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107th Congress (2001-2002)

House Report 107-405

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MARITIME TRANSPORTATION ANTITERRORISM ACT OF 2002

99-006

107TH CONGRESS

REPORT

HOUSE OF REPRESENTATIVES

2d Session

107-405
MARITIME TRANSPORTATION ANTITERRORISM ACT OF 2002

APRIL 11, 2002- Committed to the Committee of the Whole House on the State of the Union and ordered to be printed
Mr. YOUNG of Alaska, from the Committee on Transportation and Infrastructure, submitted the following
R E P O R T
[To accompany H.R. 3983]
[Including cost estimate of the Congressional Budget Office]

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

Sec. 1. Short title; table of contents.
Sec. 2. Port security.
Sec. 3. Clarification of Coast Guard authority to control vessels in territorial waters of the United States.
Sec. 4. Extension of seaward jurisdiction.
Sec. 5. Suspension of limitation on strength of Coast Guard.
Sec. 6. Extension of Deepwater Port Act to natural gas.
Sec. 7. Assignment of Coast Guard personnel as sea marshals and enhanced use of other security personnel.
Sec. 8. Automatic identification system.

SEC. 2. PORT SECURITY.

`SUBTITLE VI--MISCELLANEOUS

`Chap. Sec.
`701. Port Security
70101

`CHAPTER 701--PORT SECURITY

`Sec.
`70101. Definitions.
`70102. United States facility vulnerability assessments.
`70103. Catastrophic emergency planning.
`70104. Antiterrorism response.
`70105. Transportation security cards.
`70106. Maritime antiterrorism teams.
`70107. Grants.
`70108. Foreign port assessment.
`70109. Notifying foreign authorities.
`70110. Actions when foreign ports not maintaining effective antiterrorism measures.
`70111. Shipping container antiterrorism.
`70112. Crew and passenger manifests.
`70113. Civil penalty.

`Sec. 70101. Definitions

`Sec. 70102. United States facility vulnerability assessments

`Sec. 70103. Catastrophic emergency planning

`Sec. 70104. Antiterrorism response

`Sec. 70105. Transportation security cards

`Sec. 70106. Maritime antiterrorism teams

`Sec. 70107. Grants

`Sec. 70108. Foreign port assessment

`Sec. 70109. Notifying foreign authorities

`Sec. 70110. Actions when foreign ports not maintaining effective antiterrorism measures

`Sec. 70111. Shipping container antiterrorism

`Sec. 70112. Crew and passenger manifests

`Sec. 70113. Civil penalty

`VI. MISCELLANEOUS
70101'.

SEC. 3. CLARIFICATION OF COAST GUARD AUTHORITY TO CONTROL VESSELS IN TERRITORIAL WATERS OF THE UNITED STATES.

`SEC. 15. ENTRY OF VESSELS INTO TERRITORIAL SEA; DIRECTION OF VESSELS BY COAST GUARD.

SEC. 4. EXTENSION OF SEAWARD JURISDICTION.

SEC. 5. SUSPENSION OF LIMITATION ON STRENGTH OF COAST GUARD.

SEC. 6. EXTENSION OF DEEPWATER PORT ACT TO NATURAL GAS.

SEC. 7. ASSIGNMENT OF COAST GUARD PERSONNEL AS SEA MARSHALS AND ENHANCED USE OF OTHER SECURITY PERSONNEL.

SEC. 8. AUTOMATIC IDENTIFICATION SYSTEM.

PURPOSE OF THE LEGISLATION

This bill establishes a comprehensive national antiterrorist system that increases the security of maritime transportation and reduces the risk of the maritime transportation system being involved in a terrorist incident.

BACKGROUND AND NEED FOR THE LEGISLATION

The U.S. Coast Guard is the primary Federal agency with responsibility for the safety and security of vessels, ports, waterways, and their related facilities. Since the terrorist attack of September 11, 2001, the Coast Guard has implemented a number of tough new security measures under existing statutory authorities contained in the Ports and Waterways Safety Act of 1972 (33 U.S.C. 1221 et. seq.), and in section 1 of title II of Public Law 65-24, June 15 1917, as amended (50 U.S.C. 191).

The United States maritime borders include 95,000 miles of open shoreline, 361 ports, and an Exclusive Economic Zone that spans 3.5 million square miles. The United States relies on ocean transportation for 95 percent of cargo tonnage that moves into and out of the country. Each year, more than 7,500 commercial vessels make approximately 51,000 port calls, and more than six million loaded marine containers enter U.S. ports.

Current growth predictions indicate that container cargo will quadruple in the next 20 years. Standardized cargo containers allow cargo to be quickly transferred from ships to trucks or railcars and transported immediately to destinations in the United States. Intermodal container transportation has encouraged the development of just-in-time delivery systems and other efficiency enhancements in cargo delivery methods. A disruption of business `supply chains' or other interruptions to the flow of cargo through U.S. ports from a terrorist attack would have a major impact on the U.S. economy.

