[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]

PORT SAFETY, SECURITY, AND INFRASTRUCTURE INVESTMENT

=======================================================================

Committee on Transportation and Infrastructure
Serial No. 118-51

Committee on Homeland Security
Serial No. 118-58

JOINT FIELD HEARING

BEFORE THE

SUBCOMMITTEE ON
COAST GUARD AND MARITIME TRANSPORTATION,

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

AND THE

SUBCOMMITTEE ON
TRANSPORTATION AND MARITIME SECURITY,

COMMITTEE ON HOMELAND SECURITY

HOUSE OF REPRESENTATIVES

ONE HUNDRED EIGHTEENTH CONGRESS

SECOND SESSION

__________

APRIL 5, 2024
(PortMiami, Miami, Florida)

__________

Printed for the use of the Committee on Transportation and
Infrastructure and the Committee on Homeland Security

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

Available online at: https://www.govinfo.gov/committee/house-
transportation?path=/browsecommittee/chamber/house/committee/
transportation
_______

U.S. GOVERNMENT PUBLISHING OFFICE

57-417 PDF WASHINGTON : 2024

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

Sam Graves, Missouri, Chairman
Rick Larsen, Washington, Ranking Member

Eric A. ``Rick'' Crawford, Arkansas Eleanor Holmes Norton,
Daniel Webster, Florida District of Columbia
Thomas Massie, Kentucky Grace F. Napolitano, California
Scott Perry, Pennsylvania Steve Cohen, Tennessee
Babin, Texas John Garamendi, California
Garret Graves, Louisiana Henry C. ``Hank'' Johnson, Jr., Georgiaian
David Rouzer, North Carolina Andre Carson, Indiana
Mike Bost, Illinois Dina Titus, Nevada
Doug LaMalfa, California Jared Huffman, California
Bruce Westerman, Arkansas Julia Brownley, California
Brian J. Mast, Florida Frederica S. Wilson, Florida
Jenniffer Gonzalez-Colon, Donald M. Payne, Jr., New Jersey
Puerto Rico Mark DeSaulnier, California
Pete Stauber, Minnesota Salud O. Carbajal, California
Tim Burchett, Tennessee Greg Stanton, Arizona,
Dusty Johnson, South Dakota Vice Ranking Member
Jefferson Van Drew, New Jersey, Colin Z. Allred, Texas
Vice Chairman Sharice Davids, Kansas
Troy E. Nehls, Texas Jesus G. ``Chuy'' Garcia, Illinois
Tracey Mann, Kansas Chris Pappas, New Hampshire
Burgess Owens, Utah Seth Moulton, Massachusetts
Rudy Yakym III, Indiana Jake Auchincloss, Massachusetts
Lori Chavez-DeRemer, Oregon Marilyn Strickland, Washington
Thomas H. Kean, Jr., New Jersey Troy A. Carter, Louisiana
Anthony D'Esposito, New York Patrick Ryan, New York
Eric Burlison, Missouri Mary Sattler Peltola, Alaska
John James, Michigan Robert Menendez, New Jersey
Derrick Van Orden, Wisconsin Val T. Hoyle, Oregon
Brandon Williams, New York Emilia Strong Sykes, Ohio
Marcus J. Molinaro, New York Hillary J. Scholten, Michigan
Mike Collins, Georgia Valerie P. Foushee, North Carolina
Mike Ezell, Mississippi
John S. Duarte, California
Aaron Bean, Florida
Celeste Maloy, Utah
Vacancy

------

Subcommittee on Coast Guard and Maritime Transportation

Daniel Webster, Florida, Chairman
Salud O. Carbajal, California, Ranking Member

Brian Babin, Texas John Garamendi, California
Brian J. Mast, Florida Chris Pappas, New Hampshire
Jenniffer Gonzalez-Colon, Jake Auchincloss, Massachusetts
Puerto Rico Mary Sattler Peltola, Alaska
Jefferson Van Drew, New Jersey Hillary J. Scholten, Michigan,
Mike Ezell, Mississippi, Vice Chairman Vice Ranking Member
Aaron Bean, Florida Rick Larsen, Washington (Ex Officio)
Sam Graves, Missouri (Ex Officio)

COMMITTEE ON HOMELAND SECURITY

Mark E. Green, M.D., Tennessee, Chairman
Bennie G. Thompson, Mississippi, Ranking Member

Michael T. McCaul, Texas Sheila Jackson Lee, Texas
Clay Higgins, Louisiana Donald M. Payne, Jr., New Jersey
Michael Guest, Mississippi Eric Swalwell, California
Dan Bishop, North Carolina J. Luis Correa, California
Carlos A. Gimenez, Florida Troy A. Carter, Louisiana
August Pfluger, Texas Shri Thanedar, Michigan
Andrew R. Garbarino, New York Seth Magaziner, Rhode Island
Marjorie Taylor Greene, Georgia Glenn Ivey, Maryland
Tony Gonzales, Texas Daniel S. Goldman, New York
Nick LaLota, New York Robert Garcia, California
Mike Ezell, Mississippi Delia C. Ramirez, Illinois
Anthony D'Esposito, New York Robert Menendez, New Jersey
Laurel M. Lee, Florida Thomas R. Suozzi, New York
Morgan Luttrell, Texas Yvette D. Clarke, New York
Dale W. Strong, Alabama
Josh Brecheen, Oklahoma
Elijah Crane, Arizona

------

Subcommittee on Transportation and Maritime Security

Carlos A. Gimenez, Florida, Chairman
Shri Thanedar, Michigan, Ranking Member

Clay Higgins, Louisiana Donald M. Payne, Jr., New Jersey
Nick LaLota, New York Robert Garcia, California
Laurel M. Lee, Florida Bennie G. Thompson, Mississippi (Ex Officio)
Mark E. Green, M.D., Tennessee (Ex Officio)

CONTENTS

Page

Summary of Subject Matter........................................ vii

STATEMENTS OF MEMBERS OF THE COMMITTEES

Hon. Daniel Webster, a Representative in Congress from the State
of Florida, and Chairman, Subcommittee on Coast Guard and
Maritime Transportation, Committee on Transportation and
Infrastructure, opening statement.............................. 3
Prepared statement........................................... 4
Hon. Salud O. Carbajal, a Representative in Congress from the
State of California, and Ranking Member, Subcommittee on Coast
Guard and Maritime Transportation, Committee on Transportation
and Infrastructure, opening statement.......................... 5
Prepared statement........................................... 6
Hon. Carlos A. Gimenez of Florida, Chairman, Subcommittee on
Transportation and Maritime Security, Committee on Homeland
Security, opening statement.................................... 6
Prepared statement........................................... 8
Hon. Shri Thanedar of Michigan, Ranking Member, Subcommittee on
Transportation and Maritime Security, Committee on Homeland
Security, opening statement.................................... 10
Prepared statement........................................... 11

WITNESSES
Panel 1

Hon. Mario Diaz-Balart, a Representative in Congress from the
State of Florida, oral statement............................... 12
Prepared statement........................................... 14

Panel 2

Rear Admiral John C. Vann, Commander, Coast Guard Cyber Command,
U.S. Coast Guard, oral statement............................... 18
Rear Admiral Wayne R. Arguin, Assistant Commandant for Prevention
Policy, U.S. Coast Guard, oral statement....................... 19
Joint prepared statement of Rear Admirals Vann and Arguin.... 21
William K. Paape, Associate Administrator for Ports and
Waterways, Maritime Administration, oral statement............. 25
Prepared statement........................................... 26

Panel 3

James C. Fowler, Senior Vice President and General Manager,
Crowley Shipping, oral statement............................... 35
Prepared statement........................................... 37
Frederick Wong, Jr., Deputy Port Director, PortMiami, on behalf
of the American Association of Port Authorities, oral statement 38
Prepared statement........................................... 40
Brent D. Sadler, Captain, U.S. Navy (Ret.), and Senior Research
Fellow, The Heritage Foundation, oral statement................ 42
Prepared statement........................................... 43
Ed McCarthy, Chief Operating Officer, Georgia Ports Authority, on
behalf of the National Association of Waterfront Employers,
oral statement................................................. 50
Prepared statement........................................... 51
Dave Morgan, President and Chief Executive Officer, Cooper/Ports
America, on behalf of the National Maritime Safety Association,
oral statement................................................. 55
Prepared statement........................................... 57

APPENDIX

Questions from Hon. Salud O. Carbajal to:
William K. Paape, Associate Administrator for Ports and
Waterways, Maritime Administration......................... 69
Frederick Wong, Jr., Deputy Port Director, PortMiami, on
behalf of the American Association of Port Authorities..... 69
Ed McCarthy, Chief Operating Officer, Georgia Ports
Authority, on behalf of the National Association of
Waterfront Employers....................................... 70
Dave Morgan, President and Chief Executive Officer, Cooper/
Ports America, on behalf of the National Maritime Safety
Association................................................ 70

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

April 2, 2024

JOINT SUMMARY OF SUBJECT MATTER

TO: LMembers, Subcommittee on Coast Guard and Maritime
Transportation and Subcommittee on Transportation and Maritime
Security

FROM: LStaff, Subcommittee on Coast Guard and Maritime
Transportation and Subcommittee on Transportation and Maritime
Security

RE: LSubcommittee on Coast Guard and Maritime
Transportation and Subcommittee on Transportation and Maritime
Security Hearing on ``Port Safety, Security, and Infrastructure
Investment''
_______________________________________________________________________

I. PURPOSE

The Subcommittee on Coast Guard and Maritime Transportation
of the Committee on Transportation and Infrastructure and the
Subcommittee on Transportation and Maritime Security of the
Committee on Homeland Security will meet on Friday, April 5,
2024, at 9:30 a.m. ET in Terminal E of PortMiami to receive
testimony at a joint field hearing entitled, ``Port Safety,
Security, and Infrastructure Investment.'' The joint field
hearing will discuss emerging challenges to safety and security
at United States ports as well as the state of port
infrastructure and future investment needs. At the hearing,
Members will receive testimony from three panels of witnesses.
The first panel will include a Member from the United States
House of Representatives. The second panel will include
representatives from the United States Coast Guard (Coast Guard
or Service) and the Maritime Administration (MARAD). The third
panel will include representatives from Crowley Shipping,
PortMiami, the Heritage Foundation, Georgia Ports Authority,
and Cooper/Ports America.

II. BACKGROUND

The United States is a maritime Nation with 95 percent of
all cargo entering through the Marine Transportation System
(MTS).\1\ Cargo activity at United States ports accounts for 26
percent of the United States' gross domestic product (GDP),
generating nearly $5.4 trillion in total economic activity, and
supporting 31 million direct and indirect jobs.\2\ The United
States navigable transportation network includes 361 ports on
more than 25,000 miles of waterways, including oceans, rivers,
and lakes.\3\ The sheer size and complexity of port facilities,
along with the volume of freight handled, can make them
difficult to secure despite the critical importance of
safeguarding our Nation's ports.\4\
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\1\ Fact Sheet, The White House, Biden-Harris Administration
Announces Initiative to Bolster Cybersecurity of U.S. Ports (Feb. 21,
2024), available at https://www.whitehouse.gov/briefing-room/
statements-releases/2024/02/21/fact-sheet-biden-harris-administration-
announces-initiative-to-bolster-cybersecurity-of-u-s-ports/.
\2\ Id.
\3\ John Nemerofsky, Protecting our Ports, Security Magazine, (Jan.
10, 2022), available at https://www.securitymagazine.com/articles/
96867-protecting-our-ports.
\4\ Interpol, Port Security Project, available at https://
www.interpol.int/en/Crimes/Maritime-crime/Port-Security-Project.
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To ensure the uninterrupted operation of the MTS, the Coast
Guard is responsible for the development and implementation of
policies and procedures to facilitate commerce and improve
United States ports and waterways ensuring they are safe and
operational.\5\ Additionally, the Coast Guard serves as the
principal Federal agency charged with ensuring the security and
safety of the waters under United States' jurisdiction.\6\ Its
responsibilities include securing United States ports against
any physical or cybersecurity threats seeking to disrupt
operations. To this end, the Coast Guard is responsible for
reviewing and approving port facility security plans,
conducting site visits to ensure proper physical security
measures are being taken, and taking steps to prevent and
respond to malicious cyber activities.\7\ United States Customs
and Border Protection (CBP), complements the Coast Guard's
maritime security efforts by identifying and screening high-
risk cargo before it enters the United States.\8\
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\5\ U.S. Coast Guard, Ports and Waterways Safety Assessment
(PAWSA), available at https://
www.dco.uscg.mil/PAWSA/
#::text=The%20United%20States%20Coast%20Guard,efficient
%2C%20and%20commercially%20viable%20as.
\6\ U.S Gov't Accountability Off., GAO-20-33, Assessing Deployable
Specialized Forces' Workforce Needs Could Improve Efficiency and Reduce
Potential Overlap or Gaps in Capabilities, (2019), available at https:/
/www.gao.gov/assets/d2033.pdf.
\7\ Evaluating High-Risk Security Vulnerabilities at Our Nation's
Ports: Hearing Before the Subcomm. on Transp. and Maritime Sec. of the
H. Comm. on Homeland Sec., 118th Cong. (May 10, 2023).
\8\ CBP, CSI: Container Security Initiative, available at https://
www.cbp.gov/border-security/ports-entry/cargo-security/csi/csi-brief.
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MARAD, within the Department of Transportation (DOT), is
responsible for fostering, promoting, and developing the United
States maritime industry so it can meet the Nation's economic
and security needs.\9\ MARAD serves as a resource to ports by
providing financial assistance to help fund infrastructure
improvements and facilitate a more efficient, reliable and
operational MTS.\10\ The Federal Emergency Management Agency
(FEMA) provides additional financial assistance for security-
focused projects at ports through its Port Security Grant
Program.\11\
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\9\ MARAD, About Us: MARAD at a Glance, available at https://
www.maritime.dot.gov/
about-
us#::text=Mission%3A%20To%20foster%2C%20promote%20and,nation's%20econom
ic
%20and%20security%20needs.
\10\ MARAD, Ports, available at https://www.maritime.dot.gov/ports/
ports.
\11\ FEMA, Port Security Grant Program, available at https://
www.fema.gov/grants/preparedness/port-security.
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III. PORT SAFETY AND SECURITY

Maritime ports, facilities, and infrastructure worldwide
are vulnerable to physical and cybersecurity exposure through
domestic and foreign adversarial access to everything from port
equipment and infrastructure to supply chain information
management systems.\12\ These threats pose a serious safety and
security risk to our Nation's ports and vessels underway.
Furthermore, they threaten to disrupt the supply chain. One of
America's largest ports, the Port of Los Angeles, faces
approximately 40 million cyber-attacks per month.\13\
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\12\ MARAD, 2023-002-Worldwide Maritime Port Vulnerabilities--
Foreign Adversarial Technological, Physical, and Cyber Influence,
available at https://www.maritime.dot.gov/msci/2023-002-worldwide-
maritime-port-vulnerabilities-foreign-adversarial-technological-
physical.
\13\ Sam Fenwick, Cyber-attacks on Port of Los Angeles have doubled
since pandemic, BBC (July 22, 2022), available at https://www.bbc.com/
news/business-62260272.
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PHYSICAL/KINETIC THREATS

The terrorist attacks of September 11, 2001, heightened
awareness about the vulnerability of all modes of
transportation, including the MTS, to terrorist attacks.\14\ A
large fraction of maritime cargo is concentrated at a few major
ports, making them highly susceptible to threats.\15\ Ports
face physical security threats ranging from unauthorized access
to smuggling to terrorism and beyond.\16\ The Coast Guard and
its partners attempt to prioritize and assess these threats
through a variety of tools, including Notices of Arrival,
inspections, and specially trained teams.\17\
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\14\ Bart Elias et al., Cong. Rsch. Serv., R46678, Transportation
Security: Background and Issue for the 117th Congress, (Feb. 9, 2021),
available at https://crs.gov/Reports/R46678?source=search.
\15\ Id.
\16\ John Nemerofsky, Protecting our Ports, Security Magazine,
(Jan. 10, 2022), available at https://www.securitymagazine.com/
articles/96867-protecting-our-ports.
\17\ See supra note 14; see also supra note 12.
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Additionally, the Coast Guard tries to manage physical
security concerns both at the port facility and over the
vessels transiting in and around facilities. Under the Maritime
Transportation Security Act of 2002 (MTSA) (P.L. 107-295), port
facilities must submit a facility security plan to the Coast
Guard that outlines how they will implement required physical
and cyber security measures.\18\ The Coast Guard conducts
facility site visits to ensure each port is implementing the
proper physical and cyber security measures.\19\ It evaluates a
ship's country of registration, cargo, crew, vessel security
history and last port of call to determine the risk an inbound
vessel poses and conduct boardings accordingly.\20\ Depending
on the risk, the Coast Guard may conduct a security boarding at
sea prior to entry, provide the vessel an armed escort to
protect it from external threats, or place a security team
onboard to avoid hijacking or weaponizing the vessel.\21\
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\18\ Coast Guard, U.S. Dep't of Homeland Sec., U.S. Coast Guard,
ISPS / MTSA, History, available at https://www.dco.uscg.mil/ISPS-MTSA/.
\19\ Id.
\20\ Id.
\21\ Id.
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Maritime Security Operations is one of the Coast Guard's
major operational mission programs. It encompasses activities
to detect, deter, prevent, and disrupt terrorist attacks, and
other criminal acts in the United States maritime domain.\22\
It includes the execution of anti-terrorism, counterterrorism,
response, and select recovery operations.\23\ This mission
encompasses the operational element of the Coast Guard's Ports,
Waterways, and Coastal Security mission and complements its
Maritime Response and Prevention efforts.\24\ To help carry out
this mission, the Coast Guard maintains Specialized Forces
units, including the Maritime Security Response Team (MSRT) and
Maritime Safety and Security Teams (MSST), who have the
capabilities needed to handle high-risk law enforcement, drug
interdiction, terrorism, and other threats to the U.S. maritime
environment.\25\
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\22\ U.S. Coast Guard, Missions, available at https://www.uscg.mil/
About/Missions/.
\23\ Id.
\24\ Id.
\25\ Id.
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While the focus on ports has recently shifted to
cyberattacks, the risk of physical attacks through illicit
activity or terrorist actions remains very real and is an
ongoing threat the Coast Guard continues to work to prevent.

