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THE FUTURE NEEDS OF THE U.S. MARINE TRANSPORTATION SYSTEM
Thursday, May 13, 1999
House of Representatives, Subcommittee on Coast Guard and Marine
Transportation, Committee on Transportation and Infrastructure,
Washington, D.C.
The subcommittee met, pursuant to notice, at 10:07 a.m., in room 2167, Rayburn House Office Building, Hon. Wayne T. Gilchrest [chairman of the subcommittee] presiding.
Mr. GILCHREST. [presiding] The subcommittee on Coast Guard and Maritime Transportation will come to order.
The subcommittee is meeting today to hear testimony on the future needs of the U.S. maritime transportation system. As you know, we will limit opening statements to 5 minutes.
If other members have statements, they may be included in the record. And we don't seem to have any other members here yet.
At any rate, I want to thank Mr. Gudes, Mr. Hart, and Admiral Loy for coming this morning. We look forward to your testimony. Gentlemen, I breezed through the U.S. maritime transportation system draft report last night and I have to tell you that I was really pleased with the apparent effort and insight and depth of concern that went into this document. And I think it will provide us with a strong basis to move forward for the maritime transportation system for the United States for decades to come. You have presented us with an enormous challenge and I think this Congress will show great appreciation over the years as we try to pull all those recommendations that you have pieced together.
What I want to do just very briefly is just read a couple of things throughout the report that really presents this challenge to us. But I think it not only presents a challenge to make sure that the marine transportation system is effective, coordinated with the intergovernmental relationships between the Federal Government, the State government, the local government, but the private sector as well, but it presents us with an intellectual challenge for us to meet this new frontier.
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Let me just read one of the issues. With more than 95 percent of the expected international trade growth moving by ocean transportation, America's MTS must keep pace with navigation and berthing demands required by larger ships. That's no equivocation. We must keep pace. That is interesting because mostly larger ships are owned by foreign steamship companies. You have a couple of dozen people on the planet making us do this. That is interesting. But it is correct.
But then the other issue is, in the report, the health of America's precious marine ecosystems must be at the core of decisions affecting the expansion and upgrading of our maritime facilities. So we have another must in there.
Just two more quick things. The other area of the maritime transportation system: Federal service providers. These are all of the people in the Federal Government that have some mix of jurisdiction and responsibility with this whole maritime transportation system: the Coast Guard, the Maritime Administration, the Federal Highway Administration, the Federal Transit Administration, Federal Railroad Administration, the St. Lawrence Seaway Development Corporation, the Office of Pipeline Safety, the U.S. Army Corps of Engineers, the National Imagery and Mapping Agency, the National Oceanic and Atmospheric Administration. Those are some of the Federal agencies and the recommendation in the report is that they really need to become a collaborative team, not separate entities that, to some extent—I am not blaming anybody by any means; everybody has done a pretty good job at this point, but the fragmentation has been pretty apparent.
And I guess I could go on. It is easy just to read out of a book. The point, though, which I think we would like to begin to understand from all of the witnesses here this morning, is that we need a more collaborative effort from the Federal Government. We know that. That means the Federal Government has to become more involved. That means the Federal Government is developing a national policy.
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Now how do we do that? Does the Federal Government spend more money in this national policy and will that affect who gets the deeper channels? Where does the dredging take place? Which ones are chosen over others? Who has the most political influence to get the dollars in the Federal Government to their port? Does the Federal Government pay just out of the General Treasury for all of the dredging? Or is the Federal policy: Well, you guys are on your own. Good luck. If you want to dredge, you have got to come up with your own money. If you want to create a better port infrastructure, you have got to come up with your own money. And you let the free market take over.
So I don't think we are at the crossroads yet, because there is some more understanding of this process that needs to take place. But pretty soon we are going to hit that crossroads because I don't think we can continue to do what we are doing right now which is, basically, get Members of Congress to get on the Transportation Committee where—and you know this is way the system works—and they try to get a couple of billion dollars for this one, $1 billion for that one, a few hundred million for this and it is pretty much helter-skelter.
I think, with this report, with an intellectual effort, we have to move away from that sort of haphazard direction based on future needs. But this is an excellent report and I look forward to your testimony. Gentlemen, I am glad you are all here this morning.
Now, I will pass the baton to Mr. DeFazio from Oregon.
Mr. DEFAZIO. Thank you, Mr. Chairman, for convening this hearing. I think this is a vital issue to look forward to the next century in terms of how the U.S., the world's greatest maritime nation, is going to meet the needs of our port infrastructure so we can interface with the rest of the world. I think we have done a good job in the recent surface transportation bills of emphasizing intermodalism and the end-point of a lot of intermodalism, particularly on the West Coast, is our ports and our vital conductivity to those ports and to Asia and the rest of the world.
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So we have to think about how we are going to meet these challenges and I think you are very right in sort of setting up the parameters and I would say, among our colleagues, all of those views are represented and there is no consensus between those who basically cut the ports loose, and let them attempt to somehow meet the needs on their own, State by State, region by region, or some who would want to use Federal money, either comprehensively or just target their own special interests or districts. And neither of those extremes should prevail in this debate.
I am one of the opinion that we can't ignore any of our ports and we don't just have great port needs in terms of the largest ships, but I think the Federal Government has a need to continue its support for our small ports and medium-sized ports also, that we need that diversity for our coastal trade, for the health of communities, and recreational commercial and fishing and certainly we need to do more to meet the demands of international shipping in our largest ports and it shouldn't just be those that are blessed with deep water who become the hubs for international commerce in the next century who don't need improvements or dredging because they will become choke points. There is too much commerce and all you have to do is look at the problems that were created by the SP-UP merger and the back-up of freight in Los Angeles over the last year and some other problems to see what happens if you become too dependent upon one or another ports to then use them to disperse throughout the nation-I can cause potential choke points.
So it needs to be a little more dispersed and that does require Federal investment and I hope that the gentlemen before us will enlighten us to as to how to go forward. Thank you for being here. Thank you, Mr. Chairman. And I will have to step out to testify at any other hearing on a vital regional issue, but I will be back as soon as I can.
Mr. GILCHREST. Thank you very much, Mr. DeFazio. And this is an issue that will keep our interest as we blend our ideas. I think there are exciting times ahead. Thank you.
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Mr. Gudes, deputy under secretary, National Oceanic and Atmospheric Administration, Department of Commerce; the Honorable Clyde Hart, administrator, Maritime Administration, U.S. Department of Transportation; and Admiral Loy, commandant, United States Coast Guard. Gentlemen, once again, thank you very much.
Mr. Gudes, you may begin.
TESTIMONY OF SCOTT B. GUDES, DEPUTY UNDER SECRETARY, NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION (NOAA), U.S. DEPARTMENT OF COMMERCE; CLYDE J. HART, JR., ADMINISTRATOR, MARITIME ADMINISTRATION, U.S. DEPARTMENT OF TRANSPORTATION; AND ADMIRAL JAMES M. LOY, COMMANDANT, U.S. COAST GUARD
Mr. GUDES. Thank you, Mr. Chairman. I want to thank you, Mr. DeFazio, and the subcommittee for inviting us here today, the National Oceanic and Atmospheric Administration. We are part of the Department of Commerce. And I am pleased to be here and provide our views on maritime commerce and maritime transportation and our role in helping the competitiveness of the industry and the environment.
Let me first say that, for NOAA, promoting safe navigation dates all the way to 1807 when President Thomas Jefferson proposed and Congress authorized the creation of the Coast Survey for this nation's harbors and coasts. The NOAA Corps—and there are several members from the Corps here today with me—dates its lineage back, in fact, to this decision.
I think the committee would be pleased to know that we train our new ensigns in the NOAA Corps at the U.S. Maritime Academy at Mr. Hart's agency. And these students use the most up-to-date maritime simulators and training techniques. Our new class graduated just last month and they are now out at sea actually doing hydrography in the field and fisheries research and some of the other NOAA missions.
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With respect to NOAA's contributions to maritime transportation and safety programs and the full system, I think there are really two aspects, if I could. The first is that programmatic area of promoting safe navigation and the second—and just as important to us—is the environmental stewardship that we perform as an agency to ensure that such activities are conducted in an environmentally safe manner or where we try to help restore the environment when maritime accidents occur.
These programs that NOAA funds are more fully explained in my written testimony. Let me just run through some so you get a feel for what NOAA does to contribute to the MTS. In mapping and charting, we are the principal Federal agency that conducts the research, the surveys, the data compilation, and produce the nautical charts. This is an area that our people, or NOAA people, such as Richard Barazotto and Captain David MacFarland here today have really revolutionized what used to be a very slow, manual process of producing charts has now been digitized. To go back to your comments, Mr. Chairman—we have entered into cooperative agreements with private industry so that now we are putting out CD-ROMs regularly which can go right to the mariners with all the changes that we get from the Coast Guard and the Corps of Engineers and other agencies, rather than producing paper maps and charts. We get about 20,000 changes a year, in fact, from the Coast Guard and the Corps that we have to integrate into our products. I witnessed some of this first-hand last summer, in fact, on the Chesapeake Bay, where we have the NOAA ship 'Bay Hydrographer' out charting areas between Baltimore and the mid-Bay to try to find updates and in fact we did find some new obstructions that we got onto these charts.
Another NOAA area besides maps and charts is tides, currents, and PORTS (Physical Oceanographic Real Time Systems). We have made significant progress in the provision of tide and current data and deployment of the PORTS system. And, going back to your comment, again, what I think we realized was every port in the United States wanted a new PORTS system, but that we just couldn't do that within NOAA's budget. We had to reach a partnership with these ports. And so, actually, what we have is a situation where we get the ports to come forward and we provide the science, we provide the technical know-how and the contractual ability, they come forward with the funding, actually, to provide for the infrastructure, the instrumentation. And we have a number of ports that are lined up.
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We also operate the National Data Buoy Center, which we do in partnership with the Coast Guard. This is where we deploy, we refurbish, we manufacture the weather data buoys around this country. The Coast Guard actually deploys those and brings them back to us. Within our NOAA satellite programs that maybe this committee doesn't think about as much as maybe the Science and Technology Committee would, we help provide safe transit through our weather forecasts. Over oceans, obviously, there are not as good data sets for what is happening with the weather and ocean conditions. We provide that through our polar satellites and probably most important is the search and rescue program, SARSAT. SARSAT is provided on our polar satellites and will be on our new Air Force-NOAA polar program (NPOESS) which will provide the warnings to the Coast Guard and others.
Now that is to promote safe navigation. Let me turn to the second area, which is critically important to our agency, which is protecting the environment. Maritime transportation has an impact on the living marine resources, the coast, corals, coastal water quality, and, as you aware, as you said, Mr. Chairman, maritime environment. As this report says—maritime transportation is expected to double in the next few years and we have to ensure that such economic growth takes place in an environmentally sound way, in a sustainable way.
NOAA offers a number of programs on protecting the environment. Let me just point out that in the case of oil spills, hazard spills, we provide technical expertise to the Coast Guard. We have models for different harbors, San Francisco Harbor, for example, that shows where an oil spill will, in fact, end up and we can actually model it by the time of the day and by the currents. We had a scientific support coordinator on the scene of the New Carissa grounding in Oregon and we provided the spill trajectory, the chemical analysis, the weather forecasts, where that spill would go.
We are involved in a number of efforts across the country to clean up marshlands where there have been spills. I was just visiting with some researchers from the University of New Hampshire who were working under a grant from NOAA to clean up the Portland, Maine port where oil has contaminated the marsh grasses and to find environmentally sound ways to do that.
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And, of course, we are increasing our efforts in terms of corals where there have been damages. We just had a very innovative approach with industry in the Florida Keys where we used settlement monies to provide a new system of radio beacons to keep ships from ever hitting those corals again.
Let me conclude just by saying—I see the red light—that we are pleased to participate in the Transportation-led effort to review the maritime transportation system. We were invited to participate from the beginning and my boss, Deputy Secretary of Commerce Robert Mallet, was involved in the conference and the proceedings. This is a major undertaking. I think the study is asking the right questions. Are we, as a nation prepared to accommodate this increase? And, as I tried to point out, NOAA has a number of programs that relate to our national efforts and we are in partnership with the Coast Guard and the Maritime Administration. This effort obviously needs to be collaborative.
I would point out that every program I talked about, Mr. Chairman, at NOAA, we go about and produce our budget in a way that starts with our constituents. It starts with the people who depend on our programs. We have planning sessions, in fact, that include our sister Federal agencies in that effort. It is really a grassroots effort.
And I think that, you know, if I could leave one point, it is just that, as we look forward to what the maritime transportation system of the future is, we have to keep in mind that other side of what our effort is to make sure that, in fact, as we increase our tonnage, as we increase the efforts to provide that space between fully loaded ships of the future where every inch matters—that we do so in a way that keeps the environment in mind and keeps in mind the programs that need to respond to the environment if accidents do occur. Thank you.
Mr. GILCHREST. Thank you, Mr. Gudes.
Mr. Hart.
Mr. HART. Good morning, Mr. Chairman, Congressman DeFazio, members of the subcommittee. My name is Clyde Hart and I am the maritime administrator at the Department of Transportation. This is the second time that representatives of MARAD and the Coast Guard have had the opportunity to testify before you on the future needs of the nation's marine transportation system. I sincerely appreciate your interest in this important natural resource and may I say, Mr. Chairman, I particularly appreciate your detailed study of the draft MTS report and also your staff's participation at the Warrenton conference. It was much appreciated by all concerned.