Before the terrorist attacks of September 11, 2001, the primary focus of intermodal transportation was the safe movement of containers in a timely manner. As a result of the increased threat of terrorism, the United States must implement additional transportation security measures that deter a terrorist attack without interfering with the efficient movement of cargo through U.S. ports and waterways.

SUMMARY OF THE LEGISLATION

Section 1. Short title

This Act may be cited as the `Maritime Transportation Antiterrorism Act of 2002'.

Section 2. Port security

Section 2 of the bill creates a new subtitle VI of title 46, United States Code, to establish a comprehensive national system of antiterrorism security enhancements. Chapter 701 of this subtitle contains provisions related to port security.

New section 70101 of chapter 701 provides the definitions of seven terms used throughout the new chapter. The most significant definitions include those of National and Area Maritime Transportation Antiterrorism Plans as well as the term catastrophic emergency. In the context of this chapter, catastrophic emergency means any event caused by a terrorist act in the United States or on a vessel on a voyage to or from the United States that causes, or may cause, substantial loss of human life or major economic disruption in any particular area.

Section 70102 requires the Secretary of Transportation to conduct port vulnerability assessments for U.S. ports, including an assessment of the vulnerability of each facility in a port, at which there is a high risk of a catastrophic emergency. The results of the vulnerability assessments will be used to implement a national maritime transportation antiterrorism planning system, consisting of a national plan, area plans, as well as vessel, facility, and port terminal plans, to deter a catastrophic emergency to the maximum extent practicable. The Secretary may accept an assessment conducted by, or on behalf of, a port authority or marine terminal operator if the Secretary determines that the assessment adequately assesses the vulnerabilities of the facilities to a terrorist threat.

Section 70103 establishes the national maritime transportation antiterrorism planning system. The Secretary is required to prepare a National Maritime Transportation Antiterrorism Plan. The National Plan will assign the duties and responsibilities of the various Federal, state, and local governmental agencies. It will also create a system of surveillance and notice designed to safeguard against possible catastrophic emergencies.

Area Maritime Transportation Antiterrorism Plans are developed by Federal maritime antiterrorism coordinators, who are Coast Guard officials designated in the National Plan, in consultation with local harbor safety advisory committees. Area Plans are designed to deter a terrorist act in or near the specified area to the maximum extent practicable. The area plan will include all of the individual facility antiterrorism plans for the area plus an overall plan for the area.

Vessel and facility antiterrorism plans must be developed by owners and operators of vessels and facilities that the Secretary believes may be involved in a catastrophic emergency. The plans must be submitted to the Secretary by January 1, 2003. The vessel and facility plans must identify an individual having authority to implement antiterrorism actions as well as provide for a way to immediately communicate with appropriate Federal officials. The plans must also provide for the necessary resources, antiterrorism training, and periodic unannounced drills to deter a catastrophic emergency. Vessel or facility operators may not operate after January 1, 2003, without an approved plan.

To effectively implement this system, the Secretary will need to determine whether a particular vessel or facility poses a risk of being involved in a catastrophic emergency. For example, a ferry carrying a small number of cars across a river may not pose a risk of being involved in a catastrophic emergency. However, a ferry carrying several hundred commuters to work may be involved in just such an emergency. The vessel's area of operation or the type of cargo carried on board also may affect the decision as to whether a vessel or facility may be involved in a catastrophic emergency. For example, a ship offloading in a remote facility may not pose a threat of being involved in a catastrophic emergency. However, the same ship entering the Port of Los Angeles may pose such a threat.

The facility plans will specify the `secure' areas of a terminal in which unescorted access will only be granted to individuals that possess a Transportation Security Card issued under section 70105. The number and scope of secure areas in a facility may vary depending upon the type of facility in question. For example, the entire facility at an oil terminal may be a secure area. In contrast, the Secretary may decide that only the areas at a container terminal where individuals have access to open containers or container manifests are secure areas. The facility plans may also provide security standards for ensuring that cargo off-loaded from the vessel does not pose a threat of causing a catastrophic emergency, including both full and empty containers. The Secretary may also require that each vessel or facility operator implement any necessary interim security measures until the antiterrorism plan for that vessel or facility operator is approved.

The Federal Emergency Management Agency (FEMA) is the primary Federal agency charged with coordinating the response to a terrorist attack in the United States. Other agencies, such as the Department of Justice, provide training for first responders to terrorist attacks, including state and local police and fire departments. Section 70104 of chapter 701 requires the Secretary of Transportation to cooperate with the Director of FEMA to coordinate maritime terrorism response actions.

Since FEMA does not have jurisdiction over vessels, this section also requires the Secretary to develop a system of terrorism response for vessels. Tank vessels are currently required under the Oil Pollution Act of 1990 to have oil spill response plans. The Secretary may allow these plans to be used to address oil spilled from vessels involved in a catastrophic emergency. Similarly, some states, such as Alaska, Washington, Oregon, and California, require non-tank vessels to have oil spill response plans. The Secretary may also allow these State-approved plans to be used to address oil spilled from these non-tank vessels involved in a catastrophic emergency.

