MTSNAC MEETING SUMMARY

SEPTEMBER 3-4, 2003

OMNI HOTEL

SAN FRANCISCO, CA.

 

 

ATTENDEES

 

                        ORGANIZATION                                                     NAME

 

            American Association of Port Authorities                            John Mohr

            American Great Lakes Ports Association                            Steve Pfeiffer

            American Maritime Congress                                               ADM James Perkins

            American Pilots’ Association                                                CAPT Mike Watson

            American Trucking Associations                                          Bill Wanamaker

            Association of Metropolitan Planning Organizations          Mark Griffin

            Boat Owners Association of the U.S.                                    Bob Nelson

            Chamber of Shipping of America                                          Charles Kurz II

            Conference of Minority Transportation Officials                Gwen Harris-Gale

            Inland Rivers, Ports and Terminals, Inc.                              Jim McCarville

            International Longshore and Warehouse Union                  Terri Mast

            International Longshoreman’s Association                          John Baker

            INTERTANKO                                                                     Jonathan Benner

            Maritime Security Council                                                    Ron Thomason

            National Association of Regional Councils                          Ron Achelphol

            National Association of Waterfront Employers                   Pat Hall

            National Governor’s Association                                          Rick Vargas

            National Industrial Transportation League                          David Updegraff

            National Mining Association                                                 John Yonosko

            National Waterways Conference                                          Worth Hager

            North American Export Grain Assoc., Inc.                          Gary Martin

            Pacific Maritime Association                                                Joe Miniace

            Passenger Vessel Association                                              Darrell Bryan

            Shipbuilders Council of America                                           Bruce Croushore

            The Ocean Conservancy                                                       ADM Roger Rufe

            U.S. Chamber of Commerce                                                  Sam Crane

            U.S. Exporters Competitive Maritime Council                    Jim Cook

            United States Maritime Alliance, Ltd.                                  Carol Lambos

            World Shipping Council                                                         Chris Koch

 

 

 


WEDNESDAY, SEPTEMBER 3, 2003

 

Chairman pro tem Joe Miniace called the meeting to order at 1:00 p.m.  The chairman, John Gaughan, is on temporary assignment as the Principal Maritime Advisor for the Iraqi Ministry of Transportation and Communications and is stationed in Iraq.

 

The council members were asked to introduce themselves. Also at the table were Ray Barberesi, the Executive Director of the Council, the Sponsor, John Jamian, Deputy Administrator for the Maritime Administration, and Bob Dockendorff, Pacific Maritime Association. Maggie Blum, Associate Administrator joined the table later in the morning. Joe Miniace recognized Keith Lesnick and Richard Lolich from MARAD. Joe also thanked Joann Spittle for her tireless administrative support. The minutes from the May 12-13, 2003 MTSNAC meeting were discussed.  Several technical corrections were made, after which the minutes were unanimously approved.

 

Charles Kurz then requested that the sponsor circulate Council resolutions to the teams as soon as possible after the meetings and that the sponsor provide a chronological list of Council resolutions. The sponsor agreed to do this.

 

Action Items

 

 Ray Barberesi, on behalf of the Maritime Administration (MARAD), reported on the Action Items from the last meeting:

 

·        Update on the Inter-Agency Committee on the MTS (ICMTS) MOU - Since the departure of the Coast Guard from DOT there has not been a full meeting of the ICMTS.  The MOU, however, has been distributed among the principals and will be discussed at the next ICMTS meeting.

·        Request to keep traditional non-security functions with the Coast Guard after it moves to the Department of Homeland Security - A letter with that request from the Council has been forwarded to the Secretary of Transportation and the sponsor is awaiting a reply.

·        SEA-21 Report to the Secretary - The Council's SEA-21 report has been forwarded to Secretary Mineta.

·        ICMTS National Strategy Paper - Comments have been solicited from the Council and now awaiting for Team reports on comments and input.

·        Security Team Report - The Security Team Report has been forwarded to the Coast Guard and the Interagency Team working on the new security rules and regulations.

·        Formal role for Security Team to advise the Department of Homeland Security (DHS) - The relevant agencies are still awaiting a formal statement of recognition for security issues.

 

 

 

Worth Hager asked when the ICMTS User Needs Assessment Report would be finished.  Rajiv Khandpur, representing the Coast Guard, replied that the report is expected to be finished by the end of September. 

 

Mike Watson asked how this meshed with the comments from the Safety and Environmental Protection Team meeting minutes of July 24th..  Charles Kurz explained that the team meeting discussion centered on the implementation of the ICMTS National Strategy, and not the MTSNAC User Needs Study.

 

Sponsor Remarks

 

Joe Miniace next introduced Mr. John Jamian, Deputy Administrator for the Maritime Administration.  Mr. Jamian stated that he was proud to be part of this process and reminded the Council that at one time he had been an alternate member for Mr. Steve Pfeiffer.  Mr. Jamian reminded the members that MTSNAC is charged with identifying MTS needs and advising the Secretary of Transportation.  The recently published U.S. Chamber of Commerce study says that we will not be able to provide adequate transportation infrastructure by 2020.  Does the Council want to say that everything is OK, that SAFETEA (Safe, Accountable, Flexible, and Efficient Transportation Equity Act of 2003) is complete, or are there MTS needs that still must be addressed?  When Secretary Mineta challenged the Council with a blank piece of paper for SEA-21, a window of opportunity was opened.  That window is still open, but not for long.

