hillary J. Scholten, Michigan Vince Fong, California
Valerie P. Foushee, North Carolina Tony Wied, Wisconsin
Christopher R. Deluzio, Pennsylvania Tom Barrett, Michigan
Robert Garcia, California Nicholas J. Begich III, Alaska
Nellie Pou, New Jersey Robert P. Bresnahan, Jr.,
Kristen McDonald Rivet, Michigan Pennsylvania
Laura Friedman, California Jeff Hurd, Colorado
Laura Gillen, New York Jefferson Shreve, Indiana
Shomari Figures, Alabama Addison P. McDowell, North
Carolina
David J. Taylor, Ohio
Brad Knott, North Carolina
Kimberlyn King-Hinds,
Northern Mariana Islands
Mike Kennedy, Utah
Robert F. Onder, Jr., Missouri
Vacancy
------ 7
Subcommittee on Coast Guard and Maritime Transportation
Mike Ezell, Mississippi, Chairman
Salud O. Carbajal, California, Ranking Member
Daniel Webster, Florida Chris Pappas, New Hampshire
Brian J. Mast, Florida Marilyn Strickland, Washington
Jefferson Van Drew, New Jersey Hillary J. Scholten, Michigan
Nicholas J. Begich III, Alaska Robert Garcia, California,
Addison P. McDowell, North Carolina Vice Ranking Member
Vacancy John Garamendi, California
Sam Graves, Missouri (Ex Officio) Rick Larsen, Washington (Ex
Officio)
CONTENTS
Page
Summary of Subject Matter........................................ v
STATEMENTS OF MEMBERS OF THE COMMITTEE
Hon. Mike Ezell, a Representative in Congress from the State of
Mississippi, and Chairman, Subcommittee on Coast Guard and
Maritime Transportation, opening statement..................... 1
Prepared statement........................................... 2
Hon. Salud O. Carbajal, a Representative in Congress from the
State of California, and Ranking Member, Subcommittee on Coast
Guard and Maritime Transportation, opening statement........... 3
Prepared statement........................................... 5
Hon. Rick Larsen, a Representative in Congress from the State of
Washington, and Ranking Member, Committee on Transportation and
Infrastructure, opening statement.............................. 6
Prepared statement........................................... 8
WITNESSES
A. Paul Anderson, President and Chief Executive Officer, Port
Tampa Bay, oral statement...................................... 9
Prepared statement........................................... 11
Joe Rella, President, St. Johns Ship Building, Inc., on behalf of
the Shipbuilders Council of America, oral statement............ 13
Prepared statement........................................... 14
Tom Reynolds, Chief Strategy Officer, Seasats, on behalf of the
Association for Uncrewed Vehicle Systems International, oral
statement...................................................... 18
Prepared statement........................................... 19
Brian W. Schoeneman, Political and Legislative Director,
Seafarers International Union of North America, on behalf of
USA Maritime, oral statement................................... 23
Prepared statement........................................... 25
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
January 31, 2025
SUMMARY OF SUBJECT MATTER
TO: LMembers, Subcommittee on Coast Guard and Maritime
Transportation
FROM: LStaff, Subcommittee on Coast Guard and Maritime
Transportation
RE: LSubcommittee Hearing on ``America Builds:
Maritime Infrastructure''
_______________________________________________________________________
I. PURPOSE
The Subcommittee on Coast Guard and Maritime Transportation
of the Committee on Transportation and Infrastructure will meet
on Wednesday, February 5, 2025, at 10:00 a.m. ET in 2167
Rayburn House Office Building to receive testimony at a hearing
entitled, ``America Builds: Maritime Infrastructure.'' The
Subcommittee will receive testimony from industry stakeholders,
including from Port Tampa Bay, the Shipbuilders Council of
America, the Association for Uncrewed Vehicle Systems
International, and USA Maritime, on the state of the Nation's
maritime infrastructure.
II. BACKGROUND
America's Marine Transportation System (MTS) consists of
navigable waterways, ports, and land-side connections that
facilitate the movement of people and cargo throughout the
Nation.\1\ This includes approximately 25,000 miles of
navigable waterways and over 300 commercial maritime ports
containing over 3,500 marine terminals.\2\
---------------------------------------------------------------------------
\1\ U.S. Dep't of Transp., Maritime Admin., Maritime Transportation
System (MTS), (Aug. 17, 2023), available at https://
www.maritime.dot.gov/outreach/maritime-transportation-system-mts/
maritime-transportation-system-mts.
\2\ Id.
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Ports and the maritime industry are major economic drivers
in the United States, supporting nearly $2.9 trillion in Gross
Domestic Product (GDP) in 2024.\3\ These ports host vital
intermodal connections that move goods inland along the
national supply chain to consumers and allow for the
exportation of domestically produced goods to foreign
markets.\4\ Each port complex includes marine terminals--cargo
handling facilities that both load and unload cargo from
vessels. These marine terminals can either be operated by the
port authority, which is the governmental or semi-governmental
entity that manages the port complex, or by a private company
that leases the marine terminal from the port authority.\5\
---------------------------------------------------------------------------
\3\ American Ass'n of Port Authorities, U.S. Port & Maritime
Industry: 2024 Economic Contribution Report, available at https://
aapa.cms-plus.com/files/2024%20Economic
%20Contribution%20Report%20AAPA.pdf.
\4\ U.S. Dep't of Transp., Climate Strategies that Work: Multimodal
and Intermodal Freight Planning, available at https://
www.transportation.gov/sites/dot.gov/files/2025-01/
Multimodal%20and%20Intermodal%20Freight%20Planning.pdf.
\5\ John Frittelli & Jennifer E. Lake, Cong. Rsch. Serv. (RL33383),
Terminal Operators and Their Role in U.S. Port and Maritime Security,
(Apr. 10, 2007), available at https://crsreports.congress.gov/product/
pdf/RL/RL33383/5.
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The MTS also includes tens of thousands of miles of
navigable waterways on which over 40,000 vessels operate in
domestic waterborne commerce.\6\ To support safe vessel
operations, a robust network of aids to navigation exists,
including beacons, buoys, and other objects installed along the
waterways to provide signals and guide mariners.\7\
---------------------------------------------------------------------------
\6\ American Maritime Partnership, Jones Act--Cornerstone of U.S.
Maritime Safety & Security, available at https://
www.americanmaritimepartnership.com/u-s-maritime-industry/jones-act-
overview/.
\7\ Boat U.S. Foundation, Aids to Navigation, available at https://
www.boatus.org/study-guide/navigation/aids.
---------------------------------------------------------------------------
Responsibility for the development and maintenance of the
MTS is shared across several Federal agencies, including the
United States Coast Guard (Coast Guard or Service) and the
Maritime Administration (MARAD), both of which the Subcommittee
on Coast Guard and Maritime Transportation exercises
jurisdiction over. The Coast Guard is responsible for
maintaining aids to navigation and ensuring the safety of
marine operations.\8\ MARAD is responsible for fostering,
promoting, and developing the maritime industry of the United
States to meet the Nation's economic and security needs.\9\
---------------------------------------------------------------------------
\8\ U.S. Coast Guard, Missions, available at https://www.uscg.mil/
About/Missions/.
\9\ U.S. Dep't of Transp., Maritime Admin., About Us, available at
https://www.maritime.dot.gov/about-us.
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III. INVESTMENT IN MARITIME INFRASTRUCTURE
In order to support the development and construction of
maritime infrastructure, MARAD administers several financial
assistance programs that provide grants for projects to
strengthen maritime and related intermodal infrastructure.
MARAD's Port Infrastructure Development Program provides grants
to improve the safety, efficiency, or reliability of the
movement of goods into, out of, around, or within a port.\10\
The United States Marine Highway Program (USMHP) similarly
provides grants to promote marine highway transportation and
reduce landside congestion.\11\ Grants provided through USMHP
fund projects to help freight move by the United States Marine
Highway System as an alternative to landside shipping and
transportation options.\12\ Maritime infrastructure improvement
projects are also eligible for funding through other Federal
programs administered by the United States Department of
Transportation (DOT), including the Rebuilding American
Infrastructure with Sustainability and Equity grant program and
Transportation Infrastructure Finance and Innovation Act loans
provided by DOT's Build America Bureau.\13\
---------------------------------------------------------------------------
\10\ U.S. Dep't of Transp., Maritime Admin., Port Infrastructure
Development Program, available at https://www.maritime.dot.gov/
PIDPgrants.
\11\ U.S. Dep't of Transp., Maritime Admin., United States Marine
Highway Program, available at https://www.maritime.dot.gov/grants/
marine-highways/marine-highway.
\12\ Id.
\13\ U.S. Dep't of Transp., Grants, available at https://
www.transportation.gov/grants.
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IV. UNITED STATES SHIPBUILDING INDUSTRIAL BASE
Section 55101 of title 46, United States Code, popularly
referred to as the Jones Act, underpins the United States
commercial shipbuilding industry and requires any vessel
participating in coastwise trade to be United States-owned,
United States-crewed, and United States-built.\14\ Jones Act-
driven business supports domestic shipbuilding capacity and
prevents the Nation from losing an important strategic
capability.\15\
---------------------------------------------------------------------------
\14\ The American Waterways Operators, Issues and Advocacy: Jones
Act, available at https://www.americanwaterways.com/issues/jones-act;
see also 46 U.S.C. Sec. 55101.
\15\ American Maritime Partnership, Jones Act is Foundation of
Domestic Maritime Industry, available at https://
www.americanmaritimepartnership.com/wp-content/uploads/2019/02/Jones-
Act-is-Foundation-of-Domestic-Maritime_American-Maritime-
Partnership.pdf.
---------------------------------------------------------------------------
Due to the growth of the shipbuilding industries of global
competitors, the domestic capacity to build commercial vessels
has decreased severely over the past several decades. In the
1990s, there were seven large shipyards in the United States
building commercial vessels.\16\ Since then, three of these
yards have closed and of the remaining four, only one builds
commercial vessels while the others solely perform repair and
maintenance work.\17\
---------------------------------------------------------------------------
\16\ The State of the U.S. Flag Maritime Industry: Hearing Before
the Subcomm. on Coast Guard and Maritime Transp. of the H. Comm. on
Transp. and Infrastructure, 115th Cong. (Jan. 17, 2018) (Statement of
Adm. Mark H. Buzby, Administrator, Maritime Admin.).
\17\ Id.
---------------------------------------------------------------------------
To support the domestic shipbuilding industry, MARAD also
administers several financial assistance programs to increase
shipyard competitiveness and encourage the construction of
commercial vessels in United States shipyards. The Small
Shipyard Grant Program provides grants to shipyards with fewer
than 1,200 production employees to make capital and related
improvements, or to provide industry training to workers.\18\
The Federal Ship Financing Program (also known as the Title XI
Program) provides long-term loans to shipowners for the
domestic construction and reconditioning of vessels, as well as
to shipyards for modernization efforts.\19\ In addition, MARAD
administers the Capital Construction Fund and Construction
Reserve Fund Programs that offer tax deferral benefits provided
the proceeds are used to expand or modernize the United States
Merchant Marine.\20\
---------------------------------------------------------------------------
\18\ U.S. Dep't of Transp., Maritime Admin., Small Shipyard Grants,
available at https://www.maritime.dot.gov/grants-finances/small-
shipyard-grants.
\19\ U.S. Dep't of Transp., Maritime Admin., Federal Ship Financing
Program (Title XI), available at https://www.maritime.dot.gov/grants/
title-xi/federal-ship-financing-program-title-xi.
\20\ U.S. Dep't of Transp., Maritime Admin., Grants and Finances,
available at https://www.maritime.dot.gov/grants-finances.
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V. AUTONOMOUS MARITIME TECHNOLOGIES
The continuing development of autonomous and other
experimental maritime technologies necessitates improvements
and innovations within the MTS to ensure their safe integration
among traditional users of the current system. These
technologies have the potential to provide benefits and reduce
operational risk but will require a stable regulatory framework
to ensure their safe and secure operation. At the global level,
the International Maritime Organization (IMO) has been
conducting regulatory scoping exercises to develop a roadmap
from which autonomous technologies can be incorporated into
regulatory frameworks.\21\ The Coast Guard, which is the
official representative of the United States to the IMO, is
working to keep pace with inspecting and crafting regulations
to monitor these growing activities.\22\
---------------------------------------------------------------------------
\21\ Int'l Maritime Organization, Autonomous Shipping, available at
https://www.imo.org/en/MediaCentre/HotTopics/Pages/Autonomous-
shipping.aspx.
\22\ Nat'l Academies of Sciences, Engineering and Medicine, Coast
Guard's Next Decade: An Assessment of Emerging Challenges and Statutory
Needs, (2023), at 1, available at https://nap.nationalacademies.org/
catalog/27059/the-coast-guards-next-decade-an-assessment-of-emerging-
challenges-and-statutory-needs.
---------------------------------------------------------------------------
The introduction of autonomous and experimental systems
raises a variety of regulatory issues that must be addressed,
including crewing, testing, safety, security (both physical and
cyber), mariner credentialing, and pilotage.\23\ The Coast
Guard will need to develop comprehensive guidance or other
regulatory standards for surface, subsurface, and aerial
spaces, to ensure the safe and efficient testing of these
technologies, as well as their eventual full integration into
the MTS.\24\
---------------------------------------------------------------------------
\23\ Id.
\24\ Id.
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VI. WITNESSES
LMr. Paul Anderson, President and Chief Executive
Officer, Port Tampa Bay
LMr. Joe Rella, President, St. Johns Ship
Building, Inc., on behalf of the Shipbuilders Council of
America
LMr. Tom Reynolds, Chief Strategy Officer,
Seasats, on behalf of Association for Uncrewed Vehicle Systems
International
LMr. Brian Schoeneman, Political and Legislative
Director, Seafarers International Union of North America, on
behalf of USA Maritime
AMERICA BUILDS: MARITIME INFRASTRUCTURE
----------
WEDNESDAY, FEBRUARY 5, 2025
House of Representatives,
Subcommittee on Coast Guard and Maritime
Transportation,
Committee on Transportation and Infrastructure,
Washington, DC.
The subcommittee met, pursuant to call, at 10 a.m., in Room
2167, Rayburn House Office Building, Hon. Mike Ezell (Chairman
of the subcommittee) presiding.
Mr. Ezell. The Subcommittee on Coast Guard and Maritime
Transportation will come to order.
I ask unanimous consent that the chairman be authorized to
declare a recess at any time during today's hearing.
Without objection, so ordered.
I also ask unanimous consent that Members not on the
subcommittee be permitted to sit with the subcommittee at
today's hearing and ask questions.
Without objection, so ordered.
As a reminder, if Members insert a document into the
record, please do so and email it to
[email protected].
I now recognize myself for the purpose of an opening
statement for 5 minutes.
OPENING STATEMENT OF HON. MIKE EZELL OF MISSISSIPPI, CHAIRMAN,
SUBCOMMITTEE ON COAST GUARD AND MARITIME TRANSPORTATION
Mr. Ezell. Before I get to my remarks on the topic of the
hearing today, I first want to send my condolences to all who
were impacted by the tragic DCA Airport crash last week.
Suzette and I send our thoughts and prayers and thank all first
responders, including the Coast Guard, that were there in the
immediate aftermath.
Today, the subcommittee meets for its first hearing of the
119th Congress and continues the Transportation and
Infrastructure Committee's ``America Builds'' series to discuss
the Nation's maritime infrastructure. It is clearly critical
that we must build a safer and more efficient system.
I am also happy to say this is my first hearing as
subcommittee chairman. I am excited to lead the subcommittee
this Congress in addressing the many important issues facing
the maritime industry. I look forward to working under the
leadership of Chairman Graves in this position.
Continuing on today's topic, America's Marine
Transportation System consists of navigable waterways,
commercial ports, and landside connections which help to move
millions of passengers and billions of dollars' worth of cargo
every year.
Nearly all the country's inbound or outbound cargo is
transported by ships, requiring a robust system of maritime
infrastructure to ensure the movement of goods. Ports play a
prominent role within this system, providing access to
connections for cargo to move inland to final destinations and
outbound for export overseas.
Marine terminals within each port load and unload cargo.
That cargo is then transported both domestically to other
points in the United States, which is also known as coastwide
trade, or it is moved internationally to foreign markets.
In order to participate in coastwide trade between two
domestic points, a ship must be Jones Act-qualified, meaning
the ship is U.S.-built, U.S.-crewed, and U.S.-owned. The Jones
Act is a fundamental statute for the domestic maritime
industry. The Jones Act is quite literally the bedrock and
foundation of our Nation's shipbuilding industrial base,
because it helps to maintain a pool of qualified American
mariners that we rely on to transport goods and our military in
times of peace and war.
Unfortunately, the rise of shipbuilding industries of
global competitors has led to the decline in our own
shipbuilding capacity. Coastal Mississippi and the gulf coast
as a whole is home to several shipyards employing thousands of
Americans. I look forward to discussing ways to reinvigorate
this critical industry.
In order to promote the domestic maritime industry, the
Maritime Administration in the United States Department of
Transportation administers several programs that fund projects
to construct and expand maritime infrastructure and U.S.
shipbuilding. I hope to look at the current operation of each
of these programs to find ways we can improve them and look
forward to recommendations from our stakeholders here today.
Additionally, autonomous maritime technologies are creating
new challenges, requiring us to reassess current maritime
infrastructure to ensure their safe operation. The United
States Coast Guard is in charge of developing a framework from
which these new technologies can safely operate. However, the
development of these technologies outpaces the regulatory
rulemaking process.
We understand the Coast Guard will need to focus on
developing regulatory standards that provide for the adequate
testing and safe integration of these technologies into the
Marine Transportation System and appreciate any insights you
can provide.
Thank you for all being here today, and I look forward to
discussing the buildout of America's maritime infrastructure.
[Mr. Ezell's prepared statement follows:]
Prepared Statement of Hon. Mike Ezell of Mississippi, Chairman,
Subcommittee on Coast Guard and Maritime Transportation
Before I get into my remarks on the topic of this hearing today, I
first want to send my condolences to all who were impacted by the
tragic accident last week near the DCA Airport. Suzette and I send our
thoughts and prayers and thank all the first responders, including the
Coast Guard, that were there in the immediate aftermath.
Today the Subcommittee meets for its first hearing of the 119th
Congress and continues the Transportation and Infrastructure
Committee's ``America Builds'' series to discuss the nation's maritime
infrastructure. It is clearly critical that we must build a safer and
more efficient system.
I'm also happy to say this is my first hearing as Subcommittee
Chairman. I'm excited to lead the Subcommittee this Congress in
addressing the many important issues facing the maritime industry. I
look forward to working under the leadership of Chairman Graves in this
position.
Continuing on today's topic, America's Marine Transportation System
consists of the navigable waterways, commercial ports, and land-side
connections which help to move millions of passengers and billions of
dollars' worth of cargo every year.
Nearly all of the country's inbound or outbound cargo is
transported by ships requiring a robust system of maritime
infrastructure to ensure the movement of goods. Ports play a prominent
role within this system, providing access to connections for cargo to
move inland to final destinations, and outbound for export overseas.
Marine terminals--within each port--load and unload cargo. That
cargo is then transported both domestically to other points in the
U.S.--also known as coastwise trade--or it is moved internationally to
foreign markets.