The first step to providing security at a facility is controlling access to the secure areas of that facility. Section 70105 establishes a national standard for issuance of biometric transportation security cards whose purpose is to control access to secure terminal areas to only authorized personnel. Many truck drivers pick up or drop off cargoes from many different ports. Today, they may need multiple identification cards and background checks. A national standard is needed due to the intermodal nature of our transportation system.

This section prevents an individual from entering an area of a vessel or facility designated as a secure area in an antiterrorism plan unless that individual holds a transportation security card and is authorized to be in the area, or is accompanied by another individual who holds a card and is authorized to be in the area. The Secretary is required to issue an individual a transportation security card unless the Secretary decides that the individual poses a terrorism security risk to the United States warranting denial of the card.

There are three reasons that the Secretary may make a decision to deny issuance of the security card. First, if the individual has been convicted of a felony, the nature of which indicates that the individual may be a terrorism security risk to the United States; second, if the individual may be denied entry or removed from the United States under the Immigration and Nationality Act; and third, if the individual otherwise poses a terrorism security risk to the United States, for example, by financially supporting a terrorist organization. Subsection (e) prohibits any of the information gathered in the background investigation of an individual from being disclosed to the public, including an individual's employer. Any person who violates this prohibition is subject to penalties under the Privacy Act (5 U.S.C. 552a(i)). This section also requires the Secretary to establish an appeal process so that an individual may appeal a decision that he poses a terrorism security risk to the United States.

Section 70106 establishes Coast Guard maritime antiterrorism teams to protect vessels, ports, facilities, and cargo on United States' waters.

Section 70107 allows the Under Secretary of Transportation for Security to provide financial assistance for enhanced facility security to implement a maritime antiterrorism plan approved by the Coast Guard or an interim measure required by the Coast Guard. For each of fiscal years 2003, 2004, and 2005, $75 million is authorized for the grants. Of the amounts authorized under this section, $7.5 million is required to be used for proof-of-concept grants.

Section 70108 requires the Secretary to assess the effectiveness of the antiterrorism measures maintained at a foreign port from which vessels depart on a voyage to the United States or which pose a high risk of terrorism to the United States. The Secretary must assess the effectiveness of the foreign port's cargo screening process, facility access controls, and security management program. This will include evaluation of ports such as Vancouver and Montreal through which cargo is trans-shipped to the United States.

Section 70109 of chapter 701 requires the Secretary, after conducting a foreign port assessment, to contact the foreign government if he finds that a port in that foreign country does not maintain effective antiterrorism measures. The Secretary must also inform the foreign government about the steps necessary to improve the antiterrorism measures in use at the port.

If the Secretary finds that a foreign port does not maintain effective antiterrorism measures, section 70110 allows him to prescribe conditions of entry into the United States for any vessel arriving from that port, or any vessel carrying cargo originating from or transshipped through that port. The Secretary may also deny entry into the United States to any vessel that does not meet these conditions. Given that, development of an international standard for intermodal security of cargo shipped to the United States could be difficult to develop and take a long time to implement, the Secretary may negotiate bilateral agreements with our trading partners that provide for implementation and enforcement of security standards in their countries' intermodal transportation system.

By no later than June 30, 2003, section 70111 requires the Under Secretary for Security, in consultation with the Transportation Security Oversight Board, to develop and maintain an antiterrorism cargo identification and screening system for containerized cargo shipped to and from the United States either directly or via a foreign port, such as through the ports of Vancouver or Montreal. The information that the Secretary requires for cargo identification and screening may include items such as cargo contents, place of origin, transportation routing information, and the names of the cargo's various intermodal carriers. This information must be provided to the Under Secretary at least 24 hours before the cargo is loaded on the vessel to provide the U.S. Government sufficient time to profile the cargo and have it screened before loading. The Under Secretary must also develop performance standards to enhance the physical security of shipping containers, including standards for seals and locks as well as systems to detect any tampering or breaking of the seal or container integrity.

Section 70112 requires that the operators of commercial vessels arriving in the United States from a foreign port provide the Under Secretary with a passenger and crew manifest. This manifest must contain each passenger's and crew member's date of birth, citizenship, passport and visa number, and country of origin.

Section 70113 establishes a civil penalty of not more than $25,000 for each violation of this new chapter.

Section 3. Clarification of Coast Guard authority to control vessels in territorial waters of the United States

Section 3 of the bill amends the Port and Waterways Safety Act to require all vessels entering the 12-mile territorial sea of the United States to provide notice to the Coast Guard 96 hours before entering those waters. This section also clarifies that the Coast Guard has the authority to direct the safe operations of all vessels in the 12-mile territorial sea and other navigable waters of the United States during hazardous circumstances such as when a pilot is not on board the vessel. This section does not affect the innocent passage of ships through U.S. waters.

