[House Report 109-709]
[From the U.S. Government Publishing Office]
109th Congress Rept. 109-709
HOUSE OF REPRESENTATIVES
2d Session Part 1
======================================================================
MARITIME TERMINAL SECURITY ENHANCEMENT ACT OF 2006
_______
September 29, 2006.--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. 4880]
[Including cost estimate of the Congressional Budget Office]
The Committee on Transportation and Infrastructure, to whom
was referred the bill (H.R. 4880) to direct the Commandant of
the Coast Guard to require that a security plan for a maritime
facility be resubmitted for approval upon transfer of ownership
or operation of such facility, and for other purposes, having
considered the same, report favorably thereon with an amendment
and recommend that the bill as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SEC. 1. SHORT TITLE.
This Act may be cited as the ``Maritime Terminal Security
Enhancement Act of 2006''.
SEC. 2. REVIEW OF FACILITY PLANS.
The Commandant of the Coast Guard shall require that a security
plan for a facility required under section 70103(c) of title 46, United
States Code, shall be resubmitted for approval upon transfer of
ownership or operation of such facility.
SEC. 3. FACILITY SECURITY OFFICERS.
The Commandant of the Coast Guard shall require that the qualified
individual having full authority to implement security actions who is
required to be identified under section 70103(c)(3)(B) of title 46,
United States Code, for a facility described in section 70103(c)(2) of
that title shall be a citizen of the United States.
SEC. 4. TRANSPORTATION SECURITY CARDS.
Section 70105(a)(1) of title 46, United States Code, is amended by
striking ``The'' and inserting ``Not later than July 1, 2006, the''.
SEC. 5. FOREIGN PORT ASSESSMENTS.
Section 70108 of title 46, United States Code, is amended by adding
at the end the following:
``(d) Periodic Reassessment.--The Secretary, acting through the
Commandant of the Coast Guard, shall reassess the effectiveness of
antiterrorism measures maintained at ports as described under
subsection (a) and of procedures described in subsection (b) not less
than every 5 years.''.
SEC. 6. ENHANCED CREWMEMBER IDENTIFICATION.
Section 70111 of title 46, United States Code, is amended--
(1) in subsection (a) by striking ``The'' and inserting ``Not
later than July 1, 2006, the''; and
(2) in subsection (b) by striking ``The'' and inserting ``Not
later than July 1, 2006, the''.
SEC. 7. LONG-RANGE VESSEL TRACKING.
(a) Regulations.--Section 70115 of title 46, United States Code, is
amended by striking ``The Secretary shall'' and inserting ``Not later
than April 1, 2007, the Secretary shall''.
(b) Voluntary Program.--The Secretary may issue regulations to
establish a voluntary long-range automated vessel tracking system for
vessels described in section 70115 of title 46, United States Code,
during the period before regulations are issued to carry out section
70115 of title 46, United States Code.
SEC. 8. CENTER OF EXCELLENCE FOR MARITIME DOMAIN AWARENESS.
(a) Establishment.--The Secretary of the department in which the
Coast Guard is operating shall establish a university-based Center for
Excellence for Maritime Domain Awareness following the merit-review
processes and procedures that have been established by the Secretary
for selecting university program centers of excellence.
(b) Duties.--The Center shall--
(1) prioritize its activities based on the ``National Plan to
Improve Maritime Domain Awareness'' published by the Department
of Homeland Security in October 2005;
(2) recognize the extensive previous and ongoing work and
existing competence in the field of maritime domain awareness
at numerous academic and research institutions, such as the
Naval Postgraduate School;
(3) leverage existing knowledge and continue development of a
broad base of expertise within academia and industry in
maritime domain awareness; and
(4) provide educational, technical, and analytical assistance
to Federal agencies with responsibilities for maritime domain
awarness, including the Coast Guard, to focus on the need for
interoperability, information sharing, and common information
technology standards and architecture.
SEC. 9. REQUIREMENTS RELATING TO ENTRY OF CONTAINERS INTO THE UNITED
STATES.