CYBER THREATS

Beginning in the mid-2000s, the Chinese government
developed the National Transportation and Logistics Public
Information Platform, known as LOGINK, which is a logistics
management system that provides shipment tracking and other
logistical services.\26\ The data collected by the system
varies, but can include vessel and cargo locations, transit
conditions, specific information on the type of cargo, customs
information, and personal and financial data.\27\
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\26\ U.S. China Economic and Security Review Commission, LOGINK:
Risks from China's Promotion of a Global Logistics Management Platform
(September 2022), available at https://www.uscc.gov/research/logink-
risks-chinas-promotion-global-logistics-management-platform
\27\ Id.
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The Chinese government is seeking to spur the adoption of
LOGINK, along with its proprietary data standards, among global
ports and transportation suppliers by providing the service
free of charge. To date, LOGINK has received cooperation
agreements with dozens of ports outside of China, including
major logistical centers in Europe, Asia, and the Middle
East.\28\ Given the sensitivity of the information collected by
LOGINK, including property data on shipment and supply chains,
the data could be misused by the Chinese Communist Party to
gain access to sensitive business and foreign government data
for malign purposes. The James M. Inhofe National Defense
Authorization Act for Fiscal Year 2023 (P.L. 117-263), included
provisions to protect against malicious Chinese software. Among
its provisions is a prohibition on the use of LOGINK by
recipients of Port Infrastructure Development Grants and
directs the State Department to work with allies that use
LOGINK to dissuade its use. Further, H.R. 1836, the Ocean
Shipping Reform Act of 2023, which was approved by the United
States House of Representatives on March 21, 2024, includes
similar provisions.\29\ Similarly, Chinese-made port equipment,
including cranes, presents vulnerability to the safe and
efficient operation of ports.
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\28\ Id.
\29\ Ocean Shipping Reform Implementation Act of 2023, H.R. 1836,
118th Cong. (2023).
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On February 21, 2024, President Biden issued an Executive
Order to strengthen maritime cybersecurity.\30\ Among its
provisions, the Executive Order enables the Coast Guard to
establish safety zones to respond to malicious activity,
control the movement of vessels that present a suspected or
known cyberthreat, and require facilities to take action
against cyberthreats that pose a danger to the safety of a
vessel, shoreside facility or harbor.\31\ In concert with this
Executive Order, the Coast Guard issued Maritime Security
Directive 105-4 which requires owners and operators of People's
Republic of China manufactured Ship-to-Shore Cranes to take a
series of actions on these cranes and their systems and a
Notice of Proposed Rulemaking which establishes minimum
cybersecurity requirements for United States flagged vessels,
Outer Continental Shelf facilities, and United States
facilities subject to the Maritime Transportation Security Act
of 2002.\32\ The comment period ends on April 22, 2024.\33\
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\30\ Exec. Order. No. 14116, 89 Fed. Reg. 13971, (Feb. 21, 2024),
available at https://www.govinfo.gov/content/pkg/FR-2024-02-26/pdf/
2024-04012.pdf, see also Coast Guard, Executive Order Expands Coast
Guard Authorities to Address Maritime Cyber Threats (Feb. 22, 2024)
available at https://www.news.uscg.mil/maritime-commons/Article/
3683564/executive-order-expands-coast-guard-authorities-to-address-
maritime-cyber-threa/.
\31\ Id.
\32\ Id.
\33\ Id.
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The Coast Guard's Cyber Protection Teams (CPTs) help port
stakeholders address specific cyber threats and vulnerabilities
through consistent proactive engagement with public and private
industry organizations.\34\ Port owners and operators can
request CPTs to conduct cybersecurity assessments that include
penetration testing and configuration review as well as
assessing malware vulnerability.\35\
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\34\ Coast Guard, U.S. Coast Guard Cyber Protection Team (CPT),
available at https://www.uscg.mil/Portals/0/CPT%20One%20Pager.pdf.
\35\ Id.
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Given these threats, the Coast Guard needs to confront the
possibility and even probability of kinetic and cyberattacks by
improving its capability to protect ports against these rapidly
evolving risks.

IV. PORT INFRASTRUCTURE INVESTMENTS

The surge of cargo brought on by the COVID-19 pandemic
exposed vulnerabilities in our supply chain with ports and
intermodal connections unable to efficiently handle the higher-
than-normal container shipping volumes. The resulting supply
chain crisis brought greater focus to needs across our Nation's
infrastructure. Federal funding opportunities to support
landside investments at ports have expanded in recent years to
try and address these identified shortfalls, and port and
marine terminal operators plan to invest $163 billion for
infrastructure improvements through 2025.\36\
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\36\ Jerry Haar, America's Air, Sea, and Land Ports Require
Investment to be Globally Competitive, Wilson Center, (Mar. 2, 2023),
available at https://www.wilsoncenter.org/article/americas-air-sea-and-
land-ports-require-investment-be-globally-competitive.
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MARAD is responsible for the administration of the Port
Infrastructure Development Program (PIDP), a discretionary
grant program that provides awards on a competitive basis to
projects at coastal seaports, inland river ports, and Great
Lakes ports to improve the safety, efficiency, or reliability
of the movement of goods into, out of, around, or within a
port.\37\ Acting as the sole discretionary grant program
dedicated to port infrastructure improvements, PIDP has grown
exponentially over the last several years with the
Infrastructure Investment and Jobs Act (P.L. 117-58) providing
advanced appropriations of $450 million per year through fiscal
year (FY) 2026, which is in addition to annual appropriations
the program receives.\38\ Since its initial round of funding in
FY 2019, PIDP has distributed over $9 billion in grant
awards.\39\
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\37\ MARAD, Port Infrastructure Development Program, available at
https://www.maritime.dot.gov/PIDPgrants.
\38\ Infrastructure Investment and Jobs Act, Pub. L. No. 117-58,
135 Stat. 429.
\39\ MARAD, PIDP Applicant List, available at https://
www.maritime.dot.gov/grants-finances/federal-grant-assistance/pidp-
applicant-list.
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V. WITNESSES

PANEL I:

LHon. Mario Diaz-Balart, 26th District of Florida,
Member of Congress

PANEL II:

LRear Admiral John C. Vann, Commander, Coast Guard
Cyber Command, United States Coast Guard
LRear Admiral Wayne Arguin, Assistant Commandant
for Prevention Policy, United States Coast Guard
LMr. William Paape, Associate Administrator for
Ports and Waterways, United States Maritime Administration,
United States Department of Transportation

PANEL III:

LMr. James Fowler, Senior Vice President and
General Manager, Crowley Shipping
LMr. Frederick Wong, Jr., Deputy Port Director,
PortMiami, on behalf of the American Association of Port
Authorities
LMr. Brent D. Sadler, Senior Research Fellow,
Heritage Foundation
LMr. Ed McCarthy, Chief Operating Officer, Georgia
Ports Authority, on behalf of the National Association of
Waterfront Employers
LMr. Dave Morgan, President and Chief Executive
Officer, Cooper/Ports America, on behalf of the National
Maritime Safety Association

PORT SAFETY, SECURITY, AND INFRASTRUCTURE INVESTMENT

----------

FRIDAY, APRIL 5, 2024

House of Representatives,
Subcommittee on Coast Guard and
Maritime Transportation,
Committee on Transportation and Infrastructure,
joint with the
Subcommittee on Transportation and
Maritime Security,
Committee on Homeland Security,
Washington, DC.
The subcommittees met, pursuant to call, at 9:30 a.m., at
Terminal E, PortMiami, 1265 North Cruise Boulevard, Miami,
Florida, Hon. Daniel Webster (Chairman of the Subcommittee on
Coast Guard and Maritime Transportation) presiding.
Ms. Levine Cava, Mayor, Miami-Dade County. I think it would
be wonderful if everyone could take their seats. And in advance
of your session, I just wanted to offer some brief words of
welcome. Thank you, everyone.
Very good. Good morning. Good morning, everyone. I'm
Daniella Levine Cava, your county mayor in Miami-Dade County.
I'm thrilled that PortMiami is part of our great county
government. So, we want to welcome you officially here.
We're joined by our Chief Operating Officer Jimmy Morales,
who has responsibility for the port, the airport, and other
critical infrastructure, and of course, much of our leadership
here at PortMiami. We're very grateful that you've chosen to do
your field hearing here.
So, thank you very much to Chairman Webster from the Coast
Guard and Maritime Transportation Subcommittee of the Committee
on Transportation and Infrastructure. We think it's fitting and
proper because we have such a great operation here, and we hope
you'll have a chance to explore and tour and learn more about
it.
And, of course, to our local House Representative, Carlos
Gimenez, who served in this role as mayor for 10 years and who
serves as chairman of the Transportation and Maritime Security
Subcommittee of the Committee on Homeland Security. Thank you
so much for being here with us today, Congressman. And we are
also joined by our Congressman, Representative Diaz-Balart, who
has played such a critical role in transportation as well.
Thank you.
All right. And to all of our visiting Members, thank you
for choosing us for today's hearing. I want to welcome
particularly our Ranking Member Carbajal and Ranking Member
Thanedar and members of the subcommittees. Thank you.
So, I think you've heard Miami-Dade County is the cruise
capital of the world. We're very proud of that fact and fully
restored post-pandemic. So, quite remarkable. Cruising has come
back with a huge, huge force. People are just loving coming
here, and we also have become a global commerce capital for
trade, as well. And so, we really are doing very well here at
PortMiami, and I believe that there is no better place in our
Nation to address these critical topics in the maritime
transportation system.
We're the second most important economic engine in Miami-
Dade County after our airport. And we contribute $43 billion
annually to the local economy. We support more than 334,000
jobs. It's one of the fastest growing cargo gateways in the
country. And last year, we welcomed over 7 million cruise
passengers, more than any port in the world.
So, again, we're growing. You can see there's construction
for yet another terminal right beside us here, and it's quite a
busy waterway when these cruise ships line up and take people
on their wonderful vacations.
So, we're a coastal metropolis. We're a growing one. We're
always striving to be at the cutting edge of maritime safety
and security while building for tomorrow's infrastructure needs
and an economic engine. We did a study showing this is a $64
billion impact right here from our bay and our port.
So, welcome again, everyone. I hope you'll get a chance to
tour, as I said, and also learn about our shore power
installation. Very proud. That will be coming online in just a
short couple of months, and three ships will be able to plug in
simultaneously, reducing our fumes and carbon output and
providing us a cleaner and safer future for our vessels as
well. Thank you, everyone.
Mr. Webster of Florida. The joint subcommittee hearing
between the Subcommittee on Coast Guard and Maritime
Transportation of the Committee on Transportation and
Infrastructure and the Subcommittee on Transportation and
Maritime Security of the Committee on Homeland Security will
come to order. We're in order.
I ask unanimous consent that the chairman be authorized to
declare a recess at any time during today's joint hearing.
Without objection, show that ordered.
I ask unanimous consent that the Members not on the
subcommittee, but on either committee's full committee, be
permitted to sit with the subcommittee at today's joint hearing
and ask questions. Without objection, show that ordered.
As a reminder to Members, if you wish to insert a document
into the record, please also email it to
DocumentsTI@mail.house.gov. I now recognize myself for the
purpose of an opening statement for 5 minutes.

OPENING STATEMENT OF HON. DANIEL WEBSTER OF FLORIDA, CHAIRMAN,
SUBCOMMITTEE ON COAST GUARD AND MARITIME TRANSPORTATION,
COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

Mr. Webster of Florida. Before we begin, I want to mention
the recent tragedy in the Port of Baltimore. First and
foremost, our thoughts are with the victims and their families.
We greatly appreciate the work of the Coast Guard and other
first responders in their heroic efforts in response to this
tragedy. As the work gets underway to reopen the channel,
rebuild the bridge, and carry out an investigation, the
Transportation and Infrastructure Committee will closely
monitor developments and work with the families and
stakeholders impacted.
Turning to the agenda at hand, we meet today at PortMiami
to examine port safety and security and infrastructure
investments. I appreciate the mayor, the port's Director and
Chief Executive Officer Hydi Webb, and the rest of the team at
PortMiami for hosting us.
I'd like to welcome our witnesses joining us today. We will
be hearing testimony from three panels.
On our first panel, we'll have Representative Mario Diaz-
Balart, who represents Florida's 26th Congressional District.
On the second panel, we have Rear Admiral John Vann,
Commander of Coast Guard Cyber Command; Rear Admiral Wayne
Arguin, Jr., who is Coast Guard Assistant Commandant for
Prevention Policy; and William Paape, Associate Administrator
for Ports and Waterways for the Maritime Administration.
On the third panel, we'll hear from James Fowler, senior
vice president and general manager of Crowley Shipping;
Frederick Wong, Jr., deputy port director of PortMiami; Brent
Sadler, senior research fellow at The Heritage Foundation; Ed
McCarthy, chief operating officer of Georgia Ports Authority;
and Dave Morgan, president and chief executive officer of
Cooper/Ports America. Thank you all for being witnesses here
and joining us today.
Cargo activity in the United States ports is crucial to our
Nation's commerce and accounts for 26 percent of our Nation's
GDP, generating nearly $5.4 trillion in total economic activity
and supporting 31 million direct and indirect jobs. To protect
this crucial economic engine, we need to make the necessary
investments and ensure our ports are effectively confronting
the physical and cyber threats.
The Maritime Transportation Security Act was passed in the
wake of 9/11 and was originally envisioned to guard primarily
against physical threats. However, as technology and automation
become more engrained into the port's operations, the risk of
cyber attacks grows. For example, we know from public reporting
that one of America's largest ports, the Port of Los Angeles,
faces approximately 40 million cyber attacks per month.
At the same time, we must also confront the reality of
China's influence in the maritime domain. And it's growing and,
if left unchecked, threatens to throw up impediments to the
maritime transportation sector. Major port equipment, such as
terminal cranes, are purchased from China and could present
serious vulnerabilities to the supply chain.
LOGINK, a logistics management system developed by China,
provides shipment tracking and other logistical services while
collecting significant amounts of data that could be used for
malign purposes or to gain unfair economic advantage. I'm
pleased that the subcommittees were able to work together to
include language in last year's NDAA that provides critical
protections against this.
In the wake of the global supply chain crisis that caused
significant disruptions to commerce, it's critical that our
ports and, just as importantly, the intermodal connections that
connect our ports to inland cargo destinations, have learned
from the experiences during the pandemic and are working to
increase the resiliency of the supply chain. I look forward to
hearing from our witnesses on how port infrastructure
development grant funding is improving the efficient movement
of goods through our ports. And I look forward to learning how
operators within the supply chain are mitigating the risk of
another supply chain crisis and making the maritime
transportation system more resilient to future disruptions.
[Mr. Webster of Florida's prepared statement follows:]

Prepared Statement of Hon. Daniel Webster of Florida, Chairman,
Subcommittee on Coast Guard and Maritime Transportation, Committee on
Transportation and Infrastructure
Before we begin, I want to mention the recent tragedy at the Port
of Baltimore. First and foremost, our thoughts are with the victims and
their families. We greatly appreciate the work of the Coast Guard and
other first responders in their heroic response efforts. And as work
gets underway to reopen the channel, rebuild the bridge, and carry out
an investigation, the Transportation and Infrastructure Committee will
closely monitor developments and work with the families and
stakeholders impacted.
Turning to the agenda at hand, we meet today at PortMiami to
examine port safety, security, and infrastructure investment. I
appreciate Mayor Cava, the Port's Director and Chief Executive Officer
Hydi Webb, and the rest of the team at PortMiami for hosting us. And
thank you to all the witnesses for joining us today.
Cargo activity at United States ports is critical to our nation's
commerce, and accounts for 26 percent of our nation's GDP, generating
nearly $5.4 trillion in total economic activity, and supporting 31
million direct and indirect jobs. To protect this crucial economic
engine, we need to make the necessary investments and ensure our ports
can effectively confront physical and cyber-threats.
The Maritime Transportation Security Act was passed in the wake of
9/11 and was originally envisioned to guard primarily against physical
threats. However, as technology and automation become more ingrained in
port operations, the risk of cyber-attacks grows. For example, we know
from public reporting that one of America's largest ports, the Port of
Los Angeles, faces approximately 40 million cyber-attacks per month.
At the same time, we must also confront the reality that China's
influence in the maritime domain is growing, and if left unchecked
threatens to throw up major impediments to the maritime transportation
sector. Major port equipment, such as terminal cranes, are purchased
from China, and could present serious vulnerabilities to the supply
chain. LOGINK, a logistics management system developed by China,
provides shipment tracking and other logistical services, while
collecting significant amounts of data that could be used for malign
purposes or to gain unfair economic advantage. I am pleased our
subcommittees were able to work together to include language in last
year's NDAA that provides critical protections against LOGINK.
In the wake of the global supply chain crisis that caused
significant disruptions to commerce, it's critical that our ports, and
just as importantly, the intermodal connections that connect our ports
to inland cargo destinations have learned from the experiences during
the pandemic and are working to increase the resiliency of the supply
chain. I look forward to hearing from our witnesses on how Port
Infrastructure Development Grant funding is improving the efficient
movement of goods through ports. And I look forward to learning how
operators within the supply chain are mitigating the risk of another
supply chain crisis and making the maritime transportation system more
resilient to future disruptions.

Mr. Webster of Florida. With that, I recognize our ranking
member, Mr. Carbajal, for his opening statement for 5 minutes.
You're recognized.