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I would like to do a short statement and have permission for my full statement to be a part of the record.
Mr. GILCHREST. Without objection.
Mr. HART. As you know, our nation's marine transportation system, the MTS, consists of our waterways, commercial vessels, ports, and their intermodal connectors. This is a critical component of our overall transportation system. Our marine infrastructure and commercial carriers support our domestic trade and markets. They also support our global outreach in overseas markets and our engagement in world affairs, including protection of U.S. national security interests.
In addition, the inevitable growth of world population, the ever-increasing globalization of the world economy, and the intensified global maritime competition lead to the inescapable conclusion that the volume of international maritime trade will jump sharply in the next 20 years. As you said, Mr. Chairman, and as Mr. Gudes has also said, some estimates place the increase at double, maybe even 300 percent of current levels.
It is not only the breadth, but the pace of change that challenges us. We currently struggle to keep pace with technological advances in terms of the increased safety risk as well as the opportunities technology provides to improve system performance. Advances such as high-speed ferry vessels traveling at 40 knots; megaships carry 6,000 or more 20-foot equipment unit containers; passenger ships designed to carry 5,000 people; and improved information technology systems. Therefore, we must develop collective approaches that harness this technology and invest in the infrastructure of our MTS such that the MTS supports our marine transportation efficiency and effectiveness as well as our national interests.
Again, I want to take a moment to thank you for your interest and continued support of the MTS, the interdepartmental effort that includes the combined efforts of over a dozen Federal agencies and hundreds of private sector organizations' leaders to ensure that our MTS will meet the challenging needs of the 21st century.
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At the MTS conference, participants agreed upon a vision seeking to make our nation's MTS the world's most technologically advanced, safe, secure, efficient, effective, accessible, globally competitive, dynamic, and environmentally responsible system for moving goods and people. And, while my English teacher—as Admiral Loy said just yesterday—while our English teachers would blanch at that length of a sentence, we think that it definitely gives the flavor of what we need from our MTS system in the future. The conferees set forth several guiding principals: system integration, clear and strong Federal leadership, partnering between public and private sector, the balancing of diverse interests, aggressive technology development, and, of course, we all need the people to make this all happen. The participants at the national conference also developed recommended goals and actions in the areas of safety, competitiveness, infrastructure, security, and environment.
Regarding these goals, I would like to discuss the MTS as it relates to the world economy and our nation's port security. Domestic and international water transport systems each more about 1 billion tons of cargo per year. The inland waterway system is far-reaching, providing one of the most efficient domestic to international cargo flow networks in the world. Domestic trade is especially important to the U.S. Merchant Marine as the entire billion-ton domestic cargo is moved solely aboard U.S. flag vessels. This in and of itself generates 124,000 direct jobs on vessels and in related industries; $10 billion in annual freight revenues; and $300 million in annual Federal taxes.
In addition to substantial domestic trade, the U.S. MTS is our main gateway to the global marketplace. Its efficiency and effectiveness directly affects our economic competitiveness. MTS conference participants concluded that maintenance and improvement of the MTS are essential to maintain and improve U.S. competitiveness. And they suggested several ways to accomplish this goal: review Federal laws and regulations to identify gaps and eliminate conflicts; focus public awareness on the need for MTS investments; foster and fund institutions for MTS research, recruitment, and education; and form public-private cooperatives in areas such as planning, information, and research.
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In conclusion, the challenge before us is clear. Ports must be prepared to respond to the mounting pressure of growing trade, more non-commercial waterway users, and development of new means to harvest and preserve marine resources and increasingly aggressive efforts by criminals and adversaries intent on dong societal harm. Our efforts must include eliminating the gaps, the stovepipes, the bottlenecks between and among government agencies and between those agencies and the private sector. We need to work together if we want the very best MTS possible for the future.
This hearing helps to highlight the numerous maritime challenges we face to keep America competitive, safe, secure, and environmentally sound as we enter the 21st century. Thank you for the opportunity to discuss this important issue with you today. I will be happy to answer any questions that you have.
Mr. GILCHREST. Thank you very much, Mr. Hart.
Admiral Loy.
Admiral LOY. Good morning, Mr. Chairman, members of the Committee. I, too, am honored to have the opportunity to update the Committee on the progress of the MTS initiative that Secretary Slater has now put front and center in his inventory of things that he wants to get done for the nation. Mr. Hart has summarized a good bit of what I would have offered, sir, in terms of my opening comments. I would just point out a couple of other things that might be of interest.
One, as Clyde mentioned, the interest and participation of the staffers from the Committee at the conferences were absolutely terrific. They engaged in the plenary session. They engaged in the working groups that produced the background materials that will be reflected in the report that comes to the Congress on the 1st of July. I don't know if that was new turf being broken, but I can tell you how helpful it was to have the perspective of the committees as reflected by the staff at those particular events. And I would thank you again for that.
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You and the Committee, sir, are fully aware of the trends and the demographics, many of the things that Clyde has already mentioned: the simplistic notion of understanding 2 billion metric tons of cargo that annually moves through this system; the simplistic notion that we reached $1 trillion worth of value in that cargo that is moved through the system; 10 million barrels of oil daily, virtually all of it by maritime means, find a way to this nation; 95 percent of foreign trade, 25 percent of domestic trade is on the waterways of the nation. Those waterways are what Secretary Slater now refers to as the first original interstate system and one that he wants reckoned back to the top of the interest ladder.
90 million passengers embark annually on passenger ships, cruise vessels, and casino vessels. 90 million people who have their safety associated with the Marine Transportation System. We have some 26,000 fishing vessels that are harvesting the waters of the Nation in our own Exclusive Economic Zone—a multibillion dollar industry, as you well know, sir—that are part of the scene as we look down the road to the MTS of the future. There are 20 million recreational boats today on our waterways; with all of our thoughts about leisure time and moves to the coast, we expect that number will grow considerably in the future.
So I would just like to leave a couple thoughts, sir, with my opening statement this morning. One, congestion is a reality that we will have to face in the future of our waterways and dealing with it is something we have to be prepared for. Integrated information systems are an absolute requirement for all us as we look forward. Whether those are customer or stakeholder or regulator inputs, the aspect of being able to have an integrated information system that offers all players the opportunity to put in what they need to put in and to get out what they need to get out so as to optimize their own contribution to MTS.
The inclusiveness of private and State and local governmental inputs, as well as the Federal Government input. Your own comments, sir, in your opening statement, about the collaborative Federal leadership that is required, emphasis on the word ''collaborative'' so that there is not a fragmented approach to what we are trying to accomplish, rather one that is integrated together. That is what we are trying to offer by way of the focus on MTS.
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Three things kept coming up out of the sessions we dealt with.
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One of them was a call for a vision. Do we really understand where we want to go? Clyde has already stolen my line associated with Mrs. Oiler, my favorite English teacher in high school who would have been aghast at the run-on adjectives used in this particular vision statement. But the reality is, sir, if you just take a quick peek at that vision statement which we have on the left-hand visual here, each of those are attributes that we would like to have; on the second slide, we have taken what is in the MTS now and projected what it will be in the future.
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There is a number there, 2020, but I would offer that it is certainly not our choice to wait for 2020, rather, we must be about this business routinely. The ship's wheel in the center you can't read very well, but the points at the end of each of the spokes are a minimum inventory of Federal agencies that you have already given us a certain sampling of. That coordination process is key to getting us where we need to go.
And, lastly, sir, just to leave it on the frontal slide. These critical issues have become a guide that we have used from the very beginning of the regional listening sessions to help us through this maze and produce the report that will come to Congress on the 1st of July that you have already made reference to.
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Mr. Chairman, I thank you and the Committee for your continuing interest. I agree with Clyde that the simple fact that we are having a second follow-up hearing on the initiative is testimony to the reality of the Congress' concerns that we all should take quite seriously our responsibilities with respect to the Marine Transportation System in the nation. Thank you, sir.
Mr. GILCHREST. Thank you, Admiral Loy. Mr. Taylor, do you have any questions?
Somewhere in the report—I was just trying to flip through and find it since we were all talking about English teachers and visions—there was a term ''multi-dimensional vision for the future,'' which I think is apropos to this. Each of you have expressed a certain sense of appreciation for the task force and the work that they have done. The draft report and each of you have come up with, I think, very specific recommendations for the direction that we need to go in and so I would ask a lot of times Congress really starts off pretty well and they set up a task force and there is a report done and we get things rolling and then we turn our attention to Medicare or Social Security or Yugoslavia and things just drift along. And I am not saying that—I don't think that is going to happen this time because of the enthusiasm of all the partners in this.
But I guess my question is what would each of you see as the next step so we can be a partner and help facilitate this process? And: Are we looking at one department as being the lead agency? Will it be the Department of Transportation that will be at the pinnacle of this pyramid to move this report and these recommendations along?
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Admiral LOY. Can I take a crack at it to start? To go directly to a couple of your points, sir, I do believe it is appropriate that the Department of Transportation take the lead in this. In essence, what we are talking about is the third dimension to a national transportation system which calls for its own integration requirements between land, sea, and air, if you will, in terms of this system meeting the nation's needs in the total respect. Where that all comes together is in the Department of Transportation, so I think there is a great logic that is sound to hold onto the leadership there.
Beyond that, sir, I think where we are at this point is to have done a very systematic, a very methodical gathering effort to produce an agenda for the Congress and the Administration to consider as it goes forward to produce the guarantees that we want in terms of global competitiveness and each of the areas that you see on that construct on the right-hand chart. I believe it is all about coordination.
One of the calls that we had for at all of the listening sessions and all of the conferences and the task forces work has been adequate coordination at the local level and at the national level with a system that is designed to connect them, one with the other. There has been a suggestion associated, for example, with a regional dimension in between. I think the two keynotes are that we have superior coordination at the national level, superior coordination at the local level, and, as necessary, in regional activities.
For example, the harbor safety committees, of which we have many in the Nation already at the port level, are already about the business of coordinating their activities there. There are excellent examples, in California, in New York. I have attended meetings of such committees in Tampa, in New Orleans. They are doing terrific work in that regard. What they often don't see is the connectivity to, as you described it, the Federal role, whether it is policymaking, whether it is collaborative leadership, such that they are not off on a tangent but, rather, are part of a sense that we are going in the right direction as a whole.
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So I think that the dimensions of national coordination, local coordination, and then, for example, there is an excellent group that has just been put together on the Great Lakes. I just hosted at Kings Point a day-long conference where we took western Long Island Sound and examined it for the requirements that might serve multiple ports on Long Island Sound such that there is a regional influence there. This coordination process, once the agenda of specific activities is established, is, I think, an absolutely crucial part of this future optimization effort.
Mr. GILCHREST. Thank you. Mr. Hart.
Mr. HART. I just want to add a couple of things to what Admiral Loy just said. And number one is if you look at coordination—and I agree that I think it is key—if you look at coordination, in some respects DOT has already started or has been doing coordination. We have what is called the One DOT concept in all of our regions where basically we have the modes helping each other, trying to come together and slash and get rid of problems before they get to be insurmountable. And it doesn't matter a lot of times which particular mode has to take the lead. It is a matter of getting the job done and we have found that that kind of coordination can work.
The second thing that I would like to bring up is also in our regions a lot of times—the western region particularly—staffing has required that we have some of the modes there, some of the modes are not there. But it doesn't matter because the interests of the people are protected and the interests of the modes in getting the job done—which is what we should be about—are taken care of by the modes which are there in a particular region. And I think that kind of coordination is not a pipe dream, but it is something you see now and something that can just grow and continue to work.
That is all I have to add to your question.
Mr. GILCHREST. Mr. Gudes.
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Mr. GUDES. Well, Mr. Chairman, I note that MARAD used to be part of the Department of Commerce, so I think they won and I agree with the Commandant. I think that I spent the beginning of my career in the Federal Government working on an interagency group that was charged with coordinating Federal assistance to communities that are impacted by Defense realignments, base closures, for example. Interagency coordination is a difficult thing to do. I think that this is a good start. I think that you may want to think about reconvening the same process on a periodic basis.
I also think that there should be some sub-roles. In the environmental issues, for example, I think NOAA can play a leadership role in the case of some of the products I talked about for the ports that we specifically do. I think that is important.
I think a lot of coordination has always gone on. I also think that it is critical that such coordination not just be Federal, but be intergovernmental and coordination with the private sector because I think ultimately, as you pointed out at the beginning, those are the users of the services.
And I also think that, from again, this is now a Federal perspective, and this is difficult to do, but coordinating the Federal budget as we formulate the Federal budget so that we are in step with the Coast Guard or MARAD and some of those other agencies that you mentioned that are parts of the Department of Transportation would be important. It is a goal to work toward, but I think it is the right thing to do.
Mr. GILCHREST. The task force presented this draft report which identifies the problems in a comprehensive, well-defined way. Now, when the task force goes away, will there be enough guidance from the report to begin the process of implementing that coordination? Is there some role that Congress should play, in coordination with the administration, to see to it that this proposal can actually happen over a period of time because there will be a structure in place to ensure that it does? One or two or a team of people that are responsible then, perhaps in the Department of Transportation, who don't have that responsibility now, to move this complicated effort?
