Two announcements from two different federal agencies emanate from last week. One might matter; the other, not so much.
Last Wednesday in New Orleans, U.S. Maritime Administrator David Matsuda brought the maritime industry up-to-date on the good work being done the Department of Transportation’s maritime administration. According to Matsuda, it has been a busy and productive three-plus years; a cornucopia of progress for the domestic waterfront. Using possibly his highest profile platform yet to deliver the “good” news to the maritime industry, Matsuda’s talk centered chiefly on three metrics which he says will eventually yield great dividends. Nevertheless, and judging from the paucity of people who bothered to show up for his speech, maritime professionals everywhere stopped listening to his mantra long before he stepped off his taxpayer-funded plane in New Orleans.
Speaking from the same podium that last year saw retired U.S. Coast Guard Commandant Thad Allen captivate a packed house of maritime industry leaders, Matsuda delivered his remarks to a largely empty room. By my unofficial count, less than 30 people showed up despite seating for ten times that number and a trade show attendance (thousands) that appeared to be up markedly from the previous year. In retrospect, perhaps folks should have come in for the show after all. That’s because Matsuda proceeded to blame Marad’s considerable woes on “past” sins and then spun the train wreck that characterizes his tenure at DOT as “progress.” I couldn’t possibly make this up.
According to Matsuda, Marad, under his guidance, has thrown off the shackles of “demons of the past” and moved forward on any number of fronts to advance the cause of the domestic maritime industry. Referring first, apparently, to the scores of vessels now being moved out of the Suisun Bay reserve fleet in California, the Marad Chief touted the environmental stewardship at DOT under his watch as compared to his predecessor’s performance. In reality, though, any progress made on the West Coast with the ghost ship problem has everything to do with this Administration’s willingness to do anything (and everything) to please the California congressional delegation. It has been expensive and it has been conducted using an uneven playing field.
The previous Maritime Administrator, Sean Connaughton, simply refused to do business with a state that demanded a laundry list of ridiculously expensive and arguably pointless environmental restrictions surrounding the removal of these decaying hulls. Instead, he moved record numbers of hulls out of the Texas and Virginia fleets under considerably more difficult scrap market conditions than we see today. California, you may remember, is the state that wants to enact and enforce a ballast water treatment standard that is 1,000 times more stringent than the soon-to-be-enacted IMO benchmark. I rest my case.
Next, the Marad Administrator assured the (remaining) two dozen listeners (his amplified words echoing in the cavernous, nearly empty room) that DOT would restore the U.S. Merchant Marine Academy to be the “crown jewel of all of the federal academies.” They will do this – reportedly – as a function of a robust, increased infrastructure funding program. If true, then this is good news indeed for Kings Point. On the other hand, his handling of administrative affairs at the federal school over the past two years has left most alumni anything but happy. This situation warrants close scrutiny going forward.
As the third leg of his vast Marad “legacy,” Matsuda reported that the agency has added countless more employees to the Marad payroll over the past two years. For those of you worried that Marad didn’t have enough folks to get the cheerleading job done, it is time to rest easy. And while he didn’t elaborate on what the new hires were actually up to, he did wind up his remarks by announcing that the U.S. Maritime Administration had released a report detailing new designs for shipping vessels specifically engineered for America’s Marine Highways. According to a prepared statement, “Production of these efficient, environmentally-friendly vessels could bolster the domestic shipbuilding industry by creating new jobs and strengthening regional economies.” Fair enough.
Without a doubt, shortsea shipping should be the central focus of Marad’s domestic maritime advocacy. The new designs are nice to look at. On the other hand, what makes anyone think that a federal government which has considerable trouble managing its own fleet acquisition strategies would be a reliable source of hull forms and logistics strategy? Beyond this, even Matsuda knows that the chances of building a domestic shortsea shipping fleet are slim without (a.) elimination of the harbor maintenance tax on shortsea cargoes and (b.) significantly increased Title XI loan guarantees. That’s what he and his new employees ought to be working on. But then, this is the guy who also recently released the report U.S. Flag Fleet Competitiveness Report that did nothing but enrage the nation’s four largest maritime labor unions, who have all but called for his removal. How the one report squares with the other is simply beyond comprehension.
I’ve asked Marad PAO’s (twice now) for the official transcript of the speech so that I could link it for you. That’s apparently not going to happen. A FOIA request might get the job done. Maybe not. Simply suffice it to say that it wasn’t necessary to travel all the way to the Big Easy last week to hear this groundbreaking speech. There’s nothing to see here. Move along, now. Move along…
- EPA’s VGP: BWT regulations inching forward (slowly)
Separately, and at just about the same time, the Environmental Protection Agency (EPA) made good on its promise to deliver a new Vessel General Permit (VGP) by the end of November. Based largely on input from industry and research reports, the bulk of the new VGP basically mimics the IMO standard and what is expected to be the U.S. Coast Guard’s (phase I) standard. So far; so good.
Meanwhile, the U.S. Coast Guard is reportedly getting closer to issuing its own edict. According to MarPro sources, it is now up to OMB to make the final decision to release the final rules. They have 90 days to get this done, hence the expectation is that the Coast Guard’s standard, in the making for almost ten years, could be out by the end of January or February, at the latest. With IMO also close to ratification, possibly achieving that metric in the first half of 2012, you could be writing that check for a shiny new ballast water treatment system before you know it.
For smaller craft operators, there was a glimmer of good news. The EPA’s Draft Small Vessel General Permit, applicable for vessels less than 79 feet in length, did not appear to significantly impact this sector, although the requirement to conduct and maintain records of inspections and some other minor issues warrant close attention.
The issue of invasive species is a hot topic and the matter looks to finally be coming to a rolling boil. With the estimated cost of outfitting about 68,000 vessels with ballast water treatment systems valued at as much as USD $68 billion, or roughly $1 million per ship, the long-awaited international standard could amount to a much-needed windfall for shipyards and equipment manufacturers. Between 2012 and 2015, as many as 10,000 ships annually are expected to be fitted with BWT equipment. That’s a lot of ships and a lot of money. And, that’s news you can use. – MarPro
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Joseph Keefe is the lead commentator of MaritimeProfessional.com. Additionally, he is Editor of both Maritime Professional and MarineNews print magazines. He can be reached at jkeefe@maritimeprofessional.com or at Keefe@marinelink.com. MaritimeProfessional.com is the largest business networking site devoted to the marine industry. Each day thousands of industry professionals around the world log on to network, connect, and communicate.