Marine Safety: Coast Guard Should Address Alternatives as It Proceeds
With VTS 2000 (Letter Report, 04/22/96, GAO/RCED-96-83).

Pursuant to a congressional request, GAO provided information on the
Coast Guard's vessel traffic service (VTS) 2000 program, focusing on:
(1) the status of the program; (2) the extent to which major
stakeholders support the programs; (3) whether major stakeholders who do
not support VTS 2000 acquisition and funding are interested in acquiring
other VTS systems; and (4) the issues that could affect privately funded
VTS systems.

GAO found that: (1) VTS 2000 presents large-scale uncertainties as to
the demand for the system or how much it will cost because the Coast
Guard does not have adequate information on how many ports will operate
VTS 2000; (2) VTS 2000 development plans have not reached the stage
where specific components have been selected for ports; (3) at many
proposed locations, the economic benefits of installing VTS 2000 are
unclear; (4) VTS 2000 stakeholders stated that they have had no
involvement with the program; (5) support for VTS 2000 is mixed because
potential stakeholders believe that it will be too expensive for their
ports and users would be unfairly targeted; (6) supporters of other VTS
systems believed that alternate systems would be less expensive or
existing systems were sufficient; (7) ports without VTS favor adding
some form of VTS capability, but are reluctant to fund it; and (8) the
privatization of VTS depends on the private sector's ability to fund the
system, exposure to liability, and the Coast Guard's ability to oversee
the transition.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-96-83
     TITLE:  Marine Safety: Coast Guard Should Address Alternatives as 
             It Proceeds With VTS 2000
      DATE:  04/22/96
   SUBJECT:  Marine safety
             Traffic regulation
             Harbors
             Marine transportation operations
             Navigation aids
             Deep water ports
             Shipping industry
             Data transmission operations
             Radar equipment
             Privatization
IDENTIFIER:  Exxon Valdez
             Coast Guard Vessel Traffic Service 2000 Program
             
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Cover
================================================================ COVER


Report to Congressional Requesters

April 1996

MARINE SAFETY - COAST GUARD SHOULD
ADDRESS ALTERNATIVES AS IT
PROCEEDS WITH VTS 2000

GAO/RCED-96-83

VTS 2000 Systems

(344498)


Abbreviations
=============================================================== ABBREV

  GAO - General Accounting Office
  VTIS - vessel traffic information service
  VTS - vessel traffic service

Letter
=============================================================== LETTER


B-262229

April 22, 1996

The Honorable Howard Coble
Chairman
The Honorable Bob Clement
Ranking Minority Member
Subcommittee on Coast Guard and
 Maritime Transportation
Committee on Transportation and
 Infrastructure
House of Representatives

The Honorable James A.  Traficant, Jr.
House of Representatives

Currently, the U.S.  Coast Guard and private entities operate
radar-based vessel traffic service (VTS) systems in several U.S. 
ports.  A VTS system typically consists of remote surveillance
sensors, such as radar or closed-circuit television, and a central
data-gathering location (called a vessel traffic center).  VTS
personnel receive information on marine traffic conditions, assess
this information, and pass it on to mariners and the maritime
industry by radio.  According to the International Maritime
Organization,\1 the purpose of these systems is to improve the safe
and efficient movement of marine vessels in and around ports and to
protect the environment. 

In response to congressional direction after the 1989 Exxon Valdez
oil spill, the Department of Transportation conducted a study to
assess the need for VTS systems in ports throughout the country.  On
the basis of the study, the Coast Guard is considering constructing
new or improved VTS systems in as many as 17 ports.  The proposed
expansion, called VTS 2000, will cost an estimated $260 million to
$310 million in federal funds to build and about $42 million in
federal funds to operate each year if installed at all 17
locations.\2 At present, the Coast Guard plans to pay these costs
from its budget and not pass them on to local ports or to users, such
as shipping companies. 

You asked us to provide you with information to assist in your
deliberations about funding the VTS 2000 program, including funding
alternatives to build and operate the system.  In consultation with
your offices, we focused our work on the following four questions: 

  -- What is the current status of the Coast Guard's development of
     VTS 2000? 

  -- At ports being considered for VTS 2000, to what extent do major
     stakeholders support acquiring and funding it? 

  -- If major stakeholders are not supportive of VTS 2000, to what
     extent are they interested in acquiring and funding other VTS
     systems? 

  -- What other issues, if any, could affect the establishment of VTS
     systems that are privately funded? 

We conducted our work at 8 of the 17 ports that the Coast Guard is
considering for VTS 2000.  While the views of these 8 ports may not
be representative of the views at all 17, we selected the ports that
we thought would yield the most useful information in response to the
Subcommittee's questions.  Four locations were chosen because the
Coast Guard identified them as most likely to benefit from a new VTS
system.  We chose the other four because they currently operate a
privately funded system or have expressed an interest to do so.  (See
app.  I for general background on all eight ports.) At each port, we
obtained the views of a set of key stakeholders identified by the
Coast Guard.  These key stakeholders included representatives of (1)
ship and barge companies doing business at the port, (2) marine
pilots, and (3) port authorities. 


--------------------
\1 The International Maritime Organization, an agency of the United
Nations, is charged with maritime safety matters. 

\2 The Coast Guard prepared the current estimate prior to receiving
bids on VTS 2000.  Coast Guard officials reported that vendors have
submitted bids that were considerably less than the current estimate
of $260 million to $310 million.  Since the costs are
competition-sensitive, they cannot be released at this time.  Also,
the Coast Guard revised its estimate for the cost of operating VTS
2000 from $56 million to $42 million on the basis of more current
cost data for staff, telecommunications, and remote site leases. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

At its current stage of development, VTS 2000 presents uncertainties
as to how many ports need such a system and how much it will cost. 
Development of VTS 2000 has not yet proceeded to the point where a
great deal of site-specific information is available.  The Coast
Guard does not plan to determine how many of the 17 ports under
consideration should operate VTS 2000 systems until fiscal year 2000,
and development plans have not reached the stage where specific
components have been selected for any port.  At many of the locations
under consideration, the economic benefits of installing VTS 2000
systems are not clearly established.  Further, many of the shipping
industry, pilots' association, and port authority stakeholders we
interviewed said they had little or no involvement to date with the
VTS 2000 program.  Coast Guard officials said that they will work
more extensively with stakeholders as more specific plans emerge
concerning which ports will be included in VTS 2000. 

We did not find widespread support for VTS 2000 among the interviewed
stakeholders at the eight ports where we conducted site visits.  At
five ports, most of the stakeholders were opposed to VTS 2000. 
Support was somewhat greater--but still very mixed--at the three
other ports.  In general, many who opposed VTS 2000 said the proposed
system would likely be more expensive than necessary for their port. 
This concern was reflected in their views about paying for VTS 2000;
most opposed user fees or other funding approaches that would pass
the cost of VTS 2000 from the federal government to those using the
system. 

Support among those we interviewed was greater for VTS systems that
they perceived to be less expensive than VTS 2000 systems.  At the
four ports where VTS systems already exist (Houston/Galveston, Los
Angeles/Long Beach, Philadelphia/Delaware Bay, and San Francisco),
most key stakeholders said the existing systems were sufficient and
were needed.  At two of these ports, users are already providing
financial support, and at the remaining two, key stakeholders have
expressed a willingness to fund some type of VTS operation if
necessary to ensure that VTS coverage continues.  At two of the
remaining four ports where VTS systems do not exist (New Orleans and
Tampa), most of those we interviewed favored adding some form of VTS
capability, though their support for funding the improvements was
much more marginal.  At the final two ports (Mobile/Pascagoula and
Port Arthur/Lake Charles), support for a VTS system was largely
nonexistent or mixed. 

Several key issues could affect the establishment of privately funded
or privately operated VTS systems.  These include the private
sector's ability to fund the initial start-up costs of such a system,
the private sector's exposure to liability, and the Coast Guard's
role in planning and overseeing a privately funded system. 


   BACKGROUND
------------------------------------------------------------ Letter :2

A VTS system is one of several methods for improving navigational
safety and protecting the marine environment.\3

It helps determine the presence of vessels in and around ports and it
provides information to vessels on such matters as traffic, tides,
weather conditions, and port emergencies.  Other safety measures
include training vessel operators, improving navigational aids (such
as buoys and markers), dredging wider and deeper channels, and
inspecting vessels. 

Under the authority of the Ports and Waterways Safety Act of 1972, as
amended, the Coast Guard operates VTS systems in eight ports around
the United States.\4 Operations and maintenance costs for these
systems, which totaled about $19 million in fiscal year 1995, are
borne by the Coast Guard and are not passed on to the ports or the
shipping industry.  Two other ports, Los Angeles/Long Beach and
Philadelphia/Delaware Bay, have radar-based systems funded by their
users.  These systems are sometimes called "VTS-like" systems to
distinguish them from the Coast Guard's systems, but for consistency,
we refer to them as VTS systems in this report.  In 1995, operations
and maintenance costs were about $1.4 million for the Los
Angeles/Long Beach system and about $345,000 for the
Philadelphia/Delaware Bay system.\5 \6

Study of VTS systems was prompted by the Oil Pollution Act of 1990
(P.L.  101-380), passed after the 1989 Exxon Valdez oil spill and
subsequent spills in the coastal waters of Rhode Island, the Delaware
River, and the Houston ship channel.  The act directed the Secretary
of Transportation to prioritize the need for a new, expanded, or
improved VTS system at U.S.  ports and channels.  Under criteria for
this evaluation, the act specified that in assessing the need for a
VTS system, the Secretary consider (1) the nature, volume, and
frequency of vessel traffic; (2) the risk of collisions, spills, and
damages associated with that traffic; (3) the impact of installing,
expanding, or improving a VTS system; and (4) all other relevant
costs and data.  The resulting report, called the Port Needs Study,
was submitted to the Congress in March 1992. 