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Admiral LOY. Mr. Chairman, the report, as you pointed out, continues to be a draft report and is, in fact, not finalized out of the Administration. What is enormously important is that that very thought you just expressed was on everybody's mind at the listening sessions, at the Warrenton conference, and during the task force's effort to-date to prepare that report. They have forged in their mind the requirement for a national council that would be standing, over time, with exactly the kinds of thoughts in place that would be a forum for which Congress or the Administration could send agenda items, so to speak, that would be perceived to be the ongoing agenda of the Marine Transportation System. There are a number of different ways that could be done, whether it is something that is generated for Secretary——
Mr. GILCHREST. You are talking about a group of people that would be designated with this responsibility as a focal point at the national level to deal with anything from national security to organized crime to environmental issues to port expansion to dredging to you name it?
Admiral LOY. That is the thought process, that this system could be pulled together in such a fashion that there would be a venue perceived that would handle those kinds of things and then, as necessary, farm them out to all kinds of aspects of the Federal Government.
Mr. GILCHREST. So this council, whatever it may be called, is likely to be a recommendation in the final report?
Admiral LOY. Likely to be, yes, sir. All I can say at this point is that it was a, from all corners of the room, so to speak, in the listening sessions and in the conferences that we have held to date, that was a crucial ingredient of people's thoughts in terms of if we don't have something like that, then that first goal of collaborative Federal leadership would be very difficult to imagine.
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Mr. GILCHREST. This council will be something of a hub so that someone from Houston or Charleston or San Diego or New York or Baltimore or wherever, can have a free flow of information regarding the full range of issues dealing with the maritime transportation committee. I would guess an organization like this would be able to expedite and enhance the process of mapping and charting, of predicting the ever increasing number of container ships or bulk cargo or even the things that are carried in bulk cargo that might be carried in container ships and the full range of——
Admiral LOY. All sorts of issues, yes, sir.
Mr. GILCHREST. Well, that sounds great. Mr. Taylor.
Mr. TAYLOR. I want to thank all of you gentlemen for being here. And I want to begin by asking Mr. Hart. Recently I have seen what I thought was the administration's budget request for the title 11 program, the loan guarantee program.
Mr. HART. Yes.
Mr. TAYLOR. A few years ago, I want to say it was 1994, we passed the national shipbuilding initiative that, for the first time, dipped into the Department of Defense for funds. At that time, we dipped in to the tune of about $50 million to create $2 billion in loan guarantees. The program has been, from what I can gather, very successful. Which leads me to question why the request for this year was only $31 billion? I mean, after all, the two ships, the two Alaskan cruise ships alone are going to use up about $800 million of that money. We know that there has been a rejuvenation in the oil rig repair business that a lot of that title 11 money has gone towards and several other projects, ocean-going barges and others, which, again, I just don't see how the $31 million gets us to where we fulfill all the requests that are going to be out there. Can you comment on that?
Mr. HART. Well, I can say that we did have discussions and have had in MARAD the exact amount needed for title 11 and we did and still continue to think that the budget request will give us enough money to handle the applications that are in the pipeline and some that people haven't come to us with but are thinking about. But there is always the case that there may be people out there who want to file applications but haven't indicated whether they will or not to us, which we obviously couldn't take into account. So there is, obviously and honestly, some risk that the amount that is there wouldn't be able to cover the known universe of applicants, that is true. But we made the best estimate we could based on the number of applications in the pipeline and what we thought, reasonably, would come to us.
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Mr. TAYLOR. Let me turn that around. There already, unfortunately, a very limited number of shipbuilders in America.
Mr. HART. yes.
Mr. TAYLOR. It wouldn't be all that difficult to pick up the phone and make the 20 or so phone calls, that even includes the second-tier yards, and saying: Do you have anything in the works? Did you do that? Or did someone in the agency do that?
Mr. HART. We do market surveys.
Mr. TAYLOR. Answer my question. Did someone actually pick up the phone to Engles, to Halter, to Bender, to Steiner. Again, I have named five off the top of my head.
Mr. HART. Right. Excuse me, I am sorry. I didn't mean to interrupt.
Mr. TAYLOR. And say: Do you have something in the works in the foreseeable future where you could use this? Because the whole idea was to save what was left of our shipbuilding industry. Did anyone do that?
Mr. HART. Do I know specifically if somebody called up? No, I don't. I could find that out.
Mr. TAYLOR. Because if you are in the process of doing that, Mr. Bateman has expressed willingness to increase the number if the need is there. But, again, it has got to start somewhere and I would think that would be something that a user-friendly agency would do.
Mr. HART. I agree. We can start.
Mr. TAYLOR. Can you start making it in the very near future?
Mr. HART. I will in the very near future.
Mr. TAYLOR. I am sorry, sir, I was not here in time to hear the proper pronunciation of your name. Is it Gudes?
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Mr. GUDES. Gudes, yes, sir.
Mr. TAYLOR. OK. I noticed in your testimony you are talking about habitat restoration. It is something that I have noticed in dealing with the Corp of Engineers is that they have kind of gone from a metamorphose of redredge and fill the material anyplace they want to redredge and we take it way the hell out to the sea. And have been very reluctant to implement the congressionally mandated language in several water bills that says ''beneficial use of dredged material.''
To what extent has NOAA been working with the Corps towards habitat restoration? I mean, we don't need to bore each other with how America is moving to the coastlines. Our demand for the resource is increasing rapidly. It is not just the commercial guys, it is 10 zillion guys out there with rods and reels and their own crab pots. What is NOAA doing to actually enhance the resource? I mean, and you are not the only agency I have asked this question to. Have you all created one square foot of marsh anywhere?
Mr. GUDES. Yes, sir.
Mr. TAYLOR. I can't think of one that has created one square foot of marsh in south Mississippi.
Mr. GUDES. Yes, sir, we do. We actually have a number of programs and there are different locations to try to restore sea grasses. We are trying to do more of that. In the case of dredging specifically, we do work, on a number of projects, but we actually have an initiative in the budget that is before the Congress now to work with the Corps and with communities, and actually that is a $10 million initiative, to do a much fuller job of working with those communities and finding a way to use dredge material for environmentally sound projects.
There is, probably, a good example I can think of locally that I probably will admit I don't believe NOAA was at the forefront of doing. This is Poplar Island in the Chesapeake Bay where dredge material I believe, Mr. Chairman, from Baltimore Channel, is being used to restore Poplar Island and the islands next to Tighlman's Island because the Bay has been eroding those islands. That is an example of what we are trying to do more of.
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I can't speak specifically, Congressman Taylor, to what we have done in Pascagoula or in the Bay St. Louis area in Mississippi, but I do know, around the country, we have, through a number of areas, worked pretty closely with communities to do exactly that.
Mr. TAYLOR. Because they are close.
Mr. GUDES. Through Sea Grant and some of our external programs—many of these are external partners that we fund. For example, the Sea Grant program, we fund universities. I was just—I was mentioning before to the chairman—I was just at the University of New Hampshire where researchers funded by NOAA are actually finding ways to remediate petroleum that spilled in Portland, Maine, at the commercial port. You need to remediate that in ways that doesn't destroy the sea grasses, the marsh, as you get that oil out. They found ways to actually put tubes underneath the marshlands and to try to remediate it.
Mr. TAYLOR. If I may sir—and I started off in local government, so I am very aware of how financially strapped most local governments are—the programs I have seen to-date require a fairly substantial local sponsor for things like habitat restoration. What I know the reluctance is on the part of a typical county supervisor, a typical city council in small town America is that 25 percent comes at the expense of fixing potholes. It will come at the expense of police protection. It will come at the expense of providing water for another block in a new subdivision.
If we are really serious about this and if it is such a great idea and if it really does benefit all of the citizens, I think we ought to be fully funding it because I can just tell you, your typical county supervisor, your typical city councilman is saying I fix a pothole, everybody sees it. I fix something out there, nobody sees it; I get no credit for it. And in the next election, somebody runs against me saying I would have fixed that pothole instead of putting that reef out there. It is just a mindset.
If we are really serious about this, we ought to be willing to fund it. We should not ask them to pony up. And, again, speaking as former locally elected official, I do know they are more responsible with Federal dollars if they have to match some of those Federal dollars. But in this instance, you are asking them to take too big a leap.
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Mr. GUDES. NOAA's FY 2000 Dredging Initiative proposal for $10 M in new funds will link decisions regarding where and how to dredge with regional restoration planning and ongoing restoration activities. NOAA will work with the Corps of Engineers and other involved Federal, state and local agencies to identify dredging projects that can be linked with planned or ongoing restoration projects, and to develop creative habitat restoration projects using this dredge material productively. We plan to establish partnerships with states and local communities to promote beneficial reuse of dredged material, including providing seed money or cost sharing of local restoration projects. Our role is to expedite dredging decisions by applying NOAA's expertise on risk assessment, evaluation of contamination, and remedial design to dredging plans and watershed restoration efforts. This includes developing guidelines and practices for evaluating and disposing of contaminated sediments in an environmentally-safe manner. Matching funds will not be required from local communities.
Mr. TAYLOR. Because the existing law does.
Mr. GUDES. I don't—Congressman Taylor, I can't speak to the Corps' requirements in terms of their own——
Mr. TAYLOR. Well, I can.
Mr. GUDES. I can only talk about NOAA and the Department of——
Mr. TAYLOR. OK. What I am asking you to do in the brief time that I have with you, the existing law does require a local match. And I do think is something where we have to break people's mindsets. And I think the way that we are going to have to break their mindsets is to fully fund them, show that they work, and then get people excited about doing them. And I would hope NOAA would step forward with some proposals to do that and not only just put a proposal on the table, but really work and make it become the law of the land or the administrative policy of the land.
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Mr. GUDES. Certainly.
Mr. TAYLOR. And that is what I am asking you to do. Commandant, I just want to thank you for being here.
[Laughter.]
You all just keep doing a great job.
Admiral LOY. Thank you, sir.
Mr. TAYLOR. And we will try to get you some deep-water ships.
Admiral LOY. Thank you, sir.
Mr. TAYLOR. OK. Thank you, Mr. Chairman.
Mr. GILCHREST. Thank you, Mr. Taylor. Admiral, do you still have authority over the enlisted men from the Coast Guard that Mr. Taylor was asking about?
Admiral LOY. I reach, but I can hardly find it.
[Laughter.]
Mr. GILCHREST. Mr. Taylor, we would like to tell you that the Poplar Island project does restore about 1,000 acres of an island that was being washed away in the Chesapeake Bay and the effort was pushed in the beginning by a lot of local people that wanted to restore that habitat. It was a collaborative effort and a pretty positive thing. Very expensive. It doesn't come cheap. But it was a pretty positive effort by a lot of people to get some specific project done with the help of Federal, State, and local agencies and private sector.
Mr. Oberstar.
Mr. OBERSTAR. Mr. Chairman, I want to thank you for initiating this hearing and I hope that it will be only the first of a series of hearings. The first long-term look at ocean shipping and the U.S. role in maritime commerce and a mix of policies that are necessary and should be initiated to strengthen U.S. shipping in coming years. And the only previous in-depth series of hearings was conducted by Congressman Tom Downing of Virginia, the Chair of the Merchant Marine Subcommittee of the then-Merchant Marine and Fisheries Committee.
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He held on the order of six consecutive weeks of two-day a week hearings on the status of the U.S. Merchant Marine and those hearings constitute the most in-depth review of our role in shipping and it was done in my first term in Congress. And what struck and has lasted all these years was that at the end of World War II we had 16 million deadweight tons of shipping in the United States, over 3,200 commercial vessels. We were number one in international shipping in the world. And by the time of my first term in Congress, we were down to 800 ships, under 8 million tons of shipping. We were eighth in the world and, at that time, that was dead last. Number one was the Polish fleet. The second was the Baltic Atlantic Fleet, FESCO of the Soviet Union, and other in between us.
There was a current belief that the United States could do well without the Merchant Marine because we could contract with flags of convenience of Third World countries to ship our goods in time of national emergency. And then we had the experience of the Vietnam War and there was not a single flag of convenience that carried a ton of U.S. cargo in support of that decade-long initiative. It was, indeed, the support of the U.S. advanced stage Merchant fleet that positioned us well in the Gulf War. And our Merchant fleets pressed into service did a superior job. It was clearly inadequate for our needs and for our status as a premier trading nation in the world with nearly $600 billion in international trade.
We had, in the 1960's and early 1970's, 19 commercial shipyards in the United States, all of the doing commercial vessels and some military ships. Today we have three that are primarily doing military construction and three that are doing commercial construction. That is a pretty sorry state of affairs. Our various mix of programs that included the title 11 guarantee program to initiate domestic shipbuilding did not succeed. We build suburb ships that are safe, efficient, but they are costly. And so other countries have been able to beat us out on the shipbuilding. We are down to principally two international U.S. flag shipping entities in the international trade.
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Our container cargo capacity at major U.S. ports is clearly not the equal of Hong Kong. Sea Land has a more vigorous and expansive and aggressive, efficient container facility in Hong Kong than it does anywhere in the United States. In fact, Hong Kong processes one container every 2.5 seconds. That is 13 million a year and that is the equal of Los Angeles, Long Beach, and Port of New York, New Jersey combined. In the Great Lakes, we generate 30 percent of the nation's exports, the 8 Great Lakes States. And not a single container goes through a Great Lakes port. Many of them have put it on rails and ship it to East Coast ports or through Canada through the Port of Halifax.