(a) Requirements.--Section 70116 of title 46, United States Code,
is amended by adding at the end the following:
``(c) Requirements Relating to Entry of Containers.--
``(1) In general.--A container shipped, either directly or
via a foreign port, may enter the United States only if--
``(A) the container is scanned with equipment that
meets the standards established pursuant to paragraph
(2)(A) and a copy of the scan is provided to the
Commandant of the Coast Guard; and
``(B) the container is secured with a seal that meets
the standards established pursuant to paragraph (2)(B),
before the container is loaded on the vessel for
shipment.
``(2) Standards for scanning equipment and seals.--
``(A) Scanning equipment.--The Commandant of the
Coast Guard shall establish standards for scanning
equipment required to be used under paragraph (1)(A) to
ensure that such equipment uses the best-available
technology, including technology to scan a container
for radiation and density and, if appropriate, for
atomic elements.
``(B) Seals.--The Commandant of the Coast Guard shall
establish standards for seals required to be used under
paragraph (1)(B) to ensure that such seals are
developed and made using the best-available technology,
including technology to detect any breach into a
container and identify the time of such breach.
``(C) Review and revision.--The Commandant of the
Coast Guard shall--
``(i) review and, if necessary, revise the
standards established pursuant to subparagraphs
(A) and (B) not less than once every two years;
and
``(ii) ensure that any such revised standards
require the use of technology, as soon as such
technology becomes available, to--
``(I) identify the place of a breach
into a container;
``(II) notify the Commandant of such
breach before the container enters the
Exclusive Economic Zone of the United
States; and
``(III) track the time and location
of the container during transit to the
United States, including by truck,
rail, or vessel.
``(D) Definition.--In subparagraph (C), the term
`Exclusive Economic Zone of the United States' has the
meaning given the term `Exclusive Economic Zone' in
section 2101(10a) of this title.''.
(b) Authorization of Appropriations.--There are authorized to be
appropriated to carry out section 70116(c) of title 46, United States
Code, as added by subsection (a) of this section, such sums as may be
necessary for each of fiscal years 2007 through 2012.
(c) Regulations; Application.--
(1) Regulations.--
(A) Interim final rule.--The Commandant of the Coast
Guard shall issue an interim final rule as a temporary
regulation to implement section 70116(c) of title 46,
United States Code, as added by subsection (a) of this
section, not later than 120 days after the date of the
enactment of this section, without regard to the
provisions of chapter 5 of title 5, United States Code.
(B) Final rule.--The Commandant shall issue a final
rule as a permanent regulation to implement section
70116(c) of title 46, United States Code, as added by
subsection (a) of this section, not later than one year
after the date of the enactment of this section, in
accordance with the provisions of chapter 5 of title 5,
United States Code. The final rule issued pursuant to
that rulemaking may supersede the interim final rule
issued pursuant to subparagraph (A).
(2) Phased-in application.--
(A) In general.--The requirements of section 70116(c)
of title 46, United States Code, as added by subsection
(a) of this section, apply with respect to a container
being shipped, either directly or via a foreign port,
and entering the United States beginning on--
(i) the last day of the 3-year period
beginning on the date of the enactment of this
Act, in the case of a container loaded on a
vessel destined for the United States in a
country in which more than 75,000 twenty-foot
equivalent units of containers were loaded on
vessels for shipping to the United States in
2005; and
(ii) the last day of the 5-year period
beginning on the date of the enactment of this
Act, in the case of a container loaded on a
vessel destined for the United States in any
other country.
(B) Extension.--The Commandant of the Coast Guard may
extend by up to one year the period under clause (i) or
(ii) of subparagraph (A) for containers loaded in a
port, if the Commandant--
(i) finds that the scanning equipment
required under section 70116(c) of title 46,
United States Code, as added by subsection (a)
of this section, is not available for purchase
and installation in the port; and
(ii) at least 60 days prior to issuing such
extension, transmits such finding to the
Committee on Transportation and Infrastructure
of the House of Representatives and the
Committee on Commerce, Science, and
Transportation of the Senate.
SEC. 10. SECURITY PLANS FOR CARGO TERMINAL FACILITIES.
(a) In General.--Section 70103(c) of title 46, United States Code,
is amended by adding at the end the following:
``(8) The Secretary may require the owner or operator of a facility
that is required to have a security plan under paragraph (1) and that
is a cargo terminal, to submit information, including contracts or
other agreements that govern operations of such facilities, to the
Secretary to determine if there is any security risk involving that
owner or operator.''.