In order to participate in coastwise trade between two domestic
points, a ship must be Jones Act-qualified, meaning the ship is U.S.-
built, U.S.-crewed, and U.S.-owned.
The Jones Act is a fundamental statute for the domestic maritime
industry. The Jones Act is quite literally the bedrock and foundation
of our nation's shipbuilding industrial base because it helps to
maintain a pool of qualified American mariners that we rely on to
transport goods and our military, in times of peace and war.
Unfortunately, the rise of the shipbuilding industries of global
competitors has led to a decline in our own shipbuilding capacity.
Coastal Mississippi and the Gulf Coast as a whole, is home to several
shipyards employing thousands of Americans. I look forward to
discussing ways to reinvigorate this critical industry.
In order to promote the domestic maritime industry, the Maritime
Administration in the U.S. Department of Transportation administers
several programs that fund projects to construct and expand maritime
infrastructure and U.S. shipbuilding.
I hope to look at the current operation of each of these programs
to find ways we can improve them and look forward to recommendations
from our stakeholders here today.
Additionally, autonomous maritime technologies are creating new
challenges requiring us to reassess current maritime infrastructure to
ensure their safe operation. The U.S. Coast Guard is in charge of
developing a framework from which these new technologies can safely
operate. However, development for these technologies outpaces the
regulatory rulemaking process.
We understand the Coast Guard will need to focus on developing
regulatory standards that provide for the adequate testing and safe
integration of these technologies into the Marine Transportation
System, and appreciate any insights you can provide.
Thank you all for being here today and I look forward to discussing
the build-out of America's maritime infrastructure.
Mr. Ezell. I now recognize Ranking Member Carbajal for an
opening statement for 5 minutes.
OPENING STATEMENT OF HON. SALUD O. CARBAJAL OF CALIFORNIA,
RANKING MEMBER, SUBCOMMITTEE ON COAST GUARD AND MARITIME
TRANSPORTATION
Mr. Carbajal. Good afternoon. And thank you, Chairman
Ezell, for calling today's hearing, and congratulations on your
new post as chair----
Mr. Ezell [interposing]. Thank you.
Mr. Carbajal [continuing]. Of the and Coast Guard and
Maritime Transportation Subcommittee. I look forward to working
together with you to get things done. I hear that we already
share the same value on the Jones Act, so I appreciate your
position on that.
Before I turn to the matter at hand, I have to express some
concern and discuss what I consider was an outrageous executive
action directed at the Coast Guard, specifically the
unprecedented, misguided, and clearly political firing of Coast
Guard Commandant, Admiral Linda Fagan.
As the first female Service chief of any branch of the
military, Admiral Fagan served with honor and distinction and
exhibited a true commitment to making things better for the
Service as a whole. It is deeply unfair for this administration
to invent a false narrative for her termination and use that as
a basis to engage in political theater and retribution.
While we have made great strides in recent years in
bolstering our ports, waterways, and maritime industry, we
cannot take our foot off the pedal.
The Bipartisan Infrastructure Law alone invested more than
$17 billion in our ports and waterways. This funding has been
used to fund repairs, upgrades, and replacements to reduce port
and vessel congestion and to strengthen our supply chains.
In addition, cutting emissions near ports by boosting
electrification and investing in other low-carbon technologies
to reduce overall environmental impacts is critically important
as we continue to battle climate change. Since BIL expires in 2
years, I look forward to working together to draft BIL 2.0.
U.S. ports accounted for almost $3 trillion in Gross
Domestic Product in 2024. The sheer volume of cargo moving in
and out of ports would not be possible without robust
infrastructure and a strong workforce to support it.
Another area that is prime for robust U.S. investment is
offshore wind. Adding clean energy production into the maritime
domain is a win-win for the U.S. maritime industry, creating
jobs for mariners, business at ports, and shipbuilding
opportunities for companies and shipyards, many of which have
already made a significant investment.
I believe we are at a crossroads in the maritime domain,
facing a critical deficit in the number of U.S. shipyards, U.S.
mariners, and U.S. vessels.
As every mariner who does business in the United States
knows, the Jones Act is the foundation of the United States
maritime industry. At its core, it is designed to protect the
U.S. commercial shipbuilding industry and requires any vessel
participating in coastwide trade to be United States-owned,
United States-crewed, and United States-built.
We have an opportunity now more than ever to leverage these
built-in barriers and revitalize the maritime industry.
If the United States intends on keeping pace with capacity
and technology to maintain the steady state flow of goods, we
must continue to prioritize programs such as the Port
Infrastructure Development Program, the Small Shipyard Grant
Program, and the Federal Ship Financing Program, Cargo
Preference, and Title XI.
Building out our shipyards is a top priority for our
Nation's maritime governance and also our national security.
Our commercial mariners and our military depend on reliable
shipyards to build and repair our U.S. fleet. We know that
having only four shipyards left in America is not sustainable.
But building ships is not enough. To remain competitive
internationally, we must ensure that U.S.-flag ships have cargo
to carry.
Even more so, I am concerned that the administration's
manufactured turmoil at the Coast Guard will lead to serious
risks in the maritime transportation system--risks that we
cannot afford to make.
I am hopeful that this hearing can shed light on the
positive impacts that the loan and grant programs have had on
this industry. Also, I want you to be critical and honest: What
is it going to take to return the U.S. to a global competitor
in shipping and shipbuilding?
Thank you, and I yield back.
[Mr. Carbajal's prepared statement follows:]
Prepared Statement of Hon. Salud O. Carbajal of California, Ranking
Member, Subcommittee on Coast Guard and Maritime Transportation
Good afternoon, and thank you, Chairman Ezell, for calling today's
hearing and congratulations on your new post as Chair of the Coast
Guard and Maritime Transportation Subcommittee. I look forward to
working together with you to get some important things done this
Congress.
Before I turn to the matter at hand today, I have to discuss the
outrageous executive actions directed at the Coast Guard, specifically
the unprecedented, misguided, and clearly political firing of the Coast
Guard Commandant, Admiral Linda Fagan.
As the first female service chief of any branch of the military,
she served with honor and distinction and exhibited a true commitment
to making things better for the service as a whole. It is deeply unfair
for this Administration to invent a false narrative for her termination
and use that as a basis to engage in political theater and retribution.
While we have made great strides in recent years in bolstering our
ports, waterways, and maritime industry, we cannot take our foot off
the pedal.
The Bipartisan Infrastructure Law alone invested more than $17
billion in our ports and waterways. This funding has been used to fund
repairs, upgrades, and replacements to reduce port and vessel
congestion and to strengthen our supply chains.
In addition, cutting emissions near ports by boosting
electrification and investing in other low-carbon technologies to
reduce overall environmental impacts is critically important as we
continue to battle climate change. Since BIL funding expires in 2
years, I look forward to working together to draft the BIL 2.0.
U.S. ports accounted for almost $3 trillion dollars in Gross
Domestic Product (GDP) in 2024. The sheer volume of cargo moving in and
out of the ports would not be possible without robust infrastructure
and a strong workforce to support it.
Another area that is prime for robust U.S. investment is offshore
wind. Adding clean energy production into the maritime domain is a win-
win for the U.S. maritime industry, creating jobs for mariners,
business at ports, and shipbuilding opportunities for companies and
shipyards--many of which have already made significant investments.
I believe we are at a crossroads in the maritime domain, facing a
critical deficit in the number of U.S. shipyards, U.S. mariners, and
U.S. vessels.
As every mariner who does business in the United States knows, the
Jones Act is the foundation of the United States maritime industry. At
its core, it is designed to protect the U.S. commercial shipbuilding
industry and requires any vessel participating in coastwise trade to be
United States-owned, United States-crewed and United States-built.
We have an opportunity now more than ever to leverage its built-in
barriers and revitalize the maritime industry.
If the United States intends on keeping pace with capacity and
technology to maintain the steady state flow of goods, we must continue
to prioritize programs such as the Port Infrastructure Development
Program, the Small Shipyard Grant Program, and the Federal Ship
Financing Program, Cargo Preference, and Title 11.
Building out our shipyards is a top priority for our nation's
maritime governance and also our national security. Our commercial
mariners and our military depend on reliable shipyards to build and
repair our US fleet. We know that having only four shipyards left in
America is not sustainable.
But building ships is not enough. To remain competitive
internationally, we must ensure that U.S. flag ships have cargo to
carry.
Even more so, I am concerned that the Administration's manufactured
turmoil at the Coast Guard will lead to serious risks in the maritime
transportation system--risks that we cannot afford to make.
I am hopeful that this hearing can shed light on the positive
impacts that the loan and grant programs have had on this industry.
Also, I want you to be critical and honest--what is it going to take to
return the U.S. to a global competitor in shipping and shipbuilding.
Thank you, and I yield back.
Mr. Ezell. I will now recognize Mr. Larsen, the ranking
member of the full committee, Mr. Larsen, for 5 minutes for an
opening statement.
OPENING STATEMENT OF HON. RICK LARSEN OF WASHINGTON, RANKING
MEMBER, COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE
Mr. Larsen of Washington. Thank you. Thank you, Chair, for
calling this hearing, and congrats on your new role.
Mr. Ezell. Thank you.
Mr. Larsen of Washington. Your history of bipartisanship
and support for the maritime industry and Coast Guard will
greatly benefit this subcommittee.
Before we dive into the topic of the hearing, I want to
address news of a few weeks ago, which was the sudden
termination of Commandant of the Coast Guard, Admiral Linda
Fagan. I think what the President did was unjustified. It was
reckless. Never before in the history of the Service has a
Commandant been relieved, let alone for political purposes. I
want to thank Admiral Fagan for all that she has done for this
country.
Acting Commandant Lunday and the next Commandant must
continue to move the Coast Guard forward, building upon the
foundation Admiral Fagan built. The Coast Guard needs to
continue to make significant improvement regarding sexual
assault and sexual harassment. It needs to continue improvement
on recruiting and retention and ensuring that the Service is
more inclusive for everyone. That work has to continue.
It is my hope for today's hearing, though, that we focus on
the important work of building America's maritime
infrastructure, but I am concerned that that work is being
undermined.
The President's Executive order to pause infrastructure
funding from the Bipartisan Infrastructure Law and Inflation
Reduction Act is putting billions of dollars, hundreds of
thousands of jobs, and tens of thousands of projects at risk.
While last week's broader memorandum from the Office of
Management and Budget to freeze all Federal assistance programs
was rescinded, BIL funding, including the Port Infrastructure
Development Program grants, remain in limbo. Continued threats
and actions to claw back infrastructure funding are sowing
chaos and will have devastating impacts on the maritime
industry, national security, and economic security.
Across the country, there are over 300 ports. Of these, 20
handle the vast majority of container cargo. And only 2 U.S.
ports are in the top 20 ports globally, while China has 7 of
the top 10. This is not due to a lack of maritime activity in
the U.S. It is because China heavily subsidizes port and
maritime operations while the U.S. does not.
During the supply chain crisis in 2021, the Biden
administration mobilized funding to increase capacity and
productivity. These efforts by the Biden administration,
coupled with the hard work of longshore workers and many others
in maritime, pulled us out of the supply chain crisis.
Since then, over $2.18 billion in Port Infrastructure
Development Program funding has gone to ports across the
country to bolster safety and reliability. Ports like Houston,
Texas, received $25 million. Bay St. Louis, Mississippi,
received $4 million. The State of Alaska has received over $50
million for uses across the entire State just in fiscal year
2024 alone. These States are benefiting from the Bipartisan
Infrastructure Law. Let's keep it going.
And I want to mention the Clean Ports Program that the
Environmental Protection Agency administers has assisted in the
deployment of shore power to ports across the country,
including a $63 million grant to the Port of Anacortes in my
own district, which includes not just bringing shore power but
a total redevelopment of a wholly underutilized area of the
Port of Anacortes to create jobs and bring private sector jobs
there, including having a signed grant agreement that now the
EPA has inexplicably paused and is delaying the creation of
these private sector jobs.
This is inexplicable, and I asked the EPA to provide an
explanation of what it is doing to get this grant going again
as well as the ones that are going to the Port of Bellingham,
also in my district, and any other port that is expecting these
grants from a signed grant agreement.
Investing in shore power not only improves air quality and
reduces pollution, it is consistent with standard operations at
ports around the globe. Shipping companies want to cut
pollution. Ports want to be competitive.
Rescinding funding for ports that were passed as part of
the Bipartisan Infrastructure Law and the Inflation Reduction
Act puts our ports at a disadvantage. It is shortsighted, and
we will not go quietly letting this happen.
America's shipyards are an essential piece of maritime
infrastructure that are falling behind international
competition due to unfair and subsidized competition.
Larger shipyards have no dedicated grant program and rely
heavily on Government and commercial contracts to stay afloat.
Buy America requirements and the Jones Act help ensure
shipyards maintain steady business by requiring shipbuilding
and manufacturing to take place in the U.S.
I was heartened to hear Secretary Duffy's support for the
Jones Act during his confirmation hearing. The Jones Act has
strong support among members of this committee. It is critical
to the maritime industry.
Thanks to the historic levels of Federal investment, this
Nation's transportation system and its infrastructure are
better today than they were 4 years ago. Continuing this
progress requires ongoing investment, especially in the
maritime industry. Let's keep it going.
Thank you. I yield back.
[Mr. Larsen of Washington's prepared statement follows:]
Prepared Statement of Hon. Rick Larsen of Washington, Ranking Member,
Committee on Transportation and Infrastructure
Thank you, Chairman Ezell, for calling this hearing and
congratulations on your new role. Your history of bipartisanship and
support for the maritime industry and Coast Guard will greatly benefit
this Subcommittee.
Before we dive into the topic of this hearing, I must address the
sudden termination of the Commandant of the Coast Guard, Admiral Linda
Fagan.
What the President did was unjustified and reckless. Never before
in the history of the Service has a Commandant been relieved--let alone
for political purposes.
I want to thank Admiral Fagan for all she has done for this
country.
Acting Commandant Lunday and the next Commandant must continue to
move the Coast Guard forward. Under the leadership of Admiral Fagan,
the Coast Guard made significant improvement regarding sexual assault
and sexual harassment, recruiting and retention and ensuring that the
service is more inclusive for everyone. That work must continue.
It was my hope for today's hearing that we could focus on the
important work of building America's maritime infrastructure, but I'm
afraid that work is being undermined.
The President's Executive Order (EO) to pause infrastructure
spending from the Bipartisan Infrastructure Law and the Inflation
Reduction Act is putting billions of dollars, hundreds of thousands of
jobs, and tens of thousands of projects at risk.
While last week's broader memorandum from the Office of Management
and Budget to freeze all federal assistance programs was rescinded, BIL
funding including Port Infrastructure Development Program (PIDP) grants
remain in limbo.
Continued threats and actions to claw back infrastructure funding
are sowing chaos and will have devastating impacts on the maritime
industry, our national security and our economic security.
Across the country there are over 300 ports. Of these, 20 handle
the vast majority of container cargo. Only two U.S. ports are in the
top 20 ports globally while China has seven of the top 10.
This not due to a lack of maritime activity in the U.S.--it is
because China heavily subsidizes port and maritime operations while the
U.S. does not.
During the supply chain crisis in 2021, the Biden Administration
mobilized funding to increase capacity and productivity.
These efforts by the Biden Administration, coupled with the hard
work of our longshore workers, pulled us out of the supply chain
crisis.
Since then, over $2.18 billion in port infrastructure development
program funding has gone to ports across the country to bolster safety
and reliability.
Ports like Houston, Texas, received $25 million, Bay St. Louis,
Mississippi, received $4 million and the state of Alaska received over
$50 million for uses across the entire state in fiscal year 2024. These
states are benefiting from the Bipartisan Infrastructure Law. Let's
keep it going.
The Clean Ports Program that the Environmental Protection Agency
administers has assisted in the deployment of shore power to ports
across the country, including a $63 million grant to the Port of
Anacortes, in my own district, which includes, not just clean shore
power, but a total redevelopment of a wholly underutilized area of the
port to create jobs and bring private sector jobs there--including
having a signed grant agreement that now the EPA has paused and is
delaying the creation of these private sector jobs. This is
inexplicable, and I ask the EPA to provide an explanation of what it is
doing to get this grant going again, as well as the ones that are going
to the Port of Bellingham, also in my district, and any other port that
is expecting these grants from a signed grant agreement.
Investing in shore power not only improves air quality by reducing
pollution, it is consistent with standard operations of ports around
the globe. Shipping companies want to cut pollution, and ports want to
be competitive.
Rescinding funds for ports that were passed as part of the
Bipartisan Infrastructure Law and the Inflation Reduction Act puts our
ports at a disadvantage and is short-sighted. We won't quietly let this
happen.
America's shipyards are an essential piece of maritime
infrastructure that are falling behind international competition due to
unfair and subsidized competition.
Larger shipyards have no dedicated grant program and rely heavily
on government and commercial contracts to stay afloat.
Buy America requirements and the Jones Act help ensure shipyards
maintain steady business by requiring shipbuilding and manufacturing to
take place in the United States.
I was heartened to hear Secretary Duffy's support for the Jones Act
during his confirmation hearing. The Jones Act has strong support among
members of this Committee and is critical to the maritime industry.
Thanks to historic levels of federal investment, the nation's
transportation system and infrastructure are better today than they
were four years ago.
Continuing that progress requires ongoing investment, especially in
the maritime industry. Let's keep it going.
Thank you, and I yield back.
Mr. Ezell. The gentleman yields.
I now would like to welcome and thank our witnesses for
being here today. Briefly, I would like to take a moment to
explain the lighting system to our witnesses. There are three
lights in front of you. Green means go, yellow means you are
running out of time, and red means to conclude your remarks. In
my previous career, I explained lighting systems many times to
people that ran a red light.
I ask unanimous consent that the witnesses' full statements
be included in the record.
Without objection, so ordered.
I ask unanimous consent that today's hearing record remain
open until such time as our witnesses have provided answers to
any questions that may be submitted to them in writing.
Without objection, so ordered.
I also ask unanimous consent that the record remain open
for 15 days for any additional comments and information
submitted by Members or witnesses to be included in the record
of today's hearing.
Without objection, so ordered.
As your written testimony has been made part of the record,
the committee asks that you limit your oral remarks to 5
minutes.
With that, Mr. Paul Anderson with the Port Tampa Bay, you
are recognized for 5 minutes for your testimony.
TESTIMONY OF A. PAUL ANDERSON, PRESIDENT AND CHIEF EXECUTIVE
OFFICER, PORT TAMPA BAY; JOE RELLA, PRESIDENT, ST. JOHNS SHIP
BUILDING, INC., ON BEHALF OF THE SHIPBUILDERS COUNCIL OF
AMERICA; TOM REYNOLDS, CHIEF STRATEGY OFFICER, SEASATS, ON
BEHALF OF THE ASSOCIATION FOR UNCREWED VEHICLE SYSTEMS
INTERNATIONAL; AND BRIAN W. SCHOENEMAN, POLITICAL AND
LEGISLATIVE DIRECTOR, SEAFARERS INTERNATIONAL UNION OF NORTH
AMERICA, ON BEHALF OF USA MARITIME
TESTIMONY OF A. PAUL ANDERSON, PRESIDENT AND CHIEF EXECUTIVE
OFFICER, PORT TAMPA BAY
Mr. Anderson. Thank you, Mr. Chairman, Ranking Member
Carbajal, thank you for the invitation to testify this morning
on a topic that is important to both the Nation's economic
growth and our security, America's maritime infrastructure. And
congratulations on your first meeting as chairman and your
appointment to lead this important committee.