I look at the situation and say that we have a crisis in international shipping capability. If I were the Navy, the Army, the Marine Corps, I would say that we are grossly inadequate in our Merchant shipping support capability and would be advocating for a more vigorous program. I hope that that is the direction in which we will move.
I congratulate Secretary Slater for initiating this study and you, Mr. Chairman, for supporting the directive in last year's Coast Guard authorization bill, supported by our side very vigorously, to carry this study forward. We look forward to completion of the panel's report and then, at that time, I hope, Mr. Chairman, you will hold even further, extensive, in-depth review with an eye on crafting policies that will enable the United States to once again take its rightful place as the world's leading maritime nation. We held that distinction with the clipper ships. We held that distinction at the end of World War II. We must regain it and must not ever lose it again.
Mr. GILCHREST. Thank you, Mr. Oberstar. And we will continue to have follow-up hearings on this issue and we will also have hearings to discuss the issue that you raised dealing with ship building: What is our capacity to do that? And we will continue to discuss the issue of ship scrapping. And we will continue to discuss the issue of funding port infrastructure needs.
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Mr. OBERSTAR. Thank you.
Mr. GILCHREST. Mr. DeFazio.
Mr. DEFAZIO. Thank you, Mr. Chairman. I would hope, in discussing some of those issues and as we go to some of the concerns raised by the ranking member of the full committee, that we can focus some scrutiny on flags of convenience and the policies that are expediting and facilitating the loss of our maritime capability in this country.
I would like to focus on a couple of things. Admiral Loy, I am interested in a particular portion of the Coast Guard's jurisdiction in this issue, which is the national security implications. You know, it seems to me—and, to tell the truth, I made this point in opposing the rush toward construction and deployment of Star Wars, whatever it is, whatever it costs, under the current majority—that a more likely scenario to me was that, rather than the North Koreans firing a missile at the United States, if they could manage to launch one successfully, which they really haven't yet even though we made a big deal of the one that was almost successful—at the United States, which would be immediately seen on our early warning system and, obviously, we would retaliate. And, if I was crazy and I was head of North Korea, I would probably get a junk freighter, put a nuclear device on it, steam it into one of our harbors, and then blow it up and no one would know where it came from and I wouldn't have my country destroyed.
So I think there are some very real security concerns and I guess I would like to know how and when we are going to begin to address these and whatever you can say in a public venue.
Admiral LOY. Sir, I think the simple acknowledgement of the phrase national security in 1999 means something very different than it did in 1989 and it bears out, to a degree, the thought process that you are describing. I think we are all realizing that one, at some pace, whether that array of national security threats that we are responsible for in the maritime environment is focused to the point where it is all about drugs, or it is all about alien migration, or it is all about the national security implications associated with a protein source of fish in our Exclusive Economic Zone.
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These kinds of dimensions to the national security of the Nation are very much a part of 1999 and into the next century. One of the reasons that we have security as one of the elements in MTS has a more focused association with not only ports of embarkation, but also ports of debarkation. Our responsibilities to the 17 specified ports with respect to national defense purposes have always been there. The Espionage Act of 1917 is the basis for Coast Guard responsibility in that regard. We chair standing committees both nationally and at port levels to deal with those kinds of threats whenever we can.
I stood with Secretary Slater in Houston the other day in front of a vessel that had been making an effort to smuggle over 6 tons of cocaine into the United States underneath a load of iron ore. Well, your inference is what else could have been under that iron ore other than six tons of cocaine? The simple reality that not of all threats in that national security spectrum these days are nation-state sponsored, even offers the simple criminal element, in terms of its sponsorship of those kind of challenges to the national security of the nation.
PDDs 62 and 63 offer focus on the critical infrastructure of the United States, sir. The National Security Council is working very hard to identify the parameters necessary to stay secure into the future with respect to that different array of asymmetric threats that potentially come in our direction. I think we are grappling very well with that, but I would also say that the sense of immediacy that, on any given day, should some, be it North Korean or criminal element from the Andes, choose to continue to challenge the border security of the United States, they can do that today. As you know, our efforts are with the thought process of pressing our borders offshore so as to not have to have that engagement process you were just describing in any of the harbors in the nation.
Mr. DEFAZIO. Well, in response to the offshore—and I am fully in agreement with that, which is why I attempted to enhance and sort of underline your authority regarding the entry of foreign vessels into our waters.
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Admiral LOY. Yes, sir.
Mr. DEFAZIO. I guess I would be curious whether—I mean, one thing I learned after the New Carissa incident in Oregon is that one accepted long-term convention, for whatever bizarre reason, in the international maritime community is secrecy of ownership. You know, it became a very long and tortuous process to identify who was the responsible owner of that ship and we never really got to exactly who really owned it. I am wondering, whether or not we are looking at changes in those areas? I mean, why should the U.S. allow any ship into its waters when we don't know who really owns it? I mean, why do we have to accept it? It seems to me that is a national security—I mean, Mr. Bin Ladin. We don't know.
So why couldn't we require, in addition to some of the other things we require in terms of disclosure or would require under my legislation, couldn't we require that the ownership become transparent on these ships?
Admiral LOY. I think that is an additional piece of information that we don't have as good a handle on today, sir, as we could. And I would support the thought process of having a greater degree of specificity associated with that 24-hour notice that that vessel steaming toward the United States has to make such that in our own integrated information system, which I would offer remains virtually the key to all of our successes as we go forward here, that we need to do a better job with respect to that.
At the same time, at the national security level, in a classified program that the National Security Council owns, we do have some reasonably good insights in terms of those ships that have traded with a nation, certain flags, certain conditions. Just with respect to the Yugoslavian activity in Kosovo, we have made adjustments to that so that we are dealing as constructively as we can to keep those threats from entering the ports of the nation.
Now is there room for improvement in the specificity of the information we could check and validate and therefore act on? Absolutely.
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Mr. DEFAZIO. It seems, as we move forward with the GPS system, that we could assign every ship that is entering our waters could have a unique identification number. We would know where they were through the transponder and would have a database we would also make a requirement that the ownership be disclosed at the point it enters our waters.
Admiral LOY. It is a data field inside the technology that is currently close to being available, but not actually available.
Mr. DEFAZIO. But apparently, at least in the past—I am new to these areas on the committee—I mean, the U.S. has facilitated or not objected to this long-term convention in international shipping, the secrecy. And I don't understand why it would be in our interests or the interests of any other nation-state to support that. I mean, why should people be able to keep ownership a secret? Why? I mean, what does that facilitate except someone, anonymously can own a ship? Great, so what?
Admiral LOY. The drive has always been an economic drive, with respect to being able to trade globally.
Mr. DEFAZIO. But if I can, Admiral Loy, we are in an incredibly strong position here. Ships are going back to Asia empty. If we said ships can't enter our waters from Asia full of junk from China for Christmas, unless they disclose ownership, it would take about two minutes for most of those people to disclose ownership.
Admiral LOY. Yes, sir, I think it is a doable thing.
Mr. DEFAZIO. Thank you. Could I, Mr. Chairman? Mr. Gudes, with NOAA, I understand that there may be some problem—and I am very impressed with what you are doing in terms of real-time charts—but I understand that the performance of some of the cooperating agency is somewhat variable. In particular, I understand there may be some problems with the Corps of Engineers in certain regions getting dredging information on real-time or even a not-real-time six months later basis that that project has been completed. Is that accurate?
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Mr. GUDES. Well, Congressman DeFazio, as I was saying earlier, that we are moving to a digitized system where we will try to get this information out quickly, that sort of put requirements on all of the people who provide us the information about hazards, we can do it quicker if the data comes in in a digitized fashion, not an analog fashion. That has put some pressures on the people who tell us about hazards. It is an issue. It is an issue that we have raised within this MTS process. It is one that Federal law we need to do a better job on.
Mr. DEFAZIO. Do you need an MOU? Do you have an MOU or something with the Corps on this? I mean, is there a memorandum of understanding?
Mr. GUDES. Yes, we do have an MOU. Captain McFarland just advised me, we do have a memorandum of agreement now.
Mr. DEFAZIO. And you feel that they are doing better at complying? I mean, the question is, for example, I have had some frustrations and variable response from the Corps in the past sometimes. In some areas they are very good, but in others they are not. And this just seems to be one that is pretty critical. I mean, if we don't know where the hazards are on a real-time basis or what dredging has been connected on a real-time basis and we are presenting the system as being real-time, we have the prospect of a big mistake here.
Mr. GUDES. There has really, I think, been a revolution in terms of how we, NOAA, provide mapping and charting data out to the users. And, in fact, we intend to continue to become more and more rapid and provide much better information right into the bridge of ships. That has put pressures on other agencies who weren't necessarily ready to go along right with us at that time and it is something that we have got to continue to work toward. As I said, the faster we can get data in the format that our people need, the faster we can get it on products like this or on, actually, the products in the future.
These are what we call Raster Maps which are really visualizations of the nautical environment, but we are moving toward much more specific data that a mariner could click on and actually get a lot better information than a geographic information system. That requires us to go quicker and quicker in terms of getting that type of information.
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Mr. DEFAZIO. Now, as I understood your testimony, you involve some sort of a middle person here in terms of a private vendor. I am curious if you have a publicly available database, why wouldn't you allow people to directly access that to download maps?
Mr. GUDES. I think that, from the very—I have been associated with NOAA's mapping and charting operations since about 1983 and even when we were in the paper maps and charts, those were always provided to the public through private vendors. NOAA's paper charts are sold though a network of authorized private chart agents throughout the United States, Canada and 39 other countries, as well as directly from NOAA by mail or phone order. This network of agents is the most efficient way to reach mariners in ports and harbors around the world. For example, there are currently 19 agents in Oregon. NOAA would never be able to provide that kind of local service. Agents buy NOAA charts from us at a 40% discount and then resell them at a profit to their customers. We work with the agents, providing information and training to help them serve chart customers well.
Dave, can you help me out please?
Mr. DEFAZIO. Do you make money on it? Is that why we do it this way?
Mr. GUDES. We wish we did, but——
[Laughter.]
Mr. DEFAZIO. Well, so, if you are not making money on a private vendor, why not cut out the middle person and give the taxpayers the benefit of their tax dollar without profits to a private firm?
Mr. GUDES. Well, what we have been able to do through entering the partnership with the private sector is to be able to put out our data in a much faster fashion, but that has required some limitations on us about what we are able just to provide——
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Mr. DEFAZIO. There is nothing faster, though, than publicly posting it via the web, or a website. I mean, that would get it out faster to most people who are computer savvy than something that goes through a private vendor who then translates it into hard form that then sells it in a store to someone who takes it homes and sticks it in the CD-ROM player.
Mr. GUDES. In terms of the partnership with the private sector with Map Tech, I think, is the specific corporation. There is an investment on their part as well, in entering into a program with us to put an investment in to try to find a way to get out this data faster. But I just think it has been a good partnership, Mr. DeFazio. It has enabled us really to do things much quicker than we might have done otherwise, but that puts some limitations on what we can do as well.
Mr. DEFAZIO. Yes. Now how much does that CD-ROM cost if I want to buy it retail?
Mr. GUDES. This is Captain MacFarland.
Mr. DEFAZIO. OK, Captain. Why don't we let him speak, if he would identify himself?
Captain MACFARLAND. I am sorry. Yes, it is about $200 right now, but you can buy it on a discount.
Mr. DEFAZIO. OK. So it is $200. Now what percentage of that goes to NOAA?
Captain MACFARLAND. A small percent.
Mr. DEFAZIO. Well——
Captain MACFARLAND. About 5 percent.
Mr. DEFAZIO. How much? 10?
Captain MACFARLAND. About 5 percent, yes, sir.
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Mr. DEFAZIO. So we get $20.00 per CD-ROM. That is interesting. And this is—I remain puzzled, to tell the truth. I mean, it would be fine if the private vendor since what you produce and the government produces is not protected by copyright or patent, but if a private vendor wanted to engage in some way to enhance it and market it, that is great. But why not also make the data directly available to U.S. citizens who have access to the Internet?
Captain MACFARLAND. Yes, the cooperative research and development agreement, which is what we used to produce the CD-ROM, allows us to leverage our limited resources to get this product out. There is also a fair amount of research and development that goes into this by the private industry, in terms of productizing this, but also in terms of a revolutionary new way of doing the updates. In the past, updates to charts would take sometimes a year or more to come out. What we are looking at doing is gathering the Coast Guard information and putting this out on a weekly basis. This is something we never could have done on our own, but through this research and development agreement, we have been able to accomplish this.
Mr. DEFAZIO. Well, again, Captain, I just respectfully disagree. I mean, if it is in your database, corrected, and then you are going to download it to the vendor or the vendor is going to access your database why do you need a vendor? I mean, I have been sailing with friends and we want to get a weather chart and we can download it via satellite and see what kind of weather we are sailing into, real-time. We don't have to go through a vendor or, though, some day we probably will have to go through vendors to get that, but right now you can still get that directly through Federal resources.
And I am just questioning whether, I mean, I guess the agreement that this private, for-profit firm has with this publicly produced, taxpayer produced data is that they have some kind of exclusive marketing right and I am questioning whether or not that is prudent and whether or not we should make the database available on a real-time basis and whether or not technology has maybe, in a way, passed them by and these kinds of agreements by?
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Mr. GUDES. I think part of the issue is the issue that was raised in the beginning of in a perfect world, with appropriations to fund every program that we and NOAA might want to do, that might have been one way, one path to go. About five years, knowing about the level of funding that we were going to have and the needs to really modernize the system, I think we tried to find a creative solution to be able to really modernize.