Section 4. Extension of seaward jurisdiction

This section would extend the jurisdiction of the Coast Guard from three miles from shore to 12 miles from shore for certain security activities when the President determines that the national security is endangered. Section 4 also creates civil penalties not to exceed $25,000 for each violation of a Coast Guard order based upon this authority.

Section 5. Suspension of limitation on strength of Coast Guard

This section would suspend Coast Guard end-strength and grade distributions for any fiscal year that there is in effect a declaration of war or national emergency, for a period not to exceed six months after the end of the war or national emergency.

Section 6. Extension of Deepwater Port Act to natural gas

Locating liquefied natural gas (LNG) facilities 30 miles off the coast of the United States may pose a lower threat of damage to coastal communities in the event of a catastrophic emergency at the facility than the current practice of locating LNG facilities onshore. This section would allow natural gas to be included in the Deepwater Port Act which establishes a system for permitting and licensing deepwater terminals. Currently, only oil facilities are included in this Federal law.

Section 7. Assignment of Coast Guard personnel as sea marshals and enhanced use of other security personnel

Section 7 amends the Ports and Waterways Safety Act to allow the dispatch of properly trained and qualified armed Coast Guard personnel on facilities and vessels to deter or respond to acts of terrorism.

Section 8. Automatic identification system

This section requires that all vessels built after December 31, 2002, be equipped with a position-indicating transponder and an appropriate situation display for accessing the information made available by the transponder system. After July 1, 2003, all passenger vessels, tankers, and certain towing vessels, built before December 31, 2002, must be equipped with a transponder and display system. Finally, after December 31, 2004, all other vessels built before December 31, 2002, must also have this equipment.

LEGISLATIVE HISTORY AND COMMITTEE CONSIDERATION

Prior to the consideration of H.R. 3983, the Subcommittee on Coast Guard and Maritime Transportation held a series of four hearings on port and waterways security.

The first hearing was held on December 6, 2001, for the purpose of receiving the recommendations of the Secretary of Transportation on the need to increase security in our nation's ports and waterways against terrorist attacks. The Subcommittee discussed the Federal government's current maritime security efforts and the Administration's suggestions on ways to further reduce the vulnerability of our ports and waterways to terrorist attack. During this hearing, the Subcommittee received testimony from Transportation Secretary Norman Mineta and Admiral James M. Loy, Commandant, U.S. Coast Guard.

Secretary Mineta testified that the Coast Guard had the legislative authority to adequately secure U.S. ports, but lacked the resources to provide an effective level of security. In addition, Secretary Mineta outlined four key principles which our country needs to follow in order to build an adequate system of maritime security. These principles include the development of a comprehensive security plan which protects the entire marine transportation system, the development and use of local port security plans, the ability to continually update national and local security plans, and the recognition of the intermodal nature of transportation in general.

Admiral Loy testified that the Coast Guard mounted a significant and rapid response to the September 11th attacks on the U.S. He also noted that the Coast Guard was able to increase its security posture using existing active duty, reserve, civilian, and auxiliary personnel as well as its existing shore units, ships, boats, and aircraft. Admiral Loy reported that this increased security posture was not sustainable without other Coast Guard missions being severely impacted. Finally, Admiral Loy strongly indicated the Coast Guard's need for additional resources to support a permanently enhanced level of port security and safety.

On February 13, 2002, the Subcommittee held its second port security hearing. The purpose of this hearing was to investigate the best way to implement a nationwide security system which requires transportation workers to hold secure identity cards. The Subcommittee received testimony from Admiral James Underwood, Director of the Office of Intelligence and Security for the Department of Transportation, and representatives from the National Association of Waterfront Employers, the Pacific Maritime Association, the United States Maritime Alliance, the International Longshoremen's Association, the International Longshore and Warehouse Union, and the American Trucking Associations.

Admiral Underwood testified that the Department of Transportation was working on a uniform transportation worker identification program which would require that any person who has access to secure areas of transportation facilities be required to undergo a background check and be issued a transportation security card. Admiral Underwood emphasized the need for transportation security cards to be fully intermodal, to be built on existing technology, and to minimize the need for workers to carry multiple ID cards. Finally, Admiral Underwood stated that transportation security cards would not prove effective without the physical control of all access points to secure areas of a transportation facility.

The representative from the National Association of Waterfront Employees, the Pacific Maritime Association, and the United States Maritime Alliance testified about his organizations' support for requiring the positive identification for all persons entering marine terminals, the need for one Federal standard for credentialing, and the requirement that all individuals who are issued transportation security cards undergo a criminal background check. The witness for the American Trucking Associations testified about his group's desire to have one criminal history record check and one universal security identification card for truck drivers. The two longshore unions supported credentialing procedures for controlled access to certain areas of U.S. ports, but opposed efforts to use a prior criminal conviction as a way to prevent individuals from being employed in a secure area of a transportation facility.

On March 13, 2002, the Subcommittee held a hearing to investigate the security of containers used to ship goods imported into and exported out of the United States by water. The Subcommittee received testimony from the U.S. Coast Guard, cargo shippers, vessel operators as well as freight terminal owners and operators.