OPENING STATEMENT OF HON. SALUD O. CARBAJAL OF CALIFORNIA,
RANKING MEMBER, SUBCOMMITTEE ON COAST GUARD AND MARITIME
TRANSPORTATION, COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

Mr. Carbajal. Thank you, Mr. Chair, Chair Webster and Chair
Gimenez, for gathering us here today in this beautiful,
beautiful place called Miami for this important bipartisan
joint hearing focused on our ports. I also want to extend
thanks to the mayor for coming out and welcoming us and to my
other colleague who will be providing testimony, Representative
Diaz-Balart. You certainly live in a great place, a wonderful
piece of paradise in our country. I live in the other paradise,
Santa Barbara, California.
But I wanted to make one observation before I start my
testimony. It seems that the Democrats are not wearing ties
today, and all my Republican colleagues, especially from Miami,
are wearing ties. I'm just wondering what is the best way to do
Miami. You know, I'm a little confused.
Last week, when a containership struck the Francis Scott
Key Bridge in Baltimore, the world saw how easily a major port
can come grinding to a stop. I express my sincere condolences
to the families of the construction crew who lost their lives.
The collapse of the Key Bridge exposed vulnerabilities and
created an economic catastrophe for the country. When a major
port shutters, shock waves are felt nationwide. Locally,
thousands of individuals depend on a port for their livelihoods
and will be out of work. Further away, farmers and miners are
also affected as their product will not leave the docks.
Baltimore is also the largest car port in the country, which
will certainly affect the market for vehicles.
The United States has more than 300 ports nationwide, and
more than 95 percent of all cargo spends time on a ship. The
U.S. economy depends on our ports. Ports are intermodal
connectors integrating water, rail, road, and airborne modes of
transportation. Over 11 million containers move through U.S.
ports each year.
Ports face both physical and cybersecurity threats on a
daily basis. The Coast Guard holds the responsibility to review
port security plans, respond to cyber attacks, and monitor
daily traffic entering and exiting the ports. President Biden
recently signed an Executive order strengthening the Coast
Guard's authority to respond to cyber events at ports. This
comes at an important time as ports are receiving thousands of
cyber attacks each year. I'm interested in hearing from the
Coast Guard how they plan to utilize this Executive order and
strengthen cybersecurity.
Our ports must be resilient to all threats. Climate change
and sea level rise pose one of the largest threats of our
generation and can cause an equally devastating disruption to
the supply chain. That is why Congress worked together to
include over $2.25 billion for the Port Infrastructure
Development Program in the Bipartisan Infrastructure Law aimed
at decarbonizing and making ports more resilient. It's my
understanding this port in Miami is moving towards having
shoreside power in the very near future.
Ports are vital to our economy and national security. I
welcome today's conversation as to how to continue to support
our ports and make them more resilient. Thank you, Mr.
Chairman. I yield back.
[Mr. Carbajal's prepared statement follows:]

Prepared Statement of Hon. Salud O. Carbajal of California, Ranking
Member, Subcommittee on Coast Guard and Maritime Transportation,
Committee on Transportation and Infrastructure
Thank you, Chair Webster and Chair Gimenez, for gathering us here
today in beautiful Miami for this important joint hearing focused on
our ports.
Last week, when a container ship struck the Francis Scott Key
Bridge in Baltimore, the world saw how easily a major port can come
grinding to a stop. I express my sincere condolences to the families of
the construction crew who lost their lives.
The collapse of the Key Bridge exposed vulnerabilities and created
an economic catastrophe for the country. When a major port shutters,
shock waves are felt nationwide. Locally, thousands of individuals
depend on a port for their livelihoods and will be out of work. Further
away, farmers and miners are also affected as their product will not
leave the docks. Baltimore is also the largest car port in the country,
which will certainly affect the market for vehicles.
The United States has more than 300 ports nationwide and more than
95 percent of all cargo spends time on a ship--the U.S. economy depends
on ports.
Ports are intermodal connectors, integrating water, rail, road, and
airborne modes of transportation. Over 11 million containers move
through U.S. ports each year.
Ports face both physical and cyber security threats on a daily
basis. The Coast Guard holds the responsibility to review port security
plans, respond to cyber attacks and monitor daily traffic entering and
exiting the ports.
President Biden recently signed an executive order strengthening
the Coast Guard's authority to respond to cyber events at ports. This
comes at an important time as ports are receiving thousands of cyber
attacks each year. I am interested in hearing from the Coast Guard how
they plan to utilize this executive order and strengthen cyber
security.
Our ports must be resilient to all threats. Climate change and sea
level rise poses one of the largest threats of our generation and can
cause an equally devastating disruption to the supply chain. That is
why Congress worked together to include over $2.25 billion for the Port
Infrastructure Development program in the Bipartisan Infrastructure Law
aimed at decarbonizing and making ports more resilient.
Ports are vital to our economy and national security; I welcome
today's conversation as to how to continue to support our ports and
make them more resilient.
Thank you, and I yield back.

Mr. Webster of Florida. Now I recognize the chairman of the
Transportation and Maritime Security Subcommittee, Mr. Gimenez,
for 5 minutes for an opening statement.

OPENING STATEMENT OF HON. CARLOS A. GIMENEZ OF FLORIDA,
CHAIRMAN, SUBCOMMITTEE ON TRANSPORTATION AND MARITIME SECURITY,
COMMITTEE ON HOMELAND SECURITY

Mr. Gimenez. Thank you, Mr. Chairman. And on behalf of my
constituents in the 28th Congressional District of Florida, I
would like to welcome my colleagues and our distinguished
witnesses to Miami.
I don't know, Mario, why are we wearing ties? I really
don't get it. OK.
Mr. Webster of Florida. I didn't know y'all had them.
Mr. Gimenez. Yes. Well, we found a couple, I think, and so,
we put it on just to impress you all. But normally here,
especially in the summer, we don't go around--we have something
called a guayabera, if you're Latin, that we use for formal
things. But I'm with you, Ranking Member. It's a little too
formal for me. All right. But anyway, I digress.
Today, our guests will further learn what I have long
known: that Miami is a unique, robust, beautiful city that has
much to offer to both its residents and its visitors. This
venue, PortMiami, is the busiest passenger cruise port in the
entire world, not just in United States, but in the entire
world. And it's one of the busiest cargo ports in the United
States.
I'm excited to use this hearing to further examine the
integral role it plays in our city, and more broadly, our
country. And the mayor has already touched on how important
this port is to the economy of this city and south Florida in
general. Over 300,000 jobs are either directly or indirectly
related to this port. It's the second largest economic
generator in this area. This and the airport combine for
probably over 600,000 either direct or indirect jobs.
First, I'd like to offer my sincere condolences to the
families of the individuals who passed away or were negatively
impacted by the tragic collapse of the Francis Scott Key Bridge
in Baltimore last week and express my gratitude to the men and
women of the United States Coast Guard and other Federal,
State, and local authorities who responded to the incident.
While we're not aware of any malicious responsibilities for the
incident, the severity of the collapse of the bridge
underscores the importance of what we're discussing today.
Before I was elected to Congress, I had the distinct honor
to serve 25 years as a firefighter with the city of Miami,
later serving as its chief. I then had the privilege of being
the city manager of the city of Miami, and then finally I
served as the mayor of Miami-Dade County. It was during my time
as mayor of Miami-Dade that I saw the critical impact that the
PortMiami and maritime-borne trade has on Miami and the State
of Florida.
Our port here is not only of commerce, it's a gateway to
the world. Major disruptions at the port operations, like what
we're witnessing in Baltimore, would severely harm the local
economy and hinder the region's connectivity to the rest of the
United States and beyond. It is for that reason I worked hard
during my tenure as mayor of Miami-Dade and will continue to do
so in my current capacity to ensure PortMiami and the Nation's
ports have what they need to operate safely, effectively, and
securely.
In my current role as chairman of the House Homeland
Security Committee's Transportation and Maritime Security
Subcommittee, I am continuously concerned by the security
threats facing maritime ports across the country.
I'm especially worried by the security vulnerabilities that
exist with port equipment that is manufactured or installed in
the People's Republic of China. The ship-to-shore cranes
hovering over our docks, including the ones here, while
instrumental to our port operations, are a focal point of that
concern. Most of the U.S. port ship-to-shore cranes--nearly 80
percent--are made by ZPMC, a Chinese state-owned enterprise
under the direct control of the Chinese Communist Party.
This near-monopoly allows for ZPMC to compromise U.S.-bound
cranes that could cause malfunction or facilitate cyber
espionage at U.S. ports. This situation not only presents
cybersecurity threats, but also supply chain vulnerabilities
that could be exploited by those who wish to inflict damage to
our Nation and could have lasting impacts.
Well, unfortunately, Communist China's influence in the
supply chain extends beyond state enterprises like ZPMC. Third-
party companies often create the internal operational
components for these ship-to-shore cranes.
These components include programmable logic controllers
which control many ship-to-shore crane systems as well as crane
drives and motors. In most all cases, ZPMC requires, and I
repeat, requires that these companies ship their components to
the PRC where they can be installed by ZPMC engineers or
technicians.
As my subcommittee has discussed in previous hearings, the
proliferation of port equipment and operational technology
manufactured or installed by engineers in the PRC introduces
significant supply chain vulnerabilities into our maritime
transportation system. As a country, we must acknowledge and
assess these risks, threats, and vulnerabilities and decide how
to effectively respond.
In February, the Biden administration signed an Executive
order providing the U.S. Coast Guard with new authorities to
respond to potential malicious actors targeting our maritime
sector, and particularly those from the PRC. While I commend
the administration on this initial action, I believe we need to
continue examining this critical topic and ensure that our
ports are protected from security threats.
To do so, I have brought together a group of members from
the China Select Committee and the Committee on Homeland
Security to investigate some of the vulnerabilities associated
with PRC-manufactured port cranes and the consequences of
having a supply chain that is overly reliant upon equipment
sourced from our greatest geopolitical opponent.
Additionally, I have introduced legislative solutions such
as my Port Crane Security and Inspection Act to ensure that the
U.S. Coast Guard and other Federal agencies responsible for
safeguarding maritime ports have the tools and authorities
necessary to deter hostile actors from operating against our
ports.
I am glad to be participating in today's hearing which will
allow us to continue to address this critical topic and deliver
a strong message to our adversaries interested in meddling in
our ports and in the United States, in general. Thank you. And
I yield back.
[Mr. Gimenez's prepared statement follows:]

Prepared Statement of Hon. Carlos A. Gimenez of Florida, Chairman,
Subcommittee on Transportation and Maritime Security, Committee on
Homeland Security
On behalf of my constituents in the 28th District of Florida, I
would like to welcome my colleagues and our distinguished witnesses to
Miami. Today, our guests will further learn what I have long known:
that Miami is a unique, robust city that has much to offer to both its
residents and its visitors. Our venue, PortMiami, is one of the busiest
passenger and cargo ports in the United States. I am excited to use
this hearing to further examine the integral role it plays in our city
and more broadly our country.
First, I would like to offer my sincere condolences to the families
of the individuals that passed away or were negatively impacted by the
tragic collapse of the Francis Scott Key Bridge in Baltimore, Maryland
last week and express my gratitude to the men and women of the United
States Coast Guard and other federal, state, and local authorities who
are responding to the incident.
While we are not aware of any malicious actors responsible for the
incident, the severity of the collapse of the bridge underscores the
importance of what we are discussing today.
Before I was elected to Congress, I served for 25 years as a fire
fighter with the City of Miami Fire Department. I then had the
privilege of serving as the Mayor of Miami-Dade County and City Manager
for the City of Miami. It was during my time as Mayor of Miami Dade
that I saw the critical impact that the PortMiami and maritime-born
trade has on Miami and the state of Florida.
Our port here is not only a hub of commerce--it is a gateway to the
world. Major disruptions to the port's operations--like what we are
witnessing in Baltimore--would severely harm the local economy and
hinder the region's connectivity to the rest of the United States and
beyond. It was for that reason I worked hard during my tenure as Mayor
of Miami Dade, and will continue to do so in my current capacity, to
ensure PortMiami has what it needs to operate safely, effectively, and
securely.
In my current role as Chairman of the House Homeland Security
Committee's Transportation and Maritime Security Subcommittee, I am
continuously concerned by the security threats facing maritime ports
across the country.
I am especially worried by the security vulnerabilities that exist
with port equipment that is manufactured or installed in the People's
Republic of China. The ship-to-shore cranes towering over our docks--
while instrumental to our port operations--are a focal point of that
concern. Most of the U.S. port ship-to-shore cranes--nearly 80
percent--are made by ZPMC, a Chinese state-owned enterprise under the
direct control of the Chinese Communist Party. This near-monopoly
allows for ZPMC to compromise U.S.-bound cranes that could cause
malfunction or facilitate cyber espionage at U.S. ports. This situation
not only presents cybersecurity threats but also supply chain
vulnerabilities that could be exploited by those who wish to inflict
damage on our nation that could have lasting impacts.
Unfortunately, Communist China's influence in the supply chain
extends beyond state-owned enterprises like ZPMC. Third-party companies
often create the internal operational components for these ship-to-
shore cranes.
These components include programmable logic controllers which
control many ship-to-shore crane systems, as well as crane drives and
motors. In almost all cases, ZPMC requires that these companies ship
their components to the PRC where they can be installed by ZPMC
engineers or technicians.
As my subcommittee has discussed in previous hearings, the
proliferation of port equipment and operational technology manufactured
or installed by engineers in the PRC introduces significant supply
chain vulnerabilities into our Maritime Transportation System.
As a country, we must acknowledge and assess these risks, threats,
and vulnerabilities and decide how to effectively respond.
In February, the Biden administration signed an executive order
providing the U.S. Coast Guard with new authorities to respond to
potential malicious actors targeting our maritime sector--and
particularly those from the PRC. While I commend the administration on
this initial action, I believe we need to continue examining this
crucial topic and ensure that our ports are protected from security
threats.
To do so, I have brought together a group of members from the China
Select Committee and the Committee on Homeland Security, to investigate
some of the vulnerabilities associated with PRC-manufactured port
cranes and the consequences of having a supply chain that is overly
reliant upon equipment sourced from our greatest geopolitical
competitor.
Additionally, I have introduced legislative solutions--such as my
Port Crane Security and Inspection Act--to ensure the U.S. Coast Guard
and other federal agencies responsible for safeguarding maritime ports
have the tools and authorities necessary to deter hostile actors from
operating against our ports.
I am glad to be participating in today's hearing which will allow
us to continue to address this critical topic and deliver a strong
message to our adversaries interested in meddling in our ports.

Mr. Webster of Florida. I now recognize the ranking member
of the Transportation and Maritime Security Subcommittee, Mr.
Thanedar, for 5 minutes for your opening statement.

OPENING STATEMENT OF HON. SHRI THANEDAR OF MICHIGAN, RANKING
MEMBER, SUBCOMMITTEE ON TRANSPORTATION AND MARITIME SECURITY,
COMMITTEE ON HOMELAND SECURITY

Mr. Thanedar. Thank you, Mr. Chair, and good morning to
all. I'm used to coming here, not only not in my tie, but also
bringing my family, my children, who are excited to go on the
cruise. This is the only time I'm here working in this
beautiful building and this beautiful city.
But before I begin my remarks, I would like to thank
PortMiami for hosting us today. Thank you also to Chairman
Gimenez for hosting us in your hometown. And thank you,
Chairman Webster and Ranking Member Carbajal, for bringing our
two subcommittees together for this important hearing. Finally,
thank you, all of our witnesses today, for sharing your time
and expertise with us.
The past couple weeks have displayed the importance of the
safe and secure functioning of our Nation's maritime ports and
the Marine Transportation System. As we all are aware, on March
26, a containership crashed into the Francis Scott Key Bridge
in Baltimore, causing the bridge to collapse, claiming the
lives of six men who were working on the bridge. My heart goes
out to the friends and families of the victims of this tragic
accident.
In the aftermath of the bridge's collapse, the Port of
Baltimore was forced to shut down all maritime traffic in and
out of the port. The incident has demonstrated how critical a
single port's operations can be to the whole economy, as
industries and communities throughout the country have felt the
impact of the port's closure, including the automotive industry
in my hometown of Detroit.
But while the incident has highlighted some of the
vulnerabilities of our maritime sector, it has also displayed
its tremendous resilience. The Coast Guard, along with a host
of Federal, State, and local partners, has worked diligently
around the clock to respond to the accident, carry out search
and rescue missions, assess the damage, contain hazardous
material, and begin to clear the waterways. Thanks to their
hard work, a temporary channel has already been cleared,
allowing the port to reopen to limited traffic. I'm grateful to
all the first responders who have worked to save lives and
limit the damage caused by the accident.
Today, we will discuss what more can be done to ensure the
safe and secure operation of our Nation's seaports and prevent
further disruption to the Marine Transportation System. We must
ensure that congested waterways can be navigated safely. And
since accidents will happen regardless, we must develop better
ways to protect infrastructure and prevent catastrophic damage.
And while there is absolutely no evidence that the accident in
Baltimore was caused by any kind of cyber or physical attack,
threats to the maritime sector are very real, and we must
ensure the Coast Guard and its partners have the resources and
the tools needed to counter them.
As computer systems and networks have grown increasingly
prevalent within ports, addressing cyber threats has become
especially critical. Cyber attacks on ports in the U.S. and
overseas have already had drastic impacts, stalling the
transport of cargo and costing hundreds of millions of dollars
in economic damage.
In February, the Biden administration announced a series of
actions to greatly enhance port cybersecurity, including: an
Executive order to address Coast Guard authorities and cyber
incident reporting, proposed regulations to establish minimum
port cybersecurity requirements, a security directive to
address vulnerabilities posed by Chinese-manufactured cranes,
and an investment of more than $20 billion to improve port
infrastructure and initiate domestic manufacturing of cranes.
These actions will significantly improve port cybersecurity.
I look forward to hearing more from our witnesses on what
support is needed to carry out these actions and on other
efforts to ensure the safety and security of our Nation's
seaports. Thank you again to our hosts, our witnesses; and
Chairman, I yield back.
[Mr. Thanedar's prepared statement follows:]

Prepared Statement of Hon. Shri Thanedar of Michigan, Ranking Member,
Subcommittee on Transportation and Maritime Security, Committee on
Homeland Security
The past couple weeks have displayed the importance of the safe and
secure functioning of our Nation's maritime ports and the Marine
Transportation System. As we all are aware, on March 26th, a container
ship crashed into the Francis Scott Key Bridge in Baltimore, causing
the bridge to collapse and claiming the lives of six men who were
working on the bridge. My heart goes out to the friends and family of
the victims of this tragic accident.
In the aftermath of the bridge's collapse, the Port of Baltimore
was forced to shut down all maritime traffic in and out of the port.
The incident has demonstrated how critical a single port's operations
can be to the whole economy, as industries and communities throughout
the country have felt the impact of the port's closure--including the
automobile industry in my hometown of Detroit. But while this incident
has highlighted some of the vulnerabilities of our maritime sector, it
has also displayed its tremendous resilience.
The Coast Guard, along with a host of Federal, State, and local
partners, has worked diligently around the clock to respond to the
accident, carry out search and rescue missions, assess the damage,
contain hazardous materials, and begin to clear the waterways. Thanks
to their hard work, a temporary channel has already been cleared,
allowing the port to reopen to limited traffic. I am grateful to all
the first responders who have worked to save lives and limit the damage
caused by this accident.
Today, we will discuss what more can be done to ensure the safe and
secure operation of our Nation's seaports and prevent further
disruptions to the Marine Transportation System. We must ensure that
congested waterways can be navigated safely--and since accidents will
happen regardless, we must develop better ways to protect
infrastructure and prevent catastrophic damage. And while there is
absolutely no evidence that the accident in Baltimore was caused by any
kind of cyber or physical attack, threats to the maritime sector are
very real, and we must ensure the Coast Guard and its partners have the
resources and tools needed to counter them.
As computer systems and networks have grown increasingly prevalent
within ports, addressing cyber threats has become especially critical.
Cyberattacks on ports in the U.S. and overseas have already had drastic
impacts, stalling the transport of cargo and costing hundreds of
millions of dollars in economic damages. In February, the Biden
Administration announced a series of actions to greatly enhance port
cybersecurity, including:
an Executive Order to address Coast Guard authorities and
cyber incident reporting.
proposed regulations to establish minimum port
cybersecurity requirements.
a security directive to address vulnerabilities posed by
Chinese-manufactured cranes.
and an investment of more than $20 billion to improve
port infrastructure and initiate domestic manufacturing of cranes.