--------------------
\3 VTS systems can also play a role in waterway management activities
by providing data that identify areas of navigational risk and by
measuring the results of actions that attempt to reduce the risk of
accidents, such as groundings and collisions. 

\4 The Ports and Waterways Safety Act of 1972 (P.L.  92-340), as
amended, states that the Coast Guard "may construct, operate,
maintain, improve or expand" VTS systems for ports, harbors, and
other waters.  It also authorizes the Coast Guard to require vessels
that operate in a VTS area to comply with the service.  The eight
ports are New York, N.Y.; San Francisco, Calif.; Houston-Galveston,
Tex.; Puget Sound, Wash.; Valdez, Alaska; Morgan City, La.;
Louisville, Ky.; and Sault Sainte Marie, Mich. 

\5 In design and operation, these "VTS-like" systems are similar in
many respects to the Coast Guard's systems.  However, the Coast
Guard's regulations and standards do not apply.  Coast Guard
personnel help operate the Los Angeles/Long Beach system but are not
involved in operating the system at Philadelphia/Delaware Bay. 

\6 VTS officials from Los Angeles/Long Beach and
Philadelphia/Delaware Bay stated that their operating costs are
likely to increase in 1996 because of higher personnel costs and
upgrades in equipment. 


   FEW SPECIFICS ABOUT VTS 2000
   HAVE BEEN DEVELOPED TO DATE AT
   THE PORT LEVEL
------------------------------------------------------------ Letter :3

Although the Coast Guard's VTS 2000 proposal is the result of several
years of study, the development of VTS 2000 itself is in its early
phases.  The Coast Guard is just entering those phases of its
planning schedule in which the Coast Guard will (1) finalize the list
of ports where it believes a VTS 2000 system should be built and (2)
determine the specific mix and number of VTS 2000 components for
these ports.  At six of the eight ports we reviewed, most key
stakeholders we interviewed said they had little or no involvement in
VTS 2000.  The following is a brief summary of what has occurred to
date. 


      PORT NEEDS STUDY PRIORITIZED
      SITES FOR FURTHER REVIEW
---------------------------------------------------------- Letter :3.1

The Port Needs Study identified two sets of locations as possible
candidates for a VTS system.  Both sets were identified on the basis
of an estimate of the net benefits of installing a new VTS system at
each location.  The first set, which included seven locations, was
recommended for initial consideration.  For these locations, the
study's methodology showed that the benefit of a new or improved VTS
system would consistently be higher than costs even when different
assumptions were considered, such as decreasing benefit estimates by
50 percent or increasing cost estimates by 50 percent.  The second
set, comprising eight other locations, was identified as the next
best candidate for consideration.  These locations were not as
consistent in showing positive net benefits when the methodological
assumptions were changed.  Table 1 shows the 15 locations and the
estimated net benefits calculated for each one.  In addition to the
15 ports in table 1, the Coast Guard added San Francisco, California,
and Valdez, Alaska, because both locations currently have Coast
Guard-operated VTS systems and because the Coast Guard wants to
upgrade the equipment at these ports with VTS 2000 technology. 



                                Table 1
                
                Benefits of a New VTS System Identified
                  by the Port Needs Study for 15 Ports

                         (Dollars in millions)


                                                              Resultin
                                                                     g
                                                              marginal
                                               Net                 net
                                           benefit     Less:   benefit
                                                of       net      from
                                Existing  installi   benefit  installi
                                VTS         ng new      from    ng new
                                system/        VTS  existing       VTS
Location                        operator    system    system    system
------------------------------  --------  --------  --------  --------
Locations identified for initial consideration
----------------------------------------------------------------------
New Orleans, La.\a              No          $253.7       $ 0    $253.7
Port Arthur, Tex./Lake          No            92.4         0      92.4
 Charles, La.\a,b
Houston/Galveston, Tex.\a       Yes/          61.0      57.0       4.0
                                 Coast
                                 Guard
Mobile, Ala./Pascagoula,        No            48.1         0      48.1
 Miss.\a
Los Angeles/Long Beach,         Yes/          42.8      45.8      -3.0
 Calif.\a                        private
Corpus Christi, Tex.            Yes/          26.1      11.0      15.1
                                 private
                                 \c
Boston, Mass.                   No            15.1         0      15.1

Other locations identified for consideration
----------------------------------------------------------------------
New York, N.Y.                  Yes/           9.0       3.7       5.3
                                 Coast
                                 Guard
Tampa, Fla.\a                   No             5.2         0       5.2
Portland, Oreg.                 No             2.2         0       2.2
Philadelphia, Pa./Delaware      Yes/           2.2       6.7      -4.5
 Bay, Del.\a                     private
Baltimore, Md.                  Yes/          -1.7       1.4      -3.1
                                 private
                                 \d
Providence, R.I.                No            -2.0         0      -2.0
Long Island Sound, N.Y.         No            -2.3         0      -2.3
Puget Sound, Wash.              Yes/          -4.0     -12.2       8.2
                                 Coast
                                 Guard
----------------------------------------------------------------------
Note:  All dollars are discounted to 1993. 

\a Indicates ports that we visited.  In addition to the seven ports
indicated, we also conducted work at San Francisco. 

\b Port Arthur/Lake Charles has a radio-based system, but the system
was not considered in the Port Needs Study's analysis. 

\c Corpus Christi has a radio-based harbormaster system that does not
utilize radar. 

\d Baltimore has a nonradar radio-based system operated by the local
pilots' association. 

Many of the ports have existing VTS systems or other nonradar,
radio-based information systems to assist vessel operators, and when
the estimated benefits of these systems are taken into account, the
marginal net benefits of a new system decrease substantially in some
instances.  The study's data indicate that over the first 15 years
after a switch to a new system, there may be little marginal net
benefit in making the conversion at any of the ports with existing
radar-based VTS systems.  The five Coast Guard-operated systems have
either recently been upgraded or enhanced or are scheduled to receive
upgrades in the near future regardless of any decision on VTS 2000. 
These upgrades or enhancements will expand VTS coverage and cost
about $39 million for improved software and equipment.\7

According to Coast Guard officials, these ports are included in VTS
2000 so that existing VTS equipment can be replaced when it becomes
obsolete.  Officials indicated that they will address the timing and
affordability of this approach in fiscal year 2000. 

The Coast Guard is conducting follow-on studies at a number of the
locations to verify whether the benefits of a new VTS system outweigh
its costs.  So far, five such studies have been completed for Boston,
Corpus Christi, Mobile/Pascagoula, Philadelphia/Delaware Bay, and
Tampa.  The follow-on study for Mobile/Pascagoula was consistent with
the results of the Port Needs Study.  However, for Boston, the
marginal net benefits no longer outweigh the costs, and for Corpus
Christi, Philadelphia/Delaware Bay, and Tampa, the marginal net
benefits are higher.  (See app.  II for more information on the Port
Needs Study and follow-on studies.)


--------------------
\7 The upgrades include improvements in decision support technology,
which includes features such as visual and audio alarms to indicate a
vessel's safety zone violations; cross-functionality, which allows
for information exchange with other Coast Guard databases; and
geographic displays, which provide nautical chart overlays on the VTS
operator's display console. 


      CANDIDATE PORTS FOR VTS 2000
      ARE STILL BEING EVALUATED
---------------------------------------------------------- Letter :3.2

The Coast Guard developed an initial proposal in fiscal year 1993 to
address the Port Needs Study.  The Coast Guard said that the expanded
or enhanced use of VTS systems would reduce the risk of maritime
accidents and support other Coast Guard activities, including
national defense and law enforcement.  Through greater automation of
vessel traffic data under VTS 2000, the Coast Guard also expected to
more efficiently carry out its waterway management responsibilities. 

In fiscal year 2000, the Coast Guard will decide how many ports will
be included under VTS 2000.  In all, 17 ports are under
consideration.  Seven of the ports have existing radar-based VTS
systems--two operated privately (Los Angeles/Long Beach and
Philadelphia/Delaware Bay) and the remaining five operated by the
Coast Guard.  In addition, three ports have privately funded
radio-based information systems (Baltimore, Corpus Christi, and Port
Arthur/Lake Charles). 

The estimated cost of VTS 2000--$260 million to $310 million--is
based on the cost of (1) developing the system and (2) installing it
in all 17 locations.  The system's development--including activities
such as developing the software, designing the system, testing,
contracting, constructing the land-based support facility, and
developing the system engineering of VTS 2000--is being pursued in
four phases.  The estimated cost of the initial development phase is
$69 million, including costs incurred since the program's inception. 
This phase is scheduled for completion in fiscal year 1999 and,
according to Coast Guard officials, will result in operational
capability similar to that of the upgraded VTS systems currently
operated by the Coast Guard.  The development of all phases will cost
an estimated $145 million if the systems are installed in all 17
ports.  If all phases are implemented, they are scheduled for
completion in fiscal year 2004 and will include activities such as
developing software that interfaces with external databases and
establishing a facility to test and diagnose software to support a
national VTS system (land-based support facility).  According to
Coast Guard officials, a decision on whether to proceed with all four
development phases depends, in part, on the number of sites that
receive VTS 2000.  The additional cost of equipment and installation
at specific ports ranges from about $5 million to $30 million per
port area. 