As the president and CEO of Port Tampa Bay and the current
chairman of the Coalition for America's Gateways and Trade
Corridors, the immediate past chair of the American Association
of Port Authorities, and as a former Federal Maritime
Commissioner, the work and growth of America's seaports is
deeply personal to me, and I am honored to be here today.
At the outset, let me thank two Florida members of this
subcommittee, Congressmen Dan Webster and Brian Mast, for their
tremendous ongoing support for Port Tampa Bay and all of
Florida's ports. They recognize the critical role that ports
and port operations play in ensuring the efficient movement of
cargo to Florida's supply chain to serve our rapidly growing
population of 23 million residents.
We are proud of the role that Port Tampa Bay plays as
Florida's largest and most diverse cargo seaport and as west
central Florida's largest economic driver. According to our
most recent economic impact study, we have an almost $35
billion annual impact on our region and support more than
192,000 jobs.
Shipbuilding and repair is also an essential operation at
Port Tampa Bay and is woven into the history of the port.
Today, we are home to four shipbuilding and repair facilities
at our port and generate nearly 3,000 full-time jobs, with an
economic impact of $233 million.
Our port continues to make strategic investments for our
future, including improving the resiliency of our port
facilities, growing and expanding our containerized cargo and,
with this committee's support in WRDA 2024, the undertaking of
a major new project that deepened our shipping channels to
accommodate the growing fleet of large ships that will call at
Port Tampa Bay.
Through the foresight and support of our champions in
Congress, especially members of this committee, America's ports
such as ours have acquired and updated key equipment,
modernized berths and operations, and undertaken large projects
that expand our ability to move the cargo for our Nation.
For instance, grant programs, such as the Port
Infrastructure Development Program, have enjoyed bipartisan
support since it was founded in 2009. And PIDP is a critical
tool for ports to upgrade their infrastructure to keep pace
with advancements and compete with ports around the world.
I would also be remiss if I didn't mention how important
the biennial WRDA process is to our Nation's ports for economic
and infrastructure progress. It was a great privilege for me to
testify before the House Transportation and Infrastructure
Committee in December 2023 to help the committee kick off the
development of WRDA 2024, and I commend the members of the
committee for their leadership in crafting and passing this
hallmark legislation to keep WRDA on its biennial schedule.
Ports abroad, both allied and adversarial, are investing
heavily in their port infrastructure and rightly recognize
ports as critical infrastructure, and America must respond in
kind by investing in our ports to handle more exports and
imports.
I was heartened to hear Secretary Duffy, in his
confirmation hearing, commit to doing all he can do to find
ways in which to accelerate the processing of Federal grants,
reform bureaucratic processes at all levels, and deliver funds
more efficiently so that ports like ours can deliver important
projects on time and at or under budget. I was also very
pleased to hear his support for the Jones Act.
Thank you for your support of the men and women of the
United States Coast Guard, who are unheralded partners in our
work to secure America's ports and waterways, particularly in
the growing threat of cybersecurity.
We have a seamless working relationship with our Coast
Guard partners in the Greater Tampa Bay area, and we truly
appreciate the work the men and women of the Coast Guard do for
our Nation.
Thank you for your time, your consideration, and your
pivotal role in shaping the future of our Nation's maritime
industry.
[Mr. Anderson's prepared statement follows:]
Prepared Statement of A. Paul Anderson, President and Chief Executive
Officer, Port Tampa Bay
Mr. Chairman, thank you for your invitation to testify this morning
on such an important topic to both the nation's economic growth and
security: America's Maritime Infrastructure. And congratulations on
your appointment to lead this important subcommittee. As the President
and CEO of Port Tampa Bay, the Chairman of the Coalition for America's
Gateways and Trade Corridors, the Immediate past Chair of the American
Association of Port Authorities, and a former Federal Maritime
Commissioner, the work and growth of America's seaports is deeply
personal to me and I am honored to be here today.
At the outset, let me thank two Florida members of this
subcommittee--Congressmen Dan Webster and Brian Mast--for their
tremendous ongoing support for Port Tampa Bay and all 16 Florida
seaports. They recognize the critical role that ports and port
operations play in ensuring the efficient movements of cargo to
Florida's supply chain to serve our rapidly growing population.
We are proud of the role that Port Tampa Bay plays as Florida's
largest and most cargo-diverse seaport and as West Central Florida's
largest economic driver. According to our most recent economic impact
study, we have a $34.6 billion impact on our region and support more
than 192,000 total jobs. This includes $4.6 billion of direct business
revenue, the re-spending and local consumption impact of $2.8 billion,
and the related user output of $27.2 billion. This dollar value
represents the sphere of influence of the marine terminals, shipyards,
and non-maritime real estate holdings of the Port.
Shipbuilding and Repair is also an essential operation at Port
Tampa Bay and is woven well into our history. During World War II, the
Port was called upon to assist with shipbuilding efforts for our
nation's military and as the war was ending the Florida legislature
established our charter and created the Tampa Port Authority. Today, we
are home to four ship building and repair facilities at the Port that
generate approximately 2,983 full-time jobs with an economic impact of
$232.7 million.
Our Port continues to make strategic investments for our future,
including improving the resiliency of our port facilities, growing and
expanding our containerized cargo business, and, with this Committee's
support in WRDA 2024, the undertaking of a major new project to deepen
our shipping channels to accommodate the growing fleet of large ships
that want to call upon Port Tampa Bay. The jobs and money that flow
back into our regional economy is a direct result of our strategic
planning and growth.
Through the foresight and support of our Champions in Congress,
especially Members of this Committee, America's ports such as ours have
acquired and updated key equipment, modernized berths and operations,
and undertaken large projects that expand our ability to move the cargo
our nation's and our state's businesses, industry, and residents depend
upon.
For instance, grant programs such as the Port Infrastructure
Development Program (PIDP), have enjoyed bipartisan support since it
was founded in 2019. PIDP is a critical tool for ports to upgrade their
infrastructure to keep pace with advancements at ports around the
world. These grant projects are truly partnerships between the Federal
Government, state, and local governments, alongside private partners.
I would also be remiss if I didn't mention how important the
biennial WRDA process is to our nation's ports for economic and
infrastructure progress and vital for the sustenance and growth of
trade and commerce across our country. It was a great privilege for me
to testify before the House Transportation and Infrastructure Committee
in December 2023 to help the Committee kick off the development of WRDA
2024. I want to commend the members of the Committee for their hard
work in crafting and passing this hallmark legislation to keep WRDA on
its biennial schedule, which is so important in the timing of our
projects to minimize delays and reduce costs.
This investment and focus on the needs of America's ports is
critical for our economic and national security. Ports abroad, in both
allied and adversarial countries are investing heavily in their port
infrastructure and rightly recognize ports as critical infrastructure.
America must respond in kind by investing in our ports to handle more
exports and imports. A recent study from the U.S. Committee on the
Maritime Transportation System found that increases in infrastructure
spending could spur economy-wide returns of $2-$3 for every dollar
spent.
Our nation's ports are integral to the national infrastructure and
the responsibility of protecting, growing, and innovating the supply
chains that link every part of our economy falls to all of us from the
local, regional, state, and federal levels. This includes building
strong relationships with our private partners to assist in achieving
these goals.
I was heartened to hear the new Secretary of Transportation, in his
confirmation hearing, commit to doing all he can to find ways in which
to accelerate the processing of federal grants, reform bureaucratic
processes at all levels, and deliver funds more efficiently so that
ports like ours can deliver important projects on time and at or under
budget. Burdensome delays and inflexible requirements written into
grant requirements and agreements redirect resources away from the
intended scope of the project, and result in wasteful spending and
inefficiencies that keep us from our core functions to plan for the
long-range development of ports and port facilities.
Before I close, let me thank you for your support of the men and
women of the United States Coast Guard, who are unheralded partners in
our work to secure America's ports and waterways. We have a seamless
working relationship with our Coast Guard partners in the greater Tampa
Bay area.
We are working with the Coast Guard right now on a most timely
project to replace and repair countless navigational aides in our
shipping channels that were heavily impacted by Hurricanes Helene and
Milton, which devastated our region and our state during a 12-day
period last September and October. Because of the loss of this vital
equipment, night-time navigation is reduced or unavailable, causing
delays in the movement of ship traffic on our 45-mile channel. As you
well know, the movement of ships into and out of ports is tightly
choreographed and any disruption in schedules impacts the overall
supply chain. Our Port, along with our tenants, service providers and
various industries delivers a broad assortment of goods and services to
the Central Florida region, including 35 million tons of cargo, 17.3
million tons of petroleum, and cruise capacity for over 1.6 million
passengers.
As to my earlier comments about reducing inefficiencies, anything
your subcommittee can do to support the Coast Guard in reducing
procurement regulations and the deployment of this important equipment
would help ports like ours speed the recovery from natural disasters
and get us back to full capacity just as soon as possible.
Thank you for your time, your consideration, and your pivotal role
in shaping the future of our nation's maritime industry and
infrastructure. Your work in supporting America's supply chain supports
the development of robust international trade routes and fosters the
more efficient movement of goods and services throughout our nation.
Mr. Ezell. Thank you, Mr. Anderson.
We now recognize Mr. Joe Rella of St. Johns Ship Building
Incorporated. You are recognized for 5 minutes for your
testimony.
TESTIMONY OF JOE RELLA, PRESIDENT, ST. JOHNS SHIP BUILDING,
INC., ON BEHALF OF THE SHIPBUILDERS COUNCIL OF AMERICA
Mr. Rella. So that was good, 10 seconds remaining. I hope I
will be as good with that.
Chairman Ezell, Ranking Member Carbajal, and distinguished
members of the subcommittee, thank you for the opportunity to
testify today on behalf of the U.S. shipyard industry.
My name is Joe Rella. I am president of St. Johns Ship
Building based in Palatka, Florida. I am here to discuss the
critical role U.S. shipyards play in America's Marine
Transportation System, the economic impact of our industry, the
importance of investment in maritime infrastructure, and the
state of the U.S. shipbuilding industrial base.
Before diving in, I would like to share a bit about myself
and St. Johns Ship Building. I am a former enlisted U.S. Navy
Nuclear Power School graduate with degrees from the U.S.
Merchant Marine Academy in marine engineering and Spring Hill
College; MBA, Spring Hill in Mobile, Alabama. I received a
commission in the Navy Reserve upon graduation from the
Merchant Marine Academy.
I have sailed in the U.S. merchant marine as a licensed
engineer and participated in the strategic sealift supporting
Operation Desert Shield. My experience in shipbuilding and
repair includes U.S. Navy and commercial vessels and both blue
and brown water service. I am a former president and chief
operating officer at Austal USA, and now president of St. Johns
Ship Building.
St. Johns Ship Building is a full-service shipbuilding and
marine repair company specializing in new construction and
repair of a wide variety of aluminum and steel vessels. While
the shipyard's history has been primarily commercial, we
recently were awarded a contract with the U.S. Army Corps of
Engineers for two stop-log barges, which signifies our entry
into supporting the U.S. Government with new construction and
repair service.
The U.S. shipyard industry is diverse and operates in
several sectors, including Government new construction,
Government repair and modernization, commercial repair and
modernization, and commercial new construction. According to
the Maritime Administration, there are 120 active shipyards in
the United States spread across 27 States, with shipyard-
related and induced jobs touching all 50 States. Shipyard
companies have diversified their waterfronts to contribute to
multiple sectors, and some are also utilizing their skilled
workforce to contribute to nonmaritime construction.
A 2021 study by the U.S. Maritime Administration found that
the industry supports more than 390,000 direct and indirect
jobs across the United States and contributes $42.2 billion
annually to the GDP.
From our industry's perspective, the Jones Act is
absolutely essential to the commercial shipbuilding sector. The
Jones Act, which comes at no cost to the Government, helps
maintain a merchant marine to carry out our domestic waterborne
commerce. The law also ensures that the U.S. maintains critical
shipyard infrastructure and an associated skilled workforce
that can build, repair, modernize, and maintain more than
40,000 vessels of the domestic Jones Act fleet. This industrial
base also ensures there is sufficient workforce to support the
construction and repair of our critical national security
fleets.
U.S. shipyards build some of the most technologically
advanced vessels in the world. For example, the world's first
LNG-powered containership was built in the U.S. and is now
serving the Puerto Rican trade. Our shipyards also build world-
class offshore service vessels for oil and gas exploration,
offshore wind development and production, and vessels of all
types for the Coast Guard, and the most advanced and lethal
fleet for the United States Navy.
As we look at the current state of the U.S.-flag maritime
industry, we need to ask ourselves what's next. At the end of
the 118th Congress, bipartisan and bicameral legislation was
introduced, the SHIPS for America Act, sponsored by Senator
Mark Kelly, Senator Todd Young, Congressman Trent Kelly,
Congressman John Garamendi, and Congressman Mike Waltz, who
happened to be our Congressman at the time.
The proposed legislation would provide for the first time a
national maritime strategy to grow the entire maritime
industrial base, from shipbuilding to maritime logistics to the
merchant mariner workforce. The bill proposed the construction
of a fleet of strategic commercial assets, including 250
vessels for international commerce and 100 tankers for the
Tanker Security Program, among many other legislative proposals
to better support the U.S. maritime industry and infrastructure
for the education facilities that are in dire need of
infrastructure improvement, such as the Merchant Marine
Academy.
If we were to undertake such a shipbuilding campaign, there
will need to be substantial expansion in both shipyard
facilities and workforce. Private industry will make the
commitment based on the signals provided by the Congress and
the administration and the legal certainty provided under this
comprehensive legislative proposal.
In conclusion, the U.S. shipyard industry plays a vital
role in supporting the Nation's economic and national security
needs. Continued investment in maritime infrastructure and
support for the domestic shipbuilding industrial base,
including the Jones Act build requirement, is essential for
maintaining a robust and competitive maritime industry. I urge
the subcommittee to continue its support for these critical
initiatives.
Thank you for the opportunity to testify today. I look
forward to answering any questions that you may have. And I
have 1 minute and 16 seconds to go.
[Mr. Rella's prepared statement follows:]
Prepared Statement of Joe Rella, President, St. Johns Ship Building,
Inc., on behalf of the Shipbuilders Council of America
Chairman Ezell, Ranking Member Carbajal and distinguished members
of the Subcommittee, thank you for the opportunity to testify today on
behalf of the U.S. shipyard industry. My name is Joe Rella, and I am
President of St. John's Shipbuilding based in Palatka, Florida. I am
here to discuss the critical role U.S. shipyards play in America's
Marine Transportation System (MTS), the economic impact of our
industry, the importance of investment in maritime infrastructure, and
the state of the U.S. shipbuilding industrial base.
Before diving into the above testimony, I would like to share a bit
about myself and St. Johns Ship Building.
I am a former enlisted US Navy Nuclear Power School graduate. I was
selected to attend the US Merchant Marine Academy in Kings Point, NY,
and graduated with a degree in Marine Engineering Systems. I am also a
graduate of Spring Hill College with an MBA. I have sailed in the US
Merchant Marine as a licensed engineer and participated in the
strategic sealift supporting Operation Desert Shield. I have literally
sailed around the world on US-flagged merchant Ships. My experience in
shipbuilding and repair includes US Navy and commercial vessels and
both blue and brown water service. I am a former President and Chief
Operating Officer of Austal USA and now President of St. Johns Ship
Building.
St. Johns Ship Building is a full-service shipbuilding and marine
repair company specializing in the new construction and repair of a
wide variety of aluminum and steel vessels. We are located on the
Southeast Coast with excellent access to the Mid-Atlantic and New
England as well as the Caribbean and Gulf Coast. Our facility sits on a
beautiful, partially wooded site along the St. Johns River in Putnam
County, Florida, approximately 68 miles south of Jacksonville, Fla. The
St. Johns River is easily accessible to the Intracoastal Waterway and
opens to the Atlantic Ocean at Jacksonville, Florida. While the
shipyard's history has been primarily commercial, we recently were
awarded a contract with the US Army Corps of Engineers for two Stop Log
Barges, which signifies our entry into supporting the US Government
with new construction and repair services.
The U.S. shipyard industry is diverse and operates in several
sectors, including government new construction, government repair and
modernization, commercial repair and modernization, and commercial new
construction. According to the Maritime Administration (MARAD), there
are 120 active shipyards in the United States spread across 27 states,
with shipyard-related and induced jobs touching all 50 states. Shipyard
companies have diversified their waterfronts to contribute to multiple
sectors, and some are also utilizing their skilled workforce to
contribute to non-maritime construction efforts.
A 2021 study by the U.S. Maritime Administration \1\ found that the
industry supports more than 390,000 direct and indirect jobs across the
United States and contributes $42.2 billion annually to GDP.\2\
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\1\ https://www.maritime.dot.gov/sites/marad.dot.gov/files/2021-06/
Economic%20Contributions%20of%20U.S.%20Shipbuilding%20and%20Repairing%20
Industry.pdf
[Editor's note: There is no footnote 2.]
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From our industry's perspective, the Jones Act is absolutely
essential to the commercial shipbuilding sector. The Jones Act, which
comes at no cost to the U.S. government, helps maintain a merchant
marine to carry our domestic water-borne commerce. The law also ensures
that the U.S. maintains critical shipyard infrastructure and an
associated skilled workforce that can build, repair, modernize and
maintain the more than 40,000 vessels of the domestic Jones Act fleet.
This industrial base also ensures there is a sufficient workforce to
support the construction and repair of our critical national security
fleets.
U.S. shipyards build some of the most technologically advanced
vessels in the world. For example, the world's first LNG-powered
containership was built in the U.S. and is now serving the Puerto Rican
trade. Our shipyards also build world-class offshore service vessels
for oil and gas exploration, offshore wind development and production
and vessels of all types for the Coast Guard, and the most advanced and
lethal fleet for the United States Navy.
Shipyards & America's Marine Transportation System (MTS)
America's Marine Transportation System (MTS) is a vast network that
includes approximately 25,000 miles of navigable waterways and over 300
commercial maritime ports containing more than 3,500 marine terminals.
This system is essential for the movement of people and cargo
throughout the nation, supporting nearly $2.9 trillion in Gross
Domestic Product (GDP) in 2024. Ports and the maritime industry are
major economic drivers, hosting vital intermodal connections that
facilitate the movement of goods along the national supply chain and
enable the exportation of domestically produced goods to foreign
markets. The maritime industry is also the most economical form of
domestic transportation, moving more than 1 billion tons of cargo
annually at a fraction of the cost of other modes.
Each port complex includes marine terminals that handle cargo
loading and unloading. These terminals can be operated by port
authorities or private companies leasing from port authorities. The MTS
also includes tens of thousands of miles of navigable waterways, where
more than 40,000 U.S. vessels, like the one my company builds,
maintains and modernizes, operate in domestic waterborne commerce.
United States Shipbuilding and Ship Repair Industrial Base
The United States shipbuilding and ship repair industrial base is
underpinned by the Jones Act, which requires vessels participating in
coastwise trade to be U.S.-owned, U.S.-crewed, and U.S.-built. This
legislation supports domestic shipbuilding capacity and prevents the
loss of strategic capabilities.