These actions will significantly improve port cybersecurity.
I look forward to hearing more from our witnesses on what support
is needed to carry out these actions and on other efforts to ensure the
safety and security of our Nation's seaports.

Mr. Webster of Florida. OK. Thank you. And we have, as
we've said, three different panels. But before we begin those,
I'd like to take a moment to explain our lighting system. Green
means go, yellow means slow up, and red means stop, kind of
like a stoplight.
I'd like to ask unanimous consent that witnesses that have
full testimonies and full statements be included in the record.
Without objection, show that ordered.
I ask for unanimous consent that the record of today's
hearing remain open until such time as the witnesses on all
panels have provided answers to any questions that may have
been submitted in writing. Without objection, show that
ordered.
I ask unanimous consent that the record remain open for 15
days for additional comments and information submitted by the
Members or the witnesses to be included in the record of
today's hearing. Without objection, show that ordered.
As your written testimony has been made part of the record,
we ask that you limit your remarks to 5 minutes.
With that being said, we'll start with our first witness,
which is Representative Mario Diaz-Balart, a good friend of
mine. We served together in the State house, State senate, and
now in Congress, and in Congress, he is recognized as probably
one of the top Members of Congress.
So, thank you. You're recognized for 5 minutes.

TESTIMONY OF HON. MARIO DIAZ-BALART, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF FLORIDA

Mr. Diaz-Balart. Mr. Chairman, thank you so very much, Mr.
Chairman and Ranking Member. This is a very distinguished
panel, and I am honored that you would all be here in south
Florida.
To you, Mr. Webster--Mr. Chairman, you and I have worked on
issues dealing with infrastructure now going back to, well,
we'd rather not talk about how long, but I will tell you that
this State and the country is better off because of the
service, Mr. Chairman, that you have provided. Your leadership
on infrastructure issues and other issues, but in particular on
infrastructure issues, has been frankly remarkable.
And we are in this beautiful PortMiami, but I can't help to
think of all you have done going back to the State legislative
years, and you and I worked on those things together. But your
leadership there and you continue your leadership on making
sure that the ports of this State and now nationally are the
best they can be. So, thank you, Mr. Chairman, for your
invaluable service to this amazing country of ours.
And I would be remiss, and I'm not--because I have a lot of
friends on this panel--but I do want to mention Chairman
Gimenez. Chairman Gimenez was obviously a distinguished member
of the T&I Committee, is also of the Homeland Security and also
of the China Select Committee.
But as I'm sure you know, he's also a bit of an institution
in our community here. A firefighter, career firefighter then
fire chief and going all the way to mayor. And I will tell you,
I don't mean this as disrespectful to any mayor before or after
Mr. Gimenez, but this community and the infrastructure in this
area has not been better than when Mr. Gimenez was mayor, and
he continues to serve. And he's a valuable asset, I know, to
your committee, Mr. Chairman, to your committee, Ranking
Member. And again, it's a privilege, Mayor, Chief, and friend
and colleague, to be here with you.
I did, Mr. Chairman, submit a rather extensive statement,
so, I just want to touch a couple of issues if I may. Again, I
also thank all of you for mentioning the tragedy in Baltimore.
We are in this beautiful place that all of you have talked
about. The amazing thing about PortMiami is that it's a very
small port. It's landlocked, and yet it does amazing things for
this community, for the State, for the country, in a very small
footprint. And every port in the country is different. And this
is one of those examples of a port that is on the cutting edge.
And without this port, frankly, this community would not be
able to be this thriving community that we all see and that we
all cherish and some of us are privileged to live in.
I'm very proud that, as a former chairman of the THUD,
Transportation, Housing, and Urban Development Subcommittee of
the Appropriations Committee--I'm still on that--I was able to
create and fund--actually probably more important, right, than
creating--the Port Infrastructure Development Program,
specifically for seaports.
As you know, seaports have always had to compete for
funding with everything else, and they still do in other areas,
but at least we have this program. And I just want to emphasize
that because all of us have to be very supportive of making
sure that we continue to emphasize seaports because they are
such a vital part of our community.
Also, something a little bit unique about this port and,
frankly, this community, is that we are affected greatly--other
ports and other communities are as well--by what happens in
this region and in this hemisphere. We've all seen the tragic
situation taking place in Haiti, for example, right now, and it
is tragic. And I will tell you that whatever happens in places
like Haiti, or we're in a hurricane area, this whole hemisphere
is, and when there's a hurricane, this seaport also becomes a
hub for humanitarian relief around the entire hemisphere.
But I also want to talk about another little issue that is
a little unique for PortMiami and for this part of the State,
this part of the country. We happen to be sitting 90 miles away
from a state sponsor of terrorism. Think about that. Ninety
miles away from us, there is a dictatorship, by the way, that
has troops fighting along with the Russians in the Ukraine,
that has what the OAS Secretary General has called an army of
occupation, in Venezuela just 90 miles away from us.
And so, when we're dealing with security and safety, which
is an issue that I know that you all are looking at, one of the
things to remember is that while every port has its challenges,
this port and this community and this area has some unique
challenges and that sometimes I think are either forgotten or
ignored.
I was outraged, by the way, when the U.S. Department of
State--I deal with them all the time--in coordination with the
Department of Homeland Security, recently approved a visit for
members of that terrorist regime to go visit the Port of
Wilmington in North Carolina. Don't take my word for it. The
Representative who represents that area, Mr. Chairman Rouzer,
was equally incensed.
And furthermore, to just show you sometimes how folks can
be totally tone deaf, one of the things that was mentioned by
the Department of State during that so-called visit was that
the delegation was meeting with the Cuban counterparts in the
United States, the U.S. Coast Guard, the counterparts.
With all due respect, the U.S. Coast Guard are heroes. They
sacrifice. They risk their lives to protect commerce, to
protect the environment, to protect the American people and,
frankly, people from all over the world. And to say that the
thugs of the Cuban regime are counterparts to the U.S. Coast
Guard not only shows a lack of understanding of reality, but
it's just an insult to the men and women, to the heroes of the
United States Coast Guard.
Just one example, the so-called counterparts, the Cuban
regime's counterparts, remember, they were responsible for the
horrific tugboat massacre where they on purpose sank and
murdered and with hoses, actually hosed babies and kids, men
and women into the ocean who drowned and they sank a tugboat on
purpose. To call those folks the counterparts of the U.S. Coast
Guard is not only insensitive and insulting, but it shows a
lack of understanding of reality.
So, I am so grateful for the fact that all of you are here.
I'm grateful for your leadership. I'm grateful for what you do
day in and day out, and I'm also incredibly privileged to have
the opportunity to work with you all as my role as an
appropriator, and I thank you all.
And I know that I've gone way over my time, Mr. Chairman. I
apologize for that. That's what happens when you wear a tie,
you go over the line, you see. So, anyway, thank you for your
kindness, for your indulgence.
I yield back.
[Mr. Diaz-Balart's prepared statement follows:]

Prepared Statement of Hon. Mario Diaz-Balart, a Representative in
Congress from the State of Florida
Chairman Webster, Ranking Member Carbajal, Chairman Gimenez,
Ranking Member Thanedar, and Members of the Subcommittees:
Thank you for the opportunity to discuss port safety, security, and
the future of infrastructure investment for our nation's seaports.
Before I begin, I'd like to thank Chairman Daniel Webster, for his
leadership and his staunch support of the U.S. Coast Guard and maritime
transportation across our country. Many of you may or may not know,
Chairman Webster served as Speaker and then Majority Leader in the
Florida State Legislature and has nearly forty years of transportation
experience, proving to be an invaluable asset to our Florida
Congressional delegation and to the Transportation and Infrastructure
Committee. Thank you for always fighting for our mariners, and ensuring
our waterways are safe for the American people. Additionally, I'd like
to thank Chairman Carlos Gimenez with the Committee on Homeland
Security for the kind invitation today as well. Chairman Gimenez has
worn many hats over the years: firefighter, fire chief, and as Mayor of
Miami-Dade County. Chairman Gimenez's extensive knowledge of
transportation and maritime issues facing South Florida, specifically
PortMiami as former Mayor, proves to be an invaluable asset to the
United States Congress.
Our nation's seaports are huge drivers of economic growth,
supporting 31 million jobs, and generating nearly $5.4 trillion in
economic activity. Here in Florida, we are lucky to have some of the
best and busiest ports in the country. Our seaports support nearly
900,000 jobs and contribute $117.6 billion in economic value to our
state. For 2023, Florida's system of seaports handled 114.25 million
tons of cargo, shattering the 2022 record-high 112.5 million tons of
cargo moved \1\.
---------------------------------------------------------------------------
\1\ ``Florida Seaports Set Back-to-Back Record-High Cargo Growth,
Proving Florida Is America's Supply Chain Solution.'' Florida Ports
Council, Florida Ports Council, 30 Jan. 2024.
---------------------------------------------------------------------------
One such seaport is PortMiami, which contributes $43 billion
annually to our local economy while supporting more than 334,000 jobs.
Over a million containers of cargo come through PortMiami each year,
much of it containing fruits, vegetables, and flowers from South
America. Compared to most seaports on large plots of land, PortMiami is
limited to a relatively small space, which creates some challenges. For
example, the USDA charges a flat fee for fumigation of fruits and
vegetables arriving from international destinations. In PortMiami, only
a fraction of goods could be fumigated at the rate of larger seaports.
This made imports to PortMiami more expensive, and therefore, PortMiami
was less competitive compared to other seaports.
This problem was only going to get worse as competition was
increasing, and supply chain vulnerabilities were being exposed. I knew
that there must be a better solution.
Addressing Critical U.S. Port Infrastructure Needs
For years I have worked to improve our states seaports, both during
my time in the Florida State Legislature, and now as a Member of
Congress. In the U.S. Congress, I had the privilege of serving as
Chairman, Ranking Member, and now member of the Transportation, Housing
and Urban Development Subcommittee of Appropriations. Our seaports must
compete for funds under large, more visible infrastructure programs
under the direction of the Department of Transportation. Seaports must
compete among airport, road and bridge projects in major metropolitan
areas, multimodal projects, and many other sectors of our national
transportation system, making it challenging for seaports to obtain
sufficient funding and receive the attention that they so desperately
need.
As Ranking Member of the Subcommittee when drafting the Fiscal Year
2019 Appropriations bill, I created the first dedicated account
specifically for our seaports, which totaled $293 million. The Port
Infrastructure Development Program, also known as the PIDP, has aided
in addressing critical infrastructure needs to ports across our
country, as well as in my home state of Florida. As a result, PortMiami
received $44 million to help construct a 100,000 square foot state-of-
the-art fumigation facility that will ensure the Port remains
competitive and efficient, rivaling the ports in the Northeast. The
PIDP program is critical for our seaports to have the ability to
address necessary infrastructure needs and address supply chain
vulnerabilities.
Bolstering American Competitiveness and Readiness
In addition to securing critical port funding, I was also able to
solve a problem for our merchant shipping fleet. More than 70 percent
of U.S. Coast Guard-licensed officers stem from one of six state
maritime academies nationwide \2\. These state maritime academies rely
on at-sea training in deck seamanship, navigation, and engineering.
This training provides life-saving expertise in safe ship practices,
operations, and maintenance.
---------------------------------------------------------------------------
\2\ Alfultis, Michael A., et al. ``State Maritime Academies--
Educating the Future Maritime Workforce.'' The State of the Maritime
Workforce, Jan. 2017.
---------------------------------------------------------------------------
Regrettably, our future merchant mariners have been training on
outdated ships, some of which have obsolete steam-powered propulsion
systems, that do not reflect the current world-class vessels in the
national fleet. As a fiscal hawk, I have fought to reduce wasteful
spending, cut wasteful bureaucracy, and bolster the safety and security
of the American people. House Republican Appropriators have fiercely
worked to spend less and change the trajectory of federal spending,
without shortchanging critical investments to our national security
interests at home and abroad. Improving our American competitiveness
and readiness on the national stage begins by preparing our future
mariners at home. With our national security interests in mind, I
secured a total of $1.6 billion in funding for the replacement of the
aging school fleet to the new National Security Multi-Mission Vessels
(NSMV). These vessels serve a critical role in providing necessary
hands-on training for those serving in the maritime industry that
cannot be accomplished in a classroom. The next generation of domestic
mariner training ships must be more cost effective while also utilizing
creative solutions to generate the highly trained and capable mariners.
It may be these very mariners who answer the call to serve future U.S.
war efforts by transporting shipments of supplies to military bases
around the world often being enlisted to transport vehicles, guns,
bombs, gasoline, food, and medicine while fully supporting other U.S.
logistical needs.
This initiative alone has revitalized shipyards across our country
supporting almost 1,200 shipyard jobs during construction and
additional jobs at-sea and ashore once completed \3\. Just late last
year, the first NSMV was delivered to SUNY Maritime College, named
Empire State VII. These new vessels have state-of-the-art navigation
equipment, which in turn will prepare the academies to have a
standardized and purpose-built training platform for years ahead. The
next training vessel is slated delivery to the Massachusetts Maritime
Academy later this year. The National Security Multi-Mission Vessel
program contributes to our national security interests at home and
abroad as we increase the ranks of our well-trained maritime workforce
and bolster critical American sectors of our economy.
---------------------------------------------------------------------------
\3\ ``MARAD National Security Multi-Mission Vessel Program.''
Maritime Administration, Department of Transportation--Maritime
Administration, www.maritime.dot.gov/. Accessed 2 Apr. 2024.
---------------------------------------------------------------------------
Confronting our National Security Threats and Guarding our U.S. Ports
Any discussion of port and maritime safety in South Florida is
incomplete unless we address a serious threat to our national security
in our hemisphere, which are those in Communist Terrorist Regime in
Cuba. I was outraged when I learned that the U.S. State Department, in
coordination with the Department of Homeland Security, approved a visit
for members of the Cuban regime's Ministry of Foreign Affairs and
Ministry of the Interior, which is currently under U.S. sanction for
human rights abuses, to the Port of Wilmington in North Carolina. I
also note that our colleague who represents the district that includes
that port, Representative David Rouzer, roundly condemned on the House
Floor the Biden Administration's decision to invite representatives of
a U.S.-designated State Sponsor of Terrorism to his district. To our
distinguished members of the Coast Guard here and those working hard to
keep Americans safe every day, you deserve better. I was further
incensed by the State Department spokesperson's defense of the visit
that, ``The Cuban delegation is meeting with [U.S. Coast Guard]
counterparts and joining supervised tours of port facilities in North
Carolina . . . The U.S. Coast Guard and Cuban Border Guard have had a
collaborative relationship for decades that focuses first and foremost
on maritime safety.''
First of all, the Cuban regime's operatives are not
``counterparts'' to members of the U.S. Coast Guard. The members of the
U.S. Coast Guard serve with honor to protect the American people and
are charged to show compassion to all who they encounter. In sharp
contrast, the Cuban regime's thugs who perpetrated the horrific Tugboat
Massacre of 1994 that killed dozens of innocent people including
children, the chaos of the Mariel boatlift of 1980, and the purposeful
ramming of a boat off of Bahia Honda in October 2022 which killed five
people, are not your ``counterparts.'' The regime's operatives which
were caught smuggling cocaine in 2016, or who were caught smuggling
weapons to North Korea, are not your ``counterparts.'' It is an insult
to compare our honorable service members as though they are even in the
same league as the murderers, weapons smugglers and narcotraffickers of
the regime in Cuba. Second, it is patently absurd to engage in maritime
safety and port security visits with a terrorist dictatorship that has
no respect for human rights, and no respect for the human life. They
are not our Coast Guard's ``counterparts,'' and they certainly do not
prioritize maritime safety. It collaborates with the terrorist states
of Iran and North Korea, as well as Communist China, provides thousands
of intelligence agents to keep Maduro in power in Venezuela, sends
soldiers to train in Belarus while other Cubans fight for Russia
against Ukraine, and harbors terrorist individuals such as Joanne
Chesimard and aids terrorist organizations such as the ELN. It is a
dangerous mistake to assume that the anti-American, malign regime in
Cuba shares our goals related to port security and maritime safety.
These dangerous adversaries are seeking ways to harm Americans, and
the threat from Communist China might be the most insidious. Whether
through cyberattacks targeting our critical infrastructure, purchasing
land near military bases, and stealing valuable technology, the threat
from Communist China is the challenge of our time. Due to the Biden
Administration inaction and weakness in confronting multiple foreign
adversaries, the Republican Majority is acting. In the Homeland
Security Appropriations Act for Fiscal Year 2024, I championed language
prohibiting the Department of Homeland Security from entering into
contracts or other agreements with entities connected to the Chinese
military. This prohibition should not have been necessary, it is just
plain common sense. But under the Biden Administration, we must
prohibit even the absurd. This language also strengthens cybersecurity
at ports by requiring the Departments of CISA, CBP, the Coast Guard,
and other related agencies to submit risk assessment reports by the
mandatory deadlines, and also to brief the Congress on risks to U.S.
ports and the agency efforts to mitigate them. My colleagues and I will
continue to remain firm in countering these national security threats.
Conclusion
In closing, I'd like to thank Chairman Webster, Ranking Member
Carbajal with the Transportation and Infrastructure Committee and
Chairman Carlos Gimenez, Ranking Member Thanedar with the Homeland
Security Committee for the invitation to testify at today's joint field
hearing on Port Safety, Security, and Infrastructure Investments. We
have some difficult challenges ahead of us, due to the increasing
technological capabilities of our adversaries, and their determination
to circumvent our security strategies. I am grateful for the
opportunity to speak to you today, and I look forward to working with
my colleagues, and other authorizers, to ensure that the United States
is able to counter these threats, strengthen vulnerable supply chains,
expand the competitiveness of our farmers and other businesses, and
protect the American people for generations to come.