Mr. DEFAZIO. But you are only getting 10 percent. I mean, you can market it yourself for 100 bucks and get 100 percent.
Mr. GUDES. But part of the issue, I think, Congressman, would have been that we wouldn't have this product today if we would have stayed with the level of appropriations and the effort that we had. We had to find a different way to do business. This sort of relates back to the comments that were made, maybe, about the MTS overall.
I also think, in the case of weather, you are right, but NOAA, while we do weather forecasting and we certainly have the observational and prediction base to do that, being a weather forecaster is probably one of the more frustrating jobs in the world because other people provide that forecast to the public. When we all watch TV at night, that is the news media putting that forecast out and making lots of money selling advertisements to tell people about the weather. And we are happy to do that, because that gets the information out there.
Mr. DEFAZIO. But what I am getting at is that you do have a product there that I can access directly or I can access through the talking heads on television. But, you are saying, in this case, I can only access this product through a private vendor and I am just raising what I think are reasonable questions about that arrangement with something that was produced with taxpayer resources.
Mr. GUDES. I understand. I understand.
Mr. DEFAZIO. I know you are underfunded and I bemoan that fact. We have got weather buoys that we don't have any more off the West Coast because of your underfunding. So I understand that. But think about it. Thank you, Mr. Chairman.
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Mr. GILCHREST. Mr. DeFazio, we will have a hearing on mapping and charting and Internet access and all that, directly as a result of your questions.
Mr. DEFAZIO. We certainly could have a demonstration.
Mr. GILCHREST. Well, that demonstration would be of great benefit.
Mr. DEFAZIO. Yes.
Mr. GILCHREST. So Mr. Gudes can come back in the coming months——
Mr. GUDES. Thank you, Mr. Chairman.
Mr. GILCHREST. Yes, sir. Mr. Baird.
Mr. BAIRD. Thank you, Mr. Chairman. Admiral Loy and Mr. Hart, I want to echo my colleague Mr. DeFazio's concerns about the security mission of the Coast Guard. I share his—I have used the exact same analogy of rather than the Star Wars mission. I really believe that the Coast Guard may be the most important national security in terms of defending our own country proper. It doesn't make sense to me someone would import significant weaponry or assault on an aircraft, given that that is heavily secured but shipping, very easy it seems to me to get things through.
Could you address to what degree are you able to monitor what percentage of ships are actually inspected? This kind of thing. How ineffective are we at that, currently?
Admiral LOY. Sir, we have a ring of about 50 Captains of the Port with respective areas of responsibility. They vary, of course, in size in terms of the number of people that are there and the responsibilities that they have for those ports. I will have to get back to you for the record, sir, in terms of statistical numbers and that kind of thing but, in terms of major shipping that is entering the United States, the control mechanisms are associated with a notice that is required of all those vessels as they approach the coast and the current Port State Control system that we have in place, I think, is there, first and foremost, because of safety and environmental protection orientation and, to the degree we grow in this national security implication for a stronger requirement to be more aggressive with respect to that program, the dimension of national security would have to be ladled on top of safety and environmental protection as the raison d'etre for having such a program. That is very reasonable.
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For example, just this last week we had all of our 50 Captains of the Port with their proper players in to deal with understanding the Y2K implications of the upcoming 31st of December date so as to make certain that each of the Captains of the Port were, in a standard fashion, dealing, as an addition to the ports they control, enveloped with things we look for routinely, that we are going to be certain that those vessels that will be allowed entry into the United States on the couple of days before, couple of days after are Y2K compliant, as best as we can determine that.
But your implication is, I think, a very sound one. This nation has, by and large, over the past 200 years, been able to take its business in national security to someone's else's turf. That dynamic is a very changing dynamic in the national security spectrum that we face as a nation today.
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Mr. HART. If I could add to what the Admiral just said, at the end of last month, the President signed an executive order establishing a port security commission. Both Admiral Loy and I serve on that commission. We have had our first meeting and we are going to look into those issues about security of the nation's ports in all its various guises, not only oil spills, but also weapons of mass destruction—Congressman, your example—and have a report by this time next year.
Mr. BAIRD. That is good news.
Admiral LOY. Now the working groups have been established with respect to coming to grips with this, whether it is emanating from the National Security Council's very correct concerns with respect to critical infrastructure, everything from cyber to weapons of mass destruction. Those are the very real national security challenges that have a maritime dimension to them, which is, I think, the point that you are making, Mr. Baird. And we absolutely must be get on top of that. So these commissions and working groups are underway to begin to grapple with that.
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Mr. BAIRD. If I could shift quite markedly to a second topic, but one of importance, I was pleased to read that more is being on human factors work in preparation of pilots and crew. If we look at some of the major disasters in our recent maritime history—the Exxon Valdez and, more recently, the New Carissa—the cause in both cases was this human factor. Now we have certainly seen from aviation some of the major aviation disasters have been the interaction between pilot and copilot. A two-part question: To what extent are we working on that, both within the pilots who are trained within the States, but also international pilots? Because the New Carissa came out from a silly decision by a foreign pilot? What are we doing on that front?
Admiral LOY. Sir, on the international level, one of the dimensions, again, of port state control is to validate the SCTW convention from the International Maritime Organization. This convention provides standards for training and watchkeeping for the watchstanders on vessels that are plying the globe's waters and certainly coming towards the United States. The inference there is to set international standards and to then enforce those by port state control aspects around the nation.
You are absolutely right both with respect to the two cases you cited. In EXXON VALDEZ, Mr. Hazlewood has, as you know, long since become a name of infamy associated with that particular event and, as it relates to the NEW CARISSA, first the judgment call of the mariner associated with anchoring where he anchored and, second, the judgment call associated with attempting to lift that anchor when it was dragging in an effort to get to the pilot boat, ended up with the NEW CARISSA on the beaches of Oregon. Those were human judgments and that is the point that you are making and it is very sound.
I would offer that probably we are down to maybe 20 percent, 80 percent balance between where a mechanical, technical kind of a problem generated an incident as opposed to a human shortcoming generating an incident. So whether it is about fatigue or whether it is about standards of training, whether it is about standards of watchkeeping, the Coast Guard has undertaken, over the last several years, a Prevention Through People—PTP—program that goes directly to the heart of what you are describing and it is, in my mind, that area where we can make a quantum leap with respect to safety, environmental protection, all the issues that you see in our construct for the MTS.
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Mr. BAIRD. Thank you very much.
Mr. HART. If I may just, again, let me piggyback on what the admiral said, but a necessary component of this, as the admiral sort of implied, is training and one thing we continue to try to do is always upgrade our training. The U.S. Merchant Marine Academy at Kings Point, we continually try and run people into continuing education. There are the State schools that also do the same thing. There are several union schools which also have people that come up for updating. So training and being able to make the correct decision, under pressure, when you have to is a critical component and one that I think we need to continue and probably increase.
Admiral LOY. One of the most recent additions to that thought process is understanding the difference between open ocean safety and approaching a congested port and the internal waterways, the rivers and lakes, if you will, Mr. Oberstar, in terms of the Great Lakes. A terrific facility was just opened in Paducah, Kentucky, with a view towards focusing directly on the training associated with barges and towboats. So this is an acknowledged challenge that we have to get the human dimension to a higher degree of productivity and accident prevention.
Mr. BAIRD. Thank you very much. Thanks, Mr. Chairman.
Mr. GILCHREST. Thank you, Mr. Baird. Mr. Coble.
Mr. COBLE. Mr. Chairman, I had to attend a Judiciary hearing and I apologize for having missed most of this session today. However, let me put a question to you and Mr. Gudes, both. I am told that a Woods Hole Oceanographic Institute study estimates that an effective electronic charting system alone could do as much to reduce risks of oil and chemical spills as requiring vessels to have double hulls. First of all, let me ask you if you agree with this assessment? And, second, Admiral and Mr. Gudes, what does the Coast Guard and NOAA, if anything, have in the works to accelerate the widespread use of an electronic charting system?
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Admiral LOY. Sir, I haven't consumed that particular study that you are citing, but let me just make a general comment. The efficacy of electronic charting as the future of where we are going is a given. We are building buoy tenders today that are dependent on electronic charting. So that the investment that we are making as a service, and it is simply the reality of the day. I can't make as I sit here, sir, a judgment as to whether the implication of double hulls versus electronic charting will net an equal contribution to safety and environmental protection. I will check that out and get back to you.
But I would only advocate that the program that NOAA is responsible for is absolutely critical to making continued contributions to both safety and environmental protection on our waterways. That is what the MTS. If we can gather collaborative thinking from all of the players, not only the Feds; State and local inputs as well as private inputs, to these kind of issues and find the right answer with all of the impacted players at the table, that is the net value, I think, of a collaborative marine transportation system initiative.
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Mr. COBLE. Thank you. Mr. Gudes.
Mr. GUDES. Congressman, I understand that, apparently, the Woods Hole study does make the same point. And I would just say that I can't talk to you about the issue of double hulls. That is the Coast Guard's turf. I would say that, clearly, trying to get very accurate information about the tides and currents on the bottom has become increasingly important as we are moving more and more toward commercial transportation that tries to use every inch of available depth.
As I mentioned before, we are trying to move more to an integrated capability on the bridge of a ship. It is almost like we do now for weather forecasters on land where we provide all the sort of elements that they need to know to do their job. I would say that there have been some really pretty startling examples of where we have gone back into our multi-beam sonar technology and side-scan sonar technology found some obstructions that were surprising. In Charleston Harbor in South Carolina, we just found some rocks that actually were in the main approaches that people were not aware of and, with the sort of clearances we are talking about, that was a problem waiting to happen.
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So we definitely think this is where we need to go as an agency to provide this data faster and to provide it electronically to the bridge. And we would agree it is a major task for us.
Mr. COBLE. Thank you, gentlemen. Thank you, Mr. Chairman.
Mr. OBERSTAR. Will the gentleman yield?
Mr. COBLE. I will indeed.
Mr. OBERSTAR. Just briefly, the gentleman raises a very important matter of technology development and I did see at a christening of the Coast Guard's newest buoy tender, the Tate, last Saturday the electronic charting system to which the gentleman referred and they are all quite excited. I saw the display and how you can zero in on pieces of a channel and get a great deal of information.
But the problem remains of updating that information, of insuring that the electronic charting has always the most current information. And our charts on the Great Lakes have been extraordinarily good, but there was a bit of shoaling that didn't show up, that nobody had charted or entered into charts that caused or was the point that caused the Edmund Fitzgerald to sink. Human factors plus technology can produce great advances. But, in the end, it is the human factors that update those charts, that enter them into the right place.
They have electronic charting on board the most advanced glass-cockpit aircraft. But if the destination airport is not entered into the aircraft's computer, it can't fly there; the pilot has to fly it, himself.
Mr. COBLE. I thank the gentleman. Reclaiming my time, I yield back, Mr. Chairman.
Mr. GILCHREST. Thank you, Mr. Coble. Mr. Gudes, Mr. Hart, Admiral Loy, thank you very much for your testimony. We look forward to working with you on this issue in the months ahead.
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Mr. HART. Thank you.
Admiral LOY. Thank you.
Mr. GUDES. Thank you, Mr. Chairman.
Mr. GILCHREST. Our next panel will be Mr. Joe Cox, president, Chamber of Shipping of America; Mr. Thomas Chase, director of environmental affairs, American Association of Port Authorities; Mr. Edward Emmett, the president, National Industrial Transportation League; Mr. Jonathan Benner, U.S. legal representative, International Association of Independent Tanker Owners, INTERTANKO; Mr. George Ryan, president, Lake Carriers' Association; and Mr. Paul Kirchner, executive director, general counsel, American Pilots' Association. Gentlemen, thank you for your attendance this morning.
Gentleman, thank you for coming. It is still morning. We look forward to your testimony and your perspective on this draft report and on future ideas that you may have. So I will go according to my list which means Mr. Cox will go first.
TESTIMONY OF JOSEPH J. COX, PRESIDENT, CHAMBER OF SHIPPING OF AMERICA; THOMAS J. CHASE, DIRECTOR OF ENVIRONMENTAL AFFAIRS, AMERICAN ASSOCIATION OF PORT AUTHORITIES; EDWARD M. EMMETT, PRESIDENT AND CHIEF OPERATIONG OFFICER, NATIONAL INDUSTRIAL TRANSPORTATION LEAGUE; C. JONATHAN BENNER, U.S. LEGAL REPRESENTATIVE, ON BEHALF OF INTERNATIONAL ASSOCIATION OF INDEPENDENT TANKER OWNERS (INTERTANKO); GEORGE J. RYAN, PRESIDENT, LAKE CARRIERS' ASSOCIATION; AND PAUL G. KIRCHNER, EXECUTIVE DIRECTOR-GENERAL COUNSEL, AMERICAN PILOTS' ASSOCIATION
Mr. COX. OK. Thank you, Mr. Chairman, and good morning members. I appreciate the opportunity to be here to provide testimony on behalf of the Chamber of Shipping of America, which is an organization of U.S. owners and operators of vessels. Mr. Chairman, with your permission, I will submit my testimony to the record and provide some oversight thoughts here.
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Mr. GILCHREST. Without objection, so ordered.