To support the industry, MARAD administers financial assistance
programs such as the Small Shipyard Grant Program, the Federal Ship
Financing Program (Title XI), and the Capital Construction Fund and
Construction Reserve Fund Programs. These programs provide grants,
loans, and tax deferral benefits to increase shipyard competitiveness
and encourage the construction of commercial vessels in U.S. shipyards.
Additionally, the Jones Act sustains a competitive domestic market
for carriers, operators, and shipyards. However, when the Jones Act is
not enforced or is undermined by shortsighted policies, it can have
detrimental effects on the broader domestic maritime industry and U.S.
job creation.
For example, a 2017 decision by the Customs and Border Protection
(CBP) allowed certain foreign-built, foreign-crewed, and foreign-owned
offshore supply vessels to operate in violation of the Jones Act. This
decision led to the cancellation of numerous construction contracts for
new ``Made in the U.S.A.'' vessels due to the uncertainty introduced by
executive actions that contravene Congressional intent. The immediate
impact of these cancellations dampens the domestic industry, initiating
a vicious cycle where future opportunities may also be reconsidered or
rescinded. This not only affects current contracts but also hampers the
industry's ability to invest in its workforce and modernize facilities,
making them safer and more efficient.
This issue exemplifies how a decision by an agency to not enforce
the Jones Act can adversely impact commercial shipbuilding,
reverberating throughout the entire shipyard industrial base. This
raises costs and destabilizes the industry's ability to support
national defense requirements. We urge Congress to identify and close
existing loopholes in the Jones Act, providing clarity on matters
related to visa issues and heavy lift operations that are integral to
the success and viability of this critical commercial market.
Rather than undermining the Jones Act and the essential
shipbuilding manufacturing sector, the United States government--both
the Administration and Congress--should promote policies that actively
encourage the expansion of the shipyard industrial base.
Members of this Committee have recognized the potential benefits of
ensuring access to our domestic energy and as the United States has
emerged as the world leader in energy production, it is crucial that we
encourage the transportation of our domestically produced natural
resources, including LNG, on U.S. vessels. Policies such as Congressman
Garamendi's Energizing American Shipbuilding Act and the SHIPS for
America Act would support this goal.
Implementing such policies would not only help us regain a foothold
in the international shipping market, where we have lost ground to
heavily subsidized and government-backed shipyards, but it would also
have a direct impact on the recapitalization of our strategic sealift
fleets. The construction of LNG carrier and petroleum tankers would
stabilize the shipyard supplier base and the shipyards themselves,
thereby strengthening our overall maritime infrastructure.
Long-term, there needs to be a workforce expansion, and some
shipyards will need to reconfigure or expand production lines to meet
demands for national security vessel construction and commercial market
demands. This can and will be done as required to meet the need if
adequate, stable budgets and procurement plans are established and
sustained for the long-term. Funding predictability and sustainability,
along with fully and consistently enforcing the Jones Act, will allow
industry to invest in facilities and more effectively grow its skilled
workforce. The development of that critical workforce will take time
and a concerted effort in a partnership between industry, the Congress,
local governments, and the federal government.
U.S. shipyards pride themselves on implementing state of the art
training and apprenticeship programs to develop skilled men and women
that can cut, weld, and bend steel and aluminum and who can design,
build and maintain the best Navy and Coast Guard in the world, along
with our domestic commercial fleet. However, the shipbuilding industry,
like so many other manufacturing sectors, faces an aging workforce.
Attracting and retaining the next generation shipyard worker for an
industry career is critical.
Recent capital investments in private U.S. shipyards total more
than $7 billion and highlight the industry's potential and readiness to
meet these demands.\3\ \4\ \5\ \6\
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\3\ https://breakingdefense.com/2023/04/fincantieri-finishing-300m-
shipyard-renovations-a-big-bet-on-the-us-navys-frigate-plans/
\4\ https://www.gdeb.com/news/news_archives/2022archives.html
\5\ https://news.clearancejobs.com/2024/04/19/secnav-urges-defense-
contractors-to-invest-in-u-s-shipyards-to-enhance-navy-capabilities/
\6\ https://www.madeinalabama.com/2024/07/austal-to-add-over-1000-
jobs-with-expansion-of-mobile-shipyard/
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Impact of Chinese Maritime Dominance on U.S. Shipyards
Recently, the U.S. Trade Representative (USTR) concluded an
investigation under Section 301 of the Trade Act of 1974, finding that
China's targeted dominance in the maritime, logistics, and shipbuilding
sectors is unreasonable and burdens or restricts U.S. commerce. The
investigation revealed that China's policies have significantly
displaced U.S. shipyards in the global market.
In 1975, the United States ranked number one in commercial
shipbuilding, constructing over 70 ships annually. Today, the U.S.
ranks 19th, building fewer than five ships each year, while China
builds more than 1,700 ships annually.\7\
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\7\ https://ustr.gov/about-us/policy-offices/press-office/press-
releases/2025/january/ustr-finds-chinas-targeting-maritime-logistics-
and-shipbuilding-sectors-dominance-actionable-under
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China's dominance is driven by extensive state support and control
over its shipbuilding industry, which undermines fair, market-oriented
competition. This dominance has led to a significant reduction in
business opportunities and investments in the U.S. maritime sector,
creating economic security risks and dependencies on Chinese-controlled
supply chains. The USTR's findings underscore the urgent need for
responsive actions to invest in and strengthen the U.S. shipbuilding
industry to counter these challenges.
National Maritime Strategy
As we look at the current state of the U.S. flag maritime industry,
we need to ask ourselves ``what's next.'' At the end of the 118th
Congress, bi-partisan, bi-cameral legislation was introduced titled the
``Shipbuilding and Harbor Infrastructure for Prosperity and Security
for America Act'' (SHIPS Act) sponsored by Senator Mark Kelly, Senator
Todd Young, Congressman Trent Kelly, and Congressman John Garamendi and
Congressman Michael Waltz.
The proposed legislation would provide for the first time a
national maritime strategy to grow the entire maritime industrial base
from shipbuilding, to maritime logistics to the merchant mariner
workforce. The bill proposed the construction of a fleet of strategic
commercial assets, including 250 vessels for international commerce and
100 tankers for the Tanker Security Program, among many other
legislative proposals to better support the U.S. maritime industry.
If we were to undertake such a shipbuilding campaign, there will
need to be substantial expansion in both shipyard facilities and
workforce. Private industry, as I noted above, will make that
commitment based on the signals provided by the Congress and the
Administration and the legal certainty provided under this
comprehensive legislative proposal.
Autonomous Maritime Technologies
The development of autonomous maritime technologies presents both
opportunities and challenges for the MTS. These technologies have the
potential to increase efficiency and reduce operational risks but
require a stable regulatory framework to ensure their safe integration.
The International Maritime Organization (IMO) is conducting regulatory
scoping exercises to develop guidelines for incorporating autonomous
technologies into regulatory frameworks
Stable and consistent guidance from these agencies are critical to
enable the U.S. maritime industry to invest in these new technologies
and incorporate them into our future commercial and government fleets.
Conclusion
In conclusion, the U.S. shipyard industry plays a vital role in
supporting the nation's economic and security needs. Continued
investment in maritime infrastructure, support for the domestic
shipbuilding industrial base, and the development of autonomous
maritime technologies are essential for maintaining a robust and
competitive maritime industry. I urge the Subcommittee to continue its
support for these critical initiatives.
Thank you for the opportunity to testify today. I look forward to
answering any questions you may have.
Mr. Ezell. You took some of his time. Thank you.
The Chair now recognizes Mr. Reynolds with Seasats. You are
recognized for 4\1/2\ minutes for your testimony.
TESTIMONY OF TOM REYNOLDS, CHIEF STRATEGY OFFICER, SEASATS, ON
BEHALF OF THE ASSOCIATION FOR UNCREWED VEHICLE SYSTEMS
INTERNATIONAL
Mr. Reynolds. Chairman Ezell, Ranking Member Carbajal, and
distinguished members of the subcommittee, thank you for the
opportunity to testify today. I am Tom Reynolds, the chief
strategy officer at Seasats, Inc., a small business based in
California which develops and manufactures unmanned surface
vessels for defense, scientific, and commercial customers.
I am a member of the Association for Uncrewed Vehicle
Systems International, on their board of directors, and the
founder and the first chairman of AUVSI's Maritime Advocacy
Committee.
I am testifying today on behalf of AUVSI, the world's
largest not-for-profit organization dedicated to the
advancement of uncrewed systems, autonomy, and robotics.
By way of background, I have over 22 years of operational
and developmental experience with maritime unmanned systems. I
am a retired U.S. Navy explosive ordnance disposal officer and
surface warfare officer, a former EOD branch chief at Joint
Special Operations Command, a former 5th Fleet EOD and diving
task commander, a former 5th Fleet maritime intelligence task
commander, and the former commanding officer of the world-
famous deep sea divers at Mobile Diving and Salvage Unit 2 in
Little Creek, Virginia.
I became involved with unmanned systems as a member of an
experimental Navy-Marine Corps unit established in the late
nineties. I began working with them in 2002 to develop new
unmanned underwater vehicles, which I then planned and executed
their first combat use in 2003 during the invasion of Iraq. I
went on to conduct five additional combat tours in Iraq and a
few more combat deployments to other locations in 2012.
Notably, all of these included the use of unmanned systems,
maritime, air, and ground.
I now have 13 years in industry. All of these have been
dedicated to the design and manufacture of maritime robotic and
unmanned systems with the end user in mind. I have served as an
executive in the largest unmanned underwater vehicle company in
the world, as an executive with the leading U.S. shipbuilder,
and now with a terrific small business there in southern
California, Seasats, Inc.
What I hope to express in this testimony is that robotic
systems have a value to the United States in the maritime
domain, that regardless of views or our position on them, our
competitors are developing and deploying them faster and more
effectively than we are, because they have recognized this
value. Yet, our current regulatory framework has not kept up
with this advance in technology, and our current rules are
impeding the development and operation of a modern maritime
economy.
In addition, the principal leader in our national maritime
regulatory framework, the U.S. Coast Guard, operates no robotic
or autonomous ships or boats or underwater vehicles of its own,
zero. It is unfair to expect that our Coast Guard can
effectively regulate something it has not been equipped to
experience itself.
Finally, on behalf of AUVSI, I offer our association's full
support and commitment to work with the Government to develop
responsible standards for safety certification, updated to the
rules of the road, as well as support the development of a
workforce needed in this modern maritime economy.
Thank you, and I am looking forward to your questions.
[Mr. Reynolds' prepared statement follows:]
Prepared Statement of Tom Reynolds, Chief Strategy Officer, Seasats, on
behalf of the Association for Uncrewed Vehicle Systems International
Introduction
Thank you for the opportunity to testify today on the critical
topic of our nation's maritime infrastructure. My name is Tom Reynolds,
and I am the Chief Strategy Officer at Seasats and a Board Director
with the Association for Uncrewed Vehicle Systems International
(AUVSI). Seasats builds and operates high-endurance, user-friendly
autonomous surface vehicles (ASVs) that collect data for defense,
research, and commercial customers. I am testifying today on behalf of
AUVSI, the world's largest nonprofit organization dedicated to the
advancement of uncrewed systems, autonomy, and robotics. In addition to
serving on the AUVSI Board of Directors, I am the founder of the
association's Maritime Advocacy Committee (MAC), which represents more
than sixty (60) companies in the robotics and autonomous systems (RAS)
maritime domain. AUVSI represents a diverse range of stakeholders,
including manufacturers, operators, and policymakers focused on
integrating RAS across the air, land, and maritime domains and I am
honored to sit on their Board.
I appreciate the Subcommittee's leadership in examining how our
maritime infrastructure can support innovation, enhance safety, and
strengthen economic growth. By way of background, I have over 22 years
of operational and developmental experience with maritime unmanned
systems.
I am a retired U.S. Navy Explosive Ordnance Disposal (EOD) Officer
and the former Commanding Officer of the EOD and Diving Task Group in
5th Fleet and EOD Branch Chief at Joint Special Operations Command. I
first began operating maritime robotics and autonomous systems (MRAS)
in an experimental unit developing them in 2002 and led their first use
in combat in 2003. I went on to conduct six (6) deployments to Iraq
between 2003 and 2011, all of which included unmanned systems
(maritime, ground or air).
I now have thirteen (13) years in industry dedicated to the design
and manufacturing of MRAS. I was an executive in the largest unmanned
underwater vehicle (UUV) company in the world and an executive with a
leading U.S. shipbuilder.
My experiences in combat with uncrewed systems have forged in me a
dedication to ensuring that as a nation, we lead the world in the
integration of RAS to do the dirty, dangerous, and dull tasks, so that
our men and women in uniform conducting important public safety and
transportation missions are safeguarded from harm.
This is a very dynamic time for the U.S. Coast Guard (USCG).
Recently, the Commandant was relieved. Shortly thereafter, the service
was directed to initiate their biggest surge operation since World War
II and more significant changes are predicted in the coming weeks. At
present, the USCG is in lockdown status and recently conducted a
daylong 3 and 4-Star Leadership Conference to assess immediate and
long-term strategies.
With significant changes anticipated, I believe we have the
opportunity to accelerate and integrate readily available RAS
capabilities to meet the USCG's diverse mission needs and requirements.
We must lay the groundwork for underwater, surface, and aerial
autonomous capabilities coupled with budget needs in support of
encouraging the USCG's autonomous strategy completion and ensuring they
have sufficient budget to test and implement their strategy.
As I mentioned before, I am testifying on behalf of AUVSI today. I,
as a longtime AUVSI member with various companies and a current Board
Member, commit the association to working with you to ensure that the
United States has a robust maritime infrastructure and to ensure that
the USCG has the resources it needs to be successful in achieving its
mission and integrating autonomous technologies to supplement our men
and women in uniform. It will be critically important for this
Subcommittee to have robust oversight over the USCG, Maritime
Administration (MARAD), and others as they develop key regulations.
AUVSI is an important stakeholder to ensure industry's voice is heard
when developing those key regulations moving forward and I encourage
the members of this Subcommittee to take any and all opportunities to
work with them and their members.
Outdated Regulations and the U.S. MRAS industry
Existing regulations are not compatible with the state of
technology in the maritime industry. Currently, many of the regulations
governing maritime operations result from centuries of maritime
tradition of crewed vessels and do not adequately address the unique
characteristics and operational requirements of MRAS. Until this is
remedied, U.S. maritime regulations will continue to perpetuate
uncertainty for manufacturers, operators, and investors, discouraging
innovation and slowing the adoption of these transformative
technologies.
Specifically, regulations need to be updated to address three key
areas--development, certification, and the operation of MRAS.
1. Development: Current regulations require businesses to spend a
significantly greater amount to test as sea than our international
competition. Industry needs a testing regime at sea where MRAS can
operate with no chase vessels, no human ``lookouts'', and limited
liability.
2. Certification: Despite all the advances in sensors, artificial
intelligence, and robotic reliability, regulations do not address a
clear path to certifying MRAS for operations.
3. Operation: Industry has developed the ability to use MRAS
safely and effectively for fisheries, hydrography, oil/gas, subsea
mining, and environmental studies, however regulations restrict or lack
clarity on how to operate these systems at sea.
The Role of MRAS in Modernizing Maritime Infrastructure
The introduction of MRAS is transforming the maritime
transportation system (MTS). MRAS enhance efficiency, improve safety,
and contribute to economic and environmental sustainability. However,
realizing their full potential requires addressing key infrastructure,
supply chain, and regulatory challenges.
1. Port Infrastructure Development and Protection:
Ports and harbors face constant challenges from harsh marine
environments and vessel activity, with underwater structures, including
quay walls, pier supports, jetties, cables, and pipelines, at
particular risk from corrosion, marine growth, and damage from ship
traffic. MRAS operations can significantly augment existing inspection
and security infrastructure, promoting resiliency and safety. However,
many ports lack the facilities to support MRAS operations, including
dedicated berths for MRAS, charging and fueling stations, and data
integration systems. Programs like the Port Infrastructure Development
Program (PIDP) and Rebuilding American Infrastructure with
Sustainability and Equity (RAISE) grants are crucial to ensuring ports
can accommodate both traditional and autonomous systems. Targeted
investments can accelerate the deployment of MRAS, ensuring they
seamlessly integrate with existing infrastructure and operational
frameworks. Investments in UUVs and USVs are vital for critical
infrastructure monitoring because they can operate autonomously in
hard-to-reach and hazardous underwater environments.
2. Aids to Navigation (ATONs):
As MRAS adoption increases, our navigation systems must evolve.
Modernizing ATONs to include digital and autonomous communication
systems will ensure MRAS can navigate safely and efficiently alongside
manned vessels. The USCG's ongoing efforts in this area are critical,
but additional resources are needed to expedite these advancements and
procure and operate MRAS safely. The advancement of radar systems,
automatic identification system (AIS) base stations, communication
systems (e.g., satellites, radio systems, and camera clusters), and
integrated bridge systems are important for the MRAS market to
integrate into the manned fleets.
3. Workforce Development and Standards:
The rapid integration of MRAS into the MTS brings tremendous
opportunities for innovation and cost saving efficiencies. However, it
also underscores a critical need for standardized training and
certification programs for operators. Inconsistencies in training,
safety protocols, and operational procedures hinder the full potential
of MRAS technologies, potentially compromising safety, efficiency, and
public trust.
Industry-driven standards for MRAS training and certification are
essential to addressing these challenges. Such standards create
consistency across the sector, ensuring operators are equipped to
handle complex missions while minimizing the risks of fragmentation and
variability in training quality. By providing a unified framework,
industry-led initiatives can enhance the safety and effectiveness of
MRAS operations while fostering trust among stakeholders.
AUVSI is taking proactive steps to address this gap through its
MRAS Training & Certification Program. This collaborative initiative
brings together stakeholders from industry, academia, and government to
develop common standards for safe and effective MRAS operation. The
program aligns training with operational realities, safety
requirements, and technological advancements, establishing a reliable
foundation for workforce development across the sector.
Adopting an industry-driven program like AUVSI's offers numerous
benefits, including the creation of a robust, industry-tested standard
that can serve as a foundation for regulatory frameworks. These
standards ensure that all MRAS professionals meet rigorous safety and
operational criteria, providing consistency across training programs
and practices. By aligning with proven methodologies, such a program
offers regulators a practical, well-vetted model to incorporate into
formal policies, streamlining the regulatory process and reducing
duplication of effort.
Industry-tested standards also build public and regulatory trust by
demonstrating a commitment to professionalism, safety, and
accountability. They provide assurance that the MRAS sector is
proactively addressing operational risks and prioritizing safety, which
are critical factors for public acceptance of these technologies.
Additionally, regulatory agencies can leverage these standards to
create flexible policies that accommodate the rapid pace of
technological advancement in the MRAS industry.
These standards enhance interoperability across platforms and
organizations, a key requirement for operations in multi-stakeholder
environments such as ports, defense applications, and disaster response
efforts. Standardized procedures reduce the risk of miscommunication,
operational errors, and inefficiencies, enabling smoother and safer
collaboration. This interoperability is particularly vital in scenarios
involving coordination across multiple jurisdictions or agencies, where
consistent practices are essential.