Mr. Webster of Florida. OK. Does anybody on the panel have
a question for Representative Diaz-Balart? You're recognized,
Mr. Cohen.
Mr. Cohen. Thank you. I am not a subcommittee chairman of
the relevant committee, but I am the senior Member of this
delegation, and I feel like Rodney Dangerfield.
Moving right along with our bombastic review, I want to
express my sincere care for our colleague, Representative Diaz-
Balart. He's a good guy. We've been on travels together and got
to be friends and bonded and continue, and he does a great job.
He brought up the issue about Ukraine. I hope we get a vote
when we come back next week to support the Ukrainians, who are
valiantly fighting to maintain democracy, to fight off an
authoritarian attack by Russia, just as many in Cuba did when
Castro came. And I hope we get that vote. And right now, the
Cuban soldiers who are there are having a pretty free range in
killing Ukrainians because they've got the bullets and the
Ukrainians don t. So, I hope that happens.
And then on a bit of personal privilege, my staff emailed
me, and they didn't say anything about me not having a tie.
They said, ``I like your shirt.'' Shirts are good.
I'd also like to give note that I'm a 1967 graduate of
Coral Gables High School. I probably may be the only, other
than Mr. Gimenez, graduate of a Dade County high school in the
Congress. And I was a Cavalier, and I went to Ponce Junior and
loved Miami and still love Miami. It's changed a lot since I
was here. I've visited many times, but from when I was here,
growing up, it's changed a ton.
And I've just learned that Mr. Gimenez and I have much in
common, Sonny Liston, Cassius Clay, Joe Auer, and so much else.
And we'll have lots of time to talk about George Meyer in the
future.
Thank you. And it's good to be back in Miami. And also from
Mr. Carbajal's note, and he may not know this and it may be an
old thing, C-A-L-I-F. That's, Mr. Carbajal, that's abbreviation
for California, is it not?
Mr. Carbajal. It could be.
Mr. Cohen. When I was growing up, they told me that meant
``come and live in Florida.'' I yield.
Mr. Carbajal. Mr. Chair, now we know who to blame for the
taste in shirt that Mr. Cohen is wearing.
Mr. Webster of Florida. Yes, for sure.
Are there any questions for Representative Diaz-Balart from
the panel here?
OK. Well, that brings to the close the first panel.
Thank you for appearing, Representative Diaz-Balart. Thank
you for your insight. We really appreciate it. You are excused.
So, our second panel today consists of the executive branch
Government witnesses, which are Rear Admiral Vann. You are
recognized for 5 minutes.

TESTIMONY OF REAR ADMIRAL JOHN C. VANN, COMMANDER, COAST GUARD
CYBER COMMAND, U.S. COAST GUARD; REAR ADMIRAL WAYNE R. ARGUIN,
ASSISTANT COMMANDANT FOR PREVENTION POLICY, U.S. COAST GUARD;
AND WILLIAM K. PAAPE, ASSOCIATE ADMINISTRATOR FOR PORTS AND
WATERWAYS, MARITIME ADMINISTRATION

TESTIMONY OF REAR ADMIRAL JOHN C. VANN, COMMANDER, COAST GUARD
CYBER COMMAND, U.S. COAST GUARD

Admiral Vann. Thank you so much.
Good morning, Chairman Webster, Chairman Gimenez, Ranking
Member Carbajal, Ranking Member Thanedar, distinguished members
of the subcommittees. I am honored to be here today to discuss
the protection, defense, and resiliency of the Marine
Transportation System, the MTS, from today's cyber threats. I
ask that my written testimony be entered into the record.
Mr. Webster of Florida. So ordered.
Admiral Vann. First and foremost, I would like to express
my deepest sympathies to the six individuals who lost their
lives in the terrible accident involving the Francis Scott Key
Bridge. The Coast Guard's thoughts are with their loved ones
during this difficult time. Furthermore, my thanks go out to
the Coast Guard men and women and the many agencies and
organizations that continue to heroically respond to that
tragic accident.
The Coast Guard is committed to addressing cybersecurity
risks and responding to cyber incidents in the marine
environment to ensure our Nation's economic and national
security. The size, interdependence, complexity, and
criticality of the MTS make it a prime target for criminals,
activists, terrorists, state-sponsored actors, and adversarial
nation states.
The threat of disruptive cyber effects to our critical
infrastructure, and specifically to the MTS, require us to be
vigilant, proactive, collaborative, and resourceful. Cyber
intrusions and attacks have a devastating impact on critical
infrastructure. A successful cyber attack could impose
unrecoverable losses to port operations and electronically
stored information, hampering national economic activity and
disrupting global supply chains.
The increased use of automated systems in shipping,
offshore platforms, and port and cargo facilities creates
enormous efficiencies and introduces additional attack vectors
for malicious cyber actors. With the support of Congress, the
Coast Guard has invested in growing and maturing Coast Guard
Cyber Command to assess, identify, and respond to cyber risks
and threats. CG Cyber currently employs three Cyber Protection
Teams, or CPTs, and a Maritime Cyber Readiness Branch.
The CPTs work with local Coast Guard captains of the port
to address cybersecurity risks and respond to cyber threats in
the MTS. A Coast Guard CPT was the first Federal cyber response
team in 2021 to identify probable port network intrusion by a
People's Republic of China actor known now as Volt Typhoon. Our
ability to share information and critical vulnerabilities with
the Cybersecurity and Infrastructure Security Agency, CISA, and
law enforcement partners enabled a timely response and rapid
mitigation with that port partner.
The Maritime Cyber Readiness Branch employs subject matter
experts in cybersecurity and marine safety. They regularly
engage with industry support Area Maritime Security Committees
for planning and execution of cyber exercises and work with MTS
cybersecurity specialists at each Coast Guard area, district,
and sector to improve cyber literacy and support Coast Guard
captains of the port in measuring cyber risk.
We will soon be releasing the third annual Cyber Trends and
Insights in the Marine Environment report, which provides key
insights and trends to aid industry and other stakeholders in
identifying and addressing current and emerging cyber risks.
Through consistent work in collaboration with other
departments, agencies, and industry, CG Cyber shares critical
vulnerability information, mitigation strategies, and threat
intelligence. Our CPTs regularly deploy with Department of
Defense and CISA teams to provide maritime and operational
technology subject matter expertise around the globe. We are
better and more resilient because we exercise and execute
operations together.
I look forward to continuing this conversation and
answering your questions. Thank you.
[The joint prepared statement of Rear Admirals Vann and
Arguin is on page 21.]
Mr. Webster of Florida. Thank you very much.
Next we have Rear Admiral Arguin. You are recognized for 5
minutes.

TESTIMONY OF REAR ADMIRAL WAYNE R. ARGUIN, ASSISTANT COMMANDANT
FOR PREVENTION POLICY, U.S. COAST GUARD

Admiral Arguin. Good morning, Chairman Webster, Chairman
Gimenez, Ranking Member Carbajal, Ranking Member Thanedar, and
Congressman Cohen. I'm honored to be here today to discuss a
top priority for the United States Coast Guard: protecting the
Marine Transportation System. I ask that my written testimony
be entered into the record.
Mr. Webster of Florida. So ordered.
Admiral Arguin. I'd like to offer my heartfelt condolences
to the families and loved ones of the six individuals who lost
their lives in the tragic incident involving the Francis Scott
Key Bridge. Much like in south Florida, the Coast Guard has
strong ties throughout Maryland and the Baltimore region, and
our sympathies are with all those impacted by this horrible
incident.
Our national security and economic prosperity are
inextricably linked to a safe, secure, and efficient Marine
Transportation System, or MTS. The vast system of ports and
waterways that make up the MTS supports $5.4 trillion of annual
economic activity, accounts for the employment of more than 30
million Americans, and enables critical sealift capabilities,
allowing our Armed Forces to project power around the globe.
Florida is a shining example of the benefits brought by a
vibrant MTS, employing more than 65,000 men and women and
contributing approximately $15 billion to the State's economy.
The increasing connectedness and complexity of the Nation's MTS
also brings new vulnerabilities and threats, including in the
cyber domain.
In response to dynamic threats, the United States Coast
Guard has taken decisive action in our maritime critical
infrastructure to harden and build resiliency against cyber
attacks. On February 21, the President signed an Executive
order which further enables our port security efforts by
explicitly addressing cyber threats.
It empowers the Coast Guard to prescribe conditions and
restrictions for the safety of waterfront facilities and
vessels in ports, including reporting requirements for actual
or threatened cyber incidents. With this authority, the Coast
Guard issued a directive requiring specific risk management
actions for all owners and operators of cranes manufactured by
companies from the People's Republic of China. While the
specific requirements are deemed sensitive security information
and cannot be shared publicly, our captains of the port around
the country are working directly with crane owners and
operators to ensure compliance.
Also, on February 21, the Coast Guard released a proposed
rulemaking to set baseline cybersecurity requirements for
vessels, facilities, and Outer Continental Shelf facilities.
The public comment period for the proposed rule is open, and
the Service stresses the need for public participation in the
proposed rulemaking. The diversity of the maritime industry and
the dynamic nature of the cyber threat make public comment
critical.
While the Coast Guard is focused on implementing these new
major efforts, work is far from done. The MTS is indeed a
system where an attack on one segment has the potential to
affect others. This demands collaboration across Government and
industry to ensure unified and coordinated response to cyber
challenges in the maritime domain. Like all other risks to the
MTS, cyber risk is a shared responsibility.
As such, the Coast Guard will continue its work across all
levels of Government and engage with industry to assess
security vulnerabilities, determine risk, and develop
mitigation strategies. This layered approach from the local to
international level is critical due to the size, diversity, and
interconnectedness of the MTS.
As the proven prevention and response framework is applied
to prevent or minimize disruptions to the MTS and ports around
the country, I'm grateful for the support of this committee to
ensure the Coast Guard has the authorities and the resources we
need to stay ahead of these threats.
I look forward to your questions on the vital work the
Coast Guard does every day to help safeguard America's ports.
Thank you for the opportunity to appear before you today and
for your continued support of the United States Coast Guard.
[The joint prepared statement of Rear Admirals Vann and
Arguin follows:]

Joint Prepared Statement of Rear Admiral John C. Vann, Commander, Coast
Guard Cyber Command, U.S. Coast Guard, and Rear Admiral Wayne R.
Arguin, Assistant Commandant for Prevention Policy, U.S. Coast Guard
Introduction
Good afternoon, Chairman Webster, Chairman Gimenez, Ranking Member
Carbajal, Ranking Member Thanedar, and distinguished Members of the
Subcommittees. We are honored to be here today to discuss a top
priority for the U.S. Coast Guard: protecting the Marine Transportation
System (MTS).
The U.S. Coast Guard offers its heartfelt condolences to the
families and loved ones of the six individuals who lost their lives in
the tragic incident involving the Francis Scott Key Bridge. The U.S.
Coast Guard has strong ties throughout Maryland and the Baltimore
community, and our sympathies are with all those impacted by this
horrible accident.
At all times, the U.S. Coast Guard is a military service and branch
of the U.S. Armed Forces, a Federal law enforcement agency, a
regulatory body, a co-Sector Risk Management Agency, a first responder,
and an element of the U.S. Intelligence Community (IC). The Service is
uniquely positioned to ensure the safety, security, and stewardship of
the maritime domain.
Since the early days of the Revenue Cutter Service, the Service has
protected our Nation's waters, harbors, and ports. While much has
changed over the centuries--with our missions expanding from sea, air,
and land into cyberspace--our ethos and operational doctrine remain
steadfast. Regardless of the threat, we leverage the full set of our
authorities; the ingenuity and leadership of our workforce; and the
breadth of our military, law enforcement, and civil partnerships to
protect the Nation, its waterways, and all who operate on them.
The Criticality of the Marine Transportation System
Our national security and economic prosperity are inextricably
linked to a safe and efficient MTS. It is difficult to overstate the
complexity of the MTS and its consequence to the Nation. It is an
integrated network that consists of 25,000 miles of coastal and inland
waters and rivers serving 361 ports. However, it is more than ports and
waterways. It is cargo and cruise ships, passenger ferries, waterfront
terminals, offshore facilities, buoys and beacons, bridges, and more.
The MTS supports $5.4 trillion of economic activity each year and
supports the employment of more than 30 million Americans. It supports
critical national security sealift capabilities, enabling U.S. Armed
Forces to project power around the globe. The U.S. Coast Guard remains
laser-focused on the safety and security of this system as an economic
engine and strategic imperative.
Port Security--A Shared Responsibility and Layered Approach
The U.S. Coast Guard is the Nation's lead Federal agency for
safeguarding the MTS. The Service applies a proven prevention and
response framework to prevent or mitigate disruption to the MTS from
the many risks it faces. U.S. Coast Guard authorities and capabilities
cut across threat vectors, allowing operational commanders to quickly
evaluate risks, apply resources, and lead a coordinated and effective
response.
The U.S. Coast Guard works across multiple levels of government and
industry to assess security vulnerabilities, determine risk, and
develop mitigation strategies. This layered approach--from the local to
the international level--is critical due to the size and
interconnectedness of the MTS.
Locally: Vessel and Facility Security
Security in U.S. ports and waterways starts with individual
vessels, port facilities, and outer continental shelf facilities. The
Maritime Transportation Security Act (MTSA) and its implementing
regulations place specific requirements on regulated entities to
conduct security assessments, analyze the results, and incorporate
their findings in U.S. Coast Guard-approved security plans.
These plans set baseline requirements that regulated U.S. vessels
and facilities must follow to protect the MTS, including addressing
access control, computer systems and networks, restricted area
monitoring, communication, security systems, cargo handling, delivery
of stores, personnel training, and drills and exercises. U.S. Coast
Guard inspectors verify compliance with these plans during scheduled
and unannounced inspections throughout a given year.
For foreign-flagged vessels, the approach to security is very
similar to that of MTSA-regulated domestic vessels. Per the
International Maritime Organization's (IMO) International Ship and Port
Facility Security (ISPS) Code, each foreign vessel must conduct a Ship
Security Assessment and develop a Ship Security Plan, which must be
approved by the ship's Flag Administration prior to a vessel being
certificated as compliant with the ISPS Code. This certification is
verified by the U.S. Coast Guard during regular compliance examinations
when the vessel arrives in a U.S. port.
To enhance security, on February 22, 2024, the U.S. Coast Guard
released a Notice of Proposed Rulemaking for new cyber risk management
regulations appliable to all MTSA-regulated vessels, facilities, and
Outer Continental Shelf facilities. The proposed regulations are
primarily based on the Cybersecurity and Infrastructure Security
Agency's (CISA) Cross-Sector Cybersecurity Performance Goals and follow
the structure and format of existing security regulations in place
since 2004. Proposed regulations would require several cybersecurity
measures, including account security, device security, network
segmentation, data security, training, incident response planning, and
drills and exercises. Regulated entities would also be required to
identify a Cybersecurity Officer responsible for developing a
Cybersecurity Plan and overseeing implementation of new requirements.
Regionally: Area Maritime Security Coordination
At the regional level, Area Maritime Security Committees (AMSC) are
required by MTSA and its implementing regulations to serve an essential
coordinating function during normal operations and emergency response.
Comprised of government and maritime industry leaders, an AMSC serves
as the primary regional body to jointly share threat information,
evaluate risks, and coordinate risk mitigation activities. As the
Federal Maritime Security Coordinator (FMSC), U.S. Coast Guard Captains
of the Port (COTP) direct their regional AMSC's activities.
AMSC input is vital to the development and continuous review of the
Area Maritime Security (AMS) Assessment and Area Maritime Security Plan
(AMSP). The AMS Assessment must include the critical MTS infrastructure
and operations in the port; a threat assessment that identifies and
evaluates each potential threat; consequence and vulnerability
assessments; and a determination of the required security measures for
the three Maritime Security levels.
These AMS assessments then lead to the collaborative development of
AMSPs to ensure government and industry security measures are
coordinated to deter, detect, disrupt, respond to, and recover from a
threatened or actual Transportation Security Incident.
The U.S. Coast Guard COTP and AMSCs are also required by
regulations to conduct or participate in an exercise once each calendar
year to collectively assess the effectiveness of the AMSP in today's
dynamic operating environment.
Nationally: Interagency Collaboration
The U.S. Coast Guard functions on behalf of the Department of
Homeland Security as the co-Sector Risk Management Agency (SRMA) for
the Maritime Transportation Subsector along with the Department of
Transportation. As an SRMA, the U.S. Coast Guard is responsible for
coordinating risk management efforts with CISA, other Federal
departments and agencies, and MTS stakeholders.
CISA is a key partner whose technical expertise supports the U.S.
Coast Guard's ability to leverage our authorities and experience as the
regulator and SRMA of the MTS. CISA integrates a whole-of-government
response, analyzes broader immediate and long-term impacts, and
facilitates information sharing across transportation sectors. Our
relationship with CISA is strong and will continue to mature.
As an element of the IC, the U.S. Coast Guard possesses unique
authorities, and has opportunity and capability to collect, analyze,
and share information from domestic, international, and non-government
stakeholders which operate throughout the MTS. This ability allows the
U.S. Coast Guard to gain a collective understanding of threats and
vulnerabilities facing the maritime domain, including physical security
and cybersecurity.
Our enduring relationship with the Department of Defense (DoD) is
also crucial to safeguarding the MTS. In many cases, DoD's ability to
surge forces from domestic to allied seaports depends on the same
commercial maritime infrastructure as the MTS. The relationship between
the U.S. Coast Guard and DoD ensures the Nation's surge capability and
lines of communication will be secure and available during times of
crisis. By sharing threat intelligence, developing interoperable
capabilities, and leveraging DoD's expertise, the U.S. Coast Guard
enables national security sealift capabilities and jointly supports our
Nation's ability to project power around the globe.
The U.S. Coast Guard also supports the Federal Emergency Management
Agency (FEMA) in the Port Security Grant Program (PSGP) by providing
subject matter expertise in maritime security. The PSGP is designed to
support and protect critical port infrastructure from terrorism. FEMA
is responsible for the administration and management of the program,
which has distributed more than $3.8 billion to MTS stakeholders since
the program's inception in 2002.
Internationally: International Port Security Program
U.S. Coast Guard efforts to secure the MTS also extend overseas. By
leveraging international partnerships, including through the U.S. Coast
Guard International Port Security (IPS) program, the U.S. Coast Guard
conducts in-country foreign port assessments to assess compliance with
the ISPS Code and the effectiveness of security and anti-terrorism
measures in foreign ports. In addition, the IPS program conducts
capacity building engagements to assist foreign ports in implementing
effective anti-terrorism measures, where possible.
If the U.S. Coast Guard finds that a country's ports do not have
effective security and anti-terrorism measures, the Service may impose
additional security measures called Conditions of Entry (COE) on
vessels arriving to the United States from those ports and may deny
entry into the United States to any vessel that does not meet such
conditions. Verification that a vessel took additional security
measures when it was in foreign ports that lacked effective anti-
terrorism measures may be required before the vessel is permitted to
enter the United States.
The Growing Cyber Risks
Cyber-attacks can pose a significant threat to the economic
prosperity and security of the MTS for which whole-of-government
efforts are required. The MTS's complex, interconnected network of
information, sensors, and infrastructure continually evolves to promote
the efficient transport of goods and services around the world. The
information technology and operational technology networks vital to
increasing the efficiency and transparency of the MTS also create
complicated interdependencies, vulnerabilities, and risks.
The size, complexity, and importance of the MTS make it an
attractive cyber target. Terrorists, criminals, activists, adversary
nation states and state-sponsored actors may view a significant MTS
disruption as favorable to their interests. Potential malicious actors
and their increasing levels of sophistication present substantial
challenges to government agencies and stakeholders focused on
protecting the MTS from constantly evolving cyber threats.
Cyber vulnerabilities pose a risk to the vast networks and system
of the MTS. Increased use of automated systems in shipping, offshore
platforms, and port and cargo facilities creates enormous efficiencies,
but also introduce additional attack vectors for malicious cyber
actors. A successful cyber-attack could disrupt global supply chains
and impose unrecoverable losses to port operations, electronically
stored information, and national economic activity.
On February 21, 2024, the President signed an Executive Order (EO)
that makes clear that U.S. Coast Guard Captain of the Port authorities
apply to threats and incidents in the cyber domain and also requires
reporting of actual or threatened cyber incidents to aid in detection
and rapid deployment of an interagency response. With this authority
clarified, the U.S. Coast Guard issued a Maritime Security Directive
requiring specific cyber risk management actions for all owners or
operators of cranes manufactured by companies from the People's
Republic of China. Our Captains of the Port around the country are
working directly with crane owners and operators to ensure compliance
and further mitigate the threats posed by these cranes.
The U.S. Coast Guard's Approach
In support of the whole-of-government effort, the U.S. Coast Guard
applies a proven prevention and response framework to prevent or
mitigate disruption to the MTS from the many risks it faces.
Prevention
The Prevention Concept of Operations--Standards, Compliance, and
Assessment--guides all prevention missions, including port security. It
begins with establishing expectations in the MTS. Regulations and
standards provide a set of baseline requirements and are critical to
establishing effective and consistent governance regimes. With
effective standards in place, vessel and facility inspectors verify
systematic compliance activities to ensure the governance regime is
working. This part of the system is vital in identifying and correcting
potential risks before they advance further and negatively impact the
MTS. Effective assessment is paramount to continuous improvement. It
provides process feedback and facilitates the identification of system
failures so that corrective actions can be taken to improve standards
and compliance activities.
In addition to vessel and facility inspectors, the U.S. Coast Guard
also has Port Security Specialists and MTS Cybersecurity Specialists in
each Captain of the Port Zone. These dedicated staffs build and
maintain port level security-related relationships, facilitate
information sharing across industry and government, advise U.S. Coast
Guard and Unified Command decision-makers, and plan security exercises.
Response
The U.S. Coast Guard has a proven, scalable response framework that
can be tailored for all hazards. Whether a cyber or physical security
incident, our operational commanders immediately assess the risk,
consider their authorities, and deploy assets or issue operational
controls to mitigate risks. Depending on the incident's size and
severity, commanders set clear response priorities, request specialized
resources to help mitigate risk, and notify interagency partners to
help coordinate the response.
For complex responses, the U.S. Coast Guard maintains deployable
teams with specialized capabilities that can support operational
commanders across a spectrum of needs and domains. These teams include
specially trained law enforcement teams that can bolster physical
security, and pollution response teams that can address significant oil
spills or hazardous material releases.
In addition, the U.S. Coast Guard established three Cyber
Protection Teams as commands under U.S. Coast Guard Cyber Command.
Leveraging U.S. Coast Guard authorities and unique capabilities, these
units assist Captains of the Port with measuring cyber risk and are
poised to deploy in support of time-critical or nationally significant
cyber activities.
Future Focus
Given today's dynamic operational environment, the U.S. Coast Guard
is ever vigilant and on watch to identify emerging threats, evaluate
associated risk, and apply authorities and capabilities to protect the
MTS. While the U.S. Coast Guard has a proven prevention and response
framework that has been honed over many years, the Service is dedicated
to continually assessing and enhancing the way we execute both enduring
and emerging missions. The U.S. Coast Guard's commitment is to continue
to lead with the same level of professionalism, efficiency, and
effectiveness that the public has come to expect.
Thank you for the opportunity to testify today and thank you for
your continued support of the U.S. Coast Guard. We look forward to
answering your questions.