(b) Annual Report.--The Secretary of the department in which the
Coast Guard is operating shall annually submit to Congress a report
regarding contracts and agreements that govern operation of facilities
required to have a security plan under section 70103(c)(1) of title 46,
United States Code. Such report shall detail the extent of foreign
ownership of parties to such contracts and agreements and detail any
security risks that such foreign ownership may pose.
Purpose of the Legislation
H.R. 4880, the Maritime Terminal Security Enhancement Act
of 2006, makes several amendments to current law to enhance
maritime security at U.S. ports and aboard vessels that operate
on U.S. waterways.
Background and Need for the Legislation
Following the attacks on September 11, 2001, Congress
passed the Maritime Transportation Security Act of 2002 (MTSA)
to establish a national framework to enhance security
throughout the maritime domain. Under the MTSA, the Coast Guard
and other Federal agencies have developed and implemented
critical maritime security programs, systems, and procedures to
improve awareness of activities in the maritime domain and
capabilities to prevent future attacks to the Maritime
Transportation System. However, despite this progress, several
key mandates under the MTSA have not yet been completed. The
Committee on Transportation and Infrastructure remains
extremely concerned and frustrated by the Department of
Homeland Security's failure to fully implement the maritime
security measures required under the MTSA.
The recently proposed takeover of port terminal operations
by Dubai Ports World, a United Arab Emirates state-owned
entity, raised several concerns regarding the responsibilities
of port operators in maintaining security in U.S. ports. While
it appears that the proposed takeover will not go forward, it
brought the Nation's collective attention to the importance of
maintaining high levels of security at our ports and the need
for comprehensive and fully integrated security measures to
protect each component of the Maritime Transportation System.
The open and interrelated nature of the Maritime Transportation
System necessitates that the full scope of security measures
required under the MTSA be implemented quickly and completely.
H.R. 4880 requires the Federal government to take several
actions to enhance the capabilities of the Coast Guard and
other Federal agencies to secure the maritime domain including
the establishment of deadlines for several maritime security
programs required under the MTSA.
Summary of the Legislation
H.R. 4880 makes several amendments to current law to
enhance maritime security at U.S. ports and aboard vessels that
operate in U.S. waters.
Section 1 states that the legislation may be referred to as
``The Maritime Terminal Security Enhancement Act of 2006''.
Section 2 requires the resubmission of a facility security
plan for the Coast Guard's approval upon the transfer of
ownership or operational control over a port terminal facility.
Under section 70103 of title 46, United States Code, all U.S.
facilities were required to submit and receive approval of a
facility security plan prior to July 1, 2004. That section also
requires such facilities to resubmit a facility security plan
for approval if there is a change to the facility ``that may
substantially affect the security of the . . . facility'';
however it is unclear whether a change in ownership or
operational control over a facility would require such a
resubmission.
Section 3 requires an individual that is designated as the
Facility Security Officer under a facility security plan to be
a U.S. citizen.
Section 4 requires the Secretary of the department in which
the Coast Guard is operating to issue regulations not later
than July 1, 2006, to carry out a program to issue
transportation security cards to provide maritime workers and
merchant mariners access to secure areas within U.S. ports and
aboard U.S.-flag vessels.
The Transportation Security Administration (TSA) is in the
process of developing a Transportation Worker Identification
Credential (TWIC), in consultation with the Coast Guard, to
meet the transportation security card requirements that were
included in the MTSA (46 U.S.C. 70105). In the more than three
years since the enactment of this requirement, little progress
has been made in developing the TWIC program. The TSA recently
completed a ``prototype phase'' which tested and evaluated
several credential technologies and issuance procedures;
however the TSA did not test or evaluate procedures to carry
out security background checks or methods to collect and
display biometric information on each credential. The Committee
remains extremely concerned by the apparent lack of interest on
the part of the TSA and the Department of Homeland Security in
this vital homeland security mission. The TWIC will be one of
the primary means of restricting access to potentially
vulnerable areas within ports, terminal facilities, and aboard
vessels in the United States.
