House Report 119-147 - AMERICAN CARGO FOR AMERICAN SHIPS ACT

[House Report 119-147]
[From the U.S. Government Publishing Office]

119th Congress } { REPORT
HOUSE OF REPRESENTATIVES
1st Session } { 119-147

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

AMERICAN CARGO FOR AMERICAN SHIPS ACT

_______

June 6, 2025.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed

_______

Mr. Graves, from the Committee on Transportation and Infrastructure,
submitted the following

R E P O R T

[To accompany H.R. 2035]

[Including cost estimate of the Congressional Budget Office]

The Committee on Transportation and Infrastructure, to whom
was referred the bill (H.R. 2035) to amend title 46, United
States Code, to direct the Secretary of Transportation to
ensure that all cargoes procured, furnished, or financed by the
Department of Transportation are transported on privately-owned
commercial vessels of the United States, and for other
purposes, having considered the same, reports favorably thereon
without amendment and recommends that the bill do pass.

CONTENTS

Page
Purpose of Legislation........................................... 2
Background and Need for Legislation.............................. 2
Hearings......................................................... 2
Legislative History and Consideration............................ 2
Committee Votes.................................................. 3
Committee Oversight Findings and Recommendations................. 3
New Budget Authority and Tax Expenditures........................ 3
Congressional Budget Office Cost Estimate........................ 3
Performance Goals and Objectives................................. 6
Duplication of Federal Programs.................................. 6
Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits....................................................... 6
Federal Mandates Statement....................................... 6
Preemption Clarification......................................... 6
Advisory Committee Statement..................................... 6
Applicability to Legislative Branch.............................. 6
Section-by-Section Analysis of the Legislation................... 7
Changes in Existing Law Made by the Bill, as Reported............ 7

Purpose of Legislation

The purpose of H.R. 2035 is to amend title 46, United
States Code, to direct the Secretary of Transportation to
ensure that all cargoes procured, furnished, or financed by the
Department of Transportation are transported on privately-owned
commercial vessels of the United States, and for other
purposes.

Background and Need for Legislation

Under the Military Cargo Preference Act of 1904, all items
procured for or owned by United States military departments and
defense agencies that are transported on ocean vessels must be
carried on United States-flag vessels.\1\ However, this cargo
preference is not extended to cargo belonging to civilian
United States agencies. Instead, under the Cargo Preference Act
of 1954, only 50 percent of the gross tonnage of all Government
generated cargo transported by ship must be transported on
privately owned, United States-flagged commercial vessels.\2\
This legislation would strengthen the United States maritime
industry by implementing a 100 percent cargo preference to
cargo procured, furnished, or financed by the United States
Department of Transportation.
---------------------------------------------------------------------------
\1\10 U.S.C. Sec. 2631; see also U.S. Dep't of Transp., MARAD,
Cargo Preference Laws and Regulations, available at https://
www.maritime.dot.gov/cargo-preference/military-cargoes/cargo-
preference-laws-and-regulations.
\2\46 U.S.C. Sec. 55305; see also U.S. Dep't of Transp., MARAD,
Cargo Preference Laws and Regulations, available at https://
www.maritime.dot.gov/cargo-preference/military-cargoes/cargo-
preference-laws-and-regulations.
---------------------------------------------------------------------------

Hearings

For the purposes of rule XIII, clause 3(c)(6)(A) of the
119th Congress, the following hearing was used to develop H.R.
2035:
The Subcommittee on Coast Guard and Maritime Transportation
held a hearing on February 5, 2025, entitled, ``America Builds:
Maritime Infrastructure,'' to examine the state of the Nation's
maritime infrastructure. The Subcommittee received testimony
from Mr. Paul Anderson, President and Chief Executive Officer,
Port Tampa Bay; Mr. Joe Rella, President, St. John's
Shipbuilding Inc. on behalf of the Shipbuilders Council of
America; Mr. Tom Reynolds, Chief Strategy Officer, Seasats, on
behalf of the Association for Uncrewed Vehicle Systems
International; and Mr. Brian Schoeneman, Political and
Legislative Director, Seafarers International Union of North
America, on behalf of USA Maritime.