 

Mr. Jamian added that throughout his many travels around the country, the message that he hears from this industry is that its needs are not being adequately met and that a separate funding mechanism is needed.  He will be meeting later this week with the Undersecretary of Policy at DOT and wants to take MTSNAC recommendations with him to the meeting. He concluded, “This Administration, all the way up to the White House, is interested in hearing what the needs are and discussing solutions, so now is the time for the Council to identify and articulate those needs.”

 

Chris Koch noted that the Council had already sent a SEA-21 report to the Secretary and he hoped that it would be given proper consideration in this process.  John Jamian replied that the Council's report had been placed on his desk the first day he took office and he had been directed to study it carefully.  Joe Miniace added that the document should be a living document considering the fact that there have been a number of studies since that report was written.

 

Regional Reports

 

Joe Miniace noted that Jeff Keever of SAMTSO had planned to address the Council, but was unable to attend.  He then introduced Liz Wainright of the Merchants Exchange of Portland, Oregon and Executive Director of the Maritime Information Services of North America (MISNA).    Ms. Wainright briefed the Council on the work that MISNA has done for MARAD and the Coast Guard in providing information to MTS stakeholders around the country.  Her advice to the Council was to go forward and request MTS funding and work collaboratively with MISNA in the process.

 

Nick Cretan of the North Atlantic Marine Transportation System Organization (NAMTSO) explained that NAMTSO encompassed marine organizations from Baltimore to the Canadian border along the Atlantic Coast.  The group's next regional meeting will be in October or November of this year in Connecticut.

 

Gill Hicks, Chairman of the California Marine and Intermodal Transportation System Advisory Council (CALMITSAC), presented a review of SAFETEA, focusing on those MTS needs that are not included in the proposed legislation.  He warned the group that the MTS stakeholders cannot wait another six years for the next reauthorization to address critical MTS funding needs.  He identified three funding options for the Council to consider in their deliberations:

 

            1.   Existing TEA-21 and proposed SAFETEA funding;

2.      New revenue generation at national level, e.g., customs fees; and

3.      Project-specific revenue streams, similar to the Alameda Corridor Project.

 

Mr. Hicks concluded with the following conclusions:

 

1.      The failure to address significant infrastructure needs will most likely lead to

      serious economic dislocation;

2.      Proposed SAFETEA funding is insufficient; and

3.      Overall SAFETEA funding should be increased to approximately $360 billion.

 

Mr. Hicks then presented a recently approved CALMITSAC resolution to the Council for consideration.  A summary of the resolution follows:

 

            SAFETEA should affirm a national policy and commit resources to enhance

            the infrastructure and operational efficiencies that support the MTS;  the U.S.

            government should establish specific programs and a dedicated funding

mechanism to meet the needs of the MTS; additional SAFETEA funding should be earmarked to help local agencies mitigate adverse local impacts from MTS project           expansion; SAFETEA should increase proposed set-aside for intermodal connectors; increase funding for the Corridors and Borders Planning Program;

 increase funding for the Congestion Mitigation and Air Quality (CMAQ) Improvement Program; increase funding for the Commercial Vehicle Operations Program; restore equal taxation of gasohol with that of gasoline and redirect all gasohol tax revenues to the Highway Trust Fund; reinstate and increase funding for the Section 130 grade crossing program; and increase the total TEA-21 reauthorization to $375 billion over six years.

 

 

There was then a Q & A session.  Bob Nelson asked if the Council should register its disappointment with SAFETEA in its advice to the Secretary.  Joe Miniace said that this would be the next Agenda item.  Sam Crane asked what percentage of the road and rail projects listed on page 6 of the CALMITSAC Infrastructure Needs Report of March 11, 2003, (copy of which was provided to the members), was “inside the gate”?  Gill Hicks replied that of the 12 projects listed in the report, four were clearly “inside the gate” while the remaining eight were “outside the gate.” 

 

SAFETEA (TEA-21 Reauthorization) Discussion

 

Joe Miniace posed the question of whether or not the proposed SAFETEA legislation adequately addresses MTS needs.  Also, what improvements should be brought to the attention of the Secretary?  Bob Nelson observed that most MTS funding issues appear to overlap with SAFETEA and vice versa.  There should probably be a section in SEA-21 to address the funding needs not covered in SAFETEA.  Chris Koch noted that there had been a similar SAFETEA discussion at the last Council meeting.  The Infrastructure Team had been tasked to review SAFETEA and that has been done.  He proposed that the Council use the Infrastructure Team report as a launching pad for this discussion.  Carol Lambos suggested that the Infrastructure Team give an oral report on SAFETEA.  Chris Koch replied that the Infrastructure Team had already included much of Mr. Hicks’ comments in its paper.  The report suggested higher funding levels and underscored the support that both the Secretary and the Department of Transportation had given for the industry at large.  In addition, SAFETEA contains a higher recognition level for freight.  Joe Miniace noted that he had reviewed both reports and found them to be in general alignment.  He also applauded the work of the Infrastructure Team and Mr. Gill Hicks.