Mr. COX. Thank you, sir. In preparing the testimony, I hit a couple of major points, Mr. Chairman, and one would be that the—and probably the primary one that brings us here—is that the ports and waterways system of this nation is a national resource. It includes not only the ports, the channels, and the rivers, but the access to it. Who benefits from this system? In my testimony, I describe it back through the founding of our nation or the beginning of our nation. The beneficiaries are, of course, the people who I represent, the commercial vessel operators. That includes cargo, tanker, general cargo ships, container ships. It also includes fishing boats and anybody else who has an activity on the waterway from which they gain a commercial benefit.
We also have a beneficiary in the U.S. government. The U.S. Navy, of course, is a very much a primary beneficiary of our port system. The U.S. Coast Guard and we heard from NOAA who operate a number of vessels are also beneficiaries. And I think we cannot forget that the recreational boaters, of which, I think, we had a number articulated earlier of around 20 million recreational boats at present, also benefit from our waterway system and the infrastructure that is provided to us, as a nation. And, certainly, all of the Americans who take part in water activity, probably beginning around now in a pretty heavy way in the Chesapeake Bay, are beneficiaries.
In my testimony, Mr. Chairman, I indicated that people are very important. And I think that our training—we have heard some references to training here and the human factors—I think it is a very important point for us to make that we do have, in my opinion, the world's preeminent training facilities and the capability to provide the best-trained mariners that the world's oceans have on them. Having been one in a prior part of my career, I think I can say that with some authority, not only on behalf of myself and those who have trained with me, but those who are training today.
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And I touched intermodalism very heavily because I think intermodalism is a key aspect for us to keep in mind as we talk about our port system because we are not just discussing a vessel coming into a port, we are talking about that vessel being a part of a chain which brings cargo to and from this nation, not just to a port, to a user in our nation from a foreign location and, just as equally from our standpoint, from an American origination point in the heartland of our nation to a foreign buyer. So both of those have an equal importance with respect to what the ports and the intermodal structure play for us as a nation.
Mr. Chairman, I was a participant in the Secretary of Transportation's conference in November and I once again want to reiterate that I appreciate the fact that the staff from the U.S. Congress, both from committee and personal staff, were in attendance there. And we did benefit from the points that they made. That conference was preceded by a number of listening sessions. There was a lot of information discussed at that conference and it has been reflected in the task force report. The task force was designated by the conference itself and it is culminating its activities here in another couple of weeks and I would hope that that report will be forwarded to Congress, essentially along the lines that we have seen in draft form that has been referred to today.
I would say that there are six issues that have been previously discussed. Perhaps one that has been overlooked somewhat by the private sector it its comments, and I would like to cover here, is the council that has been referred to, the national council. That is separate from the interagency council or the interagency group that has been discussed previously by the government. The council is something that we certainly very much support, provided that our idea of private participation with our Federal partners in that council is one that maintains through the review process of the task force report. In other words, we want to participate in the effects that are going to be taking place on our waterways as users of those waterways.
Mr. Chairman, I am going to close my testimony with two thoughts. One is at the MTS conference I did have the opportunity to try and say that deep sea vessels, U.S. deep sea vessels, are a part of the marine transportation system. I understand that, in a definitional way, that was not accurate for that particular conference, but I can't sit before a committee of Congress and suggest that the deep sea going ships that I represent among my memberships are not an integral, very important part of our national maritime structure and I would certainly hope that they would be debated when we debate the marine transportation system.
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Having said that—I see the light is on, but if I could have 30 seconds to just talk about one particular problem that came up, Mr. Chairman—last week we were notified that the U.S. Customs anticipates making a change in a policy that they have had longstanding since 1991, which is dealing with spare parts aboard U.S. ships which happen to have some work done overseas and spare parts put on there and they are changing the definition of that or they intend to and it would add, according to the information given to me by my members who operate those ships that are involved, $200,000 a year onto the cost of operating that ship. And I think I put in my testimony it is no wonder that people are looking at alternative ways of operating their ship if we have costs like that which are just at a whim of an administrative interpretation.
With that, Mr. Chairman, I conclude my testimony and certainly would be willing to and able, hopefully, to answer any questions from the committee.
Mr. GILCHREST. Thank you, Mr. Cox. When we go into question period, maybe we can—and certainly after the hearing—we can further take a look at that Customs change.
Mr. COX. Thank you.
Mr. GILCHREST. And also, certainly, deep draft vessels.
Mr. Chase.
Mr. CHASE. Thank you, Mr. Chairman. It is a pleasure to be here today to talk to you about the issues affecting public ports in relation to the marine transportation system. I would ask that our written statement be put into the record and I will briefly summarize the comments in this statement.
But, first, I would like to express the regrets of our president, Kurt Model. He would like to be here testifying today. He is a member of the task force, but he was unable to make the schedule. AAPA has been involved for a long time, working with the agencies and working with Congress, to address the issues of importance. We appreciate your leadership in setting out the direction for the agencies to convene the task force and to take the private sector interests into account. We think that is extremely critical in moving forward on these issues.
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What I would like to do is quickly highlight the role that public ports play in the MTS. Our members are local and State governments, the kind of governments that Mr. Taylor talked about earlier, and they play an extremely important role in providing infrastructure for the marine transportation system.
Public ports are responding to the service challenges, Mr. Chairman, that you highlighted in your opening statements and we are investing heavily to try to meet those needs. In 1997 alone, public ports invested $1.5 billion and we estimate that over the next 5 years they will invest another $7.7 billion to meet capital investment needs. And, as we try to develop projects that meet the multiple objectives of our communities, to provide additional features like public access and environmental features, those dollars are all competing for the transportation improvements, similar to the situation that Mr. Taylor described.
But we are very proud of the projects that we do for our communities. We work very hard with our partners at the Federal level, at the State level, and our neighbors in our communities. There are numerous examples—and I highlight one in my testimony—of a project that is currently been designed and awaiting authorization in 1999 in the Port of Oakland. It would deepen the channel to 50 feet. It would, with the dredge material, create 120 acres of shallow-water habitat; 3,200 acres of wetlands; provide 30 acres of new park land; and have features on the land side that would reduce vehicle emissions by 40 tons per year.
So ports are out there leaders in delivering projects for the MTS and for the communities. And we look to the Federal agencies to do that, as a part under the longstanding partnership that exists in our country. And we think that a lot of mechanisms, the policies in place, are good. We support cost-sharing. And our main emphasis with the task force and the council—we support the council—is to find ways to improve coordination.
And, as an example, I would like to discuss our involvement with NOAA in response to Mr. Taylor's questions about beneficial uses. We think, under the Coastal Zone Management Act and with NOAA's initiative—and we are working with them. We hope to be able to support that—we think if communities can identify ahead of time areas where beneficial uses can occur and we can agree to guidelines to developing those projects through the Coastal Zone Management Planning process or other watershed type planning initiatives, then it can become more of a turnkey operation to deliver those beneficial uses.
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I think the situation we have now is ports are asked to design, fund, permit those projects. It becomes very costly and often very contentious. And we need to find ways to improve the buy-in and identification of those sites and the costs will come down and I think the Corps may be able to do it under their Federal standard concept and the local share may not be as big a challenge. So that is just one example, but there are many, many others, I think, where coordination is key.
But also—and my final point is—I think the interest and involvement and attention that Congress gives to this will help ensure that all of the agencies come to the table. We fully support DOT as a leader in this. We think the Federal Government and the administration side needs to address these issues with one voice. But they also need to know that folks are looking over their shoulder, that Congress cares, and they bring the private sector to the table in coordinating these efforts. So, in closing, we appreciate your concern for these issues. We look forward to discussing them with you. The challenges are many. The opportunities, though, are great. Thank you.
Mr. GILCHREST. Thank you very much, Mr. Chase.
Mr. Emmett.
Mr. EMMETT. Thank you, Mr. Chairman. It is a pleasure to be here and I appreciate the opportunity. My name is Ed Emmett. I represent the National Industrial Transportation League, which are the shippers, the customers of the ocean shipping industry as well as other modes.
I have submitted written testimony which I, too, would like to have made part of the official record and I would like to use my five minutes to mention just a few key points. First and foremost, this is a beginning and it is a very much needed beginning. With the globalization of commerce, U.S. business and industry is turning more and more to ocean shipping. Ocean shipping is, in fact, a part of the future, not a part of the past. And I think too many people have viewed ocean shipping as being part of the past.
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Secondly, I have to be candid and say that the Marine Transportation Task Force got off to a rocky start with shippers in that the task force didn't originally include shippers and, in fact, the conference was held at a time when the National Industrial Transportation League was having our annual meeting. Having said that, under Mr. Hart's leadership, I am very confident that he has got an expansive view of who should be involved and that all bases are being touched and we look forward to working with the advisory council and others as it goes forward.
Thirdly, as has been mentioned, maritime transport is clearly part of an intermodal system. And as you and the rest of Congress begin to look at marine transportation issues, you are going to have understand and take into account other things such as rail policy. Any place where you have only got one railroad serving a port, you could have a serious problem, no matter how good your marine transportation system is, if that railroad doesn't provide the service, then you have a problem. Secondly, the whole issue of truck size and weight. Do you treat shipments differently that are going to come in and have a rail component before they get onto the truck? Everything is going to be intermodal and none of these issues are going to be able to be separated.
Fourth, clearly ports have to be maintained. The harbor maintenance tax being ruled unconstitutional creates a problem for you that we hope to be able to help you with. We represent the ultimate payers of that tax, whatever it ends up to be or however the funding ends up.
And, finally, I would just like to add, the ocean shipping industry has changed dramatically recently. With the passage of the Ocean Shipping Reform Act you now have a new, I think, feeling of partnership between shippers and carriers and ports and labor and everybody else and that, too, will come into play in the marine transport policy.
So, with just those few points, let me again stress we view this as a wonderful opportunity for a beginning and we, the shippers, look forward to working with you and everyone else involved in crafting this policy.
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Mr. GILCHREST. Thank you very much, Mr. Emmett.
Mr. Benner.
Mr. BENNER. Thank you, Mr. Chairman and members of the committee. I speak today on behalf of INTERTANKO, the International Association of Independent Tanker Owners. INTERTANKO has appeared before this subcommittee before. I think you are familiar with it. I have a written statement. I ask that it be accepted into the record of the proceedings.
INTERTANKO has about 500 members and associate members from more than 40 countries around the world, including the United States. The combined fleet of INTERTANKO represents over 2,000 U.S. flag and foreign flag tank vessels with more than 175 million deadweight tons of import oil. Our estimate is that roughly two-thirds of all the oil imported into the United States comes on INTERTANKO ships so we have a stake in this process.
The process right now, as you have heard already, is one of inventorying some wants and some needs for the future. And it sounds simple to say it that way, but it is an important process to get these things down on paper and identify the reasons why we think they are important. The needs are the easy part. The hard part is getting to the point where we decide how much the American people are willing to pay for it and what they are willing to do about it and that is when it is going to shift into your venue at some point in the not-too-distant future, I hope.
INTERTANKO has supported the efforts to convene this process for a lot of reasons. On the very general level and the way it has been handled to-date, the process reflects a dedication by a number of Federal agencies to think strategically and to identify future issues. And there has been a good deal of cooperative spirit about the process. This pleases us very much. The agencies and departments involved in this have also shown a willingness to listen to the private sector, the vessel operators. And that doesn't mean they have agreed with everything we have said, but we have a very distinct feeling that we have been heard. That is an important part of the process and lends credibility to the process.
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Third, the atmosphere of the exchanges thus far has been open. It has been respectful of differing opinions. And I must say, as one who has participated in a number of these meetings, I think that, although there are a number of parochial interests represented, we have seen over the course of these meetings a willingness to put aside some of the more parochial interests and to try to find a way to identify the best interests of the Nation going forward with this valuable marine transportation system. As others have said, it is only a beginning. We have a long way to go.
This could be a very unique and unprecedented contribution by government and industry working together to give you and the Congress a game plan for the future of the system. That would be a very valuable contribution. I think we also have to recognize it could be a tremendous, colossal waste of time, energy, and forest products, for that matter. Much depends on how we and you make the transition from these meetings and reports, drafts that you have seen, to changing this into something that we can see out on the water and that affects the safety and the safe operation of our vessels.
Just to put it in some less general context before I conclude. Keep in mind that over 100 billion gallons of oil are imported into the United States every year. It is a staggering number. Very little of that ends up where it should not, but we know in our organization that it takes a constant attention to details to thinking about safety as a system to keep the safety record going, to keep improving it from year to year. So this marine transportation system process gives us some confidence that other people are thinking about marine safety as a system and that gives us hope for the future. We will cooperate with this committee, with the excellent work that has been done by the Department of Transportation, Commerce, and other agencies to make sure we don't end up with just a waste of time.
There are some short-term things we would like to see. We don't want them to get lost in the bigger picture. I have mentioned them in my written statement. We think hydrography and charting are extremely important. The aids to navigation, vessel traffic systems. All of these things could be improved immensely with a relatively small expenditure of funds and although we realize some of these things are not directly within this subcommittee's purview as far as the money side of it, we would hope that these things go forward and they don't wait for all the big picture items to be solved because we do have a charting problem. We could make a big difference in safety, as Mr. Coble's question indicated, if we could just have accurate chart data on a timely basis. Thank you very much.
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Mr. GILCHREST. Thank you very much, Mr. Benner. You caught my attention when you used the word ''colossal.'' We hope that this is not a colossal waste of time.
