AMC is committed to exploring opportunities to expand our U.S.-Flag maritime industry. Current and future programs have the potential to expand our industry, ensure fair and open trade, and create job opportunities for future generations of U.S. merchant mariners. AMC is playing a key role in advocating for their consideration and success.
Short Sea Shipping (Coastwise Trade) – As our nation’s highways, byways and bridges continue to degrade and struggle to keep up with passenger and freight traffic, the maritime industry has been exploring opportunities to solve America’s growing transportation needs. One of the most obvious ways is to rebuild our national coastwise trading industry.
Short Sea Shipping, historically referred to as the coastwise trade, would effectively remove thousands of trucks from major coastal and inland highways. This reduces the burden on our highways and railways, and lowers the cost and transport time for shippers. Instead of cargo entering mega-ports on each coast and then loading containers and freight on trucks and rail, the cargo is transshipped to smaller ports for distribution closer to the eventual destination: the consumer.
Coastwise trading is being effectively utilized in Europe today. However, because of unnecessary government regulation and outdated tax policy, short sea shipping has yet to take hold in the United States.
America’s Marine Highway Program is a Department of Transportation-led program to expand the use of our Nation’s navigable waterways to relieve landside congestion by increasing the efficiency of the surface transportation system. The Marine Highway System would integrate marine vessels and ports with the nation’s surface transportation system. The Program was established by Section 1121 of the Energy Independence and Security Act of 2007 to reduce landside congestion through the designation of Marine Highway Routes. Section 405 of the Coast Guard and Maritime Transportation Act of 2012 further expanded the scope of the program beyond reducing landside congestion to efforts that generate public benefits by increasing the utilization or efficiency of domestic freight or passenger transportation on Marine Highway Routes between U.S. ports.
Harbor Maintenance Tax Reform – A significant barrier to facilitate growth of Short Sea Shipping (coastwise trade) in the United States is the Harbor Maintenance Tax. This tax, which was designed as a user-fee to pay for the dredging and upkeep of ports across America, taxes each individual cargo that enters a port. Each time that cargo is transshipped to another destination, it is taxed again. The resulting multiple taxation of the cargo significantly reduces whatever direct savings would have been realized by the shipper. Educating Congress on the need to reform the tax so that transshipped cargo between US ports isn’t subject to double taxation is an agenda item for AMC.
Liquefied Natural Gas Transport – Reliable, assured access to energy sources and supplies has long been a major concern for our nation. This is even more so in today’s global economic environment, with transnational economies linked by concerns for pricing stability and source of supply. AMC has been front and center on a variety of energy related issues with maritime implications. Paramount of these has been the rebuilding of our Liquefied Natural Gas (LNG) fleet.
A recent report issued by the U.S. Government Accountability Office (GAO) found that in the next few years the U.S. is expected to change from a net importer to a net exporter of natural gas requiring 100 or more LNG carriers with 4,000 to 5,000 mariners needed to operate them to transport the U.S. LNG.
America pioneered the ocean transportation of liquefied natural gas back in the 1970s. However, since that time, our share of that trade has dwindled. The last U.S.-Flag LNG tanker left our fleet in 2000. Since that time, however, the world has changed, and with our renewed emphasis on national and homeland security, the return of America to the LNG trade is critical to our nation’s energy independence and security needs.
Liquefied Natural Gas Export-Import Incentives – America continues to look for alternative energy sources to decrease our reliance upon sources of energy imported from unstable regions of the world. Liquefied Natural Gas (LNG) is one of the most promising of those alternative energy sources. However, despite the increasing demand for natural gas in the United States, there are currently only five terminals that are capable of receiving imports of LNG from our trading partners in the Caribbean, East Asia, and around the globe.
Unfortunately, opponents to LNG have engaged in campaigns to demonize LNG, and it has become very difficult to site LNG import/export terminals. In addition, despite having pioneered the carriage of LNG in the 1970s, America has lost its fleet of LNG tankers and hundreds of LNG trained mariners have been forced out of the LNG sector. AMC has been and will continue to work to educate the public and Congress on the importance – both to our economic and our homeland security – of ensuring U.S. mariners are crewing LNG tankers to bring this vital resource into our country.
LNG is a security sensitive cargo, and must be treated as such. One effective way to protect our LNG tankers, our LNG terminals and those who reside in the nearby communities is to remove any questions for the vessels’ crews. By employing American mariners, vetted and credentialed by the Coast Guard and the Department of Homeland Security, we can be sure that those who bring this security sensitive cargo into America are highly trained, qualified and with the best interests of our country at heart.
AMC will be working to ensure that Congress and the Administration understand the need for American mariners in the LNG industry, and to identify incentives that could help revitalize this sector of our maritime industry.
Arctic National Wildlife Refuge Oil Exploration – As America continues to find ways to decrease our dependence on foreign sources of energy, it is increasingly important than we utilize sources available at home. AMC and the maritime industry have long advocated the opening of the Arctic National Wildlife Refuge (ANWR) to oil exploration. Thanks to modern exploration techniques, ANWR can be explored and the oil removed in a way that both protects the environment and helps to decrease our dependence on overseas oil. Moving the equipment, materials and eventually the oil will require the use of U.S.-Flag shipping, which will provide hundreds of jobs and dozens of ships for American mariners to crew and American operators to run.
Mariner Tax Reform – Around the world, nearly every single major maritime power provides tax incentives for merchant mariners to enable their mariners to compete against serious worldwide competition. The United States, however, does not. This places U.S. mariners at a disadvantage against equally or often lesser trained crew in the global marketplace. Instead of creating incentives for carrier companies to sail vessels under the U.S.-Flag or hire American mariners to crew their vessels, our mariner tax policy makes it harder for our internationally operating industry to compete.
A comprehensive tax reform that provides incentives for the use of American merchant seafarers would be an important step in leveling the international playing field and creating new job opportunities for Americans in the U.S. Merchant Marine.
Great Lakes Dredging – Inadequate dredging of ports in the Great Lakes are costing Americans millions of dollars each year. Vessels on the Lakes are unable to operate at full capacity, meaning they leave behind hundreds of thousands of tons of cargo each year – requiring more trips, more fuel, more wear and tear, and a greater environmental impact. It is important that lawmakers, and regulatory and oversight agencies work cooperatively to remove obstacles to dredging our ports and harbors on the Great Lakes to ensure safe, efficient and cost effective transit of these vitally important U.S. waters.
MARAD REPORT: “America’s Marine Highway Program” (PDF)
GAO REPORT: “Using U.S. Liquefied-Natural-Gas Carriers for Export” (PDF)