 

Jim McCarville added that the Inland Team had reviewed the Infrastructure Team’s report on SAFETEA and had one recommendation:  on page 2, third paragraph: add the phrase “port or” after “private.” Joe Miniace again asked the Council if SAFETEA adequately addresses MTS future needs.  The Council should state whether or not the needs are adequately addressed in the Infrastructure Team’s report.  Chris Koch replied that the Infrastructure Team was unanimous in its support of the report and that the report had recommended funding increases on page 3 in the third paragraph.  Jim McCarville suggested that there should also be mention of an increase in funds for the corridors and borders program as well as CMAQ.  John Mohr said that AAPA could support this.  Joe Miniace pointed out that the discussion should represent positions of individual Council members, and not the teams.  Sam Crane noted that the CALMITSAC report tracked the surface road and rail needs. 

 

Joe Miniace asked how many association/groups had submitted papers on SAFETEA.  Only a few had.  He also asked if they were generally consistent with this report.  Ron Achelpohl said that the National Association of Regional Councils (NARC) suggests that the highway fuel tax be indexed.  He added that MTSNAC should set parameters for the legislation it wants the Secretary to promote.  Jim Cook noted that SAFETEA has been introduced but not yet been taken up by the committee. 

 

Joe Miniace then asked Gill Hicks if the SAFETEA report neglected any specific items.  Mr. Hicks answered yes – specifically the National Corridor Planning Program has been removed, the CMAQ Program needs more money and needs to specify that freight projects are eligible, the gasohol tax is not included, and the grade crossing program has been removed.  SAFETEA puts a great burden on the states to find funding for critical projects.  Joe Miniace reminded the group that this is an opportunity to suggest infrastructure needs not covered in SAFETEA.  He then asked if there were any further changes to the document.  Bill Wanamaker said that he and ATA had a problem with highway users’ funds being used to fund rail grade crossing improvements and ATA objects to that provision. 

 

 Several changes to the document were proposed:

 

  • Page 2, third paragraph – insert “public or private port or rail facility”Jim McCarville
  • Add a final paragraph – “Further MTSNAC requests that within SAFETEA, there be a significant increase in funds for an expanded corridor/border and gateway program (clearly including freight projects) and an increase in funding and promotion of the use of CMAQ for freight projects that reduce congestion and improve air quality.”  Bill Wanamaker questioned the appropriateness of using public funds for a specific social goal. Jim Cook replied that we must address the “first mile/last mile” phenomenon and need to connect the beginning and end of the highway.  He noted that trucks play a big part in the handover at both ends.  Bill Wanamaker said that $98 billion of Highway Trust Funds come from truck users.  Highway users can’t pay for all modes.  Rail should include all costs in its charges to shippers.  John Mohr pointed out that TIFIA is a funding mechanism, a loan, and not a direct drawdown. 
  • Ron Achelpohl proposed that in the last paragraph on the second page the phrase “without new taxes or user fees” be stricken.  Mark Griffin agreed and pointed out the need to address in the deficiencies within the regions.  Perhaps SEA-21 will do this.  User fees are probably the best mechanism for this.   Jim Cook reminded the group that the Council had adopted “no user fees” in its earlier discussion.  He suggested inserting “preferably without new taxes or user fees.”  Chris Koch pointed out that on the first page, the second sentence of the third paragraph does not rule out new taxes or user fees.  He also noted that the Infrastructure Team was referring to federal taxes, not state or local taxes.  Joe Miniace suggested inserting “federal” before “taxes.”  Ron Achelpohl stated that NARC is opposed to any prohibition on new taxes or user fees.  Joe Miniace said that the problem with opening the door to state taxes is that measures, such as the container tax in California, might be proposed.  He also asked if such a proposal might violate the commerce clause of the U.S. Constitution.  He is concerned that such a measure could disadvantage California over other states.  Sam Crane suggested that if such taxes are for specific infrastructure projects, they might be acceptable.  Rick Vargas requested that the sponsor provide a summary of these proposed changes to the document.  Bill Wanamaker proposed that the group focus on taxes collected on cargo moving through the ports, e.g., customs duties, for maritime infrastructure project funding.  Jim Cook asked for clarification of the phrase “trade facilitation charges” in the third paragraph on the first page.  Chris Koch mentioned that the Infrastructure Team was waiting for clarification from the sponsor.

 

Following  a short break the meeting reconvened at 4:00 p.m.

 

SEA-21 Discussion

 

Joe Miniace opened the discussion by explaining that the Council’s Chair, John Gaughan, had requested a SEA-21 Report.  It includes all the information received since the November 2002 MTSNAC meeting in New York.  Mike Smith of SAIC presented the report to the Council.  Charles Kurz asked what was meant by “Initiative” on page 4.  It seems to indicate that MTS is something new, whereas it had been a DOT policy since late 1999.  Carol Lambos suggested that the capital “I” on initiative was perhaps misleading and incorrect.  Ray Barberesi responded that the Department of Transportation has always referred to MTS as an Initiative.