Incorporating industry-driven standards into regulatory frameworks
ensures that MRAS operations are not only safe and efficient, but also
scalable. This approach supports the gradual expansion of MRAS
technologies into new use cases and operational environments while
maintaining oversight and public confidence. AUVSI's MRAS Training &
Certification Program demonstrates the potential of this approach,
offering a trusted model for accelerating the safe and effective
integration of MRAS into the MTS.
These efforts will not only enhance operational readiness but also
position the U.S. as a global leader in RAS, innovation, and workforce
development.
4. Shipbuilding and MRAS:
The current state of U.S. shipbuilding presents a significant
challenge to maintaining maritime infrastructure and operational
readiness, particularly in producing large, crewed naval combatants.
Shipyards across the nation are behind schedule for both building and
maintenance. Traditional submarine shipyards/drydocks are at capacity
as well. MRAS provides critical and practical support to this crisis.
For both commercial and defense operations, MRAS are ultimately more
cost-effective vessels which can be built far more rapidly and at a
fraction of the cost compared to traditional ships and warships. Unlike
the constrained capacity of specialized shipyards required for building
exquisite crewed naval combatants, the industrial base for USVs, UUVs,
and undersea warfare crewed capital assets (e.g. SSNs)--from speedboats
to two hundred (200)-foot ships--has far greater flexibility, with
shorter lead times for supply chain components such as engines,
electronics, and propulsion systems. MRAS offer procurement savings,
lifecycle savings, scalability, adaptability, resilience and can be
attritable--all differentiators in comparison to crewed undersea
capital assets.
It is also important to note that the disparity in shipbuilding
capacity between the United States and China is significant and has
strategic implications for U.S. commercial and defense leadership.
China's shipbuilding industry has a capacity approximately two hundred
thirty two (232) times greater than that of the United States, enabling
rapid expansion of its commercial maritime and naval capabilities.\1\
According to a 2024 report by the Congressional Research Service (CRS),
China's Navy is the largest in the world, with a battle force of over
three hundred seventy (370) platforms, including major surface
combatants, submarines, and aircraft carriers.\2\ This fleet is
expected to grow to three hundred ninety five (395) ships by 2025 and
four hundred thirty five (435) by 2030.\3\ In contrast, the U.S. Navy
had two hundred ninety six (296) battle force ships as of August 2024,
with projections to slightly decrease to two hundred ninety four (294)
ships by 2030.\4\ This vast industrial capacity allows China to build
over 40% of large ocean-going vessels manufactured globally each year,
totaling over one thousand (1,000) ships annually, compared to
approximately ten (10) per year by the United States.\5\
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\1\ Congress.gov. Library of Congress: https://www.congress.gov/
118/meeting/house/117481/witnesses/HHRG-118-ZS00-Wstate-PaulS-
20240626.pdf
\2\ CRS Report: https://crsreports.congress.gov/product/pdf/RL/
RL33153
\3\ CRS Report: https://crsreports.congress.gov/product/pdf/RL/
RL33153
\4\ CRS Report: https://crsreports.congress.gov/product/pdf/RL/
RL33153
\5\ Brooking: https://www.brookings.edu/articles/to-expand-the-
navy-isnt-enough-we-need-a-bigger-commercial-fleet
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Additionally, the supply chains that enable domestic shipbuilding
face critical vulnerabilities, especially to Chinese extortion and
export controls. For example, the United States is significantly
dependent on China for rare earth magnets, which are essential
components in the propulsion and guidance systems in every commercial
and military vessel. There are currently no qualified domestic rare
earth magnet manufacturers in the United States. The U.S.' ability to
ensure a resilient shipbuilding base and maintain operational readiness
requires significant attention and investment to onshore manufacturing
of critical components like rare earth magnets.
This substantial difference in shipbuilding capacity underscores
the challenges faced by the U.S. in maintaining naval parity and
highlights the strategic advantage held by China in maritime
manufacturing. Investing in the scaled production of MRAS platforms can
significantly enhance operational readiness while addressing supply
chain constraints that currently hinder the production of larger crewed
vessels. By integrating MRAS platforms into the shipbuilding framework,
we can expand the operational capacity and resilience of our naval
fleet in a cost-efficient and timely manner. Simply put, MRAS do not
replace current technologies and operations but rather enhance them.
5. Security of Maritime Infrastructure:
With power and communication cables, energy pipelines, and vital
installations crisscrossing the seafloor, the need for continual
monitoring and robust inspection practices is paramount. The maritime
industry has over thirty (30) plus years with MRAS solutions to support
subsea infrastructure protection. Investments should focus on industry
solutions, especially UUVs and USVs, which are ideal for critical
infrastructure monitoring because they can operate autonomously in
hard-to-reach and hazardous underwater environments.
UUVs can offer long duration, sustained presence, and a rotational
force Concept of Operations (CONOPS) model for protection of critical
undersea infrastructure protection. We have seen threats and
vulnerabilities in the Baltic region and the North Atlantic Treaty
Organization's (NATO) response with expensive crewed assets. There is
significant opportunity for an uncrewed undersea presence and response
with life cycle savings.
6. Maritime Innovation:
The James M. Inhofe National Defense Authorization Act (NDAA) for
Fiscal Year 2023 directed the Secretary of Transportation, through a
competitive cooperative agreement, to establish a United States Center
for Maritime Innovation (USCMI) to support the study, research,
development, assessment, and deployment of emerging marine technologies
and practices related to the MTS. Maritime innovation has been
chronically underfunded and often supported in silos by government
agencies related to the U.S. MTS according to individual agency
priorities. The U.S. maritime industry stakeholders have had challenges
in developing and maintaining high priority research agendas that
address issues key to government and industry and executing aligned
portfolios of research projects that engage multi-disciplinary, multi-
organizational expertise that transcend parochial interests of
individual institutions, organizations, and companies.
The USCMI presents a unique opportunity to help build research
priority alignment among government agencies and with industry,
academia, and other stakeholders to best advance the interests of a
more competitive, safe, secure, and environmentally friendly MTS. The
USCMI also provides the collaborative forum to approach research in a
new way--not just issuing competitive grants/contracts for project
execution, but rather formulating collaborative teams that bring
together diverse stakeholders in new ways. The USCMI has been
authorized and established, but needs additional funding to execute
meaningful research, development, and demonstration projects in
partnership with the industry to drive results for the nation.
Investing in U.S. Maritime Leadership
A robust U.S. maritime infrastructure is a cornerstone of economic
and national security. As we modernize our ports, shipbuilding
capacity, and regulatory systems, we must ensure that uncrewed systems
are fully integrated into these efforts. Strategic investments in MRAS
technology, workforce development, component supply chains, and
infrastructure will position the United States as a leader in this
transformative industry.
Conclusion
MRAS are entering the market on a global scale. These systems will
be operating at sea regardless of the United States' participation in
this technological evolution. As outlined above, this is for a good
reason--MRAS offer unparalleled opportunities to enhance safety,
efficiency, and sustainability in maritime operations while
strengthening U.S. competitiveness and national security.
Until maritime regulations are updated to include the safe and
responsible development, certification, and operation of USVs and UUVs,
the United States shall remain a follower in the development of this
technology.
AUVSI and its members are committed to partnering with Congress,
federal agencies, and industry leaders to ensure the development of a
robust ecosystem that supports the integration of these systems into
our nation's maritime infrastructure.
With your continued leadership and support, the United States can
solidify its position as a global leader in maritime innovation and
maintain the strength and resilience of its MTS.
Mr. Ezell. Thank you. The gentleman yields.
I now finally recognize Mr. Brian Schoeneman with Seafarers
International Union of North America. You are recognized for 5
minutes.
TESTIMONY OF BRIAN W. SCHOENEMAN, POLITICAL AND LEGISLATIVE
DIRECTOR, SEAFARERS INTERNATIONAL UNION OF NORTH AMERICA, ON
BEHALF OF USA MARITIME
Mr. Schoeneman. Welcome aboard, Chairman Ezell, and thank
you, Ranking Member Carbajal and the rest of the Coast Guard
Subcommittee for holding this hearing.
My name is Brian Schoeneman, and I serve as political and
legislative director for the Seafarers International Union. I
am also chair of USA Maritime, the coalition of shipping
companies, associations, and unions that make up the fully
manned U.S.-flag internationals.
The goal of this hearing is to discuss the current state of
our maritime infrastructure. I would rate our infrastructure a
solid ``C.'' There is much work to be done if we are going to
catch up to the rest of the world, particularly China, who has
invested billions, if not trillions, into their maritime
sector.
In less than 30 years, China has emerged as the dominant
commercial maritime power. They are the world's largest
shipowner. They are the world's largest shipbuilder, and they
control most of the world's trailer chassis, maritime cranes,
and shipping container supply.
In that same time period, the United States has invested a
pittance. And our industry scrambles each year to convince
Congress to spend the money needed to adequately fund our
handful of Government programs, like the Maritime Security
Program. I would ask each of you to join us in that effort this
year so that Congress will again give us full funding for these
programs.
Now, while we aren't failing when it comes to our
infrastructure, we are on the brink of failure. Why? Because
we, as a Nation, have not made maritime a priority. Our
strategic opponents have, and the proof is all around us.
So how do we fix it? Fortunately, we have all the tools we
need. We just need to use them. America needs more mariners, we
need more cargo, and we need more ships of all types, from
icebreakers and fireboats to oceangoing commercial vessels. We
can fix these problems by making maritime a priority again,
like it has been in our past.
We continue to work hard to solve our current mariner
shortage. Even before COVID-19 made a bad problem worse, the
industry was focused on recruitment and retention. Since COVID,
we have worked hard to claw back our losses and bring new
mariners into the fleet. Some of this required legal changes,
including a pilot program that helped us cut the time needed to
create able seafarers in half, which we urge Congress to make
permanent. The rest required a change in how we recruit.
The world has changed. In the past, the merchant marine
sold itself: See the world, visit exotic locations, and get
paid to do it. That was the message, and it brought in all the
mariners we needed.
Today, your average mariner doesn't care nearly as much
about pay or where they are going. They are more likely to ask,
is there Wi-Fi on the ship? Quality of life more than anything
else is the name of the game now.
Where we train mariners also needs work, and Joe alluded to
this. The United States Merchant Marine Academy needs
significant investment to repair crumbling infrastructure. And
while our private sector training schools, particularly our
union schools, are world class, Kings Point and the various
State academies have long suffered from too little attention, a
lack of funding, and declining enrollments.
When it comes to ships, we are not living up to our
aspirations. Current law says America must have a merchant
marine sufficient to carry a substantial portion of our
waterborne foreign commerce. We don't do this. Our fleet
carries less than 2 percent of our foreign commerce and
represents less than 0.4 percent of the world's shipping fleet.
We saw the damage overreliance on foreign shipping creates
during the most recent supply chain crisis. More U.S.-flag
market share will help to strengthen the resilience of our
national supply chain.
The Jones Act keeps our domestic industry strong, but we
have no such protections for the international fleet. American
ships have become too dependent on Government cargo. This cargo
is barely enough to maintain the handful of ships we currently
have. Defense cargo is down, as we are supporting fewer
warfighters across the globe. And in one of the first acts of
the new administration, they suspended foreign aid cargo.
Let me be clear. There is no more ``America First'' set of
foreign aid programs out there than the Title II P.L. 480 Food
for Peace program and the Food for Progress program. These are
programs that work. They are programs where you buy food grown
by Americans, carried by Americans on American ships to feed
hungry people around the world.
Food for Peace supports American mariners and farmers, and
it helps expand demand for our products overseas. These aren't
just giveaway programs. These programs must be restarted before
it costs us even more ships and jobs than it already has.
America also needs new sources of commercial cargo. The
best way to get new cargo, in our view, is the creative use of
the Tax Code, providing tax incentives and discriminating
tariffs that benefit shippers when they put America first. Like
Buy American laws, we want to create ship American incentives
that get businesses to contract with U.S. carriers to carry
more cargo.
For us to compete against China, we must change our
priorities, and it needs to start today. We can't afford to
wait any longer. Each day we wait, the pricetag increases, the
potential downside of doing nothing increases, and each day we
wait, our strategic opponents grow stronger. The time for half
measures and incremental progress is over. We need bold
decisive action, and it must be now.
Thank you, and I look forward to your questions.
[Mr. Schoeneman's prepared statement follows:]
Prepared Statement of Brian W. Schoeneman, Political and Legislative
Director, Seafarers International Union of North America, on behalf of
USA Maritime
Thank you to the Coast Guard subcommittee, especially Chairman
Ezell--welcome aboard--and Ranking Member Carbajal, for holding this
hearing today. I'm pleased that the maritime industry, so often
forgotten when we talk about transportation infrastructure, is being
recognized as part of this America Builds series, and I'm pleased to be
able to join my colleagues here to testify before you on this subject
today.
My name is Brian Schoeneman, and I am the Political and Legislative
Director for the Seafarers International Union (AFL-CIO). In addition
to that role, I was elected by my peers to serve as Chairman of USA
Maritime, the coalition representing the U.S.-Flag international
sailing fleet, made up of ship operators, trade associations and labor
organizations owning, operating, crewing and advocating on behalf of
the United States Merchant Marine in international commerce. I'm here
today wearing both caps, as a representative of maritime labor as well
as on behalf of USA Maritime.
Fortunately, I can do this because the interests of everyone in the
American international maritime industry align. Since the founding of
our republic, and for hundreds of years before America was an
independent country, the people who live here have been dependent on
foreign commerce. Today is no different. What is different, however, is
how little of our international commerce American ships and mariners
actually carry. The vessels and crews bringing cargo into the United
States, and the vessels' crews carrying cargo leaving the United States
are rarely American. Hundreds of thousands of mariners each year visit
ports around the United States, and the vast majority of them hail from
East Asia and Eastern Europe.
As the new Administration begins its work, one of the things we've
seen is a renewed focus on the concept of ``America First.'' This is a
welcome change for the U.S.-Flag international fleet, because, in this
industry, America has not been first in quite a long time. While
statistics vary, and you can rank the size of our fleet in a variety of
ways from vessel types to deadweight tonnage, every ranking usually
finds the United States near the bottom in terms of world shipping.
China, on the other hand, is always near the top. A recent study by
the United States Trade Representative puts into perspective the
relative differences between the United States and China when it comes
to maritime. For instance, according to USTR, China's global
shipbuilding capacity represents more than 50% of the world's
shipbuilding capacity today. In 2023, China built more than 1,000
oceangoing ships--we built fewer than ten. They are now the world's
largest shipowner, with 19.1% of the global commercial fleet under
their control--less than zero point four percent of the world's ships
fly the U.S.-Flag today. Chinese based companies, many of whom have
direct ties to the Chinese government, own stakes in 95 overseas ports,
including the Panama Canal, and they dominate several other critical
maritime infrastructure sectors.
How bad is it? According to the USTR, China produces 86% of the
world's trailer chassis, 80% of the world's maritime cranes, and 95% of
the world's shipping container supply. China has spent the last thirty
years dumping hundreds of billions of dollars into its maritime
industry. In that same period, the United States has spent a pittance,
and the industry scrambles each year to convince Congress to spend the
money needed to adequately fund the Maritime Security Program, Tanker
Security Program and various other maritime programs at their fully
authorized levels. The industry is in the middle of this effort right
now, and we ask the members of his Committee to join us in urging the
Appropriations Committee to ensure full funding for MSP, TSP and the
other maritime programs that are critical to the continued existence of
the United States Merchant Marine.
The goal of this hearing is to discuss the current state of our
maritime infrastructure. If I were pressed to give a grade to our
maritime infrastructure, I would rate us a solid ``C.''
We aren't failing, but we are on the brink of failure. In many
ways, America's maritime infrastructure is crumbling. Why? Because we,
as a nation, have not made maritime a priority. Our strategic opponents
have, and the proof is all around us.
Now, to be clear, this is not an insurmountable problem. To
paraphrase former President Bill Clinton, there is nothing so wrong
with America's maritime industry that it cannot be solved by what is
right with our industry. We have some of the smartest, most dedicated
people in the world in this industry. We have some of the greatest
thinkers, the loudest and most eloquent voices, and tens of thousands
of the best merchant mariners on the planet. Working together, we can
fix these problems and turn this ship around.
My colleagues who represent ports and shipbuilders can paint a
better portrait of their respective areas than I can, so I will defer
to their expertise and focus on the areas USA Maritime represents--our
maritime workforce and our ship owners and operators.
Besides our shipbuilding capacity and our ports, the United States
maritime infrastructure includes all the other aspects of the industry
required to make it successful, including the critical role mariners
play. How we recruit them, how we train them, how they're paid and
their benefits, and how we keep them safe. Another aspect are the
ships--not how we build them, but how we operate them, how we keep them
sailing, and how we keep them under the American flag. Finally, the
cargo that our ships carry--how much, what types, and where it's going.
These are the fundamentals of our maritime infrastructure, and we face
significant challenges in every aspect of it.
The industry, alongside our colleagues from MARAD and DOD, has been
sounding the alarm on our mariner shortage for nearly a decade now.
Even before the COVID-19 pandemic exacerbated the problem, we were
already facing significant recruitment challenges, with an ageing
workforce that was hitting retirement and not enough new blood to
replace our losses. As far back as 2017, MARAD has been coming to
Congress, citing a shortage of nearly 2,000 trained unlimited tonnage
credentialed mariners. COVID made the problem far worse, as retirements
spiked and our training programs were shut down. Thanks to some law
changes, such as the reduction in the time it takes to create an able
seafarer--law changes that were enacted as pilot programs but which we
hope will be made permanent--we've begun to claw back the worst of the
shortages, but there still remains considerable work to do.
This mariner shortage is not solely an American problem. A 2021
International Chamber of Shipping study indicated the need for an
additional 90,000 qualified maritime officers by 2026 to operate the
existing world-wide fleet.
How we recruit and retain mariners must change as well, as the
world has changed, and the expectations of workers have changed. In the
past, the merchant marine sold itself. ``See the world, visit exotic
locales and ports, and get paid to do it'' were the messages, and they
were appealing. Today, your average recruit doesn't care nearly as much
about how much they'll get paid or where they're going. They're more
likely to ask, ``is there WiFi?'' or ``how's the food?'' Quality of
life issues are key, and those are not easily solvable, and it will
take a fundamental change in how we recruit mariners and where we put
our efforts into retaining them. Providing good paying jobs and good
benefits is simply not enough anymore. We also know that many Americans
just don't realize that going to sea is a viable option for them. Since
the end of the Second World War there hasn't been a major recruiting
drive for the merchant marine. While we were telling young Americans to
``Be All You Can Be,'' ``Aim High,'' and become one of the ``Few, the
Proud,'' we weren't telling them anything about the merchant marine.
Thanks to language in last year's NDAA, the Navy is tasked with coming
up with a recruiting campaign on behalf of the Merchant Marine, and
we're looking forward to working with them on implementing it.
How we train mariners also needs work. The United States Merchant
Marine Academy needs significant investment, to repair crumbling
infrastructure, buildings in disrepair, and to bring its standards up
to those of its sister service academies. While our private sector
training schools, especially those run by our maritime unions, are
world-class and doing well, King's Point and the various state maritime
academies have long suffered from too little attention, a lack of
funding and dropping enrollments. Cal Maritime, for instance, will be
shuttering its current campus and moving to Cal Poly's campus in Solano
over the next two years as they merge the two schools together. Our
state maritime academies are still paying for the fuel to run their
training ships and passing those costs on to their students. And while
there are student incentive programs designed to help reduce the cost
of these programs for students who want to go to sea, the programs are
too small and need to be greatly expanded to help more students.