Captain Anthony Regalbuto, Chief of Port Security, U.S. Coast Guard, testified that the Secretary of Transportation had established the National Infrastructure Security Committee to evaluate transportation infrastructure vulnerabilities and to recommend changes for improved security. The Container Working Group, which was established through the Security Committee, is co-chaired by the U.S. Customs Service and includes a number of additional Federal agencies concerned with cargo security. The Container Working Group issued its initial report on shipping container security to the Office of Homeland Security on February 1st. Finally, Captain Regalbuto informed the Subcommittee about the Coast Guard's efforts to have the International Maritime Organization adopt a number of improved international maritime security measures.

Chris Koch of the World Shipping Council, which represents a number of international ocean carriers that carry containerized cargo, stated his members' concerns that a terrorist attack on our marine transportation system could lead the Federal government to shut down trade into and out of the U.S. Mr. Koch also testified that any advanced cargo information required to be submitted to the government should be collected by only one Federal agency. Wayne Gibson represented the International Mass Retail Association which is a large alliance of retailers who import a large volume of goods into the United States. Mr. Gibson testified that the adherence to voluntary industry standards and internal security plans would be the best step American industry could take in improving the security of containers. Mr. Gibson also stated that pre-shipment foreign cargo exams may prove to be unreliable and that the government needs to develop a container risk assessment program.

The Subcommittee held its fourth hearing about port security on March 14, 2002. This hearing examined ways to finance the new security equipment that individual ports and marine terminal facilities must install to address the increased terrorist threat to our nation. The Subcommittee received testimony from the U.S. Maritime Administration, vessel and marine facility operators, as well as several local port authorities.

William Schubert, Maritime Administrator, testified about the Department of Transportation's plans to award $93.3 million in competitive port security grants. These grants were funded in the Department of Defense Appropriations Act of Fiscal Year 2002. The new Port Security Grants Program will finance security enhancements at critical national seaports. The Program will accelerate the installation of enhanced security measures for passengers and cargo that pass through our vital ports.

Kathy Metcalf, who represented the Chamber of Shipping of America, reported that her members, who operate various types of oceangoing vessels, have implemented a number of measures to prevent their vessels from being used in a terrorist act. The Chamber of Shipping is also working with the Coast Guard to encourage the International Maritime Organization to accept a number of U.S. maritime security initiatives. Finally, Ms. Metcalf testified that her industry should not be held responsible for paying for the security of U.S. ports. Richard Steinke, who represented the American Association of Port Authorities (AAPA), testified that U.S. ports need additional port security grant funding. According to AAPA's recent survey, 52 ports intend to apply for the Department of Transportation's port security grants. These ports expect to request $223 million to implement security programs as a result of the new terrorist threat.

A bill to ensure the security of maritime transportation in the United States against acts of terrorism was introduced as H.R. 3983 by Chairman Young on March 18, 2002, with Mr. Oberstar, Mr. LoBiondo, and Ms. Brown of Florida as cosponsors. The bill was referred to the Committee on Transportation and Infrastructure.

On March 20, 2002, the Subcommittee on Coast Guard and Maritime Transportation met in open session to mark up H.R. 3983, the Maritime Transportation Antiterrorism Act of 2002. The Subcommittee considered one amendment to H.R. 3983. Mr. LoBiondo offered an amendment that allows the Secretary of Transportation to issue transportation security cards to hazardous material truck drivers who have already undergone a security background check authorized under the USA Patriot Act of 2001, Public Law 107-56. H.R. 3983, as amended by the Subcommittee, was ordered reported to the Full Committee by voice vote in the presence of a quorum.

On March 20, 2002, the Transportation and Infrastructure Committee met in open session to consider H.R. 3983. H.R. 3983 was ordered reported to the House of Representatives by a voice vote in the presence of a quorum.

ROLL CALL VOTES

Clause 3(b) of rule XIII of the House of Representatives requires each committee report to include the total number of votes cast for and against on each roll call vote on a motion to report and on any amendment offered to the measure or matter, and the names of those members voting for and against. There were no roll call votes during Committee consideration of H.R. 3983.

COMMITTEE OVERSIGHT FINDINGS

With respect to the requirements of clause 3(c)(1) of rule XIII of the Rules of the House of Representatives, the Committee's oversight findings and recommendations are reflected in this report.

COST OF THE LEGISLATION

Clause 3(c)(2) of rule XIII of the Rules of the House of Representatives does not apply where a cost estimate and comparison prepared by the Director of the Congressional Budget Office under section 402 of the Congressional Budget Act of 1974 has been timely submitted prior to the filing of the report and is included in the report. Such a cost estimate is included in this report.

COMPLIANCE WITH HOUSE RULE XIII

1. With respect to the requirements of clause 3(c)(2) of rule XIII of the Rules of the House of Representatives and 308(a) of the Congressional Budget Act of 1974, the Committee references the report of the Congressional Budget Office included below.