Mr. Webster of Florida. Thank you.
Now, Mr. Paape.

TESTIMONY OF WILLIAM K. PAAPE, ASSOCIATE ADMINISTRATOR FOR
PORTS AND WATERWAYS, MARITIME ADMINISTRATION

Mr. Paape. Thank you, sir. Good morning, Chairman Webster,
Chairman Gimenez, Ranking Member Carbajal, Ranking Member
Thanedar, and distinguished members of the subcommittees. Thank
you for your tremendous support for the Maritime
Administration, and thank you for the opportunity to testify
today regarding the Port Infrastructure Development Program, or
PIDP, which is a discretionary grant program, in its role in
bolstering the safety and security of our Nation's ports.
Before I go further, allow me to express on behalf of the
Department of Transportation our condolences to the families of
those who lost their lives last week when the Francis Scott Key
Bridge collapsed.
I also want to express thanks to the United States Coast
Guard for spearheading the Federal response at the Port of
Baltimore and to all of our Federal partners, as well as
Maryland State and local officials, for their ongoing response
to the Baltimore bridge collapse. Times like this highlight how
important our maritime transportation system is to our economic
and national security.
MARAD promotes the development and maintenance of a
resilient maritime transportation system, including ports, by
providing grants for infrastructure projects, technical
assistance, and support for port security initiatives. The Port
Infrastructure Development Program is MARAD's largest
discretionary grant program.
The primary objective of PIDP is to enhance the safety, the
efficiency, or reliability of the movement of goods into, out
of, around, or within a port. PIDP grants support efforts by
ports and industry stakeholders to improve port and related
freight infrastructure to meet the Nation's freight
transportation needs and ensure our port infrastructure can
meet the anticipated growth in freight volumes.
In fiscal year 2023, MARAD received 153 eligible
applications for PIDP from projects across 37 States and 4 U.S.
Territories, with a combined funding request exceeding $2.8
billion, with only $662 million available. MARAD awarded grants
to fund 41 port infrastructure projects across the Nation,
including several notable PIDP projects that focused on safety
improvements across various ports. These numbers vividly
demonstrate the oversubscription of this grant program and
highlights the continued urgent need for measures to help
continue strengthening the Nation's supply chains.
On the technical assistance front, MARAD chairs the
National Port Readiness Network to ensure readiness of
commercial strategic seaports to support deployment of military
forces and national contingencies. Together with eight other
Federal agencies and military commands, this network supports
the maintenance of port readiness committees. MARAD further
facilitates the collaborative development of port readiness
plans, which are voluntary planning documents focused on port
facility readiness at commercial strategic seaports.
As our current port security initiative, the FY24 PIDP
Notice of Funding Opportunity included two critical provisions
addressing cybersecurity and technology concerns. First, the
Notice of Funding Opportunity prohibits the use or provision of
LOGINK. This measure aims to safeguard against potential
security risks associated with these platforms.
The second provision seeks to ensure projects are
consistent with Presidential Policy Directive 21: Critical
Infrastructure Security and Resilience, in that each
application selected for Federal funding must demonstrate
consideration and mitigation of physical and cybersecurity
risks relevant to their project. Projects failing to adequately
address these risks will be required to do so before receiving
funds.
Finally, the FY23 NDAA directed MARAD, in consultation with
our other Federal stakeholders, to conduct a study to assess
whether there are cybersecurity or national security risks
posed by foreign-manufactured cranes at United States ports.
Our report will be delivered to Congress soon.
In conclusion, PIDP plays a vital role in enhancing the
safety, efficiency, reliability, and resilience of our Nation's
ports. I appreciate the opportunity to appear before this
subcommittee and thank you for the support you have shown the
Maritime Administration. I welcome any questions that you may
have.
[Mr. Paape's prepared statement follows:]

Prepared Statement of William K. Paape, Associate Administrator for
Ports and Waterways, Maritime Administration
Good morning, Chairman Webster, Chairman Gimenez, Ranking Member
Carbajal, Ranking Member Thanedar and Members of the Subcommittees.
Thank you for your tremendous support for the Maritime Administration
(MARAD) and thank you for the opportunity to testify today regarding
the Port Infrastructure Development Program (PIDP), a discretionary
grant program, and its role in bolstering the safety and security of
our nation's ports.
Before I go further, allow me to express on behalf of the
Department of Transportation our condolences to the families of those
who lost their lives last week when the Francis Scott Key Bridge
collapsed. I also want to express thanks to the United States Coast
Guard for spearheading the Federal response at the Port of Baltimore,
and to all of our Federal Partners--especially my DOT colleagues at
MARAD and FHWA--as well as Maryland state and local officials for their
ongoing response to the Baltimore bridge collapse.
Times like this highlight how important our maritime transportation
system (MTS) is to our economic and national security. Our MTS, and for
that matter, our entire national surface transportation system, is the
best in the world. We have the greatest inherent flexibility and
redundancy to support the transportation segments of our supply chain.
The collapse of Key Bridge, the COVID surge, the attacks in the Red
Sea, and Hurricanes Maria, Sandy, and Irene, to name a few, serve as
notable reminders of how vital ports are to our Nation's economic
vitality. Equally, our responses to these tragedies have demonstrated
our great resolve and ability to respond as a Nation.
Several agencies play key roles in overseeing port security in the
United States. These agencies work collaboratively to ensure the safety
and security of U.S. ports and the maritime transportation system.
MARAD promotes the development and maintenance of a resilient
maritime transportation system, including ports, by providing grants
for infrastructure projects, technical assistance, and support for port
security initiatives. MARAD's cooperative efforts include chairing the
National Port Readiness Network (NPRN) to ensure readiness of
Commercial Strategic Seaports to support the deployment of military
forces and national contingencies. Together with eight other Federal
agencies and military commands, this network supports the maintenance
of Port Readiness Committees. MARAD further facilitates the
collaborative development of Port Readiness Plans, voluntary planning
documents focused on port facility readiness at Commercial Strategic
Seaports.
The primary statutory objective of the PIDP is to enhance the
safety, efficiency, or reliability of the movement of goods into, out
of, around, or within a port. Each project funded through the PIDP must
address or advance at least one of these critical objectives. PIDP
grants support efforts by ports and industry stakeholders to improve
port and related freight infrastructure to meet the nation's freight
transportation needs and ensure our port infrastructure can meet
anticipated growth in freight volumes. The PIDP provides funding to
ports in both urban and rural areas for planning and capital projects.
It also includes a statutory set-aside for small ports to continue to
improve and expand their capacity to move freight reliably and
efficiently and support local and regional economies.
In fiscal year (FY) 2023, MARAD received 153 eligible applications
for the PIDP from projects across 37 states and 4 U.S. territories,
with a combined funding request exceeding $2.8 billion with only $662
million available funding for FY 2023. Similarly, in FY 2023, the
United States Marine Highway Program, received 16 eligible applications
from projects in 12 states and 2 territories, requesting a total of
approximately $46.4 million in funding with only $12.123 million
available funding for FY 2023. These numbers highlight the continued
need for strengthening of the nation's supply chains.
In FY 2023, MARAD awarded grants to fund 41 port improvement
projects across the nation, including several notable PIDP projects
that focused on safety improvements across various ports:
Cold Bay, AK: Construction of a new dock with significant
operational and safety benefits compared to the old dock.
Kawaihae, HI: Access and lighting enhancements to improve
safety.
Astoria, OR: Major infrastructure upgrades, including
fire protection measures.
Freeport, TX: Site improvements facilitating safer cargo
movement and dedicated truck lanes.
San Diego, CA: Lighting enhancements to enhance safety.
Red Wing, MN: Mooring improvements aimed at enhancing
safety during barge operations.

Another noteworthy FY 2023 PIDP project incorporating security
enhancements is underway at the North Carolina State Port Authority in
Wilmington, NC. This comprehensive project involves reconfiguring port
access, relocating security checkpoints, installing a gate operating
system, enhancing railroad crossings, constructing a truck queuing
area, implementing new cybersecurity tools, and constructing guard and
badging facilities.
Addressing cybersecurity and technology concerns, the FY 2024 PIDP
Notice of Funding Opportunity (NOFO) included two critical provisions:
LOGINK Prohibition: In compliance with Section 825 of the
FY 2024 National Defense Authorization Act (NDAA), the FY 2024 PIDP
NOFO prohibits the utilization or provision of certain Chinese
transportation logistics platforms. This measure aims to safeguard
against potential security risks associated with these platforms.

Each applicant selected for federal funding must
demonstrate consideration and mitigation of physical and cyber security
risks relevant to their project. Projects failing to adequately address
these risks will be required to do so before receiving funds. MARAD and
the Office of the Secretary's Chief Information Officer will conduct
risk assessments on all grant projects, with additional cyber risk
mitigation activities mandated for moderate or higher risk projects.

Section 3529 of the FY23 NDAA directed MARAD, in consultation with
the Secretary of Homeland Security, the Secretary of Defense, and the
Director of the Cybersecurity and Infrastructure Security Agency, to
conduct a study to assess whether there are cybersecurity or National
security threats posed by foreign manufactured cranes at United States
ports. Our report will be delivered to Congress soon.
In conclusion, PIDP plays a vital role in enhancing the safety,
efficiency, reliability, and resilience of our nation's ports. The
projects highlighted underscore our commitment to enhancing and
modernizing the Maritime Transportation System which is vital to our
national and economic security missions.
I appreciate the opportunity to appear before this Subcommittee and
thank you for the support that you have shown the Maritime
Administration. I welcome any questions you may have.