Further, expanding MARAD's ``Centers of Excellence'' program for
training schools and fully funding it will help expand our ability to
train the next generation of merchant mariners.
Shifting away from the mariner question, we move over to ships, how
we operate them and how we keep them sailing.
The preface of the Merchant Marine Act of 1936, which remains the
current policy of the United States today, states that ``[i]t is
necessary for the national defense and development of its foreign and
domestic commerce that the United States shall have a merchant marine .
. . sufficient to carry its domestic water-borne commerce and a
substantial portion of the water-borne export and import foreign
commerce of the United States and to provide shipping service essential
for maintaining the flow of such domestic and foreign waterborne
commerce at all times . . . ''
We do not do this. We have not done this for decades, if not
longer. Our merchant marine carries less than 2% of the waterborne
foreign commerce of the United States. We saw the damage our
overreliance on foreign shipping had during the supply chain crisis
after the pandemic. Ensuring more U.S.-Flag market share for commercial
shipping can help to strengthen the resilience of our national supply
chain. While our domestic industry remains strong, and the Jones Act is
doing its job of protecting our domestic trades from foreign
interference, our international sailing fleet has no similar
protections and must compete against the rest of the world, where their
competition doesn't have to pay American taxes or comply with the same
laws American corporations based here must comply with. The result has
been that American ships have become dependent on government impelled
cargo--foreign aid, defense cargo, and other government sponsored
cargo--to keep our ships sailing.
This cargo is barely enough to maintain the handful of ships
currently under the U.S.-Flag. There is definitely not enough to expand
the fleet significantly, or even to meet the growing needs the
Department of Defense will likely have over the coming decades,
especially if we find ourselves in a conflict with a great power. In
addition, we have seen significant impacts on these forms of government
impelled cargo. Defense cargo is down, as we are supporting fewer
warfighters across the globe. Foreign aid cargo has been suspended, and
it is likely that many of the ships currently sailing as we speak will
be returning to port to be laid up until the futures of USAID, the Food
for Peace, and Food for Progress programs are clarified.
Let me be clear--there is no more ``America First'' set of foreign
aid programs out there than the Title II PL 480 Food for Peace program
and the Food for Progress program. These are programs, which have been
around for more than 70 years, where American food is purchased and
shipped on American ships to help feed hungry people and expand demand
for American commodities. These programs are some of our best
diplomatic tools, and they work. The Philippines were long one of
America's main recipients of Food for Peace shipments, and today they
are our third largest market for American wheat. When these programs
work, they are not simply giveaways to foreign countries--they are
programs that support American farmers and merchant mariners, and they
should be continued, regardless of what happens to USAID.
It's not enough to just hold on to what we currently have, since
what we currently have is not enough. If we are to raise the grade on
our maritime infrastructure, we must have new sources of cargo--
commercial, not government cargo--that we can carry. The best way to
bring this about is the creative use of the tax code, providing tax
incentives and discriminating tariffs that benefit shippers when they
choose to ship American. Like ``Buy American'' and ``Make American''
laws, creating ``Ship American'' tax incentives and discriminating
tariffs could incentivize voluntary participation by businesses, large
and small, to contract with U.S. carriers so that more commercial cargo
moves on American ships, thus supporting American jobs. For too long,
the U.S. Merchant Marine has been focused largely on government
cargoes, and we cannot continue this trend indefinitely. For American
shipping to be commercially viable, we need to be able to compete
directly against foreign operators and win. Amending the tax code, for
instance, to allow American importers and exporters to deduct up to
twice the amount of their transportation costs if they use American
ships could help drive demand and increase the cargo available for our
ships.
Solving these problems and raising the grade on our maritime
infrastructure is not going to be quick or easy. It is going to take a
fundamental altering of our national priorities, making maritime one of
them. It's going to require the federal government doing something it
rarely does well--work together. MARAD, the Coast Guard, the Defense
Department, Customs and Border Protection, USDA, the State Department,
among others will all need to pull on the same line at the same time if
we are to move the needle to improve and make maritime infrastructure
more robust
Fortunately, we have many champions in Congress who understand what
needs to be done and are willing to put in the work to get it done. The
SHIPS for America Act, a bipartisan piece of legislation soon to be
reintroduced, represents one of the largest, most comprehensive pieces
of maritime legislation in the last century. Not since the Merchant
Marine Act of 1970, or going back even farther to the Act of 1936, has
there been a more fundamental rethinking of how we do maritime in
American. USA Maritime is proud to endorse the legislation, and we are
committed to working with Congress to see its provisions enacted into
law.
As you all are aware, the problems we face now are not new. We have
faced similar problems before in America and we have overcome similar
problems before in America. But each time we've faced them and overcome
them, it has been part of a nationwide, concerted effort. There were
days, in the United States, where shipping and maritime issues were
kitchen table issues. People lived by the water, worked on the water,
bought and sold goods via the water, and traveled on the water. If we,
as a nation, choose to go the route that China has taken--one where
maritime becomes a national priority--we can return the American
merchant marine to its primacy of place. We can position US maritime
well for the future--as the safest, best managed, best maintained, best
choice for maritime transportation in the world.
It has taken China thirty years of intentional effort to dominate
world shipping for them to be in the position they are today. It has
taken them billions, if not trillions, of dollars to build their
shipbuilding capacity and their merchant fleet into the powerhouses
they are today. We don't have the luxury of time or their seemingly
unlimited resources, so we have to work smarter.
For us to compete against China, to compete on the world stage in
the way we used to, it is going to take the combined efforts of the
United States government and the private sector, working together in
partnership, to arrest this decline and rebuild our maritime
infrastructure.
It needs to start today. We cannot afford to wait any longer. Each
day we wait, the price tag increases. Each day we wait, the potential
downside to doing nothing increases. Each day we wait, our strategic
opponents grow stronger. The time for half measures, for incremental
progress, is over. We need bold, decisive action and it must be now.
We must work together, now, not tomorrow, not the next day, to
solve these problems and restore the United States Flag to its rightful
place on the waves.
Thank you, as always, for the opportunity to testify.
Mr. Ezell. Thank you, sir.
I would now like to recognize the former chairman of the
subcommittee, Mr. Webster, for his opening 5 minutes of
questions.
Mr. Webster of Florida. Thank you, Mr. Chairman. And
congratulations to you, and thanks for putting this panel
together. It is really awesome. It is a good hearing.
I ask my good friend Paul Anderson from the Port of Tampa
Bay, two hurricanes last year damaged a good portion of the
Coast Guard's equipment, and some of it was damaged. Some of it
was actually destroyed because they are only limited to partial
nighttime operations. And so I was wondering what your thoughts
are on ways we could repair or replace this equipment in a
timely manner.
Mr. Anderson. Yes. Thank you very much, Chairman Webster.
The double impact of two hurricanes in a 12-day period was
truly both extraordinary, unprecedented, and caused great
damage to not only people's lives but the impacts on the
ability of Port Tampa Bay to carry cargo into the port.
We supply over 10 million residents of the State of Florida
and over 60 million visitors with fuel supply. Our fuel
terminals were damaged, all seven of them. They were restored
very quickly.
But the most long-term damage we are still dealing with
today, as you alluded to, is the ATONs, the aids to
navigation--the range lights, the channel markers--and it is
causing restrictions on our 45-mile channel operations.
They are restricting container vessels, but these are
[inaudible]. The largest ships that come into the Gulf of
Mexico are restricted to daytime operations, due to the fact
that while the Coast Guard is doing everything they can do
within their process to restore the navigational aids, the
process itself is holding the Coast Guard back to be expedient
and nimble in responding to repairing these ATONs.
And I would propose today the committee consider that for
future Federal heavy-weather events and natural disasters that
are declared as a Federal emergency, potentially we could have
repaired these with our contractors working with the Coast
Guard and had those done. Here we are 5 months later. While the
Coast Guard did have the emergency funding, it is going to take
them at least until the end of summer, where we are going to be
here almost a year without full operations.
And I think we are great partners with the Coast Guard.
They are doing everything they can. But, as we all know, there
are certain regulations. They do not have the authority to do a
public-private partnership in this instance.
I note, Chairman Ezell, we talked about this last year in
the WRDA hearing. They can be very powerful multipliers of
expediting projects, and in this case, it would get us back to
full operations at Port Tampa Bay.
Mr. Webster of Florida. I did want to talk about also the
cranes in the port being manufactured by China. And you were
the president of the full association, American Association of
Ports.
What do you think the security risk is in using those
cranes, and what does it mean for America's ports and their
supply chain?
Mr. Anderson. Well, yes, you are referring to the American
Association of Port Authorities. We did a study among American
port members, and over 80 percent of the ports of the United
States are manufactured by ZPMZ, a CCP-controlled and funded
company.
Our port ourself, because we had low-bid State laws,
required us to buy our first two post-Panamax heavy-lift cranes
from China, but we are preparing to buy two additional cranes--
three additional cranes that will be by Allied Partner. There
are only three in the world. This will be a German company but
manufactured in Ireland.
And we are doing that because of the security risk that we
feel there will be. I know that agencies within the Government
that have oversight of this also have looked deeply into this.
And I do believe there is an ongoing risk in the competitive
aspect that Mr. Larsen outlined his concerns about China and
their subsidies, unfair competitive advantage it gives and
works against American companies.
I do believe we should also move boldly, quickly, as I
heard from my fellow testifier down the table, to support the
American manufacturing not only of shipyards, because cranes
are built at shipyards. We have the capacity and the know-how
to build these. We just need to move. And really, it needs to
be led by all of you here in Congress, not only as authorizers
but as appropriators.
Mr. Webster of Florida. Thank you very much.
I yield back, Mr. Chairman.
Mr. Ezell. The gentleman yields.
The Chair now recognizes Mr. Larsen for his 5 minutes of
questioning.
Mr. Larsen of Washington. Thank you. Thank you, Mr. Chair.
Mr. Anderson, you are going to be highlighted a little bit
early on here. So I noted during my initial statement that the
Port of Anacortes and Port Bellingham as well had their Clean
Port grants frozen or paused or we are not quite sure what the
right verb is yet.
It is a dumb move. It is disastrous. I know that Port Tampa
Bay has a $1.8 million planning grant under the program, and
there are ports in Alaska having $45 million, ports around the
country. I have no idea if all those are frozen or paused.
Can you give me the status of your particular grant?
Mr. Anderson. Yes. Thank you, Mr. Larsen. Our entire
industry is very alarmed and concerned about the pause on grant
funding. There is a lot of uncertainty. In fact, just last
week, we had an emergency board call of many of our members
representing the west coast, the Great Lakes, the east coast
and the gulf ports.
And it will be very difficult and burdensome for ports that
have had planning and strategic planning involving the use of
Federal grants. I believe we are very, very early on in this
new administration. And we discussed we just need, I think, to
be patient and let this work its way out. We just can't stop
delivering funds.
I think once they are reevaluated and looked at, pragmatism
will win the day. We believe that these grants, including all
the grants in the Bipartisan Infrastructure Law, the Port
Infrastructure Development Program, and the other grants are
critical to competing on the world stage with ports around the
country.
Mr. Larsen of Washington. Yes. I think these investments--
the administration has been clear they don't believe in climate
change or don't want to fund climate change. And if that is
their view, that is fine.
But my dad was a lineman for the Snohomish County Public
Utility District. They put electric wires up everywhere, and we
didn't call it anything but utilities. That is all it is. It is
nothing more than that. And it is getting wrapped up in this
other discussion when, in fact, moving forward in our case, the
Port of Anacortes, we developed a wholly undeveloped/
underdeveloped piece of property that has been sitting unused
to its maximum jobs potential for a long, long time. And now
that is on pause. Imagine that story is being told in every
Democratic and Republican district in this country right now,
because of this uncalled-for pause.
Mr. Schoeneman, you discussed somewhat the issue of P.L.
480. Have you heard concerns specifically about the Trump
administration's--my question says ``changes,'' I wouldn't say
``changes''--destruction of USAID?
Mr. Schoeneman. I mean, right now for us this is a major
issue. We have had--at least I talked to one of our biggest
food aid carriers, and they have got ships that are currently
sailing. One of them has already been laid up because they
don't have cargo. Another one is on its way back from Africa,
and it will get laid up when it gets here.
And every time they lay a ship up, that is 20, 30 jobs for
my members and for the rest of the industry. And we don't know
how long the ships are going to be out of service.
In addition, the company is owed like $6 million on these
contracts, and they are worried about never getting paid. And,
I mean, we are talking about--we are not talking about big
massive corporations here. We are talking about small family-
owned businesses that need that money that are operating on a
pretty shoestring.
And I want to make sure my mariners get paid. I want to
make sure my mariners are not trapped in Africa for months at a
time. If they get a stop work order while they are unloading a
ship and they just got to sit there--I mean, we have had that
happen before. It happened a couple years ago on a Food for
Progress trip, and my mariners were stuck for months.
So we are really concerned about this. And I think, as the
President is looking at AID--and regardless of what happens to
AID, I think these programs, Food for Peace, Food for Progress,
they are critical to not only U.S. farmers but to the U.S.
merchant marine, and they are one of our major cargo bases.
And if it goes away--I will tell you, in 2013, the
percentage of cargo that we carried under law, we previously
had carried 75 percent minimum food aid cargo. It was cut to 50
percent. And over the next 10 years, we lost more than a dozen
ships from the fleet permanently, because the cargo just wasn't
there to sustain the work. And if this continues for a while, I
expect that is going to happen again. So----
Mr. Larsen of Washington [interrupting]. Thanks. I don't
want to misquote. I certainly think I am paraphrasing
accurately our former colleague Roger Wicker, who is the Senate
chair of the Senate Armed Services Committee, yesterday when he
outlined the fact that USAID he believed was a good counter to
the Belt and Road Initiative of China, China's Belt and Road
Initiative. And now that tool has potentially if not already
been taken away to counter China.
Mr. Schoeneman. Absolutely. I mean, the bottom line is
wherever we walk away, China walks in. And we can't afford to
be putting ourselves in a position where we take a step back on
the world stage.
I was talking to some of my labor colleagues yesterday at
the Solidarity Center. We have been working on a lot of these--
USAID has been working along with us on a lot of these issues
overseas, trying to raise quality of life and provide union
support for workers in other countries.
And that is the best way for us to raise the standard of
living so that our American workers can compete against foreign
workers is to make sure that they are getting the same pay and
benefits and treatment that our guys get so that that isn't an
issue. So not having AID out there doing that is pretty bad.
Mr. Larsen of Washington. Thank you. I yield back except to
say I love the Small Shipyard Grant Program too, Mr. Rella.
Mr. Ezell. The gentleman yields.
I now recognize myself for 5 minutes for questions.
Mr. Anderson, you mentioned in your testimony the
catastrophic damage caused by Hurricanes Helene and Milton has
devastated navigational aids in your shipping channel.
There has been discussion on how public and private
partnerships may be used to benefit both the Coast Guard and
ports. Can you expand on this just a little bit?
Mr. Anderson. Yes, Mr. Chairman. I believe that if the
Coast Guard had the authorizing language to be able to rapidly
respond during post-hurricane heavy weather, natural disaster
events to repair facilities with a port partner as a public
entity but delivering private--we have private contractors on
retainer ready to go.
We have emergency disaster, the largest companies in the
world, BELFOR, others that could respond in days instead of
months or even a year. This is in no way a criticism of the men
and women of the Coast Guard. We have had meetings with the
admiral last Monday. We have had with the captain and sector
commander of the Coast Guard.
It is their ability to be able to work through the rules.
So I think this committee could allow them, in a future bill,
to give them the flexibility and the authorization and a
mechanism to be able to be much more responsive.
And your ports, Mr. Chairman, they are potential at risk
for the same type of issues. All the gulf ports are at risk,
Atlantic coast where you have hurricanes. So I think it would
be very prudent for the committee to consider that.
Mr. Ezell. Last Congress, Mr. Anderson, I introduced
legislation to expand the eligible uses of the Capital
Construction Fund to include marine terminal operators, MTO.
In your opinion, how would this legislation improve the
efficiency at our ports?
Mr. Anderson. Mr. Chairman, clarify with you. Authorization
for marine terminal operators?
Mr. Ezell. Yes, to expand the Capital Construction Fund to
include marine terminal operators.
Mr. Anderson. Yes. I think it would be very important. I
mentioned earlier that the terminals that China is building,
they are all subsidized.
Our Nation needs to do more of the work. There are American
terminal operators that could expand much more quickly, more
rapidly. They could fill the voids. Again, I heard one of my
fellow testifiers here talk about when we pull out or we don't
invest, China fills the void.
And I believe that capitalizing and supporting the
capitalizing of marine terminal--for example, in our case, we
have Ports America as our terminal operating partner. They are
the largest in North America, 44 terminals, I believe.
And they co-invest with us in our terminal operations. We
are a landlord port. They are the operator. When we buy these
cranes I mentioned in my earlier testimony, they are co-
investing with us as a private terminal. And they also invest
with us on the warehouses, on the infrastructure for the
cranes, the power, and all of the other marine infrastructure.
So I believe that would be a very positive step for marine
terminals.
Mr. Ezell. Thank you.
Mr. Rella, there has been an increased attention on
revitalizing the United States maritime industry and increasing
competitiveness of the domestic shipbuilding industrial base
relative to foreign competitors.
What do you see as the biggest challenge to accomplishing
this for our shipbuilding industry?
Mr. Rella. Well, it is really not a level playing field.
That is the biggest problem, right? Our shipbuilders wear
steel-toe shoes. They wear hardhats. We have OSHA oversight to
make sure our employees are safe. We have permitting
requirements, inspections for contaminants and hazardous waste
management. We have USL&H insurance requirements.
So we have a heavy burden to run a shipyard in the U.S. for
the right reasons, right, not necessarily for the wrong. But we
care about our people a lot more than some of our competitors
do. So, we need to understand that, number one, it is about the
people that work in the shipyards, too.
So there are ways--for example, one of the easy things to
do is with Government contracts where--does that mean I only
have 6 seconds?
Mr. Ezell. Go ahead. Now, finish up.
Mr. Rella. Okay. So the Government contract entity where
large shipyards are building Navy vessels or larger vessels for
any of the Government defense sectors, a small business
component requirement, now, that exists but it doesn't always
have teeth, right?
So, you can have a small shipyard, and that includes set-
aside for disabled veterans, women-owned businesses, HUBZone
entities. So, building those into the contracts with teeth,
mandatory compliance with the set-aside work for small
businesses, will stimulate the overall maritime economy.
It will help the small shipyards out. It will build the
feedstock of employees for the future for the bigger yards,
because a lot of times small shipyards are where shipbuilders
start and then it becomes their profession, right?
And then they go into larger shipyards where there is a
steady flow of business, because the biggest reason we have a
hard time retaining employees in the small shipyard world is
the lack of a horizon on the work. How do I know I am going to
have a job? I want to buy a house. How do I know I am going to
have a job when we only have two ships to build and it is for
an OSV operator?
