Review of Fiscal Year 2025 Maritime Transportation Budget Requests, Pt. 1: Maritime Administration and Federal Maritime Commission

2167 Rayburn House Office Building

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0 Tuesday, April 30, 2024 @ 02:00 | Contact: Justin Harclerode 202-225-9446

This is a hearing of the Subcommittee on Coast Guard and Maritime Transportation.

Witness List:

  • Rear Admiral Ann Phillips, Administrator, United States Maritime Administration, United States Department of Transportation | Witness Testimony
  • The Honorable Daniel B. Maffei, Chairman, Federal Maritime Commission | Witness Testimony
  • Opening remarks, as prepared, of Coast Guard and Maritime Transportation Subcommittee Chairman Daniel Webster (R-FL) from hearing, entitled “Review of Fiscal Year 2025 Maritime Transportation Budget Requests, Pt. 1: Maritime Administration and Federal Maritime Commission”:

    We meet today to review the fiscal year 2025 budget requests for federal maritime transportation programs administered by the Maritime Administration and the Federal Maritime Commission. Welcome to our witnesses – Rear Admiral Ann Phillips, Administrator of the Maritime Administration, and the Honorable Dan Maffei, Chairman of the Federal Maritime Commission.

    First, I’d like to thank both of your agencies for your efforts and coordination with other relevant agencies to ensure the continued operation of maritime commerce in the aftermath of the Francis Scott Key Bridge collapse in Baltimore. While recovery efforts continue, it is important that we also maintain stable trade flows, so thank you for your assistance to the maritime industry. 

    MARAD is the promotional agency within the Department of Transportation responsible for fostering, promoting, and developing the maritime industry of the United States. The President’s fiscal year 2025 budget request for MARAD includes $859.7 million for the administration of programs that strengthen our national security and economy, train our future mariner workforce, and build a more efficient marine transportation system.

    Among these programs is the Port Infrastructure Development Program (PIDP), a discretionary grant program to fund infrastructure projects that improve the safety, efficiency, and reliability of the movement of goods at coastal seaports, inland river ports, and Great Lakes ports. The President’s budget request includes $80 million for this program, which is in addition to the $450 million in advanced appropriations the program receives annually through fiscal year 2026 in the Infrastructure Investment and Jobs Act.

    PIPD has grown exponentially since it was first appropriated funds in fiscal year 2019.  Unfortunately, this growth comes with administrative challenges that severely impact the effectiveness of the program. This includes long delays for grant recipients in getting grant contracts signed, which slows the obligation of funds and leaves project scopes vulnerable to inflationary pressures. These delays harm the program’s ability to improve our ports. I look forward to discussing ways we can streamline this process to ensure the program is carried out as efficiently as possible.

    MARAD also oversees the Deepwater Port Licensing Program, which provides permits for the construction of ports in waters off the coast of the United States. While the prolonged timeline for processing these permits is an ongoing issue, I am encouraged by MARAD’s recent approval of an application for construction of a deepwater port off the coast of Texas.

    However, I remain concerned that there are several other applications waiting for a decision that are far beyond the 356-day statutory timeline for review. I hope to work with MARAD to ensure all applications are processed in a timely fashion as required by law, and I will continue to work with my colleagues to correct the long-term administration of this important program.  

    Lastly, the Subcommittee remains interested in the study currently underway that will inform the National Maritime Strategy. I hope to hear how MARAD is working with the Federally Funded Research and Development Center conducting the study to ensure it serves as a helpful tool in the needed revitalization of our maritime industry.

    Additionally, we have the Chairman of the Federal Maritime Commission (FMC) with us today to discuss the state of the ocean shipping industry and their ongoing work implementing the Ocean Shipping Reform Act of 2022 (OSRA). FMC is an independent agency responsible for the regulation of ocean-borne transportation in the foreign commerce of the United States. The President’s fiscal year 2025 budget request includes $48.5 million to fund the salaries and capital needs of FMC.

    The supply chain crisis caused by COVID-19 dramatically increased ocean shipping costs while congesting ports and impairing maritime trade flows. In response, Congress enacted and tasked FMC with implementing OSRA to help address many of the challenges experienced by United States exporters. FMC has worked diligently since the enactment of OSRA to implement its enhanced authorities, and I look forward to hearing from Chairman Maffei today on the status of FMC’s efforts.

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