Legislative History and Consideration

H.R. 2035, the American Cargo for American Ships Act, was
introduced in the United States House of Representatives of
March 11, 2025, by Rep. Carbajal, with Rep. Ezell as an
original cosponsor, and referred to the Committee on
Transportation and Infrastructure. Within the Committee on
Transportation and Infrastructure, H.R. 2035 was referred to
the Subcommittee on Coast Guard and Maritime Transportation.
The Subcommittee on Coast Guard and Maritime Transportation was
discharged from further consideration of H.R. 2035 on April 2,
2025.
The Committee considered H.R. 2035 on April 2, 2025, and
ordered the measure to be reported to the House with a
favorable recommendation, without amendment, by voice vote.

Committee Votes

Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires each committee report to include the
total number of votes cast for and against on each record vote
on a motion to report and on any amendment offered to the
measure or matter, and the names of those members voting for
and against.
No recorded votes were requested for H.R. 2035.

Committee Oversight Findings and Recommendations

With respect to the requirements of clause 3(c)(1) of rule
XIII of the Rules of the House of Representatives, the
Committee's oversight findings and recommendations are
reflected in this report.

New Budget Authority and Tax Expenditures

Clause 3(c)(2) of rule XIII of the Rules of the House of
Representatives does not apply where a cost estimate and
comparison prepared by the Director of the Congressional Budget
Office under section 402 of the Congressional Budget Act of
1974 has been timely submitted prior to the filing of the
report and is included in the report. Such a cost estimate is
included in this report.

Congressional Budget Office Cost Estimate

With respect to the requirement of clause 3(c)(3) of rule
XIII of the Rules of the House of Representatives and section
402 of the Congressional Budget Act of 1974, the Committee has
received the enclosed cost estimate for H.R. 2035 from the
Director of the Congressional Budget Office:

Legislation Considered Under Suspension of the Rules

The Majority Leader of the House of Representatives
announces bills that will be considered under suspension of the
rules in that chamber. Under suspension, floor debate is
limited, all floor amendments are prohibited, points of order
against the bill are waived, and final passage requires a two-
thirds majority vote.
At the request of the Majority Leader and the House
Committee on the Budget, CBO estimates the effects of those
bills on direct spending and revenues. CBO has limited time to
review the legislation before consideration. Although it is
possible in most cases to determine whether the legislation
would affect direct spending or revenues, time may be
insufficient to estimate the magnitude of those effects. If CBO
has prepared estimates for similar or identical legislation, a
more detailed assessment of budgetary effects, including
effects on spending subject to appropriation, may be included.

EFFECTS ON DIRECT SPENDING AND REVENUES OF LEGISLATION CONSIDERED UNDER SUSPENSION OF THE RULES IN THE HOUSE OF REPRESENTATIVESP WEEK OF JUNE 9, 2025
--------------------------------------------------------------------------------------------------------------------------------------------------------
Additional
Information on Suspension Bill
Bill Number Title Effect on Direct Effect on Direct Spending Link to Published Text at
Spending Revenues and Revenue Estimates docs.house.gov
Effects
--------------------------------------------------------------------------------------------------------------------------------------------------------
H.R. 188........................ Amtrak None.............. None.............. .................. https:// https://
Transparency and www.cbo.gov/ docs.house.gov/
Accountability publication/61031. billsthisweek/
for Passengers 20250609/
and Taxpayers h188_rh_xml.pdf
Act, as amended.
H.R. 248........................ Baby Changing on None.............. None.............. .................. https:// https://
Board Act. www.cbo.gov/ docs.house.gov/
publication/61462. billsthisweek/
20250609/
h248_rh_xml.pdf
H.R. 252........................ Secure Our Ports None.............. None.............. .................. .................. https://
Act, as amended. docs.house.gov/
billsthisweek/
20250609/
h252_rh_xml.pdf
H.R. 1182....................... Compressed Gas None.............. None.............. .................. https:// https://
Cylinder Safety www.cbo.gov/ docs.house.gov/
and Oversight publication/61275. billsthisweek/
Improvements Act 20250609/
of 2025. H1182_RH_xml.pdf
H.R. 1373....................... Tennessee Valley None.............. None.............. .................. .................. https://
Authority docs.house.gov/
Transparency Act billsthisweek/
of 2025, as 20250609/
amended. H1373_RH_xml.pdf
H.R. 1948....................... To authorize the Reduce by Less None.............. .................. https:// https://
International Than $500K. www.cbo.gov/ docs.house.gov/
Boundary and publication/61358. billsthisweek/
Water Commission 20250609/
to accept funds h1948_rh_xml.pdf
for activities
relating to
wastewater
treatment and
flood control
works, and for
other purposes.
H.R. 2035....................... American Cargo for Increase by Less None.............. .................. .................. https://
American Ships Than $500K. docs.house.gov/
Act. billsthisweek/
20250609/
H2035_RH_xml.pdf
H.R. 2351....................... To direct the None.............. None.............. .................. https:// https://
Commandant of the www.cbo.gov/ docs.house.gov/
Coast Guard to publication/61446. billsthisweek/
update the policy 20250609/
of the Coast h2351_rh_xml[1].p
Guard regarding df
the use of
medication to
treat drug
overdose, and for
other purposes.
H.R. 2390....................... Maritime Supply None.............. None.............. .................. https:// https://
Chain Security www.cbo.gov/ docs.house.gov/
Act. publication/61437. billsthisweek/
20250609/
h2390_rh_xml.pdf
H. Res. 137..................... Designating the None.............. None.............. .................. .................. https://
House Press docs.house.gov/
Gallery (Rooms H- billsthisweek/
315, H-316, H- 20250609/
317, H-318, and H- HR137_RH_xml.pdf
319 of the United
States Capitol)
as the
``Frederick
Douglass Press
Gallery'', as
amended.
H. Res. _....................... Denouncing the None.............. None.............. .................. .................. https://
antisemitic docs.house.gov/
terrorist attack billsthisweek/
in Boulder, 20250609/
Colorado. H%20Res%20_%20(Ev
ans).pdf
H. Res. _....................... Condemning the None.............. None.............. .................. .................. https://
rise in docs.house.gov/
ideologically billsthisweek/
motivated attacks 20250609/
on Jewish H%20Res%20_%20(Va
individuals in n%20Drew).pdf
the United
States, including
the recent
violent assault
in Boulder,
Colorado, and
reaffirming the
House of
Representatives
commitment to
combating
antisemitism and
politically
motivated
violence.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Congressional Budget Office