Mr. Webster of Florida. Thank you all for your testimony.
And now we turn to members from the second panel and questions
for them. And I recognize myself for 5 minutes.
Rear Admiral Vann, the Maritime Transportation Security Act
was approved by Congress in 2002. At the time, there were
physical problems and those were looked into; now we have cyber
problems. Do you think the Coast Guard has the right authority
and is striking a balance between cyber and physical threats?
Admiral Vann. Chairman Webster, I'll take an attempt to
answer your question and then maybe ask my colleague here who's
really--this is his area of expertise.
But to your point, clearly, cyber threats and the risks of
cyber attack have increased over time with the advance of
technology, particularly in the port environment, with the
implementation of automation and various software products,
operational technology to increase the efficiency of our ports.
What comes with that are increased vulnerabilities, and as I
mentioned in my opening remarks, attack vectors.
Our authorities, which will be bolstered by the current
rulemaking effort, are currently adequate for our team's
abilities to assist port partners in addressing risks and
responding to attacks.
I'll defer to Admiral Arguin to add to the answer.
Mr. Webster of Florida. Rear Admiral Arguin, do you have
something to add to that?
Admiral Arguin. Yes, sir. So, to answer your question
directly, the Maritime Transportation Security Act did support
or did solve a particular problem when initially enacted and
focused primarily on physical security. However, the evolving
threats that have been brought about with the cyber domain, we
are evolving those same authorities. We can use that same
structure.
And our proposed rulemaking really does focus on evolving
the requirements that we were putting in place through those
baseline cybersecurity requirements to address the emerging
threats that cyber places. So, I would say that we're good on
the physical side with MTSA. Evolving to incorporate
vulnerability closing actions underneath the MTSA is still
appropriate; yes, sir.
Mr. Webster of Florida. So, were there more that you might
need for the cyber part of that as far as the Coast Guard
needing more authority for port safety and so forth, do you
think?
Admiral Arguin. Mr. Chairman, I would say that the
framework, the structural framework, that system that was put
in place underneath the MTSA, is adequate. The authorities that
we have underneath the captain of the port authorities to be
able to address those emerging threats is adequate. We need to
build out the specifics, which is where the notice to propose
rulemaking really does focus on setting that baseline.
But the cyber challenge really is an evolving challenge
that we're going to have to be nimble and flexible as new
vulnerabilities are identified. But I feel very confident that
the structure and the system that's in place underneath MTSA is
adequate for the purposes of addressing those vulnerabilities.
Mr. Webster of Florida. So, Rear Admiral Vann, in February,
the President signed an Executive order to strengthen
cybersecurity in the maritime domain. The Coast Guard has
historically been sometimes slow to respond to doing Executive
orders and rulemaking and so forth. For example, we spent a
decade trying to execute rules for the Atlantic coast port
access routes.
Cybersecurity is rapidly developing. Do you think that the
Coast Guard will have the speed to put together what's needed
in order to do that, or are you going to adopt a slower speed?
Admiral Vann. Mr. Chairman, the Executive order clarified
captain of the port authorities to respond to cyber threats and
attacks immediately as soon as it was instituted. As you know,
sir, that same day the Coast Guard released a maritime security
directive that specifically addressed the assessment of
vulnerabilities in foreign-made ship-to-shore cranes. So,
again, that was an immediate response.
And then that same week was the Notice of Proposed
Rulemaking, which to your point, sir, there is a process that
plays out. We're in the public comment period, and the Coast
Guard encourages industry and port partners to take advantage
of the opportunity to provide feedback on the draft regulations
that have been put forward through that rulemaking process. So,
moving with haste, sir.
Mr. Webster of Florida. Thank you.
OK. Mr. Carbajal, you're recognized for 5 minutes.
Mr. Carbajal. Thank you, Mr. Chairman.
Mr. Paape, as we so tragically witnessed in Baltimore, the
continuous operation of our ports should not be taken for
granted. What is MARAD doing to help ports become more
resilient to rising oceans and extreme weather events?
Mr. Paape. I thank you for that question. We are taking a
number of actions, but I think I would like to take that
question for the record.
Mr. Carbajal. Thank you. Rear Admiral Vann, President Biden
issued an Executive order granting the Coast Guard stronger
authorities to address cybersecurity. So, building on what my
colleague just asked, how is the Coast Guard using this new
authority, and could you explain how this differs from the
existing authority the Coast Guard already had?
Admiral Vann. Thank you, Member, I appreciate that
question. As I indicated before, the Executive order was a
clarification of our Magnuson Act authorities where the captain
of the port has the authority to respond to risks and threats
and attacks, be they physical, be they any threat. This
Executive order added cyber to clarify, to your point, existing
authorities.
So, the way we are using those authorities is continuing to
do our mission in prevention. And then as cyber threats emerge
or attacks occur, captains of the port could leverage that
authority that comes with the Executive order to respond by
directing the movement or the operations of port operations of
vessels.
As I mentioned in my previous answer, one of the first
actions we took was a maritime security directive in
association with the Executive order to direct the assessment
of port cranes due to the criticality of that node of the
system and the prevalence of foreign-manufactured cranes. So,
these are actions that we've taken and that we are poised to
take should there be a threat or an attack that occurs.
Mr. Carbajal. Thank you. Admiral Arguin, I'd like to take a
moment to thank you for your commitment to addressing sexual
assault and sexual harassment in the commercial maritime
industry. Your efforts have not gone unnoticed among merchant
mariners, the very people who need your help.
How would you assess the state of change in the industry,
and how far do we still have to go?
Admiral Arguin. Ranking Member, thank you for the
compliment, but it is a team sport. We have taken directed
efforts to engage with maritime training providers, with
industry representatives, seafarers around the Nation to ensure
that everyone understands their responsibilities to change the
culture associated with maritime.
I think there's not a finish line associated with changing
a culture. It is an expectation that there is a culture that is
established to ensure that every single person feel safe coming
to work and that they feel valued. And so, that's going to be a
continuous assessment of culture, and we really get to the
point where what happens between two individuals in the engine
room or on the bridge and that interaction where both people
feel valued, feel respected, that really is the standard. And
when that fails or if that fails, that there's an expectation
for accountability.
And so, that's going to be a continuous effort. I don't
think we get to snap the chalk line and say we're done. I think
that's going to be a continuous shared responsibility not only
just with industry to change that culture, but then to ensure
that, if that culture does not stand forward, we are in a
position to hold individuals accountable.
Mr. Carbajal. With organizational leadership changes that
occur, I would submit to you that real cultural change will be
determined on the system's changes that occur within the
organization. So, as leadership changes, those are sustainable.
And so, I encourage you to look at it from that perspective.
Getting achievements now is one thing, but making sure the
culture is ever evolving to ensure that we don't have what
we've had in the past continue. So, thank you very much,
Mr. Chairman, I yield back.
Mr. Webster of Florida. Thank you. Chairman Gimenez, you're
recognized for 5 minutes for questions.
Mr. Gimenez. Thank you, Mr. Chairman.
And Mr. Paape, or anybody who can answer this, in light of
what happened in Baltimore--and right now, it looks like every
indication was, it was an accident--how many ports do we have
in the United States that are vulnerable to either an accident
or an attack that's actually not an accident? So, how many
ports in the United States would be vulnerable to such a thing
where a ship strikes a bridge, the bridge collapses, and then
basically the port is out of commission? How many ports do we
have like that?
Admiral Arguin. Mr. Chairman, I'll take a first shot at
that. I would say that every port is vulnerable. I think given
the cyber challenges and the interconnectedness, the continued
interconnectedness of the Marine Transportation System, and the
inherent vulnerabilities with that interconnectedness, that we
have to be ever vigilant to continuously evolve efforts to
close those vulnerabilities.
Specific to number of ports that may have infrastructure
that could impact or cause the closure of a particular port, I
don't have particular numbers, but I think anything that
crosses a waterway poses a particular hazard or threat, and we
need to be evaluating on a regular basis the--assessing those
waterways. As more congestion comes into our ports, we need to
understand that and be nimble and flexible to be able to put
safeguards in place to ensure the safe and efficient movement
of commerce.
Mr. Gimenez. I think it'd be wise for the Coast Guard to do
an inventory of those critical ports that are critical to the
security of the United States and see, either by accident or by
intentional act, how those ports can be affected.
I mean, this accident in Baltimore is clear indication. One
ship hits a bridge and the port is out of action for some time.
A foreign adversary could, say, have a coordinated attack. This
is not farfetched. I mean, this is what happened on 9/11,
right? So, coordinated attack to affect our ability to respond
around the world, especially our military around the world.
Have we done such an analysis? And if we haven't, I think
it should be done to say, OK, these ports are vulnerable in
this fashion to being shut down and affecting our ability as a
country to respond around the world.
Admiral Arguin. Mr. Chairman, so, just to be clear, each of
our sector commanders, our captains of port, have real-time
information on ongoing threats and hazards within each of those
ports, and they are regularly assessing risks on a daily basis
to understand the impact to the Marine Transportation System.
A consolidated list of single point failures within those
ports, I'll bring that back to the staff to verify that we have
done something like that. But on a daily basis, every one of
our sector commanders is regularly assessing risks, whether
that's weather, whether that's congestion, whether that's
impacts to the waterway due to navigation challenges. They're
regularly assessing those ports to ensure that we can continue
to move cargo on a daily basis. We certainly understand the
significance of the----
Mr. Gimenez [interrupting]. Yes, but in Baltimore, did
anybody assess the risk of a ship hitting that bridge and it
causing it to collapse? Did anybody do that?
So, I mean, you've got to think of the stuff that's never
happened before. What if? The what if. And I guess because
that's my firefighter in me. What if? All right. It's better to
prevent something than to say, oh, gee, look, it collapsed. OK?
Collapsed because it got struck by a ship.
Was there anything you could have done to that bridge,
fortified it, so that if it got struck by a ship, it would not
have collapsed?
Admiral Arguin. I'm not a bridge expert, sir, but I would
certainly say that at the conclusion of the investigation, the
causal factors and recommendations that will come through,
we'll take those into account.
Mr. Gimenez. That's what I'm calling for. So, those
critical ports are critical to the security of the United
States that if somehow knocked out of commission, what are the
ways that you can knock it out of commission and what are the
things we need to do to make sure it's not knocked out of
commission before it actually happens?
I believe in Murphy's law. All right. And it doesn't mean
everything's bad, it just says anything that can happen will.
And obviously, look, it happened in Baltimore. It could happen.
A ship lost power, it hit the bridge, the bridge collapsed.
Could we have done something to make sure that, even in the
event of Murphy's law taking effect, that we had protection
around the bridge structure so that it would not collapse?
Because now the largest port for vehicles in the United States
is knocked out of action and it's going to hurt the economy.
I'm worried more also about our ability to respond around
the world and an adversary taking certain actions to make sure
that we don't respond around the world, because we do need
maritime assets when we're responding around the world. That's
my concern. That's all I'm putting on the table.
Admiral Arguin. Yes, sir.
Mr. Gimenez. Thank you. And I yield back.
Mr. Webster of Florida. Thank you. Mr. Thanedar, you're
recognized for 5 minutes.
Mr. Thanedar. Thank you, Chairman. Admiral Vann, and all of
you, thank you for your testimony here today.
In the aftermath of the Key Bridge accident, there has been
a lot of conjecture about the cause of the accident, some of
which has been widely irresponsible. I understand that the
investigation is ongoing and you're limited in what you can
share, but that said, can you say whether at this point there
is any evidence at all that the accident was caused by a cyber
attack?
Admiral Vann. Ranking Member, as you know, we have
representation from Coast Guard Cyber Command on the Coast
Guard's Marine Board of Investigation, which is working in
partnership with the National Transportation Safety Board's
investigation. It is, as you said, sir, much too early in the
process to know the causal factors. But the reason for that
subject matter expertise is certainly to investigate the
potential for that type of a causal factor, some sort of a
cyber disruption. So, absolutely being considered and really
too early, and I wouldn't be in a position to comment.
Mr. Thanedar. All right. Thank you so much.
And Admiral Arguin, the waterways near major ports are
subject to significant congestion and obstacles that make safe
navigation challenging. What are some of the initial lessons to
be learned from the Key Bridge incident, both for vessel
operators and for port operations?
Admiral Arguin. Ranking Member, so, ships that are moving
throughout our ports, there's a shared and a layered approach,
and there are a variety of different ways that we attempt to
prevent the bad thing from happening. And that involves skilled
mariners at the helm. It involves pilots that are uniquely
positioned and experienced in operating in those particular
waters. It's the inspection and investigation of vessels, the
oversight of vessels to ensure that the systems that have been
designed to meet certain requirements are effectively operating
in the way that they're supposed to. It is the aids to
navigation to ensure that the channel is properly marked. It's
the access to information. All of those pieces of information
come together to ensure that commerce can operate safely.
And when any one of those elements fails to meet the
expectations, being able to understand why that failed and then
build resiliency into that system is important. And we
constantly are looking at those challenges on a regular daily
basis at our captains of the port.
Mr. Thanedar. Thank you. Thank you, Admiral. And Admiral
Arguin and Admiral Vann, I appreciate your testimony before our
subcommittee on some of the same topics back in February. At
that hearing, we discussed in detail the actions the
administration announced in February to bolster cybersecurity
at ports.
These actions will require significant effort from the
Coast Guard to implement. Since that hearing, Congress passed
funding for the remainder of the current fiscal year, and the
President submitted his budget request for next year.
Yesterday, for the better part of the day, I had the
pleasure of meeting the officers of the Coast Guard and being
on the water with them, and I admire their dedication and their
service to our Nation. But I kept seeing the strong need for
resources, whether it was infrastructure needs, whether it's
needs for personnel. As these challenges continue to grow, to
have a well-funded, well-staffed Coast Guard is so important,
and that became very apparent as I was traveling through and
working with them.
So, what resources does the Coast Guard require to advance
and then implement the rulemaking, inspect for compliance, and
otherwise ensure the recently announced efforts are carried out
effectively? Does the Coast Guard's budget request include the
necessary funding?
Admiral Arguin. Ranking Member, so, we certainly appreciate
the subcommittee's and committee's support, Congress' support
for Coast Guard budgets. The Commandant's been very clear. For
the Coast Guard to meet its current and future demands, we need
to be a $20 billion organization by 2033 to meet all of those
requirements. And I think it's important to recognize that a
predictable level of funding gives us the opportunity to
recapitalize our assets while also still meeting emerging
demands. And so, the support of Congress to ensure that is
paramount for us.
Mr. Thanedar. Thank you. And I yield back.
Mr. Webster of Florida. The gentleman yields back.
Representative Cohen, would you like 5 minutes?
Mr. Cohen. Seven.
Mr. Webster of Florida. OK. You can have 5.
Mr. Cohen. I'll take 4. Thank you.
I didn't really understand the answer to that question. How
much more money does the Coast Guard need than what they were
appropriated? You've been asked to do cybersecurity. You've got
the awareness of bridges and other infrastructure vulnerable to
massive ships and other forces. How much money do you need to
protect the American maritime system beyond what you're
getting?
Admiral Vann. Congressman, as my colleague mentioned, the
fiscal 2024 budget that was approved since we last appeared
before the committee and then the President's budget that's
been presented for next year and then looking ahead to 2033,
Commandant Fagan has been clear about the current roughly $13
billion Coast Guard being a $20 billion Coast Guard and looking
at a 3- to 5-percent increase in operating and maintenance
funds annually. We've said that publicly, in order to meet
those requirements, all those requirements you listed, sir, and
many others.
To be specific about cyber, my area of responsibility, I
would tell you that we are meeting the current demand signal,
but there's no doubt I think anyone has that cyber threats are
increasing. Our increasing use of automation is creating more
vulnerability. And so, if we are asked to do more, if the
required level of effort is going to go up, then the required
level of resources would need to go up with it. So, we will be
responsible in asking for what we need as those
responsibilities increase.
Mr. Cohen. Either of you all want to comment on this?
Admiral Arguin. Congressman, the Commandant's been very
clear that the status quo is a risk position that we're in
right now. Staying steady state does not give the Coast Guard
the readiness to be able to meet emerging demands and future
demands. And so, the President's budget has a prioritized list
of critical assets and critical funding support that will allow
us to not only continue to restore readiness for our aging
infrastructure and aging assets, but then also be able to meet
future demands for service for the Coast Guard.
Mr. Cohen. And I believe you need more money. I believe
almost every element of American defense and the homeland
security needs more money as we have more and more threats from
overseas and from neighbors in Central America. But we have to
realize as congresspeople that things cost money. And the
continuing resolution hurt you when we had not approved the
budget for next year, you all were operating with less funds,
and it affected your abilities. We need to be willing to take
the difficult votes to pass revenue measures to serve our
defense teams, our homeland security teams, and protect our
country.
Just putting out jingoistic comments about America and
protect us and close our border and build walls and all that
kind of stuff doesn't get it. It takes yes, I vote for the
budget or I will vote for additional funds. That's what we need
in so many areas. And I'm going to be willing to do it. I know
in cybersecurity, there's going to be a whole lot more, and
you've got trouble dealing with Silicon Valley wanting to take
a lot of people you probably want to serve in this important
area. These ports are vulnerable, and cyber is a future
warfare.
So, I just hope you'll quietly let your voices be known to
folks that they need to support funding and not just rhetoric.
Thank you for your service. I know what happened in Baltimore
is being dealt with, and I guess anything could happen. Mr.
Gimenez mentioned that. I don't expect ISIS or somebody to get
a gigantic car container, cargo container and have lots of
containers on it and be able to bring down a bridge. But they
could do something and you're responsible, so, we want to give
you the funds to be able to do the job.
Thank you, and I yield back the balance of my time.
Mr. Webster of Florida. The gentleman yields back. That
concludes our second panel. And we thank the witnesses. Thank
you for being here. Thank you for your testimony and the
information you've given us, and you are excused.
For our third panel, I'd like to welcome them and the
witnesses and ask them to get prepared. You're next.
Our third panel consists of industry experts operating in
and around ports. As the primary users and operators of ports,
they're aware of the safety, security, and infrastructure
investment needs not only today, but for long-term
sustainability and success.
So, as noted earlier at the beginning of this hearing, your
written testimony has been made a part of the record.
Therefore, we'd ask you to limit your remarks to the time-
allotted 5 minutes.
With that, Mr. Fowler, you are recognized for 5 minutes for
your testimony.

TESTIMONY OF JAMES C. FOWLER, SENIOR VICE PRESIDENT AND GENERAL
MANAGER, CROWLEY SHIPPING; FREDERICK WONG, Jr., DEPUTY PORT
DIRECTOR, PORTMIAMI, ON BEHALF OF THE AMERICAN ASSOCIATION OF
PORT AUTHORITIES; BRENT D. SADLER, CAPTAIN, U.S. NAVY (RET.),
AND SENIOR RESEARCH FELLOW, THE HERITAGE FOUNDATION; ED
McCARTHY, CHIEF OPERATING OFFICER, GEORGIA PORTS AUTHORITY, ON
BEHALF OF THE NATIONAL ASSOCIATION OF WATERFRONT EMPLOYERS; AND
DAVE MORGAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER, COOPER/
PORTS AMERICA, ON BEHALF OF THE NATIONAL MARITIME SAFETY
ASSOCIATION