The Coast Guard, which is in the early phase of the acquisition
process, plans to select a single systems integration contractor for
the project by the first quarter of fiscal year 1997.  The contractor
will develop computer software, procure hardware (radar, closed
circuit television, and radios), integrate these components of the
system, and determine what type of VTS 2000 equipment will be
installed at each port.  The Coast Guard estimates that the
contractor will be needed through 2006 if systems are installed in
all 17 locations. 

In the next few years, as it moves to acquire and install VTS 2000
systems at specific locations, the Coast Guard plans to increase the
size of its funding requests for the program.  The Coast Guard has
received about $25 million to develop VTS 2000 through fiscal year
1996.  For fiscal year 1997, the Coast Guard plans to request $6
million.  For fiscal years 1998-2004, the Coast Guard estimates that
it will need about $30 million a year to support both the development
and installation of VTS 2000 systems in ports. 

The contractor for VTS 2000 is scheduled to complete the systems'
development in 2004 as it upgrades sensors, develops software, and
establishes interface capability with up to 10 different databases. 
Starting in 1998, the Coast Guard plans to install the first systems
in New Orleans and Los Angeles/Long Beach.  Starting in 2000, it
plans to install systems in Port Arthur/Lake Charles,
Houston/Galveston, and Corpus Christi.\8 After systems are installed
at the initial sites, the Coast Guard will enhance and upgrade the
systems as necessary. 

In June 1995, several federal agencies, including the Coast Guard,
commissioned a study by the Marine Board of the National Research
Council to assess the implementation of advanced information systems
for maritime commerce.\9 Among other things, the Marine Board will
address the role of the public and private sectors in developing and
operating VTS systems and will examine user fees and trust funds as
possible funding sources.  The Marine Board expects to issue an
interim report in June 1996, and the Coast Guard plans to use the
report in decisions on the VTS 2000 project. 


--------------------
\8 While the Coast Guard has not yet made a final decision about
which ports should receive VTS 2000 systems, it has identified these
five ports as having the highest priority.  However, the Coast Guard
recently reviewed the privately funded system at Los Angeles/Long
Beach and determined that it meets most of the VTS 2000 program's
operational requirements, and as a result, the Coast Guard is
reevaluating whether to give Los Angeles/Long Beach a lower priority
in the VTS 2000 program.  The remaining four ports are scheduled to
receive VTS 2000 systems because the Port Needs Study showed high net
benefits at these locations.  Mobile/Pascagoula, another port showing
high net benefits, was not included among these initial candidates
because the follow-on studies showed that Corpus Christi should have
a higher priority than Mobile. 

\9 The sponsoring agencies include the Advanced Research Project
Administration, the Maritime Administration, and the National Oceanic
and Atmospheric Administration. 


      AT THE PORT LEVEL, MOST KEY
      STAKEHOLDERS HAVE LIMITED
      INVOLVEMENT IN VTS 2000
---------------------------------------------------------- Letter :3.3

Given that the Coast Guard is not yet at the point of determining
what VTS 2000 equipment will be installed at each port, it is perhaps
not surprising that many key stakeholders we interviewed said they
had little or no involvement in VTS 2000.\10 At six of the ports we
reviewed, most stakeholders we interviewed said they had little or no
involvement in the VTS 2000 system at their port in matters such as
the system's needs, design, and cost.\11 Coast Guard officials said
that as more specific plans emerge regarding which ports will be
included under VTS 2000, they will work more extensively with
stakeholders to determine what VTS 2000 components to install at each
location.  For example, they stated that VTS 2000 systems can be
adapted to the needs of stakeholders in each port. 

Notwithstanding this lack of specific involvement in VTS 2000, most
stakeholders we interviewed believed they knew enough to provide
their opinions about the system.  Their level of knowledge was based,
in part, on briefings about VTS 2000 conducted by the Coast Guard in
six of the eight ports.\12 At three of the locations
(Philadelphia/Delaware Bay, Mobile/Pascagoula and Tampa), follow-on
studies included interview sessions with port and industry officials
on VTS-related issues.  San Francisco was the only port among the
eight we reviewed where a majority of the stakeholders interviewed
did not think they knew enough about the system to provide an opinion
about whether it was needed at their location. 


--------------------
\10 The Coast Guard has made efforts to involve some industry
representatives in VTS 2000.  For example, in 1993, the Coast Guard
convened a team comprising representatives from the Coast Guard (14
members), industry (4 members), and the Army Corps of Engineers (1
member).  The team developed a concept of operations and validated
requirements for VTS 2000 systems.  The members' input formed the
basis for the Coast Guard's preliminary operational requirements. 

\11 The six ports are Los Angeles/Long Beach, Mobile/Pascagoula,
Philadelphia/Delaware Bay, Port Arthur/Lake Charles, San Francisco,
and Tampa. 

\12 The Coast Guard has briefed industry and port officials in
Houston-Galveston, Los Angeles/Long Beach, New Orleans, Port
Arthur/Lake Charles, San Francisco, and Tampa. 


   SUPPORT FOR VTS 2000 WAS NOT
   WIDESPREAD AMONG KEY
   STAKEHOLDERS AT PORTS REVIEWED
------------------------------------------------------------ Letter :4

Widespread support was lacking for VTS 2000 among the shipping
industry, pilots' association, and port authority stakeholders we
interviewed.  The opinions about the need for a VTS 2000 system were
predominantly negative at five ports, were about evenly split at two
others, and were predominantly uncertain at one.  (See table 2.) Many
who opposed VTS 2000 perceived the proposed system as being more
expensive than needed. 



                                Table 2
                
                  Views of Shipping Industry, Pilots'
                    Association, and Port Authority
                        Stakeholders on VTS 2000

                                                Is a VTS
                                    Is a VTS    2000        Would you
                                    system      system      be willing
                                    currently   needed at   to pay for
Port                                in place?   your port?  it?
----------------------------------  ----------  ----------  ----------
Ports identified by Coast Guard as receiving
significant benefits from a new VTS system
----------------------------------------------------------------------
Houston/Galveston (n=5)             Yes         Split       Split
                                                about       about
                                                evenly      evenly

Mobile/Pascagoula (n=7)             No          Most said   Most said
                                                no          no

New Orleans (n=6)                   No          Most said   Most said
                                                no          no

Port Arthur/Lake Charles (n=14)     No          Most said   Most said
                                                no\a        no\a


Ports with a privately funded VTS system
----------------------------------------------------------------------
Los Angeles/Long Beach (n=10)       Yes         All said    Most said
                                                no          no

Philadelphia/Delaware Bay (n=10)    Yes         Most said   Most said
                                                no          no


Ports interested in private funding of a VTS system
----------------------------------------------------------------------
San Francisco (n=9)                 Yes         Most were   Split
                                                uncertain   about
                                                            evenly

Tampa (n=8)                         No          Split       Most said
                                                about       no
                                                evenly
----------------------------------------------------------------------
Note:  n=number of shipping industry, pilots' association, and port
authority stakeholders we interviewed. 

\a When Port Arthur's and Lake Charles' responses are considered
separately, Port Arthur's responses are "split about evenly" for both
questions, and Lake Charles' responses for whether a system was
needed are "all said no" and for willingness to fund a system are
"most said no."

The level of support for VTS 2000 was even lower when key
stakeholders were asked if they would be willing to pay for the
system, perhaps through fees levied on vessels.  At six of the eight
ports, a clear majority of stakeholders was not willing to fund VTS
2000.  At the remaining two--Houston and San Francisco--support was
mixed among the stakeholders we interviewed.  However, among those
who supported VTS 2000, many said their support was conditional.  For
example, some stakeholders in San Francisco said that they would be
willing to fund the system if the alternative were to have no VTS
system at all. 

One concern expressed by some stakeholders about funding a system was
that a user fee could affect the competitiveness of their port.  Many
port and industry stakeholders commented that a user fee could cause
some vessel owners to divert cargo to other ports.  Other
stakeholders indicated that a fee would probably not precipitate such
a decision if the amount were reasonable. 


   KEY STAKEHOLDERS SHOW GREATER
   SUPPORT FOR ALTERNATIVES
   PERCEIVED AS LESS EXPENSIVE
------------------------------------------------------------ Letter :5

Although most of the stakeholders we interviewed voiced little
support for VTS 2000, they did express stronger support for a more
limited form of VTS at most of the eight ports.  (See table 3.)
Support for some form of VTS was generally present at six ports,
mixed at one, and completely absent at one (Mobile/Pascagoula). 
Opinions about paying for such a system were generally supportive at
five ports (two were already doing so), mixed at two, and negative at
one. 



                                Table 3
                
                  Views of Shipping Industry, Pilots'
                    Association, and Port Authority
                   Stakeholders on Other VTS Systems

                                                Is some
                                    Is a VTS    form of     Would you
                                    system      VTS system  be willing
                                    currently   needed at   to pay for
Port                                in place?   your port?  it?
----------------------------------  ----------  ----------  ----------
Ports identified by Coast Guard as receiving
significant benefits from a new VTS system
----------------------------------------------------------------------
Houston/Galveston (n=5)             Yes         All said    Most said
                                                yes         yes, if
                                                            benefits
                                                            were
                                                            sufficient

Mobile/Pascagoula (n=7)             No          All said    Most said
                                                no          no

New Orleans (n=6)                   No          Most said   Split
                                                yes         about
                                                            evenly

Port Arthur/Lake Charles (n=14)     No          Split       Split
                                                about       about
                                                evenly\a    evenly\a


Ports with a privately funded VTS system
----------------------------------------------------------------------
Los Angeles/Long Beach (n=10)       Yes         All said    Already
                                                yes         supporting

Philadelphia/Delaware Bay (n=10)    Yes         All said    Already
                                                yes         supporting


Ports interested in private funding of a VTS system
----------------------------------------------------------------------
San Francisco (n=9)                 Yes         All said    Most said
                                                yes         yes, if
                                                            benefits
                                                            were
                                                            sufficient

Tampa (n=8)                         No          Most said   All said
                                                yes         yes, if
                                                            benefits
                                                            were
                                                            sufficient
----------------------------------------------------------------------
Note:  n=number of shipping industry, pilots' association, and port
authority stakeholders we interviewed. 