2. With respect to the requirement of clause 3(c)(4) of rule XIII of the Rules of the House of Representatives, the performance goals and objectives of this legislation are to: (a) establish a comprehensive national system of antiterrorism security enhancements; (b) clarify Coast Guard authority to control vessels in the territorial waters of the United States; (c) extend the jurisdiction of the Coast Guard from three to twelve miles from shore for certain security activities; (d) extend the Deepwater Port Act to natural gas; and (e) require a faster deployment of the automatic identification system.

3. With respect to the requirement of clause 3(c)(3) of rule XIII of the Rules of the House of Representatives and section 402 of the Congressional Budget Act of 1974, the Committee has received the following cost estimate for H.R. 3983 from the Director of the Congressional Budget Office.

U.S. Congress,

Congressional Budget Office,

Washington, DC, April 11, 2002.

Hon. DON YOUNG,
Chairman, Committee on Transportation and Infrastructure,
House of Representatives, Washington, DC.

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 3983, the Maritime Transportation Antiterrorism Act of 2002. If you wish further details on this estimate, we will be pleased to provide them. The CBO staff contacts are Deborah Reis (for federal costs), Cecil McPherson and Jean Talarico (for the private-sector impact), and Susan Sieg Tompkins (for the state and local impact).

Sincerely,

Barry B. Anderson,

(for Dan L. Crippen, Director).

Enclosure.

H.R. 3983--Maritime Transportation Antiterrorism Act of 2002

Summary: H.R. 3983 would establish a federal program to protect U.S. ports from terrorism. In addition, the bill would authorize the appropriation of $75 million for each of fiscal years 2003 through 2005 for grants to help port facilities implement antiterrorism efforts.

Assuming appropriation of the necessary amounts, CBO estimates that implementing H.R. 3983 would cost $240 million over the 2003-2007 period and $3 million a year thereafter. Most of the funds that would be spent through 2007 would be used to implement the grant provisions of the legislation. Other than a new grant program, most of the activities mandated by the legislation are currently being carried out under the Coast Guard's existing authority. H.R. 3983 could increase federal receipts by establishing new civil penalties; therefore, pay-as-you-go procedures would apply to the legislation. CBO estimates, however, that any such increase would be less than $500,000 annually.

H.R. 3983 contains both intergovernmental and private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA). Because of uncertainties about which ports, facilities, and vessels would be affected and how certain regulations and performance standards would be implemented, CBO cannot determine whether the costs of all of the mandates contained in H.R. 3983 would exceed the thresholds established by UMRA ($58 million for intergovernmental mandates and $115 million for private-sector mandates in 2002, adjusted annually for inflation). The bill also would authorize appropriations for grants to help port facilities to implement antiterrorism efforts.

Major Provisions: H.R. 3983 would establish a port security program to be carried out primarily by the Department of Transportation (DOT), acting through the U.S. Coast Guard. The bill would focus on the security of facilities at U.S. and foreign ports, as well as vessels using such facilities. Major elements of the program would include:

Vulnerability assessments for each port that DOT believes is at high risk of a terrorist act;

A national antiterrorism plan for deterring acts of terrorism directed at maritime transportation, and individual plans for areas at risk of attack;

Maritime antiterrorism teams to protect the public as well as vessels, ports, facilities, and cargo in U.S. waters;

Grants to ports to implement maritime antiterrorism plans or interim measures required by the Coast Guard--for this purpose the bill would authorize the appropriation of $75 million a year over the 2003-2005 period;

Assessments of foreign ports that vessels entering U.S. ports might visit, including recommended actions that such ports should take to enhance security and actions that the United States might take if foreign ports fail to maintain effective antiterrorism measures;

Regulation of deepwater ports handling natural gas; and

Other activities to regulate shipping of containerized cargo, require manifests of vessel passengers and crew, create a sea marshal program, and safeguard American ports.

Estimated Cost to the Federal Government: The Coast Guard is implementing most of the provisions of H.R. 3983 under its existing authority. The following table shows the estimated costs of carrying out requirements of the bill that are in addition to those already authorized and planned, including grants for enhanced port security. The costs of this legislation fall within budget function 400 (transportation). 



-------------------------------------------------------------------------------------------------------------


                                                By fiscal year, in millions of dollars--                     


                                                                                    2003 2004 2005 2006 2007 


-------------------------------------------------------------------------------------------------------------


CHANGES IN SPENDING SUBJECT TO APPROPRIATION 1                                                               


Estimated authorization level                                                         78   78   78    3    3 


Estimated outlays                                                                     28   53   78   54   27 


-------------------------------------------------------------------------------------------------------------


Basis of estimate: For this estimate, CBO assumes that H.R. 3983 will be enacted during fiscal year 2002 and that the necessary amounts will be appropriated for each fiscal year. For fiscal years 2003 through 2005, section 2 of the bill authorizes the appropriation of $75 million for grants to owners or operators of ports. In addition, CBO estimates it would cost $3 million a year to assess security efforts at foreign ports and regulate U.S. deepwater ports that handle natural gas--activities that are not authorized under current law. Outlays for these activities are based on historical rates for similar Coast Guard programs.