 

The first section of the document, General MTS Planning Process, calls for a permanent MTS National Advisory Council, similar to the Inland Waterway Users Board. 

 

The next section is called Short Sea Shipping.  Bill Wanamaker agreed with the Short Sea Shipping concept provided it doesn’t dip into other dedicated funds and pays for itself.  Rick Vargas asked if there were a definition of Short Sea Shipping.  Ray Barberesi replied that the Maritime Administration was currently working on a definition, but basically it covers inland waterways, intercoastal, non-contiguous, and hemispheric water transportation.  A complete definition will be provided to the Council tomorrow.  Chris Koch took issue with the statement in the report that the Nation’s marine infrastructure is inadequate to handle the flow of containers. 

 

The next section addresses the Maritime Administration’s Title XI loan guarantee program and its proposed expansion for Short Sea Shipping.  Jim McCarville asked if the recommendation for an expansion of Title XI loan guarantee authority was limited to Short Sea Shipping only.  Ray Barberesi replied that it was.  Ron Thomason wondered if the proposed Title XI security projects would conflict with Transportation Security Administration (TSA) port security projects.  The answer was no.  Bruce Croushore reminded the group that this Administration has consistently tried to zero out the Title XI Program.  Pat Hall recommended the elimination of security references in the Title XI section.  Chris Koch asked if the proposed Title XI expansion covered only Short Sea Shipping facilities or mixed facilities as well.  Joe Miniace responded that the main purpose was to develop Short Sea Shipping infrastructure and not to provide a backdoor to other infrastructure needs. 

 

Harbor Maintenance Tax Short Sea Shipping Exemption was the next section discussed.  The goal of this recommendation is to exempt certain domestic movements from the Harbor Maintenance Tax.  Gary Martin asked if this proposal met the test of the World Trade Organization (WTO) concerning subsidizing certain domestic industries.  John Mohr asked if this exemption would also apply to vessels from Canada and Mexico.  Joe Miniace explained that it would only apply to U.S.-flag vessels in U.S. domestic trade.  Mike Watson asked if the recommended projects on page 11 constituted a proposal to modify the Jones Act.  Joe Miniace replied that they did not.  Sam Crane noted some confusion between the earlier reference to an Advisory Board that would advise the Secretary, and this section that allows the Secretary to seek advice from any party.  This needs some clarification.  Rick Vargas asked who would pay for these projects?  Joe Miniace replied that funding is not intended to be part of this discussion.  Charles Kurz asked if the sponsor could advise the group about on-going proceedings, e.g., the Short Sea Shipping Cooperative Program meeting on July 12.  Worth Hager asked for a clarification of the I-95 Corridor Coalition.  Ray Barberesi explained that the I-95 Corridor Coalition is a group set up by TEA-21.  It is composed of states and associations, and funds projects that primarily study ITS issues along the I-95 corridor.  Bill Wanamaker asked where the I-95 Corridor Coalition got its funding.  Ray Barberesi answered that it came from TEA-21.  Worth Hager asked if any consideration had been given to the I-10 corridor.

 

National Port Redevelopment Program (NPRP) is the next section of the report.  Mike Smith began a presentation of this proposal, which is similar to the Port of Anchorage, AK Intermodal Expansion Project.  Ron Thomason asked how this would interact with the Department of Homeland Security on security issues and underscored the need to integrate security issues in certain sections of this proposal.  Chris Koch asked whether the proposal’s drafters assumed there was a current lack of adequate terminal capacity or a possible future lack.  Joe Miniace replied that it was the latter.  What is meant by seaport redevelopment?  Tearing down terminals and building housing?  No.  Jim Cook, referring to page 13, asked if the benefits in Anchorage could be applied to the proposed NPRP?  It was pointed out that all the benefits listed have not yet been realized.  They were the basis for the Alaska legislation that created the Anchorage project.  Chris Koch asked if the mechanism referred to in the last sentence of the second paragraph of page 12 was to coordinate all funding mechanisms?  Joe Miniace replied that this was a planning model.

 

Inland Waterway Trust Fund was next discussed.  Worth Hager pointed out that the first paragraph on page 14 was incorrect and that the Inland Waterway Trust Fund is not used for maintenance.  Jim McCarville added that the Administration is not matching what the users are currently contributing.  Chris Koch noted that MTSNAC had already addressed this issue in its report to the Secretary and asked what the group was trying to accomplish in this proposal.  Ray Barberesi responded that this was an expansion of what had already been proposed.  Jim McCarville pointed out that this group’s charge is to recommend policy, not legislation, and that the reference on page 14, in the fourth paragraph, to lobbying the Administration is incorrect.  Worth Hager asked if the proposed permanent MTS National Advisory Board would preempt the decisions of the Inland Waterways Users Board.  Ray Barberesi answered that it would not; it would only deal with those issues that come under the purview of the Secretary.

 

The next section reviewed was Waterway Passenger Transportation.  This section would consolidate all passenger ferry programs within one DOT agency – the Maritime Administration.  This section will be further discussed later.