\a When Port Arthur's and Lake Charles' responses are considered
separately, Port Arthur's responses for whether a system was needed
are "most said yes" and for willingness to fund a system are "split
about evenly." Lake Charles' responses for whether a system was
needed are "all said no" and for willingness to fund a system are
"most said no."

At the four ports with existing VTS systems (Houston/Galveston, Los
Angeles/Long Beach, Philadelphia/Delaware Bay, and San Francisco),
interviewed stakeholders thought the systems were important to vessel
safety.  At Los Angeles and Philadelphia, where privately funded
systems are in place, most stakeholders said they regarded the
existing systems as sufficient.  In a January 1996 memo, the
Commander of the local Coast Guard district stated that the Los
Angeles system is a highly professional waterway management tool
effectively meeting the needs of the port and the Coast Guard.  He
noted that in broad terms, the Los Angeles system is entirely
consistent with the vast majority of technical specifications
identified in VTS 2000 operational documents; he favors admitting the
system into the Coast Guard's national VTS network.  At
Houston/Galveston and San Francisco, where the Coast Guard's VTS
systems are in place, stakeholders were generally pleased with the
safety and service information provided by the current system but had
concerns about the cost of a VTS 2000 system. 

At two of the four ports where no form of VTS currently exists (New
Orleans and Tampa), most of the stakeholders said some form of VTS,
which they perceived to be less expensive than VTS 2000, was needed. 
At Tampa, for example, many stakeholders believed that a radar-based
system would not be the most cost-effective alternative, and some
preferred a system based on satellite technology (called a dependent
surveillance system) that allows operators to determine the position
of their vessel.  At New Orleans, proposals from stakeholders
included setting up manned watchtowers to monitor traffic in key
areas of the Mississippi River. 

At Port Arthur, views were about evenly mixed as to whether a more
limited VTS system was needed.  Some stakeholders thought that VTS
would be valuable in certain areas, but not in the entire Port
Arthur/Lake Charles area identified in the Port Needs Study.  Of the
four ports, Mobile/Pascagoula was the only one where stakeholders
thought no VTS system was needed.  Most of the stakeholders said they
did not believe a VTS system was needed because of the low volume of
deep-draft traffic in the Mobile area.  As a result, these
stakeholders generally regarded the current procedures as adequate. 
These procedures include such measures as permitting only one-way
traffic in certain areas and maintaining communications with other
vessel operators in the region. 

As table 3 showed, views on funding such a system were mixed.  In
general, because stakeholders we interviewed perceived that other VTS
alternatives could be less costly than VTS 2000, they were somewhat
more disposed to consider paying for a VTS alternative.  However,
others were not willing to pay for a system.  At New Orleans, for
example, some stakeholders objected to funding a service that would
benefit users passing through the port to other destinations because
these stakeholders believed the users might be difficult to identify
and charge for the service.  As with VTS 2000, some stakeholders were
concerned about whether charging user fees would affect the
competitiveness of their port. 


   SEVERAL KEY ISSUES COULD AFFECT
   THE ESTABLISHMENT OF PRIVATELY
   FUNDED VTS SYSTEMS
------------------------------------------------------------ Letter :6

Most stakeholders at most of the ports we visited raised concerns
that could affect the establishment of privately funded VTS systems. 
These concerns include the private sector's ability to fund the
initial start-up costs of such a system, the private sector's
exposure to liability, and the Coast Guard's role in planning and
overseeing a privately funded system. 


      ABILITY TO OBTAIN ADEQUATE
      FINANCING MAY BE LIMITED
---------------------------------------------------------- Letter :6.1

Most key stakeholders we interviewed at three of the six ports that
do not have a privately funded VTS system were concerned that if
local VTS systems are to be funded by the user community rather than
through tax dollars, lack of adequate financing may pose a barrier. 
The start-up costs depend on the size and complexity of the system,
but buying radar equipment, computer hardware and software, and
operations space could cost $1 million or more for a system. 

Financing the systems at Los Angeles/Long Beach and
Philadelphia/Delaware Bay posed similar concerns, and both projects
received federal or state financial assistance.  The state of
California provided a low-interest loan of $464,550 to help pay
capital costs, and the ports of Los Angeles and Long Beach each
provided $250,000 in grants for VTS equipment.  The Marine Exchange
of Los Angeles/Long Beach, which operates the system, uses Coast
Guard property at no cost.  For operators of the
Philadelphia/Delaware Bay system, the Commonwealth of Pennsylvania
provided a $100,000 grant to help upgrade radar equipment in 1986,
and Pennsylvania and Delaware authorized pilotage fee increases in
1995 to pay for further upgrades costing more than $1 million.\13

To provide you with additional information on this issue, we
contacted representatives from five foreign locations with VTS
systems that charge port fees or user fees to pay for VTS
operations.\14 At four of the five locations, the central government
paid for all or part of the cost of developing and installing the VTS
system.  For example, the Port of Rotterdam's VTS capital costs of
$180 million were paid both by the central government (66 percent)
and by the local government (34 percent).  At the Port of Marseilles,
France, capital costs totaled about $3.5 million, of which the port
paid 66 percent and the central government paid the remaining 34
percent.  The central governments of these two countries agreed to
pay the development and installation costs as part of their oversight
role and their recognition of the need for VTS systems in their
country.  The Port of London was the only port where capital costs
were paid entirely by the port authority.  Most funding for this
system comes from harbor fees.\15


--------------------
\13 At this location, operation and maintenance costs for the VTS
system are paid as part of the pilotage fees assessed on certain
types and sizes of vessels using the port.  A related example is San
Francisco, where the Marine Exchange has said that if federal funding
for the Coast Guard's system is cut off, the Marine Exchange would
operate the system on a privatized basis, and ownership of the
facility would remain with the Coast Guard.  Thus, initial capital
costs would be minimal. 

\14 The five locations are Rotterdam, the Netherlands; Marseilles,
France; London, England; Antwerp, Belgium; and Hong Kong.  At the
first three locations, local port authorities operate the VTS
systems; in Antwerp, the Belgian government works with the local
government to operate the VTS system; and in Hong Kong, the central
government operates the system. 

\15 We also contacted a representative from Canada to obtain
information on Canada's efforts to pay for VTS operations through
user fees.  The 15 VTS systems operated by the Canadian Coast Guard
each require mandatory participation but have no associated user
fees.  According to the Director, Marine Communication and Traffic
Services, there is a strong movement through the government for
maritime cost recovery, particularly for VTS operations.  He said a
study to look at full or partial cost recovery for VTS operations is
ongoing.  Included in the study is an analysis of what portion of the
cost should continue to be paid by the central government, since
benefits accrue to the public through environmental protection.  This
study is planned to be completed in 1997. 


      CONCERN ABOUT LIABILITY
      PROTECTION IS WIDESPREAD
---------------------------------------------------------- Letter :6.2

Liability protection for private operators of a VTS system was a
widespread concern among those we interviewed.  Coast Guard and
privately funded VTS systems generally supply only advisory
information, such as vessel traffic or environmental conditions;
control of the vessel remains with the master of the vessel. 
However, most port and industry stakeholders we interviewed at the
six ports that do not have a privately funded system were concerned
that private VTS operators would be liable if inaccurate information
given by the VTS operations center led to an accident.  Privately
funded VTS systems in both Los Angeles/Long Beach and
Philadelphia/Delaware Bay receive liability protection under state
laws except in cases of intentional misconduct or gross negligence. 

At the foreign locations we contacted, officials said that exposure
to liability from operating VTS systems had not been raised as an
issue because the master or captain of the vessel has ultimate
responsibility for the safe navigation of the vessel.  Directives
from the VTS operator generally come only when a mechanical failure
in the ship occurs or when a situation requires immediate safe
traffic management.  However, all ports noted that since the area of
VTS operator liability has yet to be tested in a court of law, a
precedent has not yet been set.  At one port, an official noted that
the port authority carries third-party insurance ($75 million per
incident) as protection from accidents occurring under VTS guidance. 

At locations such as Tampa and San Francisco, where the possibility
of operating privately funded systems has been discussed,
stakeholders we interviewed believe that securing liability
protection is a key issue that must be resolved before they would
move forward to establish a VTS system. 

The Coast Guard's legal counsel has said that the Coast Guard's
exposure to liability in jointly operated systems does not differ
appreciably from that in other, more formally established, Coast
Guard-operated vessel traffic services.\16 If there is no Coast Guard
involvement with the privately funded VTS, no federal liability would
stem from the actions of Coast Guard personnel. 


--------------------
\16 The liability of the United States (through the Coast Guard) for
the acts of its personnel will be determined in the manner and to the
extent provided for by the Federal Tort Claims Act. 