Pay-as-you-go considerations: The Balanced Budget and Emergency Deficit Control Act sets up pay-as-you-go procedures for legislation affecting direct spending or receipts. Enacting H.R. 3983 could increase federal revenues by establishing civil penalties, but CBO estimates that any such increase would be less than $500,000 annually.

Intergovernmental and private-sector impact: H.R. 3983 contains both intergovernmental and private-sector mandates as defined in UMRA. Because of uncertainties about which ports, facilities, and vessels would be affected and how certain regulations and performance standards would be implemented, CBO cannot determine whether the costs of all of the mandates contained in H.R. 3983 would exceed the thresholds established by UMRA ($58 million for intergovernmental mandates and $115 million for private-sector mandates in 2002, adjusted annually for inflation). The bill also would authorize appropriations for grants to help port facilities to implement antiterrorism efforts.

Mandates that affect both the public and private sector

Because facility and vessel owners and operators include both public and private-sector entities, the following requirements would be both intergovernmental and private-sector mandates as defined by UMRA.

Antiterrorism Plans. Section 2 would require the Coast Guard to perform port vulnerability assessments for each port, and for each facility in that port, believed to be at high risk of a catastrophic emergency, as defined in the bill. Based on the results of that assessment, certain facilities and vessel owners or operators would be required to develop and comply with their own antiterrorism plans.

The selected facilities and vessels that are required to develop the antiterrorism plans and the specific level of security improvements would be determined after the bill's enactment. Based on information from the Coast Guard, it is unclear what facilities and vessels would fall under this requirement. Consequently, CBO cannot estimate either the total costs to comply with the mandate or when such costs would be incurred.

Federal Transportation Identity Cards. Other provisions of section 2 would prohibit individuals from entering secure areas of specific facilities and vessels unless they meet certain conditions. Owners and operators would be required to check identification for all individuals and may have to hire additional personnel. CBO cannot estimate the cost of compliance with this mandate because the identification of the secure areas also is contingent upon the vulnerability assessments that will take place after enactment of the bill.

Automatic Identification System. Section 8 would require certain vessels built after December 31, 2002, to be equipped with an automatic identification system that would transmit the vessel's location and certain other information. This mandate would accelerate the Coast Guard's automatic identification system that is scheduled to begin in 2004 with staggered implementation dates. According to DOT, the cost of a transponder ranges from $5,000 to $12,000. The specific vessels required to be equipped with an automatic identification system would be determined by the Secretary after enactment of the bill.

Mandates that affect the private sector only

H.R. 3983 would impose mandates on shippers and certain persons involved in the transport of containerized cargo, and owners and operators of commercial vessels.

Shipping Container Security. Section 2 would require the Under Secretary of Transportation for Security to develop performance standards to enhance the physical security of shipping containers, including standards for seals and locks, no later than June 30, 2003. CBO cannot estimate the cost to comply with the mandate, however, since the details of the performance standards have not been established.

Electronic Notification. The bill would require shippers and certain persons involved in the transport of cargo to provide the Under Secretary of Transportation for Security, by electronic transmission, information on containerized cargo, no later than 24 hours before the cargo destined for the United States is loaded on a vessel. The bill also would require the operator of each commercial vessel arriving in the United States from a foreign port to provide to the Under Secretary, by electronic transmission, a passenger and crew manifest, in advance of the vessel arriving in the United States. Finally, the bill would require a commercial vessel entering the territorial sea of the United States to notify the Secretary by electronic transmission not later than 96 hours before that entry and to provide the information regarding the vessel, including its name, route, time of entry, and a description of dangerous or hazardous cargo. The above entities already transmit the information although not electronically. The additional cost to transmit the required information electronically would be minimal.

Previous CBO cost estimate: On September 18, 2001, CBO transmitted a cost estimate of S. 1214, the Port and Maritime Security Act of 2001, as ordered reported by the Senate Committee on Commerce, Science, and Transportation on August 2, 2001. S. 1214 contains provisions similar to those of H.R. 3983, but the Senate bill encompasses other law enforcement activities such as drug interdiction. The Senate bill also would extend the collection of some vessel tonnage duties that will expire after 2002 and would make most of the duties available to the Coast Guard without further appropriation for implementing port security activities. As a result, most of the spending under S. 1214 would be financed from such fees, while the new spending under H.R. 3983 would all come from annual appropriations.

CBO identified intergovernmental and private-sector mandates in H.R. 3983 that are similar to those found in S. 1214. For example, both bills require that the Coast Guard conduct vulnerability assessments for ports. CBO cannot determine the aggregate cost of the mandates in either version, in part because of the uncertainty about which ports would be affected.

Estimate prepared by: Federal Costs: Deborah Reis, Impact on State, Local, and Tribal Governments: Susan Sieg Tompkins, Impact on the Private Sector: Cecil McPherson and Jean Talarico.