 

Education and Training was next discussed.  The main proposal was to establish a Center for Maritime Security Training at the U.S. Merchant Marine Academy at Kings Point, N.Y.  Chris Koch suggested that the Secretary already had the authority to establish such a center and that legislation was not needed.  Ron Thomason emphasized the need to integrate this with programs already being administered by the Transportation Security Administration (TSA).  There was discussion on the need to distinguish between

education for a growing mariner pool and specific security training.  Charles Kurz said that education is already being addressed by the marine industry.

 

The sections on research, technology, and development as well as the environmental process will be discussed at tomorrow’s session.  Joe Miniace advised the group that there was no need to review the conclusions section until the recommendations are discussed.   The recommendations will be reworked for tomorrow’s session.  He added that this document is a compendium from several other documents.  John Mohr said that as an alternate member and new to the process, he would have like to see previous meeting minutes.  Joe Miniace replied that since this document references other reports, he had hoped that they had been distributed in advance so that members would have read them in preparation for the meeting.  He was also very concerned that most team meetings have been attended by a small percentage of Council members – at most one third.  The teams and their reports do not necessarily represent Council consensus.  This document reflects several earlier documents and does not contain anything new.  Chris Koch disagreed and said that the Anchorage Port Project was new.  Joe Miniace  thanked Mike Smith of SAIC for his presentation and added that there was still much work to be done.

 

The Council then returned to the SAFETEA report.  Tom Marchessault, from the Office of the Secretary of Transportation, gave a clarification of the term “trade facilitation charge”.  He explained that the funding mechanism for an Alameda Corridor-type project is a good example of a “trade facilitation charge.”  Such a charge is a user fee.  Chris Koch then suggested that the phrase “trade facilitation charge” be stricken from the SAFETEA report.  It was agreed that the sentence with that phrase would be reworded to reflect the Council’s understanding that a trade facilitation charge is a user fee.  Should references to new taxes and user fees be removed from page two, last paragraph?  Yes.  A revised draft document was prepared for the Council’s review.  Bill Wanamaker stated that taking more highway trust fund money and putting it into CMAQ as recommended in this document is bad policy and Congress won’t agree.  The needed funds should come from the Harbor Maintenance Trust Fund, and not the Highway Trust Fund.  He added that if the last paragraph of the document and the TIFIA language were stricken, then ATA could support it.  A vote was taken on the revised document.  It was approved with one dissenting vote. 

 

The meeting was recessed at 6:05 p.m. A reception was held at the Port of San Francisco’s Ferry Building.

 

 

THURSDAY, SEPTEMBER 4, 2003

 

The meeting reconvened at 9:00 a.m. 

 

Public Comment Period

 

The first speaker was Paul Bea, of the Port of New York/New Jersey, representing the Coastwise Coalition, a Washington-based group of operators, ports, suppliers and government.  Mr. Bea addressed the group with a PowerPoint presentation that emphasized a “Coastwise shift” in government and private sector planners’ approach to freight movements along our crowded coastal corridors.

 

The second speaker was Richard J. Wiederhorn, Planning Manager for the Port of Oakland, CA., which is the fourth busiest port in the U.S. and is an active participant in the Marine Transportation System (MTS) Initiative.  He emphasized that each port is unique and that there is no one textbook model for all ports.  The needs of all ports must be considered in any federal legislation.  While Short Sea Shipping offers great opportunities, the program recommended here should also be applicable to deep-sea shipping and deep-sea ports.

 

Richard Plant, Director of Special Projects for the International Organization of Masters, Mates and Pilots spoke next.  Mr. Plant pointed out that the SEA-21 report does not specify that the vessels used in Short Sea Shipping must be U.S. built and U.S. crewed.  There is also very little mention of the labor pool.  Where will that pool come from?  In order to make Short Sea Shipping a success, there must be a long-term commitment by all parties.  Although 95% of U.S. international trade moves by water, what percentage moves on U.S.-flag vessels?  We all need to do a better job in educating both our mariners and the public about the MTS and our Nation’s maritime fleet.  Many public benefits are realized through enhanced taxes paid by employed mariners.  He also noted that the CALMITSAC report does not contain any photos of U.S.-flag vessels and that less than 50% of the Council commented on the report yesterday.

 

Dave Connolly, Vice President and Assistant Secretary-Treasurer of the Sailors’ Union of the Pacific (SUP) spoke next.  Mr. Connolly explained that he was also the Director of the training arm of the SUP and that there is now a manpower crisis in the mariner field.  The industry is wondering where the future trained mariners will come from.  One frustrating issue is the conflict between international and domestic mariner training standards.  SUP is sponsoring a new training program for high school students who want to enter the maritime field.  This program is located at MarVista High School in Los Angeles, where students are offered mariner classes.  SUP hopes to expand this program nationwide.  Mr. Connolly stated that the section on Education and Training of the SEA-21 draft report is woefully inadequate and that dedicated support for manpower recruitment and retention is needed.  He also suggested that a sealift manpower project should be added to this section.  Joe Miniace mentioned that some schools seeking training opportunities similar to the SUP’s program have already approached him.  Charles Kurz added that MARAD has a program, the Ship Operations Cooperative Program (SOCP), which has a mariner recruitment and retention element.  Jonathan Benner suggested that the best way to reconcile the domestic and international manning regulations is for the U.S. to more closely mirror the international regulations.