The TSA and the Coast Guard have finalized a Notice of
Proposed Rulemaking for the implementation of the TWIC program
in the maritime transportation sector and the development of a
Merchant Mariner Credential that will combine the elements of
Merchant Mariner's License, Merchant Mariner's Document,
Certificate of Registry, and STCW Endorsement into one
qualification credential. It is expected that the Notice of
Proposed Rulemaking will be published in the Federal Register
later this month and that the public will have an adequate
period to comment on the proposed rules. The Committee will
continue to monitor the progress of the proposed rules and will
use its oversight function to ensure that any regulations take
into account the concerns of merchant mariners and the general
public.
Section 5 requires the Coast Guard to periodically reassess
foreign ports' compliance with international port security
requirements and the effectiveness of antiterrorism measures
maintained at those ports under such agreements not less than
every 5 years. The Committee supports the Coast Guard's ongoing
efforts to enhance maritime security at foreign ports through
its foreign port assessments and through the International Port
Security Program; however, the Committee believes that the
Coast Guard should continue to validate foreign ports'
compliance with international regulations through periodic
reassessments.
Section 6 requires the Secretary of the department in which
the Coast Guard is operating to not later than July 1, 2006,
develop standards and procedures for enhanced crewmember
identification credentials for U.S. and foreign merchant
mariners that are carried aboard vessels that call on U.S.
ports and to issue regulations that require such crewmembers to
carry such credentials and present them on demand as required
under the MTSA (46 U.S.C. 70111). The Committee believes that
the rulemaking for crewmembers' identification be carried out
on the same timeline as the rulemaking for the TWIC. The
Committee strongly recommends that the Secretary continue to
work with our international partners to develop common
standards and procedures for such credentials; however, failure
to come to an agreement through the International Maritime
Organization should not deter the United States from
implementing this critical maritime security measure
domestically by the statutory deadline of July 1, 2006.
Section 7 amends section 70115 of title 46, United States
Code, to require the Secretary of the department in which the
Coast Guard is operating to issue regulations that establish
and implement a long range vessel tracking system by not later
than April 1, 2007. This system will have the capability to
track vessels up to 2,000 nautical miles from shore and will
compliment the near-shore tracking capabilities provided by the
Automatic Identification System (AIS). The Coast Guard has
previously testified to the Committee that they are working
through the International Maritime Organization (IMO) to
develop the components of a global system rather than
implementing a long range vessel tracking system domestically.
The IMO has announced that it is holding meetings in May
2006 to discuss proposed standards and requirements for an
international long-range vessel tracking system. The Committee
understands that the final domestic system will have to be
compatible with the system that will be implemented by our
international partners; however, the Committee remains
concerned by the Administration's apparent decision to delay
the development and implementation of this system here at home.
The Committee strongly recommends that the Coast Guard actively
work through the IMO to develop standards and procedures;
however, failure to come to an agreement through the IMO should
not deter the United States from implementing this critical
maritime security measure domestically by the statutory
deadline of April 1, 2007.
This section also authorizes the Secretary to establish a
pilot program to track vessels who voluntarily agree to
participate until such time as the program under this section
becomes mandatory. The Committee strongly recommends that the
Secretary utilize the pilot program to test and evaluate
technologies and procedures to further the development of a
mandatory, nationwide long-range vessel tracking system.
Section 8 directs the Secretary of the department in which
the Coast Guard is operating to establish a university-based
Center for Excellence for Maritime Domain Awareness. The
Department of Homeland Security has created six such Centers of
Excellence which bring together the nation's best experts and
focus its most talented researchers on a variety of threats to
the Nation's homeland security. The Committee recommends that
such a Center be established to improve the Federal
government's capabilities to deter and respond to potential
threats in the maritime domain by enhancing its awareness of
all activities that occur within the maritime domain.
Section 9 would prohibit maritime cargo containers from
entering a U.S. port unless a container was screened using non-
intrusive scanning equipment in a foreign port, the results of
the scan are provided to U.S. authorities, and the container is
sealed with an enhanced seal. The provision establishes a
timeline that would require all cargo containers originating
from foreign nations that exported more than 75,000 twenty-foot
equivalent units (TEUs) in calendar year 2005 to be screened
and sealed by not later than three years after enactment. The
provision further requires that containers originating from all
other ports be screened and sealed by not later than five years
after enactment. The provision further requires that containers
originating from all other ports be screened and sealed by not
later than five years after enactment. As the scanning
technology develops, the Commandant of the Coast Guard could
also require that the scan identify the atomic elements of the
contents of the container. This will help decrease the rate of
false positives in the scan results.