Estimate approved by: Peter H. Fontaine, Deputy Assistant Director for Budget Analysis.

CONSTITUTIONAL AUTHORITY STATEMENT


Pursuant to clause (3)(d)(1) of rule XIII of the Rules of the House of Representatives, committee reports on a bill or joint resolution of a public character shall include a statement citing the specific powers granted to the Congress in the Constitution to enact the measure. The Committee on Transportation and Infrastructure finds that Congress has the authority to enact this measure pursuant to its powers granted under article 1, section 8 of the Constitution.

FEDERAL MANDATES STATEMENT


The Committee adopts as its own the estimate of Federal mandates prepared by the Director of the Congressional Budget Office pursuant to section 423 of the Unfunded Mandates Reform Act (Public Law 104-4).

PREEMPTION CLARIFICATION


Section 423 of the Congressional Budget Act of 1994 requires the report of any Committee on a bill or joint resolution to include a statement on the extent to which the bill or joint resolution is intended to preempt state, local, or tribal law. Except to the extent that international maritime commerce is subject to the exclusive jurisdiction of the United States under the Constitution, the Committee states that H.R. 3983 does not preempt any state, local, or tribal law.

ADVISORY COMMITTEE STATEMENT


No advisory committees within the meaning of section 5(b) of the Federal Advisory Committee Act were created by this legislation.

APPLICABILITY TO THE LEGISLATIVE BRANCH


The Committee finds that the legislation does not relate to the terms and conditions of employment or access to public services or accommodations within the meaning of section 102(b)(3) of the Congressional Accountability Act (Public Law 104-1).

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED




TITLE 46, UNITED STATES CODE




Subtitle
Sec.


I.

GENERAL

101

* * * * * * *

VI.

MISCELLANEOUS

70101

* * * * * * *



SUBTITLE VI--MISCELLANEOUS




Chap.

Sec.

701.

Port Security

70101

CHAPTER 701--PORT SECURITY

Sec.

70101. Definitions.

70102. United States facility vulnerability assessments.

70103. Catastrophic emergency planning.

70104. Antiterrorism response.

70105. Transportation security cards.

70106. Maritime antiterrorism teams.

70107. Grants.

70108. Foreign port assessment.

70109. Notifying foreign authorities.

70110. Actions when foreign ports not maintaining effective antiterrorism measures.

70111. Shipping container antiterrorism.

70112. Crew and passenger manifests.

70113. Civil penalty.



Sec. 70101. Definitions






















Sec. 70102. United States facility vulnerability assessments










Sec. 70103. Catastrophic emergency planning


































































































Sec. 70104. Antiterrorism response






Sec. 70105. Transportation security cards




























































Sec. 70106. Maritime antiterrorism teams








Sec. 70107. Grants


































Sec. 70108. Foreign port assessment








































Sec. 70109. Notifying foreign authorities




Sec. 70110. Actions when foreign ports not maintaining effective antiterrorism measures


















Sec. 70111. Shipping container antiterrorism














Sec. 70112. Crew and passenger manifests






















Sec. 70113. Civil penalty




-

PORTS AND WATERWAYS SAFETY ACT


* * * * * * *













* * * * * * *

SEC. 15. ENTRY OF VESSELS INTO TERRITORIAL SEA; DIRECTION OF VESSELS BY COAST GUARD.




























-

ACT OF JUNE 15, 1917


Chap. 30- AN ACT To punish acts of interference with the foreign relations, the neutrality, and the foreign commerce of the United States, to punish espionage, and better to enforce the criminal laws of the United States, and for other purposes.


TITLE I.


* * * * * * *

TITLE II.


* * * * * * *







* * * * * * *

TITLE XIII.


GENERAL PROVISIONS.








* * * * * * *

-

TITLE 14, UNITED STATES CODE


* * * * * * *

PART I--REGULAR COAST GUARD


* * * * * * *

CHAPTER 17--ADMINISTRATION


* * * * * * *

Sec. 661. Authorization of personnel end strengths




* * * * * * *

PART II--COAST GUARD RESERVE AND AUXILIARY


* * * * * * *

CHAPTER 21--COAST GUARD RESERVE


* * * * * * *

Sec. 724. Authorized number of officers




* * * * * * *



* * * * * * *

-

DEEPWATER PORT ACT OF 1974


* * * * * * *

DECLARATION OF POLICY






* * * * * * *





* * * * * * *

DEFINITIONS






* * * * * * *



* * * * * * *

LICENSE FOR THE OWNERSHIP, CONSTRUCTION, AND OPERATION OF A DEEPWATER PORT




* * * * * * *

PROCEDURE




* * * * * * *







* * * * * * *





* * * * * * *









* * * * * * *





* * * * * * *



* * * * * * *







* * * * * * *

PIPELINE SAFETY AND OPERATION




* * * * * * *








 
  
 
 



 




 
  
     

        
 
          


          


          

         

      		
    





  
     

       

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