Performance Goals and Objectives

With respect to the requirement of clause 3(c)(4) of rule
XIII of the Rules of the House of Representatives, the
performance goal and objective of this legislation is to ensure
that all cargoes procured, furnished, or financed by the
Department of Transportation are transported on privately-owned
commercial vessels of the United States.

Duplication of Federal Programs

Pursuant to clause 3(c)(5) of rule XIII of the Rules of the
House of Representatives, the Committee finds that no provision
of H.R. 2035 establishes or reauthorizes a program of the
Federal government known to be duplicative of another Federal
program, a program that was included in any report from the
Government Accountability Office to Congress pursuant to
section 21 of Public Law 111-139, or a program related to a
program identified in the most recent Catalog of Federal
Domestic Assistance.

Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits

In compliance with clause 9 of rule XXI of the Rules of the
House of Representatives, this bill, as reported, contains no
congressional earmarks, limited tax benefits, or limited tariff
benefits as defined in clause 9(e), 9(f), or 9(g) of the rule
XXI.

Federal Mandates Statement

An estimate of Federal mandates prepared by the Director of
the Congressional Budget Office pursuant to section 423 of the
Unfunded Mandates Reform Act was not made available to the
Committee in time for the filing of this report. The Chairman
of the Committee shall cause such estimate to be printed in the
Congressional Record upon its receipt by the Committee.

Preemption Clarification

Section 423 of the Congressional Budget Act Of 1974
requires the report of any Committee on a bill or joint
resolution to include a statement on the extent to which the
bill or joint resolution is intended to preempt state, local,
or tribal law. The Committee finds that H.R. 2035 does not
preempt any state, local, or tribal law.

Advisory Committee Statement

No advisory committees within the definition of Section
5(b) of Public Law 92-463 (5 U.S.C. 1004(b)), United States
Code, are created by this legislation.

Applicability to Legislative Branch

The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act (Public Law
104-1).

Section-by-Section Analysis of the Legislation

Section 1. Short title

This section provides that this bill may be cited as the
``American Cargo for American Ships Act''.

Section 2. Cargoes procured, furnished, or financed by United States
Government

This section amends Section 55305 of title 46, United
States Code, to require the Department of Transportation to
ensure that 100 percent of the gross tonnage of equipment,
materials, or commodities procured, furnished or financed for
its own account is transported on ocean vessels is done so on
privately-owned commercial vessels flagged in the United
States.