The Committee is concerned that a weapon of mass
destruction could be smuggled into the United States in one of
the 11 million containers that enter the United States each
year. After 9/11, the Coast Guard was the first agency to
declare that we must ``push the borders out''. It is too late
to screen the containers once they reach the United States.
The major container terminals in Hong Kong have been
scanning 100 percent of the containers entering the facility
over the past year. They scan for radiation and for density. It
costs $6.50 to scan a container at those terminals. This does
not include the cost of reading and interpreting those scans.
Section 9 also requires all containers shipped to the
United States to have a container seal that will indicate
whether any of the sides of a container have been breached. For
years, thieves have drilled out the container hinges, stolen
merchandise, and replaced the hinge bolts--without being
caught. In the post-9/11 environment, it is important to be
able to detect any breach in the shell of a container after it
has been scanned to ensure that a weapon of mass destruction
has not been smuggled into the container between the point of
scanning and when it enters the United States.
Section 10 would authorize the Secretary to request certain
information from an owner or operator of a maritime facility
that is necessary to determine the facility's security risk.
Legislative History and Committee Consideration
H.R. 4880, the Maritime Terminal Security Enhancement Act
of 2006, was introduced by Coast Guard and Maritime
Transportation Subcommittee Chairman Frank A. LoBiondo on March
6, 2006. The bill was referred primarily to the Committee on
Transportation and Infrastructure.
The Subcommittee on Coast Guard and Maritime Transportation
has held numerous hearings during the 109th Congress and
previous Congresses to continue its oversight over the Federal
government's implementation of maritime security measures as
required by the Maritime Transportation Security Act of 2002
and the Coast Guard and Maritime Transportation Security Act of
2004. The Subcommittee held a field hearing on January 24,
2006, in Philadelphia, Pennsylvania, to review the status of
several maritime security programs including the requirement to
develop a Transportation Workers' Identification Credential
(TWIC). The Subcommittee held an additional oversight hearing
on March 9, 2006 to investigate the impacts of foreign control
of operations at U.S. ports on U.S. maritime security efforts.
On April 5, 2005, the Subcommittee on Coast Guard and
Maritime Transportation was discharged from consideration of
the bill, and the bill was considered during a mark-up session
of the Committee on Transportation and Infrastructure. At this
mark-up, Coast Guard and Maritime Transportation Subcommittee
Chairman, Mr. LoBiondo, offered an amendment to add several new
sections to the end of the bill. The amendment was adopted
unanimously by voice vote. Mr. Nadler of New York also offered
an amendment to add a section requiring maritime cargo
containers to be screened at foreign ports prior to entry at a
U.S. port. The Nadler amendment was also adopted by voice vote.
Mr. Cummings of Maryland offered an amendment to authorize the
Secretary of the department in which the Coast Guard is
operating to request certain information from the owner or
operator of a maritime facility. The Cummings amendment was
also adopted by voice vote.
H.R. 4880, as amended, was approved by voice vote and was
ordered favorably reported to the House.
Rollcall 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 rollcall votes during committee consideration of
the bill.
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 Legislation
Clause 3(d)(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 requirement 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
Committee has received no report of oversight findings and
recommendations from the Committee on Government Reform and
Oversight on the subject of H.R. 4880.
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.
4880 from the Director of the Congressional Budget Office.
U.S. Congress,
Congressional Budget Office,
Washington, DC, May 15, 2006.
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. 4880, the Maritime
Terminal Security Enhancement Act of 2006.
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), Sarah Puro (for the State and local
impact), and Paige Piper/Bach (for the private-sector impact).
Sincerely,
Donald B. Marron,
Acting Director.
Enclosure.
H.R. 4880--Maritime Terminal Security Enhancement Act of 2006
Summary: H.R. 4880 would amend the Maritime Transportation
Security Act of 2002 (MTSA) to address new and ongoing issues
relating to port security. Assuming appropriation of the
necessary amounts, CBO estimates that implementing H.R. 4880
would cost about $140 million over the next five years. We
estimate that enacting this legislation would have no effect on
revenues or direct spending.
The bill contains intergovernmental mandates as defined in
the Unfunded Mandates Reform Act (UMRA), but CBO estimates that
the costs to public ports would not exceed the threshold
established by that act ($64 million in 2006, adjusted annually
for inflation).