We need block buys, we need consistent build programs, and
the ability to tag into the contract mods with small business
clauses for the smaller shipyard component of it. That is a
start.
Mr. Ezell. Thank you.
The Chair now recognizes Mr. Carbajal for his 5 minutes of
questioning.
Mr. Carbajal. Thank you, Mr. Chairman.
Mr. Anderson, I appreciate the information you provided in
your testimony, quote, ``Increases in infrastructure spending
could spur economy-wide returns of $2-$3 for every dollar
spent.''
This statement really lends itself to the benefit of the
Federal investment in programs like the Port Infrastructure
Development Program and the Marine Highways. As you know, these
programs were funded by the Bipartisan Infrastructure Law.
The Trump administration has released conflicting
information calling on funding from the Bipartisan
Infrastructure Law and the Inflation Reduction Act to be paused
while also exempting some programs. This subcommittee has yet
to get clear answers from MARAD regarding the status of current
grant programs.
Can you detail what that would mean for ports if the Port
Infrastructure Development Program were paused; and two, are
you aware of any ports that have been ordered a work pause and
unable to recoup grant awards?
Mr. Anderson. Thank you, Mr. Carbajal. I am not aware of
specifically any ports that have been told to pause directly as
of last week. I think this is an evolving situation that we are
all patiently waiting further guidance. Ports do strategic
planning. Our plan is a 2030 plan. We are amending it to a
2035. It is not a next year plan.
We need to plan projects with confidence that our Federal
and our State partners will co-invest with the ports, because
typically our Federal grants are a 50 percent. We are investing
50 percent. We count on those dollars.
So, in general, I absolutely think that it is critical that
ports continue to receive funding. And I will go back to my
comments. When you have an adversary or an economic war with a
nation that is building ships faster than us, building cranes,
building ports, and we are not investing in our ports to
maintain our competitive stature as well as for strategic
national events, it is very concerning.
Mr. Carbajal. Thank you.
Mr. Anderson, on January 29th, the new Secretary of
Transportation directed the Department to prioritize projects
that, quote, ``give preference to communities with marriage and
birth rates higher than the national average.'' I am having
trouble understanding how birth and marriage rates contribute
to making grant awards that strengthen our national supply, let
alone the legality of it.
I would venture to guess that this panel of witnesses
combines over 100 years of maritime experience. Does anyone
know how marriage and birth rates help determine sound maritime
investments? Anybody? Anybody on the panel? Your silence says
it all.
Mr. Anderson, do you know how Port Tampa Bay and the
surrounding area compares to the national birth and marriage
rates? And does it concern you that such factors are being
considered in awarding grants?
Mr. Anderson. I have no information or knowledge of what
that would be. I was very pleased to see the now-Secretary
support the Jones Act, which is critical to our port, our
shipyards, the workforce, the men and women who wear those
hardhats, the steel-toed shoes, the welders----
Mr. Carbajal [interrupting]. Thank you, Mr. Anderson. I
appreciate your pivot, but didn't quite answer the issue. Thank
you very much.
Mr. Schoeneman, as we discuss maritime infrastructure, we
have to include the Jones Act. Without it, domestic commerce
would be controlled by foreign interests, shipyards would
disappear, and mariner jobs would follow.
Can you discuss the importance of the Jones Act and the
impact of waivers?
Mr. Schoeneman. One hundred percent. I mean, the bottom
line is--and I believe Chairman Ezell mentioned this in his
opening statement. The Jones Act is a bedrock foundation of
American maritime law. It has been forever, at least since
1920. And there have been laws on the books since the first
Congress that provide preferences to American ships and
restricted domestic commerce to American ships.
We wouldn't be here as a country if there was no Jones Act.
We wouldn't be here as a merchant marine with no Jones Act. We
would have no shipping at all, and my mariners would have no
jobs. So for us, protecting the Jones Act is fundamental. It's
about making sure that the United States maintains its status
as a maritime power.
And regardless of who is opposing it or saying nasty things
about it, the bottom line is, even the most hard core of
conservative thinkers, Adam Smith, ``The Wealth of Nations''
man himself, flat out said that when it comes to--and I have
the quote here--it comes to--``defense, however, is of much
more importance than opulence.'' And that is what the Jones Act
proves.
The bottom line is, of all the laws you can put on the
books, if you are going to be protectionist, do it for national
security reasons, and the Jones Act is that fundamentally. So
for us, we have to do everything we can to protect it, because
we wouldn't be here without it.
Mr. Carbajal. Thank you. Mr. Chair, I am out of time. I
yield back.
Mr. Ezell. The Chair now recognizes Mr. McDowell for his
questioning for 5 minutes.
Mr. McDowell. Thank you, Mr. Chairman. And thank you to the
witnesses for testifying before the subcommittee today. We
appreciate you joining us.
And my first question is for you, Mr. Rella. Of the
financial assistance programs that the Maritime Administration
administers that you mentioned in your testimony, which do you
feel is the most valuable to the shipbuilding industry?
Mr. Rella. The Small Shipyard Grant Program is probably one
of the more significant ones. The Title XI program is good for
the operators to contract to build ships and especially for
foreign operators. I participated in the construction of a
vessel for a foreign operator through the Title XI program back
in my day. So it brings folks to the shipyards in the U.S. So
Title XI is good.
But for smaller yards, the Small Shipyard Grant Program is
great. It would be great if it was more of a 25-percent match
instead of a 50-percent match. But still, it is very helpful to
allow shipyards--and it is productivity; it is about
productivity, right? So anything we do has got to be earmarked
against the productivity improvement.
And that is how small shipyards--we have been scrapping and
fighting for many years now. We have gotten pretty good at
doing it and diversifying our product mix. So--and the way you
do that is through keeping--getting the best--keeping the best
people you have, but also innovation and technology, right? So
advancing with the latest and greatest in metal fabrication----
Mr. McDowell [interposing]. Sure.
Mr. Rella [continuing]. And shipbuilding.
Mr. McDowell. What are ways that Congress can work to
improve the existing funding programs or take action to help
bolster this industry?
Mr. Rella. Could you repeat the question?
Mr. McDowell. Sure. Yes. So what are ways that Congress can
work to improve existing funding programs or take other action
to help bolster the industry?
Mr. Rella. That is an easy one to answer. I think the SHIPS
for America Act is probably the best way to do that, right?
That is the most comprehensive, broad-reaching bill or
initiative, I call it, because I wasn't always involved in all
the bills that come through.
But I can tell you the SHIPS for America Act engages all
components of the maritime industry, from the education
institutions to all the way through to the ship operators. And
it is a path to us getting the ships that we need to support
our overseas theaters of operation.
Mr. McDowell. Sure. Mr. Anderson, a question for you.
According to your testimony, your organization has $34.6
billion in economic impact on the region.
How can Congress provide support for growth in shippers'
cargo business capacity?
Mr. Anderson. Yes. Thank you, Congressman.
The very--again, very easy, support for continue. I
believe, the--as I have previously testified, a regular
biennial WRDA bill is so important that this committee do for
our Nation's ports.
For Port Tampa Bay, it included during the last WRDA bill
authorization for the deepening of our channel, which we
absolutely will need to continue to handle the larger ships
that are waiting to come into the Gulf of Mexico. Our adversary
nations are making these investments. We need to be more
competitive.
I think the speed of delivery on how grants come out the
door is very critical. The awards that we have received in the
Port Infrastructure Development Program, for example; whereas,
from award to delivery of the check was 2 years. In the
meantime, inflationary pressure increased the cost of the
project by 40 or 50 percent.
So finding efficiencies in that process could be very
helpful as well.
Mr. McDowell. Got you. I don't have much time left. But,
Mr. Reynolds, what do you see as the biggest barriers to
continued U.S. leadership in maritime robotics and autonomous
systems?
Mr. Reynolds. So thank you for the question. I would say
the first barrier I would think of relevant to this
subcommittee would be regulations, the regulatory framework.
And, again, I point to the fact that the U.S. Coast Guard
is our leading body when it comes to the development and the
enforcement of those regulations, and I think there are great
guardsmen out there; they serve, they are always operating.
While I was in the Navy, sometimes I would be at peace, but
then I would go and operate. Our guardsmen are always
operating. And yet, it is still--frankly, it surprises me a bit
that they do not have any robotics systems.
I will point to one success they have on the National
Security Cutter, the ScanEagle has been deployed, and I think
it is being replaced by a different unmanned aircraft. And that
has been very successful. I understand they like it very much.
I would suggest that when it comes to unmanned underwater
or unmanned surface vessels, it would gain some wisdom and
would gain some operational capability, but also really
appreciate how to better regulate this technology.
Thank you. Sorry I went over.
Mr. McDowell. No worries. Thank you, sir. Chairman.
Mr. Ezell. The gentleman yields. The Chair now recognizes
Mr. Pappas for 5 minutes.
Mr. Pappas. Thank you, Mr. Chairman, and congratulations on
taking the helm of this subcommittee. I want to thank all of
our witnesses for their testimony today.
I do think that strengthening U.S. maritime has to be the
highest priority in the Halls of Congress, because the status
quo simply is inadequate to meet our economic challenges and
our national security needs.
In New Hampshire, my State is home to a number of merchant
mariners who have chosen to call my State home; helps to have
no State income tax. But I am concerned about the number of
individuals that are pursuing this career. The U.S.-flag fleet,
as small as it has been historically in the mariner pool, has
shrunk to near-record lows. So I was glad that Congress has
passed funding last December to ensure that our Government
invests in capital improvements for the Merchant Marine Academy
and also language requiring the Navy to create a recruiting
campaign on behalf of the merchant marine, the first since
World War II in terms of a major campaign.
Mr. Schoeneman, I appreciate your testimony today. As we
think about workforce, we continue to face a historically tight
labor market. This is the case across various sectors of our
economy; certainly the case with maritime.
Can you assess some of the efforts around workforce
development post-pandemic, some of the investments in the
maritime, the Merchant Marine Academy, and where Congress
should really focus its attention with respect to workforce?
Mr. Schoeneman. Absolutely. I think we have made a lot of
progress since COVID-19. As I mentioned, we have been dealing
with a mariner shortage for a while now, and it is caused by a
variety of things, not the least of which is a lot of our
mariners are older. They are getting older. They are aging out
and they are retiring, and we are not replacing them as quickly
as we need to be.
We were very happy to see that the language was passed in
the NDAA to create the recruitment drive, and we are hoping
that we can work with the Navy Department to put something
together.
I mean, as I mentioned in my testimony, we have been
telling American kids, ``be all you can be'' and ``aim high''
and ``be one of the few, the proud'' forever. But since World
War II, we haven't talked about the merchant marine at all. And
our biggest issue, we find, is people don't know what we do.
They have no idea that these jobs are even available.
And when we go into the community and say, look, we can
take--I can take a kid off the street, 18-year-old kid, put him
through our training program. In a year, we will make him a
merchant mariner, we will give him his first job guaranteed out
of school, and in 2 or 3 years, he is going to be making a
solid middle-class living. And by the time he ends his career,
he is going to make a lot of money.
And these are tough jobs, they are hard jobs, but they are
good jobs. And for the most part, our guys will work 6 months
of the year, they have the other 6 months to do whatever they
want. We cover their vacation, we provide them with benefits,
the pay is good. The food is getting much better. It is one of
the things the guys want on the ships a lot.
And a lot of the vessels in the fleet have started putting
on Wi-Fi and things like that. So we are doing our best to make
sure that we are putting ourselves in a good position to be
able to recruit.
What Congress can help us with, obviously, is the
recruitment drive. Funding for all of the training schools is
critical; fully funding the Centers of Excellence program that
MARAD put together is important, I think. And just making sure
things like student incentive payments that the maritime
academies provide, the State academies and everything.
Those are always fully subscribed, and they don't cover the
entire cost. We need to expand those programs and make sure
that we are not passing on and making it harder for mariners to
join the industry because they have got to pay for things like
fuel for their ships when they go on a sea cruise over the
summer, which no other college kid is going to have to pay.
So there is a lot of--I think a lot of room for improvement
there, and we are looking forward to working with you guys on
that.
Mr. Pappas. Well, thank you. And I appreciate your comments
as well, Mr. Schoeneman, with respect to the Food for Peace
program. And reflections on the important role that Government
cargo plays in strengthening U.S. maritime. Obviously, it can't
begin and end there, but that is a critical component. It is a
win-win for our national interests, as well as for our farmers
and for our economy.
So I hope we can continue to find ways to support that and
so many other critical programs that are a lifeline for U.S.
maritime.
Thank you for all of your comments, and I yield back my
time.
Mr. Ezell. The gentleman yields. The Chair now recognizes
Mr. Van Drew for 5 minutes.
Dr. Van Drew. Thank you, Mr. Chair. Congratulations. Look
forward to working with you, as always.
While autonomous vehicles, vessels, present both
opportunities and challenges for the maritime transportation
industry, I am concerned about safety, security, and regulatory
oversight. It is important. There are workforce implications
that are important that come along with this technology. Safety
must remain our top priority. I think that goes without saying.
Mr. Reynolds, thank you for being here today. How will
these vessels interact with crewed ships--ships that have crews
on them--port operations, and emergency response efforts?
Mr. Reynolds. Thank you for your question, Congressman. I--
so I think safety at sea is safety at sea whether there are
people on board or not. I believe that the COLREGS, although
they have not been updated in quite some time, are very well-
suited just for considering manned vessels.
But consider also the state of sensors and artificial
intelligence and other advances that have gone into the
industry already. In a calm sea, the sensors work very well and
are very comparable to what you have with a manned vessel.
But in heavy seas, because you don't need to worry about
the human element, about being seasick, about being tired,
about being rocked around on a vessel, there are actually some
artificial intelligence and sensors on board vessels that can
make ships at sea even safer.
I would, though, defer to the U.S. Coast Guard to really
work out how to do that, and AUVSI is committed to working with
the Coast Guard to come up with those regulations.
Dr. Van Drew. Thank you for the answer. So I mean, if I was
to summarize that, encapsulate that, there is tremendous
potential, but we do have to be careful?
Mr. Reynolds. Of course. Yes. Yes, sir. You know----
Dr. Van Drew [interrupting]. How about cybersecurity
protocols, are they adequate to protect these vessels from
emerging cyber threats, which, again, is another concern?
Mr. Reynolds. Yes, sir. Actually, AUVSI is a trusted
partner in cybersecurity, particularly with the U.S. Navy. And
I would also submit that cybersecurity is an issue, whether it
is a manned vessel or not. That is an issue for all systems on
every vessel.
Dr. Van Drew. I have been vocal in the past about
autonomous vehicles, whether they are on ground or in the
water. I do think we have to be careful.
The technology, I believe, has--I am stating the obvious. I
think you would agree--I think you would all agree that it must
be further researched. We still need to be careful, we still
need to know more, we have to see what could go sideways
because we don't want that to happen. There also must be a
viable regulatory framework for these vessels.
I am a guy that doesn't love regulations, but in this case,
obviously, you need them. We need to be careful. And I know
there are already efforts to do this, but there are, in my
opinion, some significant gaps.
Mr. Reynolds, back to you for a minute. What specific
regulatory changes are needed to test maritime robotic and
autonomous systems? What specifically would you like to see?
Mr. Reynolds. Thank you again for that. So currently, there
are no overall regulations that would govern this.
Currently, the captains of a port, of a Coast Guard port
are just given--I guess delegated the authority to allow
whether a vessel can go out to sea and do any testing or not
based on their judgment. Again, most of these captains of port
have never operated or been around unmanned systems before, and
it is just something that they are trusted or expected to work
out.
So they work closely with industry, very much have a
personal relationship, and it is actually a patchwork. You have
a captain of port in one area that will be different from a
captain of port in another.
Dr. Van Drew. Real quick, Mr. Reynolds. Are we where we
should be--in other words, I will talk about something else
that falls under transportation, aviation. We are definitely--
we are about a decade, at least a decade behind in drone
technology and UAS technology compared to China and some other
countries.
Are we behind, are we where we should be, are we ahead? If
you had to quickly give me a word, what would that word be?
Mr. Reynolds. So I will give a two-part answer to that.
Yes, we are definitely behind. But we are also behind because
there is not enough, I guess, incentive by industry to really
go out and develop this technology. There are so many
roadblocks.
Dr. Van Drew. Not your--forgive me for interrupting, and I
know my time is up. I am going to yield back.
I am so tired in every committee that we talk about
technology in the United States Congress, I ask that question
about a myriad of things, I know the word is always, we are
behind, we are behind. America leads. It is time we take the
lead. We have been behind for the last 4 years. Hopefully, now
we are going to move forward.
Mr. Reynolds, I thank you for your answers, and I yield
back, Chairman.
Mr. Ezell. Thank you. The gentleman yields. The Chair now
recognizes Ms. Scholten for 5 minutes of questions.
Ms. Scholten. Thank you, Mr. Chairman, and congratulations.
Wonderful to have you at the helm here in this committee.
I want to thank our panel of witnesses today for your
commitment to this incredibly important topic. We appreciate
your insights in this thoughtful conversation about maritime
infrastructure. As a Representative from Grand Rapids,
Michigan, Coast Guard City, U.S.A., making sure that we have a
strong and successful maritime industry is important to me.
Like many of my colleagues on this subcommittee, I am
concerned with the rise of global competitors, shipbuilding
industries. Adversarial nations, like China, have bolstered
their shipbuilding capabilities while domestic capacity has
decreased.
That is why the Maritime Administration's Federal
assistance programs to boost U.S. shipyard competitiveness are
absolutely critical, not only to our Nation's economy, but to
our security.
Mr. Rella, can you speak to how any potential freeze in the
Maritime Administration's Federal assistance programs could
hinder progress in domestic shipyard activities and undermine
our competitiveness?
Mr. Rella. Yes. So the Small Shipyard Grant Program is the
one most obvious, I think. If that is frozen for this year,
that would delay any new productivity improvements that would
be assisted with the Government with that program. I had
mentioned Title XI, similar thing for shipbuilders or operators
to come and build with us.
And the--just, essentially, any assistance and training and
education would also potentially hamper with our workforce
development. So we find a way to get by. It just delays our
progress.
Ms. Scholten. And getting by doesn't necessarily put us at
the cutting-edge of competitiveness, I would imagine?
Mr. Rella. No.
Ms. Scholten. Supporting our ports, including ports like
Muskegon and Grand Haven in my district, is also critical to
our national security, as well as the smooth operation of our
supply chains. While the Bipartisan Infrastructure Law made
historic investments in our ports, we have to keep pace to
unlock port capacity across the country, especially in our
Great Lakes.
Mr. Anderson, how can Congress build on previous
investments to ensure our ports can accommodate our commercial
and recreational needs in addition to protecting our supply
chains?
Mr. Anderson. Yes. As I previously mentioned, I believe,
regular passage of WRDA is vital to all of our Nation's ports.
I think I can speak for all of our Nation's ports as a member
of the American Association of Port Authorities and past chair
that we support any type of programs that support port
infrastructure. It is, as you mentioned, strategic to our
national defense, our competitiveness in a global marketplace,
and we are, in many cases, behind, particularly adversarial
countries.
So, grant programs, efficiencies in regulatory regimes that
sometimes have slowed the delivery of grant-related projects
that are, in many cases, hundreds and hundreds of millions of
dollars that get delayed, so looking at how we can improve
those, making sure whatever administration is administering
those grants, that we get velocity through the grant programs,
they don't get hung up in the bureaucratic process.