      COAST GUARD'S ROLE IN
      PRIVATELY FUNDED SYSTEMS HAS
      NOT BEEN DEFINED
---------------------------------------------------------- Letter :6.3

The Ports and Waterways Safety Act of 1972, as amended, provided that
the Coast Guard may "construct, operate, maintain, improve or expand"
VTS systems; however, the act does not address what role, if any, the
Coast Guard should play in privately funded systems.\17 At seven of
the eight ports we reviewed, most stakeholders said the Coast Guard
should play a role with the private sector in developing privately
funded VTS systems, including establishing operating standards. 
Among the reasons for the Coast Guard to be involved, the
stakeholders cited the Coast Guard's regulatory authority to require
mandatory participation, the need for consistent and unbiased
operations, and the Coast Guard's expertise in and experience with
other VTS systems.  For example, the consensus of stakeholders in
Tampa was that industry, the state, and the Coast Guard should
jointly determine the need for a system.  A report produced by the
state of Florida states that "any interim [VTS] system should be
established in conjunction with the Coast Guard since a system
without Coast Guard support will have no real authority and may not
conform with other U.S.  Coast Guard systems."

While support for the Coast Guard's involvement in privately funded
systems was widespread, opinions were somewhat divided over what form
this involvement should take.  The two ports that currently have
privately funded systems tended to differ in how they saw the Coast
Guard's role.  At Los Angeles/Long Beach, where the Coast Guard
provides personnel for helping to run the system, the executive
director of the marine exchange said this arrangement gives the
system greater viability in performing its operations.  Local Coast
Guard officials said they also benefit from the system, since it can
assist them with other duties, such as waterway management, search
and rescue operations, and law enforcement activities.  Private
operators of the Philadelphia/Delaware Bay system believed that the
Coast Guard had a role in private systems but in a more limited
capacity.  For example, with the Philadelphia/Delaware Bay VTS, Coast
Guard personnel do not participate as VTS operators, but frequent
communication on issues of mutual concern occurs between the private
operators and the Coast Guard's Marine Safety Office.  For example,
the VTS operators would notify the Coast Guard if a navigation buoy
were reported to them as being missing or in the wrong location. 
However, operators of the system also said that the Coast Guard
should have the authority to approve and set the standards for
operating a system. 

At the foreign locations we contacted, the central government played
a role in most of the locally or privately operated systems.  At
three of the four locations where the local government or port
authority operates the system, the central government established the
operating regulations.  Officials said that the role of the central
government was to provide regulatory control and oversight to ensure
standard procedures for operating the VTS systems in their country. 

The Coast Guard recognizes that its authority for involvement in
privately funded systems is limited.  In response to questions in a
June 1995 congressional hearing, the Coast Guard stated that

     "Statutory and/or regulatory changes are needed to support the
     development of public-private partnerships for VTS systems.  The
     Coast Guard would need either broad authority to accept
     reimbursement for personnel it provided, or the authority to
     approve or sanction non-federal VTSs.  Formal certification of
     VTS-like facilities and development of standard operating
     procedures would also make sense.  They are both good business
     practices and would enhance the safety and quality of VTS
     operations."


--------------------
\17 However, the Coast Guard Authorization Act of 1993 authorized the
Coast Guard to provide for personnel support for the interim Vessel
Traffic Information Service in Los Angeles/Long Beach.  The act
states that the Coast Guard shall be reimbursed for all costs
associated with providing the Service with these personnel in
accordance with a reimbursable agreement between the Coast Guard and
the state of California.  The act does not address the Coast Guard's
interaction with any other privately funded VTS system. 


   CONCLUSIONS
------------------------------------------------------------ Letter :7

Difficult choices need to be made about installing and improving VTS
systems in the nation's ports.  Important questions about the VTS
program currently remain unanswered, including how many ports need
the system, how much it will cost, and whether other cost-effective
solutions are available.  At the same time, there is an acknowledged
need to improve waterway safety.  The available information indicates
that several ports under consideration are likely to realize
substantial benefits from the installation of VTS systems, and at
many ports we visited, stakeholders appeared interested in making
improvements--and, in some locations, perhaps paying for them--if the
economic soundness of such improvements can be demonstrated. 

An immediate and essential next step is for the Coast Guard to more
aggressively open lines of communication with key stakeholders at
ports under consideration for VTS 2000.  This communication is
essential in either securing support for VTS 2000 or in developing
possible alternatives.  Such alternatives could include Coast
Guard-operated systems or upgrades that are less extensive than VTS
2000 systems or systems built and operated by the private sector.  To
encourage more private-sector participation in VTS operations,
however, several other issues would need to be resolved, including
ways to provide financial assistance, liability protection, and an
overseer role for the Coast Guard. 


   RECOMMENDATIONS TO THE
   SECRETARY OF TRANSPORTATION
------------------------------------------------------------ Letter :8

We recommend that the Secretary of Transportation direct the
Commandant of the Coast Guard to take the following steps regarding
the VTS 2000 program: 

  -- To help ensure that the user community has adequate opportunity
     to provide its views, interact more closely with key
     stakeholders before making a final decision on the number of
     ports that will receive VTS 2000 systems.  This interaction
     could be achieved by discussing the need for the system in each
     location, allowing local officials to participate in designing
     the system's configuration, or discussing other waterway safety
     measures that may obviate the need for a VTS 2000 system in
     their port.  Discussions should also include the level of
     support that exists for privately funded systems and factors
     (such as financial assistance and liability indemnification)
     needed to facilitate their establishment.  The Coast Guard
     should report to the Congress on the potential for privatization
     and the actions needed to develop privately funded systems. 

  -- Given the (1) high development costs for the program (estimated
     at up to $145 million) and (2) the large number of proposed
     sites that show relatively low net benefits from acquiring new
     VTS 2000 systems, determine whether the safety benefits of VTS
     2000 can be achieved more inexpensively by installing other VTS
     systems, perhaps patterned after existing, recently upgraded
     Coast Guard systems. 

  -- To ensure that the operation of privately funded systems is
     consistent with the Coast Guard's responsibility for marine
     safety and the marine environment, determine with input from
     industry and other stakeholders, the Coast Guard's appropriate
     role in overseeing privately funded systems and seek
     authorization from the Congress to implement this role. 


   AGENCY COMMENTS AND OUR
   EVALUATION
------------------------------------------------------------ Letter :9

We provided a draft of this report to officials from the Department
of Transportation and the Coast Guard for their review and comment. 
We discussed the report with these officials, including the Coast
Guard's VTS 2000 Project Manager, Office of Acquisition, and the
Chief of the Vessel Traffic Management Division, who generally agreed
with the report's findings and said they would consider the report's
recommendations.  They provided comments that clarified the cost of
developing VTS 2000, which we have incorporated into the report. 


---------------------------------------------------------- Letter :9.1

We performed our work from August 1995 through March 1996 in
accordance with generally accepted government auditing standards.  A
detailed description of our scope and methodology appears in appendix
III. 

As arranged with your offices, unless you publicly announce its
contents earlier, we plan no further distribution of this report
until 10 days after the date of this letter.  At that time, we will
send copies to the Secretary of Transportation; the Commandant of the
Coast Guard; and the Director, Office of Management and Budget.  We
will make copies available to others on request. 

Please contact me at (202) 512-2834 if you or your staff have any
questions concerning this report.  Major contributors to this report
are listed in appendix IV. 

Sincerely yours,

John H.  Anderson, Jr.
Director, Transportation and
 Telecommunications Issues


BACKGROUND ON EIGHT PORTS VISITED
BY GAO
=========================================================== Appendix I

Described below is information on the type of vessel traffic at each
port we visited, the navigational difficulty for each port, and a
description of the current vessel traffic service (VTS) system at
each port.  For ports with Coast Guard-operated systems, we also
supply information on the upgraded or enhanced systems. 


   HOUSTON/GALVESTON, TEXAS
--------------------------------------------------------- Appendix I:1

Galveston Bay marks the entrance from the Gulf of Mexico that leads
to ports such as Houston, Galveston, and Texas City.  This large,
irregularly shaped, shallow body of water is about 30 miles long and
17 miles wide at its widest part.  Because the bay is generally only
7 to 9 feet deep, deeper-draft vessels must use a 400-foot-wide,
40-foot-deep dredged channel to reach their inland port destinations. 
Vessels destined for the Port of Houston travel a total of 53 miles
up the bay and ship channel to reach their destination, while
Galveston- and Texas City-bound vessels transit only 11 miles and 16
miles, respectively.  Other factors that affect navigation in this
region include fog conditions and tidal changes, which can be
exacerbated by wind conditions. 

The volume and type of traffic transiting this region add to the
navigation challenges noted above.  The Houston/Galveston Bay area
ranks third among U.S.  ports for its handling of crude oil and
second for its handling of other petroleum products.  This area is
one of the busiest ports in the U.S.  as well.  For example,
according to a Coast Guard official, over 17,000 deep-draft and
97,000 barge transits operated under VTS Houston in 1994. 

Under the authority of the Ports and Waterways Safety Act, the U.S. 
Coast Guard established a VTS system for the Houston/Galveston area
in 1975.  The Coast Guard staffs the VTS system with at least one
supervisor and four vessel traffic controllers for each watch 24
hours a day, 7 days a week.  The Coast Guard's operating costs for
the VTS system were about $3.2 million for 1995.  Participation in
the VTS system is mandatory for all power-driven vessels over 131
feet long, vessels greater than 26 feet long engaged in towing, and
vessels certified to carry 50 or more passengers.  On average, about
340 vessels use the Coast Guard's VTS services on a daily basis. 