 

Marina Secchitano, Regional Director of the Inland Boatmen’s Union of the Pacific (IBU), San Francisco Region, was the last commenter.  Ms. Secchitano said that she was also commenting on behalf of the Water Transit Authority (WTA) of the San Francisco Bay area.  She expressed her concern over the proposal to consolidate all passenger ferry programs within one DOT agency – the Maritime Administration.  She explained that passenger ferries belong in the transit section of DOT, since so much progress in securing additional funding and support for ferry systems has been made within the Federal Highway Administration (FHWA) and the Federal Transit Administration (FTA).  Although the IBU strongly supports MARAD and its programs, Ms. Secchitano said that she hoped the Council would reconsider this recommendation.  She also reminded the Council that the unions are a very important resource in this process.

        

Joe Miniace thanked the speakers for their comments to the Council.  He added that the Council needs to study the international trade implications of a Harbor Maintenance Tax exemption for domestic short sea shipping movements.  Ray Barberesi briefed the Council on the recent Short Sea Shipping meeting, held at DOT headquarters on July 23rd.  MARAD has recently signed a Memorandum of Understanding (MOU) on Short Sea Shipping with the Government of Canada and is currently working on a similar MOU with Mexico.  Mr. Barberesi added that short sea shipping does include international voyages.

 

Mike Watson asked about the recent Port Redevelopment initiative begun by the Secretary of Commerce in June of this year and if the Council’s sponsor was aware of this.  Maggie Blum of MARAD replied that the sponsor was aware of this and is now raising these issues at the highest levels within DOT.

 

Mike Watson emphasized the need to include a reference to the Jones Act in the working definition of Short Sea Shipping.

 

The Council then took a short break at 10:15 a.m..

 

After the break the Council resumed its SEA-21 discussion.  Jim McCarville stated that the Inland Team would like it to include a discussion of waterside issues.  Chris Koch pointed out that this was the second report to the Secretary and also suggested that a paragraph on SAFETEA should be added on page 3 of the document.  Bob Nelson suggested that language on security also be added.  He also felt that the title of the document could be changed to include the concept of Intermodal funding.  A section on intermodal funding opportunities and issues should be added as well as a section on MTS regional issues.  The section on training and education should include more material on human resources and mariner retention.

 

Rick Vargas said it is important to state our goals at the outset.  The last two paragraphs on page 20 more appropriately belong at the beginning of the document.  Carol Lambos added that the group needs to be clear that the recommendations transcend legislation and are a compendium of different approaches, including SAFETEA, DOT policy, and potential legislative action.  Jim Cook agreed and stressed the need to identify these approaches throughout the document.  Not everything in the document is a legislative proposal.  Sam Crane suggested that a small group wordsmith the document between sessions today. 

 

Joe Miniace returned to the discussion of the MTS Initiative.  Bob Nelson suggested that the capital “I” in initiative be eliminated.  Ron Achelpohl added that regional MTS activities should be included as well.  We should explain the relationships between different transportation planning organizations.  Jonathan Benner felt uneasy with the General MTS Planning Process section and asked for an explanation of the Inland Waterways User Board that is proposed as a model for the MTS National Advisory Board.  Jim McCarville replied that the board is composed of those paying into the system and that this proposed MTS National Advisory Board may do some harm to the industry.  Worth Hager questioned how the board would create priorities.  Bob Nelson then suggested that the word “industry” in the third paragraph of the General MTS Planning Process section be stricken and replaced with the word “system-wide.”  Jim Cook asked if this proposed board would be subject to the Federal Advisory Committee Act (FACA) like the current MTSNAC.  Greg Martin said that based on his experience with interagency advisory committees, not all are subject to the rules of FACA, and suggested that this board be modeled after the Trade Advisory Committees and include other agencies.  Jim Cook replied that a permanent member category should also be established.  Jonathan Benner explained that the Inland Waterways User Board is very different from this.  He felt that the idea of a permanent board was flawed and perhaps shouldn’t be done.  He feels that the awareness and political will of this Council are deficient.  The government doesn’t need 30 people to tell it what to do, other than there is a problem that needs to be addressed.  Steve Pfeiffer warned of the danger of making port policy without any port members being represented on the committee.  Joe Miniace then asked if MTSNAC wants to advise the Secretary to formally institute such a board.  John Mohr replied that this might not yet be ripe for a decision.  A motion to replace the current advisory council with a permanent advisory board was made and seconded.  A vote was taken and the council voted to keep the present advisory council format and not to make it permanent.

 

The Council then moved to the Short Sea Shipping section.  MARAD presented its working definition of Short Sea Shipping:

 

Short Sea Shipping covers all waterborne transportation that does not cross an ocean. It includes intracoastal shipping within the waters of the United States, intercoastal shipping among the United States and its territories, sea-river shipping by vessel to and from inland ports, and shipping between and among the United States and its trading partners

in the Western Hemisphere.