I think this committee could look at some of those,
encourage--and whatever name that program turns out to be--and
I think we all recognize that funding is an absolute linchpin
to the competitiveness of our Nation's ports today and going
forward.
Ms. Scholten. Thank you.
In addition to investing in our infrastructure, it is
incumbent on Congress to uplift our workforce. Making sure that
we have this capacity to do these projects means nothing if we
don't have the workers to actually do them. These are skilled
laborers who are at the forefront of our maritime industry.
However, we know that there is a critical labor shortage right
now.
Mr. Schoeneman, I know you have been active in calling out
our mariner shortage. How can we adjust our recruitment and
retention efforts? I know we saw incredible gains in the Coast
Guard under Admiral Fagan's leadership, and we want to make
sure that we can keep that going in our Coast Guard and match
it with mariners across the country, particularly so that we
can leverage increasing trends of Gen Z entering the skilled
trades, which is a great thing.
Mr. Schoeneman. Absolutely. I think from our perspective--I
mean, number one--and I mentioned it before--is we have just
got to make sure people know these jobs exist. They don't. You
see a truck on a road, you know there is a truck. You see an
airplane flying in the sky, you know there is an airplane.
If you are not on a port, if you are not in a district like
Congressman Mast or somewhere where you are going to see ships
all the time, you don't think about it. How does something get
to Walmart? Well, it goes on a truck. No, it goes on a ship
first, and trying to get people to understand that is hard.
So we have to do a better job in promoting ourselves. And I
think that is something the industry really needs to focus on,
and I am looking forward, hopefully with--with this new Navy
program that was in last year's NDAA, that we can start doing
that.
I think, other than that, it is just working on quality of
life. We need to make it clear that we are not recruiting the
same people that we have been over the years. They have
different priorities, and we need to make sure we are meeting
those priorities; otherwise, they are going to find something
else to do that is not going to take them away from their home
as often as this job does.
Ms. Scholten. Thank you. You have got strong partners on
this committee, and certainly in me to make it happen. Thank
you.
I yield back.
Mr. Ezell. The gentlelady yields. The Chair now recognizes
Mr. Mast for 5 minutes.
Mr. Mast. Thank you, Mr. Chairman. Appreciate you all
taking the time to be here today, share your expertises with
each and every one of us.
I want to talk a little bit about trucking. I want to speak
specifically to you, Mr. Anderson, right now a little bit about
the Port of Tampa and help you guys to help me understand. As
we go through different driver classifications, CDL, and the
Class A, Class B, Class C, all the different endorsements that
we could look at out there for an individual, and I want to ask
very specifically related to drivers that are 18 years old, not
yet 21 years old, right, a lower age driver, do you have a
problem with 18-year-old drivers coming in and out of your port
moving goods from A to B, whether it just be to another
location just outside the port because that is where it is
going to be--let's say, circling the wagons to bring it across
the State or across the country or whether directly out of the
port, directly to interstate commerce, somewhere over the road,
out to Texas or who knows where; do you have a problem in
general with somebody being 18 years old doing that?
Mr. Anderson. Thank you, Congressman. First, no, don't have
a problem. I want to thank you for your support for everything
we have done in our port.
And as we look at it, as many of our testimonies have
talked about today, there is a graying in the workforce,
particularly in the maritime industry, trucking industry, and
we would wholeheartedly support--we average about 10,000 truck
moves a day in and out of our port complex. It is a critical
function.
Our trucking companies are having difficulty finding
truckdrivers. Getting a CDL at a young age with the proper
training, safety--we ask 18-year-olds to sail on the bridge of
an AEGIS-class destroyer and drive that ship in and out of our
port or other ports. We ask 18-year-olds to get behind an
Abrams tank and drive it. I think they can drive a truck with
the proper training.
I think we need to do a better job as a Nation in promoting
the quality of life that can be in today's trucking world. It
is not the trucking that our mom and dads thought of when these
are long hauls or gone for weeks. There are really quality
trucking opportunities. You are home every night. The benefits
are good. And these can be long-term careers. And they can turn
into owning your own operation and business.
Mr. Mast. All I can say to that is: damn right. I couldn't
have said it any better myself, right? You are moving across
the seas as a part of our Navy or moving a tank across the
desert somewhere, you name it. I think you have the opportunity
to go out there and serve over our roads as well.
But let's be a little bit--and I think this comes down to:
Do we have trust in our training systems, or do we not? Do we
have trust in the licensure, or do we not? Because whether you
are 18, 28, 38, 48, whatever it might be, either we believe in
the training that you have and then the experience that you
have garnered thereafter, or we don't believe in it, right?
So let's go more specific. You don't have a problem with
somebody handling over 26,000 pounds being 18 years old?
Mr. Anderson. I do not.
Mr. Mast. Anybody have an issue with that?
Don't have a problem if somebody can go out there and get
their hazmat credentials? You are not worried about the age for
them as long as they go through the proper vetting, get the
proper clearance to do it, as long as they get the proper
training?
Mr. Anderson. I do not. And there is somebody on this
panel, I believe, who was an EOD. They didn't ask him his age
when he was doing that training.
Mr. Mast. We've just got to be able to kick well, right?
Just kick it with the end of our boot? No, that is not how we
do EOD work.
But don't have a problem with an H endorsement or an X
endorsement for somebody regardless of age as long as they have
the proper training; fair to say?
Mr. Rella. So I can't keep my mouth shut because I hire
people all the time for the shipyards, right? They have to meet
certain criteria, clean record, drug testing, and make sure
that they are doing the right things, too. Sometimes the
biggest problem is finding someone--you got to get them young
before they have a chance to screw up too much.
Mr. Mast. That is certainly--that is part of the
credentialing, right? You are not going to get the hazmat
credentialing if you haven't lived----
Mr. Rella [interposing]. Right.
Mr. Mast [continuing]. The proper lifestyle in that way.
What about--let's go to one other thing. You kind of
touched on it with your Navy and tanker analogy.
What about--let's speak a little bit, military training,
transferring over to those that want to start moving goods over
the road. Just compare and contrast to me a little bit: Where
do you think our military truckdriving training is at?
Should somebody be able to come right out of service, take
off the uniform, put on a different pair of boots, and step
into the rig, or do you think they are not meeting the--the
military is failing somewhere and not getting them up to the
same level, or they are? Anybody?
Mr. Rella. Again, I will chime in. So it has to be
comparable equipment, right? So, I mean, if they are training
on a military piece of equipment, if you can learn to drive a
tank, yes, but you need to learn how to drive a truck.
Mr. Mast. Military drives 916s, they call it, right?
Mr. Rella. So you just make sure there is apples-for-apples
sort of match to that where----
Mr. Mast [interrupting]. You feel the training is
comparable?
Mr. Rella. Honestly, I can't comment on that. I can't
really comment on that.
But I can tell you that what we look for is when we hire
welders is weld certifications, right? And have they--is there
a standard by which we can hire them as a second-class or a
first-class welder, right?
So they come in with credentials, we look at them, and we
even test them, right, before we hire them to make sure they
can do what they say they can do.
Mr. Mast. If you will just indulge me for one point, Mr.
Chairman?
Mr. Ezell. Yes.
Mr. Mast. And I would simply just say, for our military, if
they are not being trained at a level that is commensurate to
everybody else, that is an issue for our military to be looking
at because it is nonsensical to have somebody trained at a
lower level. And if they are being trained at the appropriate
level, and we are putting a roadblock in front of them from
getting immediately into the workforce after they have served
their country, then that is very nonsensical as well.
Mr. Schoeneman. On the maritime side, that is something we
have been working on for a while. Like, the bottom line is
military maritime, we have been working on this for years.
If a guy gets out of the Navy, spent 20 years at a post in
the Navy, there is no reason why he should not be able to come
over in the merchant marine and sail and be at that level
immediately. The same on guys with their licenses.
So for us, this has been critical. And it all comes down to
making sure that regulations and the rules the Coast Guard puts
together and all that stuff makes sense and that they take into
account the fact that you can have 20 years at sea, and that
should count for something when you come back into the
industry.
Mr. Mast. Damn right. Thank you, Mr. Chairman.
Mr. Ezell. The gentleman yields. The Chair recognizes
Representative Strickland for 5 minutes.
Ms. Strickland. Thank you, Chairman Ezell and Ranking
Member Carbajal.
I have the privilege of representing the South Puget Sound
in Washington State. We have lots of ports there. And I
appreciate all of your testimony today because you talked about
a lot of things, the need for more shipbuilding. But I would
say more importantly, the workforce development part of this.
And they are all connected to each other.
In every industry or every panel I am on, I always hear a
conversation about worker shortage. And I am going to quote Mr.
Rella who said, get them while they're young. And I think that
is a really smart strategy.
Can you talk a bit, Mr. Schoeneman, about what concrete
steps we at the Federal Government can take to make the
merchant marine and maritime supporting skilled trades a more
viable career path for younger people?
When I host my academy night, there are students who show
up, they don't even know what the Merchant Marine Academy is or
that it exists. And so just some ideas about what you think we
can do better to reach out to younger people?
Mr. Schoeneman. I think, obviously, number one, is make
sure they know what it is. And I think when it comes to Kings
Point, Kings Point is the diamond in the rough. People just
don't realize. They think about the service academies, they
think about Annapolis and Colorado Springs and they think about
West Point, but they don't think about Kings Point.
And it is one of these things where I told my son, I was
like, you are looking for colleges; I know one that is pretty
good. How about you check over here.
Ms. Strickland. Right.
Mr. Schoeneman. When it comes to what Congress can do, I
think, obviously, making sure that we have the ships and the
cargo and the long-term jobs, that is the number-one thing.
Nobody wants to get started in an industry that people think is
dying, you know.
Ms. Strickland. Right.
Mr. Schoeneman. And, I mean, Joe talked about it. Like,
when you have serious construction in the shipyard, that means
you got work for a long time. People are going to want to do
those jobs.
In the merchant marines, the same way. My guys want to know
that that ship is going to be moving and that it is going to
have cargo and that those routes are going to exist. And if
they get started, they are not going to end up spending 10
years and then have to transition into another job.
So from our perspective, anything Congress does that
supports the Maritime Security Program, supports the tanker
program, increased funding for those programs, getting the
funding so that it is done properly every year, that keeps
those jobs in existence, and that makes it possible for us to
go out and recruit.
And the same thing for when it comes to recruitment, I have
been mentioning over and over again, we have to get that stood
up so that we are telling people, hey, this is a viable career
and you should try it out. And I think once we do that and we
put the money that we need to into our training and the service
academies and the State academies, I think we will be in a much
better position than we are right now.
Ms. Strickland. Yes. So what I just heard you say is
investing in our maritime manufacturing industrial base so
there is certainty, and also, I would say, good trade policy to
make sure that we know commerce is going to be there.
Mr. Reynolds, did you want to add something, sir?
Mr. Reynolds. Yes, ma'am. So I have spent a couple weeks
this past--well, about a year ago up at the main--Massachusetts
Maritime Academy and working with the Massachusetts Department
of Transportation and actually bringing unmanned systems to
that campus, and I want to point out that we talk about
unmanned systems. The first thing I suggest we think about is,
they are not in lieu of manned systems. I am not trying to
threaten my friend here to my left one bit, but they are very
complementary.
Ms. Strickland. Yes.
Mr. Reynolds. And there--and unmanned systems can go where
we already don't send people.
Ms. Strickland. Yes.
Mr. Reynolds. And they can provide some of the--it is
trite--but I will just say the dull, dirty, dangerous tasks.
And I also believe that young people are interested in and
attracted to flying an unmanned aerial vehicle to inspect aids
to navigation, operating unmanned underwater vehicles to go do
surveys around wind farms or subsea infrastructure.
And so I just wanted to add one--we are not trying to
replace people. We think we can augment the maritime industry,
and that, including this--merchant marine academies are an
education, I think, would attract younger generations.
Ms. Strickland. Absolutely. And we have a younger
generation that is very tech-savvy. So to your point, it is not
meant to supplant; it is meant to supplement and make us more
effective.
And I just want to do one plug--and I am going to come to
you, Mr. Rella--that in Tacoma, Washington, where I am from--
and I am the former mayor, so I did a lot of work with the
ports--Tacoma Public Schools and the Port of Tacoma are
partnering to create a maritime skill center, Maritime 253.
And I say this because I hear rumblings about this
administration trying to eliminate the Department of Education.
The Department of Education provides a lot of funding to our
public school system. So if we are talking about supplementing
and enhancing programs that help us solve these problems as
well, we have to think about the Department of Education, local
school districts and how our ports, which are local taxing
districts, all need to work together.
Mr. Rella?
Mr. Rella. Sure. We talked about the maritime academies,
and they certainly are a pipeline for leaders in the maritime
industry. But then you have the need to say, for example, in a
shipyard, the skills, trades that you need to build ships. And
when I ran also, I started--and we had 700 employees at the
time. And when I left, we had 2,500 in 5 years.
So we had a really great State support and also local
support, local government support. They helped fund a lot of
our training programs. They put up a maritime training center
right next to the shipyard.
Ms. Strickland. Right.
Mr. Rella. So having incentive--maybe Federal-State
partnerships in the maritime where there are some incentives
for the State to help support that maritime industry--the
training growth.
Alabama--and I speak for Alabama because I spent a lot of
time there, but it is--I live in Florida now, but it is the
Alabama Industrial Development Training, AIDT, and they trained
folks to our procedures, to the shipyard's procedures, and they
had to qualify to that. And then we made the hire decision.
Ms. Strickland. Right.
Mr. Rella. So--and it was all free of charge to the
potential employee.
Ms. Strickland. Yes.
Mr. Rella. So those sorts of things are really how you can
build a workforce quickly. It comes from different angles. It
is the State, it is the county, it is the city, and the Federal
Government participating together to build that workforce.
Ms. Strickland. Absolutely. Yes. And public schools. And so
thank you all for your testimony.
Mr. Rella. And the public schools.
Ms. Strickland. And, again, we have to let more young
people know that this is even a career option because it is
such a vast industry.
Thank you, Mr. Chair. I yield back.
Mr. Ezell. The gentlelady yields.
I want to recognize myself for one question. Mr. Anderson,
we had some conversation about low bid. You were telling me
about an issue you had with having to buy two cranes from China
because of low bid. I have, over the course of many years in
public service, had my issues with low bid.
Could you tell me the problem that you have with the cranes
that you bought, that you had to buy because of the low bid?
Mr. Anderson. Yes. So, Mr. Chairman, we are required under
Florida statute to--when we do a procurement over a certain
amount, we go through an RFP process, and the statute requires
that you accept the low bidder in that process. And in that
instance, the other crane manufacturers, recognizing in a
bidding process with the low-bid requirement, the Chinese
company being subsidized by the CCP, that they could not
compete on a price basis, so they just didn't bid.
On the second go-around, we are piggybacking off another
bid that was done, which we are allowed to do. But there needs
to be, just like I was asking earlier for the Coast Guard to
have some flexibility and authorization to use some private-
public partnership to expedite things, there are situations
where low bid isn't--when it comes to national security, you
shouldn't be required to have a low-bid requirement.
We are using the existing law to purchase these cranes that
will be built in Ireland, so we have navigated around that. But
I believe that that is sometimes harmful to our Nation's
interests.
Mr. Ezell. Would anybody else like to say anything about
having to deal with low bid and national security or anything
else with low bid?
Okay. Thank you very much. And I recognize Mr. Carbajal for
5 minutes.
Mr. Carbajal. Thank you, Mr. Chairman.
Mr. Rella, I understand that one of your business lines is
constructing offshore wind support vessels. The current
administration has the stated goal of dismantling offshore wind
projects.
How do you expect the termination of offshore leases to
affect your businesses if that is the case?
Mr. Rella. We did have a focus and have delivered three
crew transfer vessels for the offshore industry. We are
building two more. We are close to signing the contract for
another. So it is still vibrant for us, but any future builds
might be in question.
The shipyard has diversified into other product lines, not
just relying on the offshore wind, including commercial steel
vessels. The CTVs that we are building for the offshore wind
are aluminum hulled, so they are the high-speed craft,
typically multihull.
So, we have diversified our product mix for commercial
steel and also commercial aluminum vessels, such as research
vessels and other types of vessels for the marine industry. And
we are also looking to--obviously, I mentioned earlier, we are
entering the Government sector with the Army Corps of
Engineers.
So there are things that were attractive and the investment
tax credits were something that we enjoyed the benefit of as a
shipbuilder. So, that is a good program. Wherever it goes,
however it is applied, I think for the shipyard to receive the
tax credit to that effort is good.
So that is--goes with--like, currently with the wind farm
future, see where that goes. So--but we have already flexed
and--what the wind farm industry has done for us in the
shipbuilding sector at least is enabled the shipyard to gain
the expertise in aluminum ship welding, right, aluminum
fabrication.
So we can take that expertise and move it to other markets,
which is what we are doing.
Mr. Carbajal. Thank you.
Mr. Reynolds, with a 10-percent shortfall in the Coast
Guard's workforce and a budget that is significantly below the
needs of the Service, can you discuss in more detail the
opportunity that autonomous technology could offer, and
understanding the constraints on the Coast Guard's budget, what
is the fastest and most cost-effective way for the Coast Guard
to adopt these technologies?
Mr. Reynolds. Thank you, Congressman. I will say the first
thing here is that the Coast Guard only has an R&D budget of
about $18 million a year. And that is for the entire Coast
Guard's budget.
The U.S. Navy, as well as actually Department of Commerce,
NOAA, are already investing and operating a wide range of
unmanned systems in various states of development. I would
suggest close collaboration between DHS, DoD, as well as DOC to
leverage these existing Government investments.
I will also add that the investment on the commercial side,
basically industry wants to lean forward. Industry believes
that there is something here. And so, you see quite a bit of
private investment going into this technology, and I think our
first thing we believe is that if you get it in the hands of
the guardsmen just to develop their own comfort level with this
kind of technology, they will then understand what requirements
they need and understand how to best utilize this technology.
Again, I will point to what the National Security Cutter
has done with an unmanned air vessel--aircraft, contractor-
owned, contractor-operated. So the Coast Guard doesn't actually
own this technology, but it is employed on the National
Security Cutters.
And from what I understand from past testimony, the Coast
Guard is thrilled with how this has really improved and really
extended the capability of that platform without removing any
people. It's been additive.
And so, the Coast Guard mission is extremely arduous. They
go into places that a lot of people won't want to go. They
conduct missions that maybe your robotic system could go do
maybe more safely or help them do it.
So my first thought would be partner with the U.S. Navy and
NOAA. I think they would be--I hope they would be open to that.
And then, let's work with industry about maybe what we could
deliver and just get in the hands of the guardsmen or something
like a pilot project for them to learn about themselves.
Mr. Carbajal. Thank you.
Mr. Chair, I yield back.
Mr. Ezell. Thank you. The gentleman yields.
If there are any other members of the subcommittee who have
not been recognized?
Seeing none, that concludes our hearing today.
I would like to thank each and every one of you today for
being here and providing this important testimony. The
subcommittee stands adjourned.
[Whereupon, at 11:44 a.m., the subcommittee was adjourned.]
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