H.R. 4880 also would impose new private-sector mandates, as
defined in UMRA, on the shipping industry. CBO estimates that
the aggregate direct cost of complying with those mandates
would exceed the annual threshold for private-sector mandates
($128 million in 2006, adjusted annually for inflation) in at
least one of the first five years the mandates would be in
effect, beginning in 2010.
Estimated cost to the Federal Government: The estimated
budgetary impact of H.R. 4880 is shown in the following table.
The costs of this legislation fall within budget function 400
(transportation).
------------------------------------------------------------------------
By fiscal year, in millions of
dollars--
---------------------------------------
2007 2008 2009 2010 2011
------------------------------------------------------------------------
CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Spending for Center of
Excellence
Estimated Authorization 4 4 4 4 4
Level......................
Estimated Outlays........... 4 4 4 4 4
Spending to Implement Scan and
Seal Requirements
Estimated Authorization 10 15 30 40 45
Level......................
Estimated Outlays........... 5 10 25 35 45
Total Spending Under H.R.
4880
Estimated Authorization 14 19 34 44 49
Level....................
Estimated Outlays......... 9 14 29 39 49
------------------------------------------------------------------------
Basis of estimate: For this estimate, CBO assumes that H.R.
4880 will be enacted near the end of fiscal year 2006 and that
the entire amounts estimated to be necessary to carry out the
bill will be appropriated for each of fiscal years 2007 through
2011.
CBO estimates that implementing most provisions of H.R.
4880 would have no significant effect on federal spending
because the activities that would be required by these
provisions are already underway. Such provisions would
establish new deadlines for ongoing projects, require new
elements to be added to port security plans, and create new
federal reporting requirements. The bill's provisions that
would establish a Center for Excellence for Maritime Awareness
and increase oversite of shipping container security would
increase federal costs, assuming appropriation of the amounts
needed to implement them. CBO estimates that, in total, these
projects would cost about $9 million in 2007 and about $140
million over the 2007-2011 period.
Center for excellence for maritime awareness
H.R. 4880 would direct the United States Coast Guard (USCG)
to establish a center for excellence for maritime awareness.
The university-based center would provide educational and other
assistance to federal agencies on issues relating to maritime
security. Such centers sponsored by the Department of Homeland
Security (DHS) typically receive between $3 million and $6
million annually. Based on the costs of supporting similar
centers established by other agencies within the department,
CBO estimates that the USCG would provide a grant of $4 million
a year to the new center beginning in 2007.
Container security
H.R. 4880 would prohibit cargo containers from entering the
United States unless they are sealed and have been scanned with
imaging and radiation-detection equipment. Under the bill, the
USCG would promulgate standards for scanning equipment and for
seals to detect breaches in containers after they have been
scanned. The new requirements would become effective within
three years (for containers loaded in countries that originate
more than 75,000 ``twenty-foot equivalent'' containers) and
within five years (for countries originating a smaller volume
of traffic). The bill would authorize the appropriation of
whatever amounts are necessary for this purpose.
Assuming appropriation of the necessary amounts, CBO
estimates that implementing and enforcing this provision would
cost about $5 million in 2007. Annual costs would rise to $45
million by 2011. We estimate that most of these amounts would
be used to equip, train, pay, and support an additional 300 to
400 DHS employees to review container scans and enforce the
bill's requirement that containers be sealed. We expect that
annual costs would fall in later years (after 2011) because DHS
would probably develop more efficient ways to review scans and
inspect seals.
For this estimate, CBO assumes that the cost of installing
and maintaining the systems necessary to comply with the bill's
requirements would be borne by foreign shipyards rather than
the federal government, although we expect that DHS would
probably finance some of this effort through its existing
container security initiative (CSI). DHS received
appropriations of nearly $140 million for the CSI program for
2006. Industry experts have estimated that up-front costs to
acquire and deploy the necessary scanning and detection
equipment for nearly all foreign ports shipping containers to
the U.S. would be about $1.5 billion over three years, with
those costs borne primarily by foreign governments and the
shipping industry.
