Page 107: of Maritime Reporter Magazine (August 1994)

Clinton: Programs To Bring More

Than $1 Billion To U.S. Yards

The Administration's shipbuild- ing initiative could result in more than $1 billion in orders for Ameri- can shipyards, supporting thou- sands of jobs for American workers and signaling the industry's rebirth,

President Clinton said. "Our work for our maritime in- dustries reflects what we're doing for the economy as a whole," Mr.

Clinton said. "Given the right tools and opportunities, our shipbuilders can out-produce any competitors in the world. And American workers and American ingenuity can keep building a new prosperity across our country. Together, we will make it happen." "The President's shipbuilding ini- tiative is one part of our overall effort to ensure America's future as a maritime nation," Secretary of

Transportation Federico Pena said. "Our proposed Maritime Se- curity and Trade Act will ensure that merchant ships will continue to fly the American flag and be crewed by American seafarers. We urge Congress to enact it into law before the year is out."

As part of the program to boost the American shipbuilding indus- try, the President announced ap- proval of a $115 million loan guar- antee to help Coastal Ship, Inc.,

Houston, finance construction of

U.S.-flag RoRo barges to be built by

Trinity Marine Group, Gulfport,

Miss. The project is expected to support about 600jobs for American shipyard workers.

Under legislation enacted last year, shipyard modernization projects are now also eligible for guarantees. The President an- nounced approval of a federal loan guarantee for National Steel and

Shipbuilding Co. (NASSCO) of San

Diego. NASSCO will use the $22.7 million loan guarantee to invest in modern and advanced shipbuilding technologies.

In a May, 1992 visit to NASSCO,

Mr. Clinton talked about the need to convert industries dependent upon military contracts to commer- cial uses.

Today the President said, "We now have proof positive that we can built real partnerships between gov- ernment and private industry to preserve thousands of American jobs — and create thousands of new jobs — using the unique skills of defense workers for civilian commerce."

Under the ship financing pro- gram administered by the Maritime

Administration (MarAd), the gov- ernment does not make direct loans.

Funds are secured in the private sector with repayment guaranteed by the government.

As the President requested, last year's legislation also expanded the program to foreign buyers who build ships in the U.S. Historically, the program was limited to U.S. pur- chasers. MarAd is now reviewing two applications to help finance ships to be built for export, the President said. The Saracen Group, head- quartered in Geneva, Switzerland, requested $726 million in guaran- tees to support construction of 30 multipurpose containerships at

McDermott Shipyard in Louisiana.

The project would support an esti- mated 2,600 shipyard jobs.

In addition, Fleves Shipping

Corp., Piraeus, Greece, has applied for a $133 million loan guarantee to build four oceangoing product tank- ers at Newport News Shipbuilding (NNS) in Newport News, Va. The project would support an estimated 500 shipyard jobs.

AT PRESS TIME...

Singmarine To Build

Hovercraft With

Textron Marine

Singmarine Industries Ltd.'s sub- sidiary Singmarine Dockyard &

Engineering Pte. Ltd. has entered into a licensing arrangement with

Textron Marine Systems to build hovercraft for Vietnam, Myanmar and the ASEAN countries.

Under the agreement,

Singmarine Dockyard will have the exclusive right to build the C7 hovercraft at its yards with full tech- nical support from Textron, which develops the vessels.

The C7 hovercraft is a multi-pur- pose Air-Cushion Vehicle capable of travelling at high speed with low drag. Fully amphibious and highly versatile, it is able to move on diffi- cult terrains, making it suitable for both commercial and military uses.

In May, Singmarine Dockyard and Textron delivered a hovercraft,

Hover-Rescue, to the Civil Aviation

Authority of Singapore (CAAS). The vessel was commissioned for airport rescue and fire fighting purposes.

Clinton Urges Passage

Of Security Bill

President Clinton has urged

Congress to pass the Admini- stration's program to ensure the future of America's merchant ma- rine. "Our shipbuilding program is in place and is producing dramatic re- sults," the President said. "Now we must act to be sure commercial ships will continue to fly the American flag, provide jobs for American sea- farers, and be available to support our economic and defense needs."

The Administration's proposed

Maritime Security and Trade Act of 1994 would establish a new 10-year, $1 billion maritime security pro- gram. Program participants would agree to make their ships and other commercial transportation re- sources available during national emergencies, or as otherwise deter- mined by the President. At press time, the House of Representatives was expected to vote on the mari- time legislation, introduced as HR 4003, the week of August 1.