In 1995, the Coast Guard completed a $700,000 enhancement that
provided the Houston VTS system with one additional radar site. 
According to a Coast Guard official, this addition filled a gap in
the VTS system's area coverage that had previously affected the Coast
Guard's ability to monitor vessel traffic in the upper Galveston
Bay/Redfish Bar area. 

The Coast Guard also plans to develop a VTS 2000 system for the
Houston/Galveston area by 2000.  The Coast Guard's estimated costs
for a VTS 2000 system in Houston/Galveston include about $8.8 million
in acquisition, construction, and improvement costs and about $3
million in annual operating costs. 


   LOS ANGELES/LONG BEACH,
   CALIFORNIA
--------------------------------------------------------- Appendix I:2

The ports of Los Angeles and Long Beach are located within San Pedro
Bay, a body of water separated from the open sea by a 7-mile-long
breakwater.  After entering the bay, maritime traffic travels to one
of the many deep-water berths located in this 15,000-acre, man-made
harbor.  According to Coast Guard officials, despite the relatively
high marine traffic volume in the harbor, the area is not considered
difficult to navigate, as it is relatively free of navigation hazards
and weather problems, except for occasional fog.  Together, the ports
of Los Angeles and Long Beach are responsible for the highest
container tonnage of any port in the nation.  In fiscal year 1994,
these ports received 7,933 commercial vessels, transporting more than
103 million tons of cargo, including automobiles, petroleum products,
and other bulk products.  In addition, the Port of Los Angeles
supports a cruise ship industry. 

Since early 1994, the Marine Exchange of Los Angeles and Long Beach
have been operating a vessel traffic information service (VTIS)
system.  This system, initially established as an interim system
until the Coast Guard could build its own VTS, was developed with
financial assistance from the ports of Los Angeles and Long Beach and
a loan from the state of California.  The geographic area covered by
the system extends out to 20 miles offshore.  On the basis of an
agreement with the harbor pilots, VTIS does not advise vessels within
the breakwater, although it has that capability.  State law requires
all vessels of a certain size to participate in the system.  For
example, ships over 300 gross tons participate in the system.  The
annual operating costs of VTIS, currently about $1.4 million, are
covered by user fees levied on vessels using the system's services. 
Fees currently range from $180 to $340 per entry into the VTIS area,
depending on the size of the vessel. 

The Coast Guard has played an active role in the Los Angeles/Long
Beach VTIS since its inception.  Initially developed under the Coast
Guard's guidance, the system operates under many of the same rules
and procedures that the Coast Guard uses at its own VTS sites.  The
system uses Coast Guard watchstanders, who along with Marine Exchange
personnel, monitor traffic and provide mariners with information. 
The state of California reimburses the Coast Guard for the use of its
personnel.  VTIS also provides the Coast Guard with valuable
assistance during its search and rescue efforts and law enforcement
actions, and VTIS disseminates information on Captain of the Port
Orders. 

The Coast Guard currently plans to build a VTS 2000 system that would
be fully operational by 1998 in the Los Angeles/Long Beach area.  The
Coast Guard estimates that acquisition, construction, and improvement
costs will be $4.9 million and that annual operating costs will be
about $1.7 million. 


   MOBILE, ALABAMA/PASCAGOULA,
   MISSISSIPPI
--------------------------------------------------------- Appendix I:3

Mobile, Alabama is about 28 miles inland from the Gulf of Mexico. 
Deep-draft vessels bound for Mobile from the Gulf use a channel that
is at least 400 feet wide for their transit up Mobile Bay.  This
shipping channel, which runs north and south between the Gulf and
Mobile, is dredged to about a 40-foot depth, while the remainder of
the bay is generally only 7 to 12 feet deep. 

Pascagoula, Mississippi, which lies about 24 miles west of Mobile, is
also an inland port that requires deep-draft vessels to transit up a
narrow channel to reach its harbor area.  However, in this location,
the transit is only about 10 miles from the Gulf of Mexico. 

Navigational challenges in this area (in addition to the narrow
channel) are presented by two main factors:  weather conditions and
crossing marine traffic in certain locations.  Relatively frequent
and strong weather fronts and fog are typical in this region. 
Frontal systems occur about 20 times per year and are usually
accompanied by heavy rain and strong winds.  Fog is most problematic
in the winter and spring, and visibilities can fall below one-half
mile 4 to 8 days per month from November through April.  Crossing
marine traffic presents a navigational challenge in two locations
where the Intracoastal Waterway (a major shipping channel for
shallow-draft vessels) crosses the main ship channels leading to
Mobile and Pascagoula.  Because of the large volume of shallow-draft
traffic transiting east and west along this waterway, there is a
potential for collisions with shipping channel traffic in this area. 
As a result, in both locations, the Coast Guard advises vessel
operators to exercise particular caution and requests that they make
a security call prior to crossing the Intercoastal Waterway,
particularly during periods of restricted visibility.  Vessel
operators make a security call to advise other vessels in the
vicinity of their current location and their intended route. 

Deep-draft vessel traffic in the Mobile/Pascagoula area is relatively
light compared with that of larger Gulf Coast ports like New Orleans
and Houston.  According to Coast Guard information, 1,118 deep-draft
vessels arrived at the Port of Mobile and 328 deep-draft vessels
arrived at the Port of Pascagoula in 1995.  In addition, a
significant amount of shallow-draft traffic occurs in this region,
according to a Coast Guard official.  Counting deep- and
shallow-draft shipping together, commodities (by tonnage) being moved
in and out of the Mobile area include crude or bulk materials (such
as forest products, pulp, and iron ore) (38 percent), coal (32
percent), and petroleum and petroleum products (20 percent).  At
Pascagoula, 85 percent of the tonnage is petroleum and petroleum
products. 

Currently, no radar-based VTS system monitors vessel traffic in this
region.  However, port officials in both locations are in contact by
radio or telephone with vessels operating in their port to enforce
local rules and regulations (such as speed limits) and assign berths
to vessels, among other things. 

The Coast Guard's plans for VTS 2000 currently include the
installation of a VTS 2000 system in this port by 2001.  The Coast
Guard estimates that costs for the system will be about $5.3 million
in facility and equipment costs and $2 million in annual operating
costs. 


   NEW ORLEANS, LOUISIANA
--------------------------------------------------------- Appendix I:4

The Port of New Orleans, encompassing a 34-mile stretch of the
Mississippi River, is one of the largest ports in the United States. 
This port area serves vessel traffic from three waterway complexes: 
ocean traffic entering from the Gulf of Mexico, river traffic moving
along the Mississippi and Ohio rivers, and vessel traffic from the
Intracoastal Waterway.  Vessels coming into this port region from the
Gulf of Mexico are typically deep-draft vessels, while the river and
Intercoastal Waterway vessels tend to be primarily shallow-draft
vessels, according to the Coast Guard. 

According to the Coast Guard, several factors influence the
difficulty of navigation in this river port area.  The first is
geography.  For example, blind corners, sharp bends, and strong
currents in the Mississippi River make it more difficult for vessel
operators to both see each other and avoid collisions.  The second is
the sheer volume of vessels transiting and mooring in the area.  The
port region has many miles of warehousing facilities and barge
mooring on both banks of the river.  The amount of activity occurring
along the river banks and the number of vessels going up and down the
river pose an increased risk of collisions because maneuvering room
decreases.  The third is changing river conditions.  Because this
region is a river environment, it is affected by seasonal changes
(such as winter thaw), which can increase the water level and the
speed of the river's currents.  With faster river currents, vessels
must operate at higher speeds to maintain their maneuverability,
thereby reducing their time to maneuver and increasing the potential
risk of accidents.  This condition is exacerbated by spring fog,
which can significantly reduce visibility in the region. 

In 1995, about 41,600 vessels transited through the New Orleans area. 
Of this total, about 6,400 were deep-draft vessels, and the remainder
were shallow-draft vessels.  Cargoes carried by vessels transiting
this area include iron and steel, metal ores and scrap, and
fertilizers.  However, according to a Coast Guard official, about
half of the shallow-draft vessels carry dangerous cargoes, such as
petroleum and petroleum products. 

The Coast Guard currently operates a limited vessel traffic
management system in the New Orleans region.  It is a radio-based
vessel information system that uses red and green signal lights to
direct vessel traffic.  The scope of its operation depends in part on
the river conditions.  For example, when there are high water
conditions (which may have been created by winter thaw), strong
currents create a "boil" at a particular location in the river that
is capable of turning a large vessel 180 degrees off course.  Because
of the added risk under this type of condition, the operators of the
system limit the transits in this area to one vessel at a time to
ensure that vessels have adequate maneuvering space to accommodate
the effects of the river's current as they try to correct their
course. 

The Coast Guard's plans for a VTS 2000 in this region include
installation of two phases of a VTS 2000 system by 2001.  The Coast
Guard estimates that total facility and equipment costs for both
phases would be about $29.7 million and total operating expenses
would be about $6.6 million annually. 


   PHILADELPHIA,
   PENNSYLVANIA/DELAWARE BAY,
   DELAWARE
--------------------------------------------------------- Appendix I:5

Delaware Bay marks the entrance from the Atlantic Ocean that leads
inland to ports such as Philadelphia, Pennsylvania; Wilmington,
Delaware; and Camden, New Jersey.  The bay itself is an expansion of
the lower part of the Delaware River, and the bay's entrance is about
10 miles wide between Cape May, New Jersey, and Cape Henlopen,
Delaware.  Deep-draft vessels entering Delaware Bay approach this
entrance between the capes utilizing one of two sea lanes that
approach the entrance from either the east or the south.  Traffic
separation schemes identify inbound and outbound lanes and a zone of
separation in each of these sea lanes to help reduce the risk of
collision in this area.  Because parts of Delaware Bay are shallow,
deep-draft vessels transit to their inland destinations via a channel
that is 40 or more feet deep throughout its 90-mile length.  The
ports of Philadelphia and Camden, which lie opposite each other along
the Delaware River, are about 87 miles from the capes, while
Wilmington is about 63 miles from the capes. 