 

Jonathan Benner suggested that the name should be changed to Coastwise or Coastal, to which Maggie Blum of MARAD replied that one word could change everything.  She pointed out that since CAPT. Schubert changed the name to Short Sea Shipping, the concept has taken off.  Terri Mast asked that language on the Jones Act be added to the definition.  Jonathan Benner said the group needs to decide what it wants the definition to accomplish.  Chris Koch suggested that the last sentence could be eliminated and that a clarification be added that this definition does not expand or contract the provision of the Jones Act.  Jim McCarville suggested the addition of “to or between ports” in the second sentence, and Steve Pfeiffer requested the inclusion of Great Lakes ports in the definition. Bob Dockendorff suggested that consideration might be given to replacing “Western Hemisphere” with “NAFTA.”

 

The following suggested revisions/additions to the document were agreed upon:

 

  • Tuning up the safety section
  • Addition of a security section
  • Expansion of the training section
  • Summary of intermodal funding issues
  • Revision of Executive Summary
  • Add permanent charter members to the Council

 

Joe Miniace asked that the sponsor coordinate incorporation of these changes during the lunch break, which was taken at 11:45 a.m..

 

The afternoon session began at 12:45 p.m. with a discussion of the Short Sea Shipping section of the SEA-21 report.  Mike Watson cautioned the group against subsidizing one aspect of short sea shipping at the expense of another.  Joe Miniace asked if the Council wants Title XI funding to include landside terminal improvements as well as conventional ship construction.  Bruce Croushore replied that Title XI already is open to shipyard modernization, but not to terminal improvement.  Bill Wanamaker said that Title XI should take care of terminal improvements and that TIFIA should not be tapped for that purpose.

 

Discussion then turned to the Harbor Maintenance Tax Short Sea Shipping Exemption section.  Chris Koch pointed out that this type of exemption for domestic cargo could set off a WTO protest and Bill Wanamaker noted that a Harbor Maintenance Tax exemption would mask the true cost of domestic cargo movements, and so this should be stricken from the report.  Pat Hall suggested that the Harbor Maintenance Tax exemption issue should be included in the study proposed in the report.  Jim McCarville stated that shallow draft vessels don’t add to channel maintenance and should be exempted from the tax anyway.  Greg Martin recommended that this exemption not be mentioned in the report and just let the proposed study raise it as one means of encouraging short sea shipping.  Jim Cook agreed and moved that this entire section be stricken and be left up to the study.  His motion was seconded and a vote was taken.  The motion was approved with one dissenting.

 

The Capital Construction Fund  (CCF) was next discussed.  Jonathan Benner asked why domestic shipping has been excluded from using the CCF.  Jim McCarville explained that the American Waterways Operators (AWO) had opposed this due to the large investments many of their members had already made in domestic vessels without the aid of CCF.  Darrell Bryan informed the Council that his group, the Passenger Vessel Association (PVA), is working to open up the CCF to domestic operators.  Bruce Croushore suggested approval of this section with the deletion of the word “already” before “deposited” in the last sentence.  Jonathan Benner asked if this expansion of the use of the CCF just included contiguous trade.  The answer is yes.  Ray Barberesi added a suggested clarification – drop the phrase “short sea shipping” at the end of that last sentence and replace it with “coastwise trade.”  Jim Cook made a motion to approve the section with the suggested changes.  The motion was seconded, a vote was taken and the motion was passed with two dissenting.

 

The Council then discussed the Recommended Short Sea Shipping Pilot Projects and Programs section. Terri Mast was concerned that the third bullet on development of a U.S./Canada/Mexico Cooperative could water down the Jones Act.  A motion was made and seconded to approve this section.  A vote was taken and it was approved unanimously.

 

MTS Infrastructure was the next topic.  Chris Koch said that the members received the details on the Port of Anchorage Project only yesterday.  Many of the questions concerning road and rail issues are covered in SAFETEA.  Investment in cranes and terminals needs to be further discussed.  He suggested that this section be eliminated.  Sam Crane expressed doubt about the high priority of this issue.  Carol Lambos agreed with Chris Koch and Sam Crane in part because of those entities that have already invested in infrastructure.  These items, however, should be part of a complete package of issues that the Council deals with.  Worth Hager suggested that the section on the Inland Waterway Trust Fund and the Harbor Maintenance Tax exemption be eliminated and the following be substituted:

 

In conjunction with the recommendations previously submitted to the Secretary by the MTSNAC, it should be the policy of the Administration and the Department to advocate the Federal government fully support the navigation component of the U.S. Army Corps of Engineers civil works mission, including:

         Construction

-        The goal of spending $150 million per year from the Inland waterway Trust Fund to be matched with $150 million from the general revenue.

-        Fully and efficiently fund the Federal component required within partnership agreements for deep-draft port construction projects

-        Promote timely implementation of new navigation construction studies and projects

         Operation and Maintenance

-        Encourage the President and OMB to secure an appropriate spend-down of the Harbor Maintenance Trust Fund consistent with the rate of HMT collection

-        Encourage the President and OMB to secure full and efficient funding for operation and maintenance of the inland waterways system

In addition, the MTSNAC encourages the Secretary to

         Promote streamlining of the project planning process

         Support the concept that the monies contained in the Inland Waterways Trust Fund and the Harbor Maintenance Trust Fund be used only for the purposes for which they were intended.