Mr. BENNER. Well, I—I——
Mr. GILCHREST. That is always the potential and I appreciate your seriousness and your attention to not only detail, but also to assure us that we have a very important responsibility in the areas of our jurisdiction and we should take those responsibilities seriously, follow through on this pretty-well-done draft report.
Mr. BENNER. Thank you, sir.
Mr. GILCHREST. And I usually don't like to use over-simplified analogies, but the big picture is putting every one of these tiny pieces of the puzzle together, which includes some charting, mapping, navigational aids and all of those things. The big picture can't be a big picture unless all of that is in there.
Mr. Ryan.
Mr. RYAN. Thank you, sir. I also ask that my complete paper be put in the record. And I will just say, as we all discussed, we have been part of a long process in preparing this report. It is coming along. Industry certainly has had a lot to say. We have worked cooperatively with many recreational interests, boating interests, environmental interests in putting this report together.
I am glad to hear the note that you passed on that we would not be discussing the funding at this issue. I think we would be here until tomorrow and we still wouldn't be finished. So it is good we didn't include funding in this, although some of my written comments included some comments about funding, I certainly won't discuss them here. And I understand that——
Mr. GILCHREST. We really would appreciate the opportunity to be engaged with all of you over whatever period of time it takes to make some dent into that issue.
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Mr. RYAN. Yes, sir. We will be there.
I would like to just confine my comments to a few things relating to the Great Lakes. It certainly was mentioned this morning that trade could increase 200 or even 300 percent and that is one of the reasons for having a need for an MTS. I think, even without a 200 or 300 percent increase in trade, we still need the kind of coordination that was discussed earlier. But, certainly, on the Great Lakes, we are not going to have a doubling or tripling of trade over the next 20 years and I think probably a number of ports through the United States will not have the doubling or tripling either.
Some of this demand has certainly been created by the need of having some ports that can handle ships which have a draft of 53 feet to handle these new container ships. But that is certainly not what is going to go on throughout the Nation and there will be commercial decisions that will drive that. I would say that, for the Great Lakes, we are not going to have any significant increase in the size of the ships serving the foreign trade for the Great Lakes. And the recognition of that reality by Congress, is to point that, when it comes to Federal programs as a result of this MTS program we look at equity between port ranges. What has to be considered is that some will not require that kind of investment.
Next I would like to say that one group who is not at the table is the Corps of Engineers and I would say that, in the MTS system, I would say that the largest partners happen to be the people who have the most bucks and I think that Congress has given the Corps of Engineers with those $3 billion for port dredging a great deal.
Mr. GILCHREST. A quick simple answer to that. We don't have jurisdiction over the Corps of Engineers in this subcommittee. And we would love to have had the Corps of Engineers here this morning, but that has sort of a geopolitical jurisdictional issue up here. But we will have a joint hearing in the near future with the Corps present.
Mr. RYAN. Thank you, sir. Certainly an important player for us on the Great Lakes. As much as the Coast Guard is, and MARAD, and NOAA.
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I would like to now just comment on a couple of items. On navigation charts, several people have commented on the inadequacy of the navigation charts. And if we recognize that we have inadequate information on the navigation charts, then you have to recognize, junk in, junk out. If you are talking about electronic charts, you can't count on bum information. So we support fully the continuation and full expansion of funding so that NOAA or whatever other agency will do the surveys, have sufficient funds to complete that work. Otherwise we are not going to have the right kind of charts, electronic or paper.
And in my comments, I indicated that, given the periodic discussion about NOAA funding, whether they have enough survey ships or NOAA officers, I think it is a good time, for instance, to now look at whether we have too much fragmentation and, perhaps, the U.S. Coast Guard should be the agency that would be responsible for the surveys. We know that MARAD was shifted from Commerce at one time to the Department of Transportation and perhaps Congress might consider that some functions of NOS might be transferred over to the Coast Guard.
The Coast Guard are the folks that have officers who know how to run ships. They also have ships and they have multi-missions. Perhaps this is another mission which should be considered. I would also like to comment that we do need that kind of coordination, that Corps of Engineers data is consistently delivered to NOAA, to make sure that it is in a digital format so that it can be used immediately for those who need it for safety reasons.
Two more comments. One deals with Coast Guard personnel. And I say this in my written comments with a great deal of admiration for the U.S. Coast Guard. I had my first Coast Guard Seaman's document in 1953 from the Coast Guard, so I worked a few years with Coast Guard over time.
However, right now, I think we have a situation where there is a lot of lost motion with Coast Guard transfers. I have known seven district commanders. Since I have been president of Lake Carriers, I have known seven men who were in charge of the marine inspection on the district level. I have known dozens of people who have been skippers of the ice breakers in that short period of time, scores of people who have been in charge of OCMIs. Because every two or three years, Coast Guard personnel have to keep changing. They are constantly in a state of being trained in order to have upward mobility for another job.
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And I think perhaps it might be time that we looked at the uniformed officers requirements for the national security and police aspects of the Coast Guard Missions and that which might be truly marine transportation and perhaps there could be some savings to the Federal Government if not all the folks are in uniform. Much as I admire them for being able to say when they reach captain that they have been transfered 15, 18 times in a short period of their career, there has got to be a lot of human loss in that, too, that could be looked at.
And I would be remiss in not mentioning my last item: ice breaking. I am glad this committee has supported ice breaking so much in the past. Mr. Oberstar, of course, had to leave and Mr. Coble had to leave. And you, sir, thank you for the support you have given on ice breaking. It is an important of the MTS system on the Great Lakes. My time is up. Thank you.
Mr. GILCHREST. Thank you, Mr. Ryan.
Mr. Kirchner.
Mr. KIRCHNER. Thank you, Mr. Chairman. I know what it feels like to be the outside horse at the Kentucky Derby now. I am pleased to appear today before the subcommittee on behalf of the American Pilots' Association. The APA is the national trade association of professional maritime pilots. We represent virtually all of the state-licensed pilots operating in the United States as well as the three groups of Coast Guard registered pilots operating in the Great Lakes. As I recount in my prepared testimony, which I won't read here, we also have been active in the MTS program or process.
Let me use the time allowed here to just zero in on four concepts or values that we have tried to promote during our involvement in the MTS program. Number one, the MTS should recognize the value of and support local decisions on safety matters. Our experience tells us that many navigation safety decisions on matters such as under-keel clearance and special traffic restrictions, berthing, or maneuvering practices are best made at the local level. We believe that the Federal Government's role in a national marine transportation system should facilitate and not frustrate the navigation safety and decisionmaking abilities of local maritime communities.
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On a related point, number two, the MTS should support the work of local harbor safety committees. The Commandant had discussed these earlier. In many of our ports and waterway areas, a local harbor safety committee is a critically important vehicle for making these types of decisions on navigation safety issues. What makes these committees so successful, however, is that they are local communities. Their structure, their membership, their procedures, and subject matter jurisdiction are all specifically tailored to meet the local needs and circumstances. We should be very careful that efforts to harmonize or to standardize harbor safety committees or to incorporate them into some type of national MTS structure do not change them so much that they would no longer be effective in making timely, informed decisions.
Number three, the MTS vision should call for a more active Federal role in the introduction of advanced navigation technologies. Federal leadership is not only appropriate but necessary in the development and implementation of navigation technology. We would hope that one of the results of the MTS program would be reliable adequate funding for such things as the Coast Guard's DGPS system, the Coast Guard's efforts to promote the use of AIS technology, NOAA's electronic chart activities, and, in particular, NOAA's PORTS system.
Number four, traditional aids to navigation will continue to be an important component of the MTS. No segment of the maritime industry supports the introduction of advanced navigation technologies more than APA-member pilots. We should all be wary, however, of unreasonable expectations or inappropriate justifications for these new additional tools. The use of electronic charts, the DGPS-based navigation systems, or AIS will not make traditional aids to navigation obsolete. Our pilots and others will continue to use and rely on ranges, buoys, lights, and day marks. Also, we should not make the mistake of arguing that funding for the government's advanced technology activities could be offset by corresponding cost savings in the traditional aids area.
All of us here today want our marine transportation system to be the best in the world. We are contemplating nationally a doubling if not tripling of waterborne commerce, in addition to significant increases in other waterway uses. If we take a zero-sum approach in which each new safety feature must be matched by the elimination of an existing one, we will fall far short of our goal. I would like to conclude at that point, Mr. Chairman. Again, we appreciate this opportunity to be here today and I will be happy to answer any questions.
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Mr. GILCHREST. Thank you, Mr. Kirchner. Mr. Taylor.
Mr. TAYLOR. Thank you, Mr. Chairman. I will begin with Mr. Chase. Mr. Chase, something that has troubled me, getting back to beneficial use, is that, in the instances where I have tried to work with the Corps to initiate some projects, they come back and say, well, it is maintenance dredging. We had to do something very quickly, so we just went back to the standard old way of doing things. And I have been trying to encourage them to designate disposal sites ahead of time. Have a master plan. If you have an emergency dredging with mile 5 through 10 of the Pascagoula Channel, this is your site ahead of time. You need to dredge around Greenwood Island. This is your site ahead of time.
Do you know of anywhere in the country where it has worked to do something like that: designate sites ahead of time with an overall master plan for a district so that when a shoal occurs at the mouth of San Francisco Bay or wherever they have already decided where the spoil, where the dredge material will go?
Mr. CHASE. Yes, sir. In fact, one very good example was in Pascagoula Harbor. And they used authority under the Coastal Zone Management Act, but it was part of the Navy—I believe it was a home porting activity in the 1980's—and they spent some time and was very specific around some berthing operations.
Other places around the country are trying to address those issues through planning. The Corps of Engineers has guidance to do dredge material management plans. They use ONM dollars for that. There is the national dredging team initiative which came out of a DOT-led effort a few years ago that led to an 18-recommendations report and that has a strong emphasis on regional, local planning. In the Chesapeake Bay around the Port of Baltimore, they have, I think, one of the very best long-range planning efforts.
So there are a lot going on. I think there are a lot of challenges. The Corps should be paying for developing the plans. They need to share those costs with the locals. Maintenance is a little bit tricky because 100 percent of the maintenance is paid by the harbor maintenance tax, so the locals don't have a cost-share there so they may not be at the table. It takes some more effort, I think, for them to be there. But it is happening. And then, as you develop alternatives, if they are more expensive than open water disposal, finding cost-sharing partners. And that is where I try to spend a lot of time working with the other agencies, through the Coastal Zone Management Act, in particular, to identify areas and help find cost-sharing partners if the local government or the port don't have the resources for that.
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Mr. TAYLOR. Well, if I may, while I have your attention, ask that your association strongly consider encouraging the Corps to designate these sites ahead of time. Just as in the past they designated disposal sites either on-land or way offshore, start designating some beneficial use sites. Because, again, I am pretty well familiar with the Gulf Coast situation. I have got to believe we could save a great deal of taxpayers' money by transporting material much shorter distances and doing something good with it rather than hauling it 20, 30 miles offshore and changing the water depth from 50 feet to 52 feet. It doesn't do much for you.
Mr. CHASE. Could I respond to that, sir.
Mr. TAYLOR. Sure. Sure.
Mr. CHASE. We certainly do agree with that and we do support that with the Corps. We think that the national dredging team should include private interests like ports. Right now, it is strictly a government agency initiative. And we think, as part of a council, it could be brought in there and we would have a stronger voice.
Another area where I think we can help improve planning and find innovative financing is trying to link dredge material disposal and beneficial uses with mitigation banking. I know there is a lot of controversy around that concept, but this committee or the full committee, certainly, has endorsed mitigation banking for highway projects and T–21 and we think we could use dredge material to build those banks and offset the cost of construction by selling mitigation banking credits. So there is a lot out there we can look at.
Mr. TAYLOR. Thank you. Mr. Benner, I happen to have been around when we passed the Oil Pollution Act of 1990. I also happened to be a Coast Guardsman in 1971 when the Coast Guard was saying, any day now we are going to have a reg requiring double hulls. So I realize that things in that area have not moved very quickly. But there are finally some laws on the books that say they will be implemented.
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One of my concerns, based on some conversations with people in the tanker business is that—and, again, it may be one guy talking out of school or several people talking out of school and it was a few years ago—but this person that I was speaking to said, well, you know, there is a new Republican Congress and we are just not going to build any double hulls. And then, when it gets to the drop-dead date, we are going to go before that Republican Congress and have them extend the deadline and we have basically got you where we want you because you have to import half your oil. Tell me that is not the thinking and, more particularly, could you tell me to what extent the fleet is being replaced, so far, by double-hulled tankers and what steps you are taking to meet the implementation dates called for by the Oil Pollution Act of 1990.
Mr. BENNER. Well, without commenting on the specifics of the exchange you had with this gentleman——
Mr. TAYLOR. Sure.
Mr. BENNER. I find that to be a fairly reckless projection of what would happen.
Mr. TAYLOR. That is what I did, also. Yes.
Mr. BENNER. The double-hull conversion process is well underway. As you know, the final date for that conversion—Congress provided a phase-in period—the final date is 2015. Right now, the degree to which the transition has occurred is that about a little more than 25 percent of all the tank vessels operating are double-hulled. Actually, there has been a fairly substantial move toward conversion to double-hull construction.
Mr. TAYLOR. Now, are you including inland barges or are you talking about ocean vessels?
Mr. BENNER. I am talking about the deep sea fleet.
Mr. TAYLOR. OK.