Estimated impact on State, local, and tribal governments:
H.R. 4880 contains intergovernmental mandates as defined in
UMRA because it would require ports to comply with certain
regulations more quickly than under current law, to resubmit
security plans to the Coast Guard in certain circumstances, and
to hire a United States citizen for the position of chief
security officer. Only the provisions that would require
publicly owned ports to comply with regulations more quickly
than under current law could impose costs on those entities.
Based on information from industry and governmental sources,
CBO estimates that the costs to intergovernmental entities of
these provisions likely would total less than $3 million and
therefore would not exceed the threshold established in UMRA
($64 million in 2006, adjusted annually for inflation).
Estimated impact on the private sector: H.R. 4880 would
impose new private-sector mandates, as defined in UMRA, on
shipping carriers and owners and operators of maritime terminal
facilities. CBO estimates that the aggregate direct cost of
complying with those mandates would exceed the annual threshold
for private-sector mandates ($128 million in 2006, adjusted
annually for inflation) in at least one of the first five years
the mandates would be in effect, beginning in 2010. That
conclusion is based on our analysis of the mandate with the
highest cost that would require that all cargo containers that
enter the United States be secured with a seal that meets
certain standards.
Seal requirements for cargo containers
The bill would impose a mandate on certain shipping
carriers by requiring all containers to be secured with a seal
that meets certain standards before the containers are loaded
on the vessel for shipment to the United States. The bill would
require seals that are able to detect any breach and identify
the time of such breach. The requirement would be phased in
over the next five years.
While the standards for such seals have not been
established, industry sources indicate that based on current
technology certain electronic seals could be secured and read
at a cost of approximately $30 to $45 per container for each
shipment. Based on information from industry and government
sources, approximately 15 million containers required to have
such seals are projected to enter the United States in 2010.
Based on this information, CBO expects that the direct costs to
comply with this mandate would amount to at least $450 million
or more in 2010, the first year the mandate would be in effect
and thus, would exceed the annual threshold for private-sector
mandates. In subsequent years, the direct cost of the mandate
on shipping carriers would tend to decrease as the cost of
seals may decrease according to industry sources, but CBO has
no basis for estimating the change in costs.
Other requirements
The bill also would impose mandates on owners and operators
of maritime terminal facilities. The bill would require that
any individual having full authority to implement security
action at a terminal facility be a citizen of the United
States. The bill also would authorize the Secretary of DHS to
require that owners or operators of a terminal facility submit
certain information that govern operations of the facility to
the Secretary to determine if there is any security risk
involving the owner or operator. Additionally, the bill would
require that owners and operators of maritime terminal
facilities resubmit their security plans for approval upon
transfer of ownership or operation of the facility. And
finally, the bill could impose additional mandates on the
private-sector depending on how and when certain regulations
addressed in the bill would be issued. Based on information
from industry and government sources, CBO expects that the
direct cost of complying with those requirements would be small
relative to UMRA's annual threshold.
Other impacts
The bill also would require all shipping containers
entering the United States to be scanned with certain equipment
with a copy of the scan to be sent to the Coast Guard. Because
the bill does not specify who would be required to provide such
scans, this provision may not impose a mandate as defined in
UMRA on the private sector. Even so, to the extent that
scanning causes a delay in the delivery of shipments, the
private sector could incur additional costs.
Previous CBO estimates: On May 9, 2006, CBO transmitted a
cost estimate for S. 2495, the Greenlane Maritime Cargo
Security Act, as ordered reported by the Senate Committee on
Homeland Security and Governmental Affairs on May 2, 2006. On
April 28, 2006, we transmitted a cost estimate for H.R. 4954,
the Security and Accountability for Every Port Act, as ordered
reported by the House Committee on Homeland Security on April
26, 2006. On March 29, 2006, CBO transmitted a cost estimate
for S. 1052, the Transportation Security Improvement Act of
2005, as reported by the Senate Committee on Commerce, Science,
and Transportation on February 27, 2006. Like H.R. 4880, all
three of those bills would address concerns about port
security, particularly regarding freight containers entering
the United States from foreign ports, and would use different
approaches to address such concerns, which are reflected in
CBO's cost estimates.
Estimate prepared by: Federal Costs: Deborah Reis. Impact
on State, Local, and Tribal Governments: Sarah Puro. Impact on
the Private Sector: Paige Piper/Bach.
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 I, 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).