A motion was made and seconded to revise the MTS Infrastructure section.  The motion was unanimously approved.

 

The Waterway Passenger Transportation section was addressed next.  Rick Vargas sought clarification on the rationale for moving all the ferry programs to MARAD.  This is the first time the Council has seen this and he asked the sponsor to explain why this change has been proposed.  Darrell Bryan expressed concern that the funding sources could be lost if the program were moved.  We need to increase awareness of the contributions made by our ferry systems.  He would like to see this section deleted.  Terri Mast concurred with both Darrell Bryan and Rick Vargas and added that it was probably premature to make this change.  Ray Barberesi explained that there have been ongoing discussions within the Department of Transportation about the proper integration of the water mode into the Department’s programs.  Just this last year MARAD’s budget was fully integrated into the DOT budget process.  There is more efficiency in promoting MTS through MARAD and reflects an administrative shift within DOT.  Moving the ferry programs to MARAD would not change the funding stream.  Rick Vargas replied that the proposal has merit and warrants further discussion.  Joe Miniace reminded the group that this was a living document and proposed that it be taken out of the document at this time, but subject to further review and study.  He asked the sponsor to prepare a presentation on this proposal for the next MTSNAC meeting.

 

The Council then turned to the Education and Training section.  Gwen Harris-Gale suggested that the title be changed to Workforce Development.  This suggestion with a revised text proposed by Ms. Harris-Gale was adopted unanimously.

 

The Council also unanimously approved a revised Research, Technology, and Development section text.

 

A new Security section was reviewed and unanimously approved by the Council.

 

The Council then began discussion on the Safety and Environmental Process section.  Jonathan Benner said that the title was a misnomer and should be changed to Safety and the Regulatory Process.  Admiral Rufe noted that no environmental organizations such as NOAA or CEQ are included in this process.  Maggie Blum replied that environmental streamlining is currently being addressed in the CEQ and DOT.  This section with its revised title was then unanimously adopted.

 

There was then general discussion about how to incorporate the Council’s SAFETEA paper into the SEA-21 report:  should it be included as an appendix to the SEA-21 report?  Jim Cook suggested that the SAFETEA paper be sent to the Secretary as soon as possible and the Council could then finalize its SEA-21 paper.  The Council agreed.

 

The final section, Executive Summary, was next discussed.  Chris Koch asked what was meant by the phrase “a truly intermodal national transportation system.”  He also requested that the Infrastructure Team co-chairs be involved in drafting the Executive Summary.  Joe Miniace agreed to this request.

 

Jonathan Benner expressed his concern with the idea of formalizing the Council by making it a permanent board.  The motion to make the Council permanent was withdrawn with the understanding that it would be discussed further at the next full Council meeting. 

 

John Mohr then made a motion, which was seconded, to approve the current SEA-21 report with the substantial revisions.  The Council approved this motion unanimously.

 

Bill Wanamaker then presented a resolution recommending that the Secretary support and champion SEA-21.  Jonathan Benner seconded the motion.  There was discussion on the motion.  When asked why he made the motion, Bill Wanamaker explained that unlike the surface community, the maritime community doesn’t have such a solid legislative history on maritime issues.  The proposal was rejected, with one dissenson.

 

Team Minutes

 

Pat Hall reported that the Security Team had met to discuss the proposed Coast Guard vessel and facility security rules and regulations, and had prepared a security paper that the Council had as a handout.  Pat Hall made a motion that the Council approves the Security Team’s paper and that it be forwarded to the Secretary.  Jonathan Benner disagreed with the suggestion and said that he felt it was inappropriate for the Council to take a public stand on an issue before a federal regulatory agency.  Carol Lambos pointed out that the Coast Guard’s rulemaking process had already ended, so there would not be any conflict for the Council.  Bill Wanamaker expressed concern with the reference to racial profiling and the lack of guidance on suspicious behavioral characteristics.  He recommended that the last paragraph of this report be stricken.  Jim Cook said that there was no harm in sending these recommendations to the Secretary.  A motion to accept the report with the last paragraph deleted, was made and seconded.  The Council voted on in favor, 19-7.  All of the team meeting minutes were then approved.

New Business

 

Bob Nelson reported that recreational boaters were working with local leaders and the Coast Guard Captains of the Port (COTPs) in developing port area security plans as required by the Maritime Transportation Security Act (MTSA) of 2002.  He emphasized the need for MTSNAC and MARAD to work more closely with other regional groups and requested that the Chair work with the sponsor to improve that coordination.  Joe Miniace said that regional groups should present clear recommendations that the Council can focus on and respond to.  Sam Crane specifically thanked the City of San Francisco and the ILWU for their good work in this area.  Carol Lambos expressed appreciation to MTSNAC’s sponsor, MARAD, for the excellent audio-visual support and fast turnaround on documents throughout the last two days.  Gwen Harris-Gale then passed out a brochure on security training from the Maritime Institute of Technology and Graduate Studies (MITAGS).

 

 Joe Miniace thanked the Council members, MARAD staff, and guests for their participation. The date and location of the next meeting is pending. The meeting was adjourned at 4:55 p.m.

 

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