Changes in Existing Law Made by the Bill, as Reported

In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):

Changes in Existing Law Made by the Bill, as Reported

In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italics, and existing law in which no
change is proposed is shown in roman):

TITLE 46, UNITED STATES CODE

* * * * * * *
SUBTITLE V--MERCHANT MARINE

* * * * * * *

PART D--PROMOTIONAL PROGRAMS

* * * * * * *

CHAPTER 553--PASSENGER AND CARGO PREFERENCES

* * * * * * *

SUBCHAPTER I--GOVERNMENT IMPELLED TRANSPORTATION

* * * * * * *

Sec. 55305. Cargoes procured, furnished, or financed by the United
States Government

(a) Minimum Tonnage.--[When the United States Government]
Except as provided in subsection (c), when the United States
Government procures, contracts for, or otherwise obtains for
its own account, or furnishes to or for the account of a
foreign country, organization, or persons without provision for
reimbursement, any equipment, materials, or commodities, or
provides financing in any way with Federal funds for the
account of any persons unless otherwise exempted, within or
without the United States, or advances funds or credits, or
guarantees the convertibility of foreign currencies in
connection with the furnishing or obtaining of the equipment,
materials, or commodities, the appropriate agencies shall take
steps necessary and practicable to ensure that at least 50
percent of the gross tonnage of the equipment, materials, or
commodities (computed separately for dry bulk carriers, dry
cargo liners, and tankers) which may be transported on ocean
vessels is transported on privately-owned commercial vessels of
the United States, as provided under subsection (b), to the
extent those vessels are available at fair and reasonable rates
for commercial vessels of the United States, in a manner that
will ensure a fair and reasonable participation of commercial
vessels of the United States in those cargoes by geographic
areas.
(b) Eligible Vessels.--To be eligible to carry cargo as
provided under subsection (a), a privately-owned commercial
vessel shall be documented under the laws of the United
States--
(1) for not less than three years; or
(2) after January 1, 2030, for less than three years,
if the vessel owner signs an agreement with the
Secretary providing that--
(A) the vessel shall remain documented under
the laws of the United States for not less than
three years; and
(B) the vessel owner shall, upon request of
the Secretary, agree to enroll the vessel in an
emergency preparedness agreement or voluntary
agreement authorized under section 708 of the
Defense Production Act of 1950 (50 U.S.C. 4558)
and shall ensure the vessel remains so enrolled
until the vessel ceases to be documented under
the laws of the United States.
(c) Exception.--When the Department of Transportation
procures, contracts for, or otherwise obtains for its own
account, or provides financing in any way with Federal funds or
advances funds or credits, for the furnishing or obtaining of
the equipment, materials, or commodities, the Secretary of
Transportation or recipient of such financing shall take steps
necessary and practicable to ensure that 100 percent of the
gross tonnage of the equipment, materials, or commodities
(computed separately for dry bulk carriers, dry cargo liners,
and tankers) which may be transported on ocean vessels is
transported on privately-owned commercial vessels of the United
States, as provided under subsection (b), to the extent those
vessels are available at fair and reasonable rates for
commercial vessels of the United States, in a manner that will
ensure a fair and reasonable participation of commercial
vessels of the United States in those cargoes by geographic
areas.
[(c)] (d) Violation of Agreement.--A vessel under an
agreement executed pursuant to subsection (b)(2) may be seized
by, and forfeited to, the United States if, in violation of
that agreement--
(1) the vessel owner places the vessel under foreign
registry; or
(2) a person operates the vessel under the authority
of a foreign country.
[(d)] (e) Waivers.--(1) Notwithstanding any other provision
of law, when the President, the Secretary of Defense, or the
Secretary of Transportation declares the existence of an
emergency justifying a temporary waiver of this section or
section 55314 of this title, the President, the Secretary of
Defense, or the Secretary of Transportation, following a
determination by the Maritime Administrator, acting in the
Administrator's capacity as Director, National Shipping
Authority, of the non-availability of qualified United States
flag capacity at fair and reasonable rates for commercial
vessels of the United States to meet the requirements of this
section or section 55314 of this title, may waive compliance
with such section to the extent, in the manner, and on the
terms the Maritime Administrator, acting in such capacity,
prescribes, and no other waivers of the requirements of this
section or section 55314 of this title shall be authorized.
(2)(A) Subject to subparagraphs (B) and (C), a waiver issued
under this subsection shall be for a period of not more than 60
days.