The navigational challenges that mariners face when transiting this
region include curves with irregular depths; strong currents; shoals,
particularly rock shoals in the Marcus Hook, Pennsylvania, region;
occasional visibility limitations caused by fog, precipitation,
smoke, and haze; and ice conditions in the winter.  However,
according to a Coast Guard official, the two significant navigational
challenges in this region are at the approaches to the Delaware Bay
entrance and at the location where the Chesapeake and Delaware Canal
enters the Delaware River. 

In 1995, 2,570 deep-draft vessels arrived in this region. 
Pennsylvania terminals accounted for 51 percent of these arrivals,
while terminals in New Jersey handled 31 percent and Delaware handled
18 percent.  While many of these vessels carried a wide variety of
products--ranging from fruit, cocoa, and salt to plywood, steel, and
asphalt--about one-third of the vessels arriving in this region were
carrying petroleum products.  According to a port official, oil and
oil-related products accounted for 85 percent of the total tonnage
arriving in this port region in 1994. 

The Philadelphia Marine Exchange and the Pilot Association for the
Delaware Bay and River jointly operate a vessel traffic information
system for vessels operating in the Delaware Bay and River.  The
lower bay area is monitored via radio and radar by the pilots
operating out of a watchtower at Cape Henlopen.  The upper bay and
rivers are monitored by radio via the Maritime Exchange.  Vessel
traffic is monitored 24 hours a day, 7 days a week, and operating
costs for this service are funded through fees paid to the pilots for
their piloting services.  Unlike the Coast Guard's VTS systems,
vessels are not required by law to participate in this privately
funded system, but according to a pilot official, all piloted vessels
do participate.  However, participation in the VTS system by
shallow-draft vessels is mixed--according to a local Coast Guard
official.  The VTS system underwent a $1.2 million dollar upgrade in
late 1995 that improved operators' ability to monitor an anchorage
area and provided for an expansion in their offshore coverage of
vessels approaching Delaware Bay, according to a pilot official. 

The Coast Guard's current plans for VTS 2000 include the installation
of a system in this port by 2002.  The Coast Guard currently
estimates that acquisition, construction, and improvement costs will
be $6.5 million and annual operating costs will be $1.3 million for
the proposed system. 


   PORT ARTHUR, TEXAS/LAKE
   CHARLES, LOUISIANA
--------------------------------------------------------- Appendix I:6

The Port Arthur region consists of four major ports--Port Arthur,
Beaumont, Orange, and Lake Charles--that together had about 2,400
deep-draft-vessel arrivals in 1994.  Petroleum products and chemicals
are the primary cargos for these areas. 

According to Coast Guard officials, navigation in Port Arthur is
considered moderately difficult because vessels must transit up to 8
hours through a relatively narrow 56-mile channel and Sabine Lake
with virtually no anchorages along the way.  In contrast, navigation
for Lake Charles involves a 25-mile transit for vessels from the Gulf
of Mexico.  Coast Guard officials said the transit is considered
moderately easy because large vessels are restricted to one-way
traffic, thereby eliminating the potential collision hazard between
larger ships.  Also, as a further precaution, vessels approaching a
ship carrying liquified natural gas must maintain minimum distances
from it (2 miles ahead or 1 mile behind). 

Neither Port Arthur nor Lake Charles has a radar-based VTS system. 
Instead, both areas have a radio-based scheduling system that
provides certain marine traffic with information on vessel movements. 
Only deep-draft vessels with marine pilots aboard participate in this
system; barges and other intercoastal waterway traffic do not usually
communicate with the operations center with respect to their
locations or other information. 

The Coast Guard plans to install and operate a VTS 2000 system in the
Port Arthur/Lake Charles area by 2000.  The Coast Guard estimates
that facility and equipment costs to build the system will be about
$6 million and annual operating costs will be about $1.3 million. 


   SAN FRANCISCO, CALIFORNIA
--------------------------------------------------------- Appendix I:7

The San Francisco Bay region comprises a series of connecting bays
that make up the largest harbor on the Pacific Coast.  Maritime
traffic enters the area from the Pacific Ocean and can travel through
a number of bays including San Francisco Bay, San Pablo Bay, and
Suisun Bay.  The bay traffic destinations include locations such as
Oakland, Richmond, and San Francisco, while traffic transiting beyond
the bays can travel about 37 or 43 miles upriver to the ports of
Stockton and Sacramento, respectively. 

This region is considered a difficult navigation area because of its
high-traffic density, frequent episodes of fog, and challenging
navigational hazards.  In 1994, there were 3,502 vessel arrivals in
the San Francisco Bay region.  Sixty-six percent of these vessels
were either full container vessels or tank vessels carrying petroleum
products.  In addition to vessel arrivals, there is a high volume of
ferry traffic in this region, adding to the navigational challenges
for vessel operators traveling in the area.  The episodes of fog,
most frequently experienced in the summer, add to the difficulty of
navigating by significantly reducing visibility.  According to a
Coast Guard official, this region's large volume of vessel traffic
and low visibility periods and the navigational hazards presented by
narrow channels, shallow depths, prominent shoals, and crossing
vessel traffic areas all contribute to the need for mariners
transiting in this region to be subject to a number of regulations. 
One key regulation is a requirement that many of them participate in
the VTS system. 

The Coast Guard established the VTS system in 1972 shortly after the
passage of the Ports and Waterways Safety Act of 1972 and following a
serious collision between two tank vessels that resulted in extreme
environmental damage to San Francisco Bay.  The Coast Guard continues
to operate the VTS system today and monitors about 250 vessel
movements per day.  On average, just over two-thirds of these VTS
system contacts are with ferries operating in the region. 
Participation is mandatory for all vessels meeting certain minimum
requirements.  For example, all power-driven vessels 40 meters or
greater in length must participate in the system.  Coast Guard
personnel monitor approximately 133 miles of waterway, 24 hours per
day, 7 days per week using radio, radar, and camera equipment. 
According to a Coast Guard official, the geographic area covered by
VTS extends from about 38 nautical miles offshore into the central
bay area and upriver toward the north and east to the ports of
Stockton and Sacramento.  Operating costs for the current VTS system
are about $2.6 million annually. 

The VTS system is currently undergoing a $6.1 million upgrade that
will provide two additional radar surveillance sites, two additional
camera surveillance sites, and digitized radar displays in the Vessel
Traffic Center.  The upgraded system is expected to be fully
operational in the summer of 1996.  In 2004, the Coast Guard plans to
replace the system again with a VTS 2000 system.  The Coast Guard's
estimated costs for the VTS 2000 system are about $6.6 million in
acquisition, construction, and improvement costs and about $2.2
million in annual operating costs. 


   TAMPA, FLORIDA
--------------------------------------------------------- Appendix I:8

The Tampa Bay harbor is a relatively large, shallow body of water
containing three major ports--Tampa, St.  Petersburg, and Manatee. 
Maritime traffic, which included about 10,000 commercial vessel
arrivals in 1994, enters the bay from the Gulf of Mexico.  Vessels
transit through dredged ship channels and take up to 6 hours to reach
their destinations.  A large portion of the vessels transiting the
bay are tank vessels that annually carry more than 4 billion gallons
of oil, petroleum products, and hazardous materials.  In addition,
Tampa Bay supports growing cruise ship and tourist industries, with
current arrivals averaging three each week. 

According to Coast Guard officials, navigation in Tampa Bay is
considered moderately difficult because of its high marine traffic
density, the absence of inner-harbor anchorage areas, swift currents,
and narrow channels.  Reduced visibility caused by fog and severe
thundershowers (which occur, on average, 24 and 91 days each year,
respectively) also add to the challenges of navigating in this
region. 

A major oil spill resulting from an accident in the bay in 1993 was
the impetus for actions currently underway by state and local
officials to develop their own VTS system for the bay area.  The
state of Florida has established a consortium of maritime interests
to design and develop an interim system that will serve the area
until the Coast Guard builds its own VTS there.  The consortium is
developing a proposal for a system that is compatible with the Coast
Guard's performance goals for VTS 2000.  Under current plans, this
privately operated system could be fully operational within the next
several years, if funding to build and operate it can be obtained. 

Currently, the Coast Guard anticipates building and operating a VTS
2000 system in Tampa that would be fully operational by 2001.  The
Coast Guard estimates that facility and equipment costs to build the
system will be $5.6 million and annual operating costs will be about
$1.9 million. 