Enviro Groups Oppose

Cutting Renewable

Fuels Program

Five national environmental or- ganizations are urging the U.S.

Senate to vote against an oil-indus- try sponsored effort to bar the U.S.

Environmental Protection Agency from implementing its program to require more use of renewable fu-

August, 1994 els, such as ethanol — a domesti- cally-produced corn-based gasoline additive—to achieve clean air goals.

The effort was presented by Sena- tor J. Bennett Johnston (D-La.).

Following EPA's decision in June to institute the new program in 1995,

Sen. Johnston moved to amend

EPA's appropriations bill and pro- hibit any funds being spent for the renewable fuels program.

Friends ofthe Earth, Sierra Club,

Natural Resources Defense Coun- cil, National Wildlife Federation, and Environmental Working Group are the agencies who support the program and who are fighting Sen.

Johnston's effort.

The oil industry has strongly op- posed the EPA program on ethanol, wishing to continue to use only a methanol-based derivative, much of it manufactured from foreign im- ports.

AAPA Testifies On

WRDA Reauthorization

The president of the American

Association of Port Authorities (AAPA) urged Congress to maintain its two-year cycle of reauthorizing the Water Resources Development

Act (WRDA). The biennial legisla- tion authorizes federal funding for water resources and navigation projects at the nation's ports. AAPA

President Erik Stromberg said: "If there is one message I leave with the Subcommittee today, it is that we must maintain this two-year cycle. Continuation of biennial au- thorizations and maintaining ad- equate annual appropriations lev- els are essential to effective plan- ning and budgeting for projects by state and local governments." Ap- proximately 400 million cubic yards of sediment are dredged from fed- eral navigation channels and berths each year, to keep them safe and open for international trade.

APL OK'd To Extend

Subsidizable Life Of

The Sue Lykes

MarAd and Maritime Subsidy

Board have given approval to Ameri- can President Lines, Ltd. (APL), to extend the subsidizable life of the

Sue Lykes (ex-President Wilson, ex-

Hong Kong Mail) through October 31, 1995 — and if Lykes exercises its option to extend its charter, until January 12, 1996. The vessel is currently under charter to Lykes

Bros. Steamship Co., Inc.

In approving the application, the board required a reduction in the previously subsidizable life of the

Ruth Lykes to August 19,1994, the termination of the current outbound voyage and to apply the reduced amounts to the extension of theSwe

Lykes. The board also stated that financial aid would be granted until the specified date or until the vessel is replaced by new construction or otherwise withdrawn from the sub- sidy contract, whichever is earlier.

Waterman Alleges Dept.

Of Ag. Is Violating

Cargo Preference Acts

Waterman Steamship Corp. has filed an application requesting the

Secretary of Transportation to re- quire the Department of Agricul- ture to comply with the Maritime

Administration's (MarAd) directives as it relate to ocean transportation of Title II preference cargoes.

In its application, Waterman stated that the Department of Agri- culture is improperly administer- ing its cargo preference program in three important respects, thereby impeding Waterman's participation in the cargo preference program.

Waterman also alleges the Agricul- ture Department is allocating pref- erence cargo to ports where all U.S.- flag service is not available and later fixing the cargo on mixed service —

U.S.-flag vessels with foreign-flag feeder vessels, which is a violation of

MarAd's prioritization rule issued

June 16, 1986. In addition,

Waterman said the Department of

Agriculture is violating the Cargo

Preference Act of 1954 by failing to administer its P.L. 480 program in such manner as to ensure fair and reasonable participation ofU.S.-flag vessels by geographic destination areas. Further, Waterman asserts that the Department of Agriculture is violating the 1954 Act through bidding procedures which requires

U.S.-flag dry cargo liner vessels to bid against foreign- flag and/or non- liner U.S.-flag vessels for preference cargoes which should be reserved for U.S.-flag liner vessels. The ap- plication has been assigned Docket

P-008 and is being published in the

Federal Register. Comments should be filed in triplicate with the Secre- tary, Maritime Administration,

Room 7300, Nassif Bldg., 400 - Sev- enth St., SW, Washington, DC 20590, by 5:00 p.m. August 17. 91