(B) Upon termination of the period of a waiver issued under
this subsection, the Maritime Administrator may extend the
waiver for an additional period of not more than 30 days, if
the Maritime Administrator makes the determinations described
in paragraph (1).
(C) The aggregate duration of the period of all waivers and
extensions of waivers under this subsection with respect to any
one set of events shall not exceed three months in a fiscal
year.
(3) The Maritime Administrator shall--
(A) for each determination referred to in paragraph
(1), identify any actions that could be taken to enable
qualified United States flag capacity to meet the
requirements of this section or section 55314 at fair
and reasonable rates for commercial vessels of the
United States;
(B) provide notice of each determination referred to
in paragraph (1) to the Secretary of Transportation
and, as applicable, the President or the Secretary of
Defense; and
(C) publish each determination referred to in
paragraph (1)--
(i) on the website of the Maritime
Administration not later than 24 hours after
notice of the determination is provided to the
Secretary of Transportation; and
(ii) in the Federal Register.
(4) The Maritime Administrator shall notify--
(A) the Committee on Commerce, Science, and
Transportation of the Senate and the Committee on
Transportation and Infrastructure of the House of
Representatives of--
(i) any request for a waiver (or an extension
thereof) made by the Secretary of
Transportation of this section or section
55314(a) of this title by not later than 72
hours after receiving such a request; and
(ii) the issuance of any such waiver (or an
extension thereof), and why such waiver or
extension was necessary, by not later than 72
hours after such issuance; and
(B) the Committee on Commerce, Science, and
Transportation and the Committee on Armed Services of
the Senate and the Committee on Transportation and
Infrastructure and the Committee on Armed Services of
the House of Representatives of--
(i) any request for a waiver (or an extension
thereof) made by the Secretary of Defense of
this section or section 55314(a) ¹
of this title by not later than 72 hours after
receiving such a request; and
(ii) the issuance of any such waiver (or an
extension thereof), and why such waiver or
extension was necessary, by not later than 72
hours after such issuance.
[(e)] (f) Programs of Other Agencies.--
(1) Each department or agency that has responsibility
for a program under this section shall administer that
program with respect to this section under regulations
and guidance issued by the Secretary of Transportation.
The Secretary, after consulting with the department or
agency or organization or person involved, shall have
the sole responsibility for determining if a program is
subject to the requirements of this section.
(2) The Secretary--
(A) shall conduct an annual review of the
administration of programs determined pursuant
to paragraph (1) as subject to the requirements
of this section and annually submit to the
Committee on Transportation and Infrastructure
of the House of Representatives and the
Committee on Commerce, Science, and
Transportation of the Senate a report on the
administration of such programs;
(B) may direct agencies to require the
transportation on United States-flagged vessels
of cargo shipments not otherwise subject to
this section in equivalent amounts to cargo
determined to have been shipped on foreign
carriers in violation of this section;
(C) may impose on any person that violates
this section, or a regulation prescribed under
this section, a civil penalty of not more than
$25,000 for each violation willfully and
knowingly committed, with each day of a
continuing violation following the date of
shipment to be a separate violation; and
(D) may take other measures as appropriate
under the Federal Acquisition Regulations
issued pursuant to section 25(c)(1) of the
Office of Federal Procurement Policy Act (41
U.S.C. 1303(a)(1)) or contract with respect to
each violation.
[(f)] (g) Security of Government-Impelled Cargo.--
(1) In order to ensure the safety of vessels and
crewmembers transporting equipment, materials, or
commodities under this section, the Secretary of
Transportation shall direct each department or agency
(except the Department of Defense), when responsible
for the carriage of such equipment, materials, or
commodities, to reimburse, subject to the availability
of appropriations, the owners or operators of vessels
of the United States carrying such equipment,
materials, or commodities for the cost of providing
armed personnel aboard such vessels if the vessels are
transiting high-risk waters.
(2) In this subsection, the term ``high-risk waters''
means waters so designated by the Commandant of the
Coast Guard in the maritime security directive issued
by the Commandant and in effect on the date on which an
applicable voyage begins, if the Secretary of
Transportation--
(A) determines that an act of piracy occurred
in the 12-month period preceding the date the
voyage begins; or
(B) in such period, issued an advisory
warning that an act of piracy is possible in
such waters.

* * * * * * *

[all]