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
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
TITLE 46, UNITED STATES CODE
* * * * * * *
Subtitle VI--Miscellaneous
* * * * * * *
CHAPTER 701--PORT SECURITY
* * * * * * *
Sec. 70103. Maritime transportation security plans
(a) * * *
* * * * * * *
(c) Vessel and Facility Security Plans.--(1) * * *
* * * * * * *
(8) The Secretary may require the owner or operator of a
facility that is required to have a security plan under
paragraph (1) and that is a cargo terminal, to submit
information, including contracts or other agreements that
govern operations of such facilities, to the Secretary to
determine if there is any security risk involving that owner or
operator.
* * * * * * *
Sec. 70105. Transportation security cards
(a) Prohibition.--(1) [The] Not later than July 1, 2006, the
Secretary shall prescribe regulations to prevent an individual
from entering an area of a vessel or facility that is
designated as a secure area by the Secretary for purposes of a
security plan for the vessel or facility that is approved by
the Secretary under section 70103 of this title unless the
individual--
(A) * * *
* * * * * * *
Sec. 70108. Foreign port assessment
(a) * * *
* * * * * * *
(d) Periodic Reassessment.--The Secretary, acting through the
Commandant of the Coast Guard, shall reassess the effectiveness
of antiterrorism measures maintained at ports as described
under subsection (a) and of procedures described in subsection
(b) not less than every 5 years.
* * * * * * *
Sec. 70111. Enhanced crewmember identification
(a) Requirement.--[The] Not later than July 1, 2006, the
Secretary, in consultation with the Attorney General and the
Secretary of State, shall require crewmembers on vessels
calling at United States ports to carry and present on demand
any identification that the Secretary decides is necessary.
(b) Forms and Process.--[The] Not later than July 1, 2006,
the Secretary, in consultation with the Attorney General and
the Secretary of State, shall establish the proper forms and
process that shall be used for identification and verification
of crewmembers.
* * * * * * *
Sec. 70115. Long-range vessel tracking system
[The Secretary shall] Not later than April 1, 2007, the
Secretary shall, consistent with international treaties,
conventions, and agreements to which the United States is a
party, develop and implement a long-range automated vessel
tracking system for all vessels in United States waters that
are equipped with the Global Maritime Distress and Safety
System or equivalent satellite technology. The system shall be
designed to provide the Secretary the capability of receiving
information on vessel positions at interval positions
appropriate to deter transportation security incidents. The
Secretary may use existing maritime organizations to collect
and monitor tracking information under the system.
Sec. 70116. Secure systems of transportation
(a) * * *
* * * * * * *
(c) Requirements Relating to Entry of Containers.--
(1) In general.--A container shipped, either directly
or via a foreign port, may enter the United States only
if--
(A) the container is scanned with equipment
that meets the standards established pursuant
to paragraph (2)(A) and a copy of the scan is
provided to the Commandant of the Coast Guard;
and
(B) the container is secured with a seal that
meets the standards established pursuant to
paragraph (2)(B), before the container is
loaded on the vessel for shipment.
(2) Standards for scanning equipment and seals.--
(A) Scanning equipment.--The Commandant of
the Coast Guard shall establish standards for
scanning equipment required to be used under
paragraph (1)(A) to ensure that such equipment
uses the best-available technology, including
technology to scan a container for radiation
and density and, if appropriate, for atomic
elements.
(B) Seals.--The Commandant of the Coast Guard
shall establish standards for seals required to
be used under paragraph (1)(B) to ensure that
such seals are developed and made using the
best-available technology, including technology
to detect any breach into a container and
identify the time of such breach.
(C) Review and revision.--The Commandant of
the Coast Guard shall--
(i) review and, if necessary, revise
the standards established pursuant to
subparagraphs (A) and (B) not less than
once every two years; and
(ii) ensure that any such revised
standards require the use of
technology, as soon as such technology
becomes available, to--
(I) identify the place of a
breach into a container;
(II) notify the Commandant of
such breach before the
container enters the Exclusive
Economic Zone of the United
States; and
(III) track the time and
location of the container
during transit to the United
States, including by truck,
rail, or vessel.
(D) Definition.--In subparagraph (C), the
term ``Exclusive Economic Zone of the United
States'' has the meaning given the term
``Exclusive Economic Zone'' in section
2101(10a) of this title.
* * * * * * *