Mr. BENNER. And, right now, on order in the world shipyards, there are approximately another 400 tankers over the next 2 to 3 years that will come on line that are double-hulled. I think that the general expectation at least in the sectors of the tanker industry that I am familiar with, is that there will not be a major problem meeting the congressional deadline and international deadlines for conversion to double-hulled construction, so I hope I am not naive about that, but that would be my reaction to your statement. I think the deadlines will be met and the conversion is well underway.
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Mr. TAYLOR. Thank you. Mr. Chairman, thank you very much.
Mr. GILCHREST. Thank you, Mr. Taylor. I will assure you that this Republican member will hold fast. We certainly want to hold fast to that Oil Pollution Act of 1990, hold fast to its provisions and continue to improve the technology beyond 1990. And we will have a very specific hearing on dredging with our partner, Mr. Boehlert. The whole hearing will be on nothing but dredging. We look forward to that. I thank you, Mr. Benner.
What I would like to do is, if each of you could just give me one—I enjoyed your testimony. It is extremely helpful. And I have some specific questions, but I would like to start off with, if each of you could give me a specific recommendation as to what could be done to improve the maritime transportation system. Just one recommendation. That will give us about six right off the top. Mr. Chase.
Mr. CHASE. Thank you, sir, for choosing me first.
[Laughter.]
Mr. GILCHREST. Well we could go——
Mr. CHASE. We support the council and getting the agencies to coordinate and deliver their services in a more coherent way. And we, related to that, feel that Congress needs to provide direction for that because the administration, we are concerned, is not—we strongly think DOT is taking a leadership role here. We are concerned that there may not be as much support in the administration at large. And we think, to make sure the other agencies are at the table, Congress should give them direction to work together and find solutions as you outlined in your opening remarks, really, to us, is the key.
Mr. GILCHREST. That is interesting. Thank you. Mr. Emmett.
Mr. EMMETT. I think, through a change of circumstances here in Congress a few years ago, you have taken a good step and that is marine transportation being included in the overall Transportation and Infrastructure Committee. The most important thing from a shipper viewpoint would be to recognize that marine transportation is going to be growing very rapidly because of globalization.
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Next, marine transportation policy and infrastructure needs to comport with those of the rail industry and the motor carrier industry because marine transportation is not an entity unto itself. Once you get it here, it still has to go somewhere else. And so the whole intermodal aspect I think would be our key focus.
Mr. GILCHREST. Thank you. Mr. Cox.
Mr. COX. Thank you, Chairman. And I appreciate your starting on the other end of the table. I am going to bring up the issue of funding. I am going to bring it up in the context of having worked with the process for over a year now with respect to dealing with the administration with not just dredging, sir, but the entire marine transportation system and the infrastructure. And I guess my wish list would include that the administration accept the fact that they are going to have to play a part in the funding of the infrastructure that enables this nation to be world's leading trading nation, to the benefit of all of our citizens.
Mr. GILCHREST. Now, Joe, I am going to stop and ask you a question. When you say the administration has to play a part, does that mean they need to recognize that they have to submit in their budget more funding for the infrastructure of the maritime system or does that mean that they need to be more aggressive in sitting at the table and discussing the issue? What were your thoughts on the administration's participation in this?
Mr. COX. Well, my remarks were predicated on the fact that we do have a proposal which has finally surfaced from the administration which, when you read it, you understand that there is no Federal involvement in the funding process. And if they are going to come to the table and play, then they are going to have to bring some chips.
Mr. GILCHREST. OK. Otherwise, stay home. Well, thank you.
Mr. COX. Yes. Well, don't stay home——
Mr. GILCHREST. Mr. Benner. No, I understand that.
Mr. BENNER. I think my reaction is something of a distillation of what has been said before. The major problem that we see is a lack of dedication to understanding that there is a problem. And if this process is showing us that that is changing, then I think we have taken a big step forward. But, as you have often heard, this nation is the world's largest maritime trading nation. The economy and security of the country very much depend on the flow of commerce being able to move safely and efficiently. And there is not a great public awareness about that, so it is hard to channel political will into solving some of these many difficulties. If the problem is recognized and identified and if we can get the gospel out on that, that is going to make a big difference over the next 10 or 20 years.
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Mr. GILCHREST. Thank you. Mr. Ryan.
Mr. RYAN. Sir, I would say, from a practical mariner's standpoint, I think we would help solve some of the safety and environmental matters that are of your concern and that is if the Federal Government would provide better real-time meteorological information, weather information, water level information, tide and current information, and, of course, reliable chart information so that the mariner can do the job properly. That is what I say.
Mr. GILCHREST. Thank you very much. Mr. Kirchner.
Mr. KIRCHNER. That is what I was going to say. If I had to ask my members what is the one thing that they would really like to see, what is the one Federal program that they think can give the most immediate help to them, it would be the NOAA services. The electronic charting, but, most particularly, PORTS, the physical oceanographic real-time system. That is an extremely valuable program and it is curious why pilots and others have to work so hard to get these in their ports. The pilots go out, they find funding from wherever they can. Each port handles this and struggles with it as hard as they can and there ought to be more support and more funding from the Federal Government for this activity.
Mr. GILCHREST. Thank you very much. Just a couple of other quick questions. And that consolidation of your testimony is very, very helpful to us. It helps us to move in a more specific direction so that a little piece of the puzzle can go where it is supposed to go.
Mr. Cox, a question toward larger, deeper draft, longer ships. As I think everybody would agree, to a great extent that is the trend. Because of that, do you see a consolidation of U.S. ports as a natural consequence of that? Not so that we have ships backed up 200 miles out to sea. Are there too many U.S. ports to handle the increasing larger ships and, as an inevitable consequence of that, are there going to be fewer ports handling the bulk of the cargo?
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Mr. COX. Thank you, Chairman. And I am aware that I have American Association of Port Authority people here, so I am behind this one. AAPA is itching already with this question.
Mr. GILCHREST. I don't want to put you in the hot seat, but, I mean, as somebody sitting here looking at this unfolding over the next couple of decades and I know people are asking for more Federal funding and the ports are out there desperately trying to remain viable and there is an inevitable competitiveness between ports. Give us your overview of that, gentlemen.
Mr. COX. Mr. Chairman, I think that most of these questions—and I have been watching with interest the debate about ports around the Nation and the sizes of ships—I think most of these questions are answered in the commercial world and the fact that the commercial world usually has a way of arriving at the answer that is economically most beneficial for the American citizens. I don't think—and just looking down the road—I don't see how we can triple trade and, at the same time, lessen the number of ports that vessels are going to call at. The two thoughts just don't logically flow.
If you take the major ports that we presently have and you say, let us take a 7 million per year container port and in the year 2020 we expect to move 21 million containers through that port, we could develop the infrastructure, perhaps, on a dockside to do that. Maybe even dredge out additional berths and build something, but then you have to get the containers from there inland. I just don't see that occurring with a lesser number of ports. I see every port probably playing a different role than it plays today. And maybe trade will not triple for every port. But there is going to be, in my personal opinion, an increase in every one—the rising tide may not come up 20 feet in every port, but it is certainly going to rise in every port.
Mr. GILCHREST. Or at least stay steady.
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Mr. COX. Yes. Well, I don't know. I don't know about being steady.
Mr. GILCHREST. That is an interesting—I would tend to agree with what you are saying.
Mr. COX. I have some caveats.
Mr. GILCHREST. But Mr. Ryan said in the Great Lakes that he didn't—could you clarify that again, Mr. Ryan? You didn't think that you were going to have any increase or significant increase in shipping activity, based because, I suppose, on the geography of the Great Lakes.
Mr. RYAN. You are absolutely right, Mr. Chairman. The geography has a lot to do with it. Of the 15 locks that are required to pass through before you get to Lake Erie, 13 of them are owned by Canada. We have an infrastructure in place there that would cost probably $12 billion to—the numbers are all over the lot—but $6 billion to $12 billion Canadian to significantly increase the size of that lock system. We have only 2 of those locks of the 15.
In the upper lakes, yes we do have 1,000 foot vessels, but we are also constrained in increasing the size of those vessels because of each of the ports which would need dredging. There are environmental considerations. There are depths consideration. We are constrained by 26.5 foot draft in the international part of the system. We can go to 28 feet when we have high water in the domestic part of the system. So we are constrained by the infrastructure which probably won't change in these next two decades.
And then, of course, our major industry is the steel industry and I think Congress will have a lot to say about whether we have a stopping of the illegally dumped steel which has affected our steel industry.
Mr. CHASE. Is this an issue that the task force addressed in any significant way, the projection of doubling possibly tripling the amount of cargo in 20 years or more? And then—I guess this is more of a funding issue and it is not anything that you could put your finger on very clearly. So maybe I will move on to the next question.
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Mr. COX. Well, Mr. Chairman, If I could just——
Mr. GILCHREST. Yes.
Mr. COX. I said I had a couple of caveats. I think for a particular port, there may be some diversions that occur because of the circumstances, either the commercial circumstance where one is artificially placed on them due to a tax structure, so there could be a movement to another port. But I think that my comment didn't reflect changing the dynamics of the port itself. You could certainly accommodate a larger ship, but you are not going to be able to take all of the cargo coming in and out of the United States and synthesize it down into a number of megaports. I don't see that happening. I see it as being spread out a little bit, although probably not as equitably as the ports would like.
Mr. GILCHREST. So, to some extent, the free market will help establish that criteria. There will be the ports that will deal with megaships; the ports that will deal with much, you know, smaller vessels. There will be, perhaps, an increase in the transportation using barges?
Mr. COX. Yes, I think—well, I throw the ball to Mr. Emmett, but the point is how much is it going to cost the shipper to move from point A to point B and if point A is all clogged up because of a bunch of larger ships or ships that have a certain draft can't get into a port in a timely manner, then there is going to be a plan B which is going to be more economically efficient plan and that is going to involve other ports or other modes.
Mr. Chairman, I drove down Interstate 81 to watch my son graduate from college on Saturday. I had a fine day. I would like to put it on the record here. But getting——
Mr. GILCHREST. What was the college?
Mr. COX. Radford University. He was glad to see us, but I was also glad to get off of Route 81. If anyone has ever driven that and seen the number of trucks that go down 81, you sigh—there is a relief when you get off of Route 81. And I can only imagine if we told the American public we were going to triple the number of trucks traveling 81, they would say we have to find some other answer for that.
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Mr. GILCHREST. Right.
Mr. CHASE. Mr. Chairman.
Mr. GILCHREST. Yes. Mr. Chase.
Mr. CHASE. If I could. I feel I would be remiss in not at least trying to offer some thoughts about that question without trying to answer it too directly. But I think one trend we may see with the hub system and the growth in trade is a growth in feeder services between ports because the truck travel in particular, but also rail, both of those modes are more polluting in terms of air emissions than water transportation. And congestions on highways and all of the issues about highways that remain, we expect to see more of that.
If you also look—and there are numbers in the report about just the numbers of ships built that require a deeper depth. Those numbers are growing and even in a sort of coastwise trade, I think we expect to see more deeper vessels in that type of trade.
And also we don't just ship containers through ports. Deeper ports are needed for bulk commodities and those kinds of cargoes will shift as ports take up containers and displace, because of land constraints, those other types of cargoes that now move through those ports to other ports. So I think that whole shift in dynamic, that change to a coastwise trade, and market forces and flexibility, driven by the growth in trade all contribute to the need to have an extensive, well-invested port system.
Mr. GILCHREST. So this whole discussion is a continuum. In a democratic free market system, you never have a final solution or a final answer. It continues to be an unfolding challenge. Mr. Kirschner, you had your hand up.
Mr. KIRCHNER. I just had one more comment there. One thing that we haven't done in the MTS initiative and, to my knowledge, we haven't done as a country, is to try and take a step away from the port and the marine transportation end of it and ask what is in the national interest. We keep talking about our ports have to be competitive. Now it seems to me it is not the ports that have to be competitive; it is the U.S. goods that have to be competitive and the U.S. economy that has to be competitive.
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And we ought to be asking the question: What is the most efficient way to move the goods? And it may well be that a 6,000 TEU container ship or an 8,000 TEU container ship is not the most efficient way to move containers. But the ports are being pressured to expand their capabilities, to make huge investments of public as well as private funds to accommodate these ships. And, as you mentioned earlier, it is really a small group of foreign interests are driving this process. They are acting like sports franchises do when they want to get a stadium.
And, at some point, there has got to be some way to take a step back and ask what happens if you don't improve the infrastructure to accommodate a VLCC or an 8,000 TEU container ship? How else are those goods going to move? And I don't know what the answers to those questions are——
Mr. GILCHREST. I was just going to ask you that. What is the cheaper way?
Mr. KIRCHNER. Well, it is easier to ask the questions than to come up with the answers, but to my knowledge, we are not asking those larger questions. We keep wanting to get the focus down on the port interests and the marine end of it, which is important, but I think we've got to ask also what the national interest is. What is best for the American consumer?
Mr. GILCHREST. Well, gentlemen, I have some other questions, but what I would like to do because of the lateness of the hour is, if you don't mind, is to send them along to you in written form in the next couple of days and then continue this dialogue. And I would also like the subcommittee to sit down and do this again, if it is not too much of a hardship on travel and things like that, once the final report is out and we can see what we can—we can really take some concrete yet flexible steps in the direction that we all, through consensus, agree we need to go.
Thank you very much gentlemen. The hearing is adjourned.
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[Whereupon, at 12:44 p.m., the subcommittee was adjourned.]
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