BACKGROUND ON THE PORT NEEDS STUDY
AND FOLLOW-ON STUDIES AT FIVE
PORTS
========================================================== Appendix II

The Research and Special Programs Administration's Volpe National
Transportation Systems Center conducted the Port Needs Study from
February 1990 through July 1991 at a cost of $2.8 million.  The scope
of the study involved an examination of the need for VTS systems at
23 locations.  The study assessed the need for a VTS system by using
two methods of cost-benefit analysis.  The first method evaluated the
full benefits and full costs of installing a VTS system without
considering the costs and benefits of existing systems.\1 Ten of the
17 ports under consideration for VTS 2000, however, currently have
some form of VTS system or radio-based information system.\2 The
second method took these existing systems into account by evaluating
their benefits and costs.  On the basis of the second method, the
study determined the marginal net benefit, if any, that a new system
would bring to eight of the ten locations.\3

Cost estimates for each port were based on initial investment costs
and annual operation and maintenance costs.  Investment costs were
estimated by developing a "candidate" VTS system for each port zone. 
The candidate VTS system's design is a preliminary engineering design
made for developing cost estimates.  For comparison purposes, initial
investment costs were assumed to be committed in fiscal year 1993,
and operation and maintenance costs are estimated from fiscal year
1996.  All costs are in 1990 constant dollars. 

Benefit estimates for each port zone were based on the cost of vessel
accidents and associated consequences expected to be prevented by the
candidate VTS system.  The estimates were based on a statistical
analysis of historical vessel accidents and traffic and the unique
navigational features of each port zone to determine the probability
of vessel accidents occurring in each port zone.\4 These
probabilities were applied to vessel traffic forecasts to estimate
the probable number of future vessel accidents that would occur in
the absence of any VTS system.  The effectiveness of the candidate
VTS system in preventing vessel accidents in each port zone was then
estimated as the cost of the losses expected to be avoided by the VTS
systems.  Benefits and costs were calculated over a 15-year
period--1996-2010--and discounted to 1993. 

Starting in fiscal year 1993, Volpe issued a series of follow-on
studies for the Coast Guard on selected sites.  To date, reports on
five of the ports considered for VTS 2000 have been completed.\5
Reports were issued on Mobile and Corpus Christi in 1993, Boston and
Tampa in 1994, and Philadelphia in 1995.  Among other things, the
follow-on studies supplement the Port Needs Study by validating and
updating vessel traffic patterns and forecasts, documenting traffic
management requirements, and updating the VTS cost-benefit analysis. 
Table II.1 gives the results of the follow-on studies. 

The results of the follow-on studies are not comparable with the Port
Needs Study for several reasons.  For example, the Port Needs Study
used a discount rate of 10 percent in calculating costs and benefits,
while the follow-on studies used a discount rate of 7 percent.\6
Using a lower discount rate contributes to an increase in the present
value of net benefits attributable to a VTS system.  In addition, the
follow-on studies used more current transit data or adjusted the
original data based on input from the local marine community.  For
example, the follow-on study at Philadelphia/Delaware Bay used 1993
data from the Army Corps of Engineers, while the Port Needs Study was
based on 1987 data from the Corps. 



                               Table II.1
                
                  Results of Follow-on Studies at Five
                                 Ports

                         (Dollars in millions)


                                     Total
Location                           benefit    Total cost   Net benefit
----------------------------  ------------  ------------  ------------
Corpus Christi                       $89.9         $13.2         $76.7
Mobile                                69.7          17.8          51.9
Boston                                11.6          18.7         (7.1)
Tampa
 Coast Guard's VTS                    53.6          23.5          30.1
 Proposed private VTS                 18.6           6.6          12.0
Philadelphia
 Coast Guard's VTS                    40.6          18.1          22.6
 Existing private VTS                 21.2           3.7          17.6

----------------------------------------------------------------------
\a The costs and benefits for Corpus Christi and Mobile were
discounted to 1993.  The costs and benefits for Philadelphia, Tampa,
and Boston were discounted to 1998.  All costs and benefits are in
1992 constant dollars. 


--------------------
\1 The benefit is based on the cost of avoided casualties and
associated consequences attributable to a candidate VTS system (the
difference between the number of casualties, assuming that a VTS
system does not exist at a port, and the number of casualties,
assuming that a VTS system does exist). 

\2 The Port Needs Study did not evaluate the marginal net benefit of
the radio-based information system in Port Arthur.  Also, the VTS
system in Valdez was not included in the study because the Congress
had already legislated the expansion and improvement of the Prince
William Sound VTS system in the Oil Pollution Act of 1990. 

\3 The marginal benefit is based on the difference in the cost of
avoidable casualties and associated consequences attributable to an
existing VTS system and the avoidable casualties attributable to a
candidate system. 

\4 The primary source of accident data was the Coast Guard's Casualty
Maintenance database for 1980-89.  The only source of traffic data
was the Army Corps of Engineers.  Volpe used 1987 traffic data as the
basis for projecting future traffic patterns. 

\5 The Coast Guard also plans to conduct follow-on studies of
Portland, Oreg.; Puget Sound, Wash.; Providence, R.I.; Long Island
Sound, N.Y.; and Baltimore, Md.  In total, the studies will cost
about $2 million. 

\6 The lower discount rate was used in accordance with guidance
issued by the Office of Management and Budget. 


SCOPE AND METHODOLOGY
========================================================= Appendix III

This work was prepared at the request of the Chairman, Subcommittee
on Coast Guard and Maritime Transportation, House Committee on
Transportation and Infrastructure, and Representative James A. 
Traficant, Jr., who was formerly the ranking minority member of the
Subcommittee. 

To assess the status of VTS 2000, we examined the Port Needs Study
and updated studies on five ports and interviewed officials who were
responsible for the study and updates at Volpe National
Transportation Center.  (App.  II provided additional information on
the Port Needs Study).  We did not conduct an assessment of the
accuracy of the data used in the Port Needs Study or the updates.  We
reviewed program documents and interviewed Coast Guard program
managers and acquisition managers for the VTS 2000 program. 

To determine the interest of industry and ports in acquiring and
funding VTS 2000 or other systems, we obtained information from four
ports (New Orleans, Port Arthur/Lake Charles, Houston/Galveston, and
Mobile) identified by the Port Needs Study as having the greatest
benefit from a VTS system.  In addition, we obtained information from
four other ports that either have privately funded VTS systems or
have expressed interest in funding VTS systems with nonfederal funds. 
At each port, we obtained information on implementation issues that
arise or could arise in privately funded systems.  Table III.1
categorizes these ports. 



                  Table III.1 Breakdown of Eight Ports
                             Visited by GAO

                                  Top four    Ports with         Ports
                              ports in the     privately   considering
                                Port Needs    funded VTS     privately
Name of port                         Study        system    funded VTS
----------------------------  ------------  ------------  ------------
New Orleans, La.                         X
Port Arthur, Tex./Lake                   X
 Charles, La.
Houston/Galveston, Tex.                  X
Mobile, Ala./Pascagoula,                 X
 Miss.
Los Angeles/Long Beach,                                X
 Calif.
Philadelphia, Pa./Delaware                             X
 Bay, Del.
San Francisco, Calif.                                                X
Tampa, Fla.                                                          X
----------------------------------------------------------------------
The information we obtained at each of the ports we visited was based
on multiple data sources.  Our work included a standard set of
questions with stakeholders from industry, pilots' associations, and
port authorities and reviews of documents.  We developed our list of
interviewees from the Coast Guard's Port or Safety Advisory Committee
in each of the eight ports, or we based our list of interviewees on
recommendations from the local Coast Guard office.  The committee
comprises key users of each port, such as pilots, ship and barge
companies doing business at the port, and port officials.  We
verified with Coast Guard, industry, and port officials that our list
of interviewees represented the key stakeholders that had an interest
in operations of the port.  (See table III.2 for a breakdown of key
stakeholders interviewed in each location.) In addition, we reviewed
documents on the VTS 2000 program and local correspondence with the
Coast Guard.  We also reviewed available documents on waterway
safety. 



                              Table III.2
                
                Type of Key Stakeholders Interviewed at
                               Each Port


                                                    Port       Pilots'
Name of port                      Industry     authority   association
----------------------------  ------------  ------------  ------------
Houston                                  3             1             1
Los Angeles/Long Beach                   8             1             1
Mobile/Pascagoula                        4             1             2
New Orleans                              3             1             2
Philadelphia/Delaware Bay                7             2             1
Port Arthur/Lake Charles                 8             4             2
San Francisco                            6             2             1
Tampa                                    4             3             1
----------------------------------------------------------------------
In addition to obtaining information from ports in the United States,
we obtained information from six foreign countries to determine how
they have implemented user fees.  We judgmentally selected five
foreign ports that charge port fees or user fees to fund VTS systems. 
The selected ports are Rotterdam, the Netherlands; Marseilles,
France; Antwerp, Belgium; London, England; and Hong Kong.  We also
collected information from Canada because it is examining user fees
as one means to pay for VTS systems in the future.  Using a standard
set of questions to obtain information, we conducted telephone
interviews with central government officials and operational managers
in these countries.  These officials were identified to us by
representatives of the International Association of Lighthouse
Authorities and the European Commission as the most knowledgeable
about VTS issues in their respective countries. 

We conducted legal analysis of pertinent laws and regulations
governing the Coast Guard's responsibilities in operating VTS systems
and the implementation of user fees to pay for such systems.  Among
other things, we reviewed the Ports and Waterways Safety Act of 1972,
as amended, and the Oil Pollution Act of 1990.  Also, we interviewed
the Coast Guard's legal counsel on legal issues related to VTS 2000. 

We reviewed numerous budget and program documents.  We also
interviewed key stakeholders at the national level, including the
American Waterways Operators, the American Association of Port
Authorities, and the American Institute of Merchant Shipping.  Also,
we discussed our approach with the Marine Board of the National
Research Council. 


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix IV

Neil Asaba
Gerald Dillingham
Dawn Hoff
David Hooper
Luann Moy
Mehrzad Nadji
Elizabeth Reid
Stan Stenersen
Randy Williamson


*** End of document. ***