TESTIMONY OF JAMES C. FOWLER, SENIOR VICE PRESIDENT AND GENERAL
MANAGER, CROWLEY SHIPPING

Mr. Fowler. Chairman Webster, Chairman Gimenez, Ranking
Members Carbajal and Thanedar, members of the committee, I'm
honored to appear here today to discuss critical issues
concerning port safety, security, and infrastructure
investment.
I'm James Fowler, senior vice president and general manager
of shipping at Crowley. We're a U.S. owned and operated
maritime, energy, and logistics solutions company serving
commercial and Government sectors with over 170 vessels, mostly
in the Jones Act fleet, and approximately 7,000 employees
around the world--employing more U.S. mariners than any other
company. The Crowley enterprise has invested more than $3.2
billion in maritime transport, which is the backbone of global
trade in the global economy.
As a ship owner-operator and transportation services
provider with more than 130 years of innovation and a
commitment to sustainability, Crowley serves customers in 36
nations and island territories. We sincerely appreciate the
committees' continued work towards making America's ports the
most efficient, safe, and secure in the world.
Crowley has operations in ports along the U.S. east coast
and gulf coast, including Gulfport, Mississippi; Mobile,
Alabama; Port Everglades and Jacksonville, Florida; Wilmington,
North Carolina; and Eddystone, Pennsylvania. These facilities
support our U.S. customers as well as customers in Mexico, the
Caribbean, and Central America. We also have significant
operations in San Juan, Puerto Rico, and in the U.S. Virgin
Islands.
While the investigation of the terrible and tragic collapse
of the Francis Scott Key Bridge in Baltimore continues, it
reminds us all that safety is of critical importance to the
maritime industry and all transportation modes. We also see
that our Nation's intricate supply chain is vulnerable to
disruption, and industry must continue to work collaboratively
with Federal officials to address these issues.
Post-9/11, our industry has made significant changes to
operations and procedures to increase security at all of our
ports. As a port stakeholder, we take our obligations in this
area seriously, and we work closely with a number of Federal
agencies, including CBP, the U.S. Coast Guard, and CISA. While
the focus over the past 20 years has been on security physical
threats, we've become increasingly prepared for cyber threats.
Crowley works closely with both the CISA Maritime Modal
Sector Coordinating Council and the Customs Trade Partnership
Against Terrorism program to address industry cyber and supply
chain concerns.
We're also mindful of the concerns raised over the last
year involving cranes manufactured by ZPMC. While Crowley does
not own any ZPMC cranes, we know they're extensively used in
U.S. ports, including some in which we operate. The recent
Executive order on this and other cybersecurity matters brings
further attention to the critical role that ports in the
maritime sector have in our economy, and Crowley looks forward
to working with our Government partners on proposals to
strengthen the security and resiliency of our Marine
Transportation System.
An important part of maintaining resiliency in our supply
chains is ensuring that our Nation's port infrastructure
receives the investment necessary to accommodate the movement
of trade both now and in the future. Crowley is investing in
port electrification in coordination with local, State, and
Federal partners, particularly MARAD. Port infrastructure
development grants have been critical to expanding
electrification efforts in ports like Jacksonville, where we're
in the early stages of a project to build out electrical
connections for hundreds of refrigerated containers. These
improvements will decrease our diesel fuel usage and costs,
reduce air and noise pollution, and increase equipment uptime
and efficiency.
We've also worked with our public-sector partners to
utilize PIDP grant funding for desperately needed upgrades to
the Crown Bay Terminal in St. Thomas in the Virgin Islands and
to begin construction of New England's flagship offshore wind
terminal in Salem, Massachusetts.
PIDP grants should continue to be available and expanded to
ensure that we don't lose momentum in addressing the needed
port improvements across the U.S.
In conclusion, while progress has been made in addressing
various challenges facing the maritime industry, continued
vigilance and investment are essential to ensure the safety,
security, and resilience of our ports and supply chains. I
commend the committees' further dedication to these critical
issues and stand ready to collaborate in advancing solutions
that strengthen our Nation's Marine Transportation System's
infrastructure and competitiveness.
Thank you for the opportunity to testify today, and I look
forward to your questions.
[Mr. Fowler's prepared statement follows:]

Prepared Statement of James C. Fowler, Senior Vice President and
General Manager, Crowley Shipping
Chairman Webster, Chairman Gimenez, Ranking Members Carbajal and
Thanedar, Members of the Committees, I am honored to appear here today
to discuss critical issues concerning port safety, security, and
infrastructure investment.
I am James Fowler, Senior Vice President and General Manager of
Shipping at Crowley. We are a U.S.-owned and -operated maritime, energy
and logistics solutions company serving commercial and government
sectors with over 170 vessels, mostly in the Jones Act fleet, and
approximately 7,000 employees around the world--employing more U.S.
mariners than any other company. The Crowley enterprise has invested
more than $3.2 billion in maritime transport, which is the backbone of
global trade and the global economy. As a ship owner-operator and
transportation services provider with more than 130 years of innovation
and a commitment to sustainability, Crowley serves customers in 36
nations and island territories. We sincerely appreciate the Committees
continued work toward making America's ports the most efficient, safe,
and secure in the world.
Port Safety
While Crowley is not primarily a port operator, we do have
extensive operations in ports along the U.S. East and Gulf Coasts
including in Gulfport, MS; Mobile, AL; Port Everglades and
Jacksonville, FL; Wilmington, NC; and Eddystone, PA. These facilities
support our U.S. customers as well as customers in Mexico, the
Caribbean, and Central American. We also have significant operations in
San Juan, Puerto Rico and in the U.S. Virgin Islands.
At Crowley we have a company-wide safety culture that is imbedded
in everything we do. Every employee has the authority and obligation to
stop work if they believe it is not safe. Each Crowley meeting or shift
change begins with a Safety Moment--a brief pause to share a safety tip
or idea about how to improve our safety performance. This practice is
part of our commitment to continual improvement when it comes to safety
and helps us develop new ideas for safety procedures and reinforces the
role that safety plays in our performance as a company.
While the investigation of the terrible collapse of the Francis
Scott Key Bridge in Baltimore continues, it reminds us all that safety
is of critical importance to the maritime industry and all
transportation modes. We also see that our Nation's intricate supply
chain is vulnerable to disruption and industry must continue to work
collaboratively with federal officials to address these issues.
Port Security
Post 9/11 we as an industry have made significant changes to
operations and procedures to increase security at all our ports. As a
port stakeholder we take our obligations in this area seriously and we
work closely with a number of federal agencies including CBP, the U.S.
Coast Guard and CISA. While the focus over the past 20 years has been
on physical security threats, we are becoming increasingly aware and
prepared for cyber threats. Crowley works closely with both the CISA
Maritime Modal Sector Coordinating Council and the Customs Trade
Partnership Against Terrorism (CTPAT) program to discuss and work to
address industry cyber and supply chain concerns.
We are also mindful of concerns raised over the last year involving
cranes manufactured by ZPMC. While Crowley does not own any ZPMC cranes
we know they are used extensively at U.S. ports, including some in
which we operate. The recent Executive Order on this and other
cybersecurity matters brings further attention to the critical role
ports and the maritime sector have in our economy, and Crowley looks
forward to working with our government partners on proposals to
strengthen the security and resiliency of our marine transportation
system.
Port Infrastructure
An important part of maintaining resiliency in our supply chains is
ensuring that our Nation's port infrastructure receives the investment
necessary to accommodate the movement of trade both now and in the
future. For Crowley looking toward the future we are investing in port
electrification efforts in coordination with local, state, and federal
partners, particularly MARAD. Port Infrastructure Development Grants
(PIDP) have been critical to expanding electrification efforts in ports
like Jacksonville, where we are in the early stages of a project to
build out electrical connections for hundreds of refrigerated
containers. These improvements will decrease our diesel fuel usage and
costs, reduce air and noise pollution, and increase equipment up-time
and efficiency.
We have also worked with our public sector partners to utilize PIDP
grant funding for desperately needed upgrades to the Crown Bay Terminal
on St. Thomas in the U.S. Virgin Islands and to begin construction of
New England's flagship offshore wind terminal in Salem, Massachusetts.
We believe PIDP grants should continue to be available and expanded to
ensure we do not lose momentum in addressing needed port improvements
across the U.S.
Closing
In conclusion, while progress has been made in addressing various
challenges facing the maritime industry, continued vigilance and
investment are essential to ensure the safety, security, and resilience
of our ports and supply chains. I commend the committees for their
dedication to these critical issues and stand ready to collaborate in
advancing solutions that strengthen our nation's marine transportation
system's infrastructure and competitiveness. Thank you for the
opportunity to testify today and I look forward to your questions.

Mr. Webster of Florida. Thank you very much.
Mr. Wong, you're recognized for 5 minutes.

TESTIMONY OF FREDERICK WONG, Jr., DEPUTY PORT DIRECTOR,
PORTMIAMI, ON BEHALF OF THE AMERICAN ASSOCIATION OF PORT
AUTHORITIES

Mr. Wong. Good morning, Chairman Webster, Chairman Gimenez,
Ranking Member Carbajal, Ranking Member Thanedar, and
Congressman Cohen.
My name is Fred Wong. I'm the deputy port director here at
PortMiami. And Miami welcomes you all, and we appreciate you
guys addressing critical topics in the maritime transportation
system. I respectfully ask that my written testimony be read
into the record, sir.
Mr. Webster of Florida. Without objection, duly done.
Mr. Wong. Thank you. Before I begin, I want to extend my
condolences to the families of those lost in the collapse of
the Baltimore Key Bridge last week. Our Nation's port industry
stands with Baltimore now.
My testimony is given on behalf of the American Association
of Port Authorities, AAPA. AAPA represents over 80 U.S. ports
on urgent and pressing issues facing our industry, promoting
common interests of the port community, and providing critical
industry leadership on security, trade, port development, and
other operational issues.
According to Ernst & Young, ports moved $5.4 trillion in
imports and exports, or roughly 20 percent of the U.S. economic
activity, while supporting 2.5 million jobs.
Ports need robust Federal funding and streamlined
construction to expand capacity and reduce emissions at every
point in our operations. We simply cannot do this without your
Federal support. The ports are concerned because the annual
appropriations in the President's budget request for the Port
Infrastructure Development Program have all decreased. The
President's budget request was lowered by $150 million, and the
appropriations for PIDP was lowered from $212 million in FY
2023 to only $50 million in FY 2024 for competitive grants.
Although ports mainly operate independently, they are part
of a larger system. A crisis at one port, such as Baltimore,
means that all the other ports must absorb all the other cargo
flow. The Committee on the Marine Transportation System
estimates that every dollar spent on our maritime supply chain
returns $3 of economic activity. We ask Congress to fund port
infrastructure projects at a level on par with other modes of
transportation across the globe.
To significantly improve project delivery at all ports, the
PORT Act has been referred to the Transportation and
Infrastructure Committee. This bill will allow MARAD to expand
the list of categorical exclusions and increase access to the
Federal Permitting Improvement Steering Council.
We are partners with the U.S. Customs and Border
Protection, and shortages of CBP officers and agriculture
specialists are a chronic problem with most of our seaports.
CBP's workload staffing model reveals a deficit of 1,750
officers and 250 agriculture specialists nationally. This
deficit significantly impacts processing time at our seaports.
CBP also faces funding shortages for their Federal
inspection facilities at our ports. In recent years, CBP has
turned to our port authorities to pay for major upgrades and
new facilities, which is unsustainable. We thank Congresswoman
Lee for introducing the CBP SPACE Act, which will allow CBP to
access existing user fees to fund their Federal facilities at
seaports and sets guidelines around what ports are expected to
provide.
At all of our seaports, cybersecurity is our top priority.
We thank Chairman Gimenez for his leadership on maritime
security. As the U.S. Coast Guard sets MARSEC Directives, we're
requiring certain cybersecurity standards for the maritime
sector. AAPA members are weighing in on the Notice of Proposed
Rulemaking to ensure regulations comport with facility
operations while keeping our industry protected.
Ports are cognizant of the increased use of connected
equipment, including ship-to-shore gantry cranes. While our
industry works on long-term solutions such as reshoring
manufacturing of critical cargo handling equipment, ports and
maritime terminals have taken steps to ensure the safety and
security of our operations.
Last year, after touring PortMiami with Chairman Gimenez,
Congressman Gallagher, chairman of the Select Committee on the
Chinese Communist Party, said that he felt that ports were
doing what they needed to do to mitigate potential risk only in
the short term. The Port Security Grant Program is the only
program dedicated to port security improvements and upgrades,
but funding has dropped significantly, and we ask Congress to
increase the PSGP funding, as well.
As hubs to commerce and trade, our U.S. seaports continue
to contribute to the Nation's supply chain. Thank you for the
opportunity to testify on behalf of AAPA today, and I look
forward to answering your questions, Mr. Chair.
[Mr. Wong's prepared statement follows:]

Prepared Statement of Frederick Wong, Jr., Deputy Port Director,
PortMiami, on behalf of the American Association of Port Authorities
Good morning, Chairman Webster, Chairman Gimenez, Ranking Member
Carbajal, Ranking Member Thanedar, and members of the Subcommittees.
My name is Frederick Wong, and I serve as the Deputy Port Director
for PortMiami. Thank you for coming to Miami to address critical topics
in the maritime transportation system.
Before I begin, I want to extend my condolences to the families of
those lost in the collapse of the Baltimore Key Bridge last week. This
tragedy highlights how fragile our supply chain is and how flexible and
resilient our industry is. The nation's port industry is standing with
Baltimore right now.
About Ports and AAPA
My testimony is given on behalf of the American Association of Port
Authorities (AAPA) from the Atlantic, Pacific, and Gulf coasts, the
Great Lakes, in Alaska, Hawaii, Puerto Rico, Guam, and the U.S. Virgin
Islands. Today, in our nation's capital, AAPA represents over 80 U.S.
ports on urgent and pressing issues facing our industry, promoting
common interests of the port community, and providing critical industry
leadership on security, trade, transportation, infrastructure,
environmental, and other port development, and operational issues.
Our U.S. seaports deliver vital goods to consumers, facilitate the
export of American made goods, create jobs, and support our local and
national economic growth. Ports also have a crucial role in our
national defense. This is evident by the designation of 18 ``strategic
military seaports of significance'' by the Department of Defense.
According to Ernst and Young, ports moved $5.1 trillion dollars in
imports and exports in 2023, this represents roughly 20 percent of the
U.S. economic activity. The port and maritime industry sustains 2.5
million jobs and has an economic impact of $311 billion dollars to the
U.S. economy.
Infrastructure Funding
Ports need robust Federal funding to build and maintain their
infrastructure. To remain competitive in a global market, we need to
expand capacity, purchase more efficient equipment, improve roadways
and rail, and reducing emissions at every point in our operations. We
simply cannot do this without Federal support.
Although ports are eligible for funding through the U.S. Department
of Transportation's INFRA, RAISE, CRISI, and other grants, our
signature funding source is the Port Infrastructure Development Program
(PIDP), administered by the Maritime Administration (MARAD).
The Ports are concerned because the annual appropriations,
authorizations, and the President's Budget Request for PIDP have all
decreased. Last year, MARAD lowered the PIDP authorization from $750
million to $500 million. The President's Budget Request was lowered
from $230 million to $80 million. And the appropriation for PIDP was
lowered from $212 million in FY23 to only $50 million dollars in FY 24
for competitive grants.
Although ports mainly operate independently, they are part of a
much larger system. A crisis at one port such as Baltimore, means that
other ports across the country must absorb the cargo flow--as we are
seeing right now up and down the East Coast. Ports are always planning
for growth and for potential disruptions.
Competitive grant funding for ports is an investment in the safety,
security, and resilience of the American supply chain. The Committee on
the Maritime Transportation System estimates that every dollar spent on
our maritime supply chain returns three dollars in economic activity.
We ask Congress to fund port infrastructure projects at a level on par
with other modes of transportation across the globe.
Infrastructure projects are not limited to land. Ports rely on the
Army Corps of Engineers to deepen and maintain Federal navigation
channels. We need to ensure the Army Corps has the resources required
to deepen and widen our harbors and turning basins for safe navigation,
and to conduct routine maintenance to allow commerce to flow year-
round.
Permitting Reform
Federal funding is not only a must but the ability to spend those
funds efficiently is critical. Unnecessary delays in project
construction add significant costs to the port or local project
sponsor. These additional costs compel ports to either delay or halt
other projects preventing the port from growing.
The PORT Act (H.R. 7587) is currently before the Transportation and
Infrastructure Committee and was introduced by members of the
Committee. This bill would allow MARAD to update its list of
Categorical Exclusions, allow the use of other agencies' Categorical
Exclusions, and expand access to the ``Federal Permitting Improvement
Steering Council'', among other policies. This bill, along with the
reforms in the ``Fiscal Responsibility Act'', will significantly
improve project delivery at all ports.
Security Infrastructure
Ports work hand-in-hand with the Federal Government to keep our
country secure. Ports-of-entry are borders too. We are partners with
the U.S. Customs and Border Protection (CBP), and they need the staff
and resources to process the cargo and passengers at maritime
facilities and port-of-entries into the United States.
Shortages of CBP officers and agriculture specialists are a chronic
problem at seaports. CBP's Workload Staffing Model reveals a deficit of
1,750 officers and 250 agriculture specialists. This deficit
significantly impacts processing times, adding an additional bottleneck
to ports, and limiting our ability to keep up with long-term growth in
trade and travel.
CBP also faces funding shortages for their federal inspection
facilities at ports. In recent years, CBP has turned to port
authorities to pay for major upgrades and new facilities. This shifts
the burden of financing their inspection mission from the Federal
Government onto the ports. This is unsustainable.
We thank Congresswoman Lee for introducing the CBP SPACE Act (H.R.
6409) which will allow CBP to use existing user fees to fund their
federal inspection operations at seaports and set guidelines around
what ports are expected to provide.
Cybersecurity
At all ports, cybersecurity is a top priority. A critical attack on
any of these systems could have devastating economic consequences or
even a loss of life. The Maritime Transportation System needs resources
to continue to harden IT systems to prevent attacks and to respond
appropriately when an attack does occur. We thank Chairman Gimenez for
his leadership on maritime cybersecurity issues.
Our industry works closely with the U.S. Coast Guard to mitigate
and report all cyber threats. As the Coast Guard sets Marsec Directives
requiring certain cybersecurity standards for the maritime sector, AAPA
members are weighing in to the Notice of Proposed Rule Making (NPRM) to
ensure regulations comport with facility operations while keeping our
industry protected.
Ports are cognizant about the increased use of connected
equipment--including ship-to-shore gantry cranes. While our industry
works on long-term solutions such as reshoring manufacturing of
critical cargo handling equipment, ports and Marine Terminal Operators
have taken steps to ensure the safety and security of their operations.
This includes replacing stock IT and Operating Terminal systems on
cranes; working with the U.S. Coast Guard, other federal authorities,
and private companies to inspect crane systems; segmenting cranes from
each other and from public networks; and limiting access to crane
systems, both physically and virtually. Last year, after touring
PortMiami, Congressman Mike Gallagher, Chairman of the Select Committee
on the Chinese Communist Party, said he felt ports were doing what they
needed to do to mitigate potential risks in the short-term.
The Port Security Grant Program (PSGP) is the main method by which
ports and related groups can make large scale security upgrades to
their facilities. The PSGP was created shortly after 9/11 as Congress
realized that ports--as critical infrastructure--were vulnerable to
threats. However, in the ensuing years, PSGP funding has dwindled to a
fourth of its highest appropriated amount. We ask Congress to increase
PSGP funding to cover more port projects and ensure that ports are the
main recipient of PSGP awards.
Conclusion
As hubs to commerce and trade, our U.S. seaports stand ready to
continue to contribute to the nation's supply chain. Thank you for the
opportunity of testifying on behalf of AAPA today. I look forward to
answering any questions you may have.

Mr. Webster of Florida. Thank you.
Mr. Sadler, you're recognized for 5 minutes.

TESTIMONY OF BRENT D. SADLER, CAPTAIN, U.S. NAVY (RET.), AND
SENIOR RESEARCH FELLOW, THE HERITAGE FOUNDATION

Mr. Sadler. Thank you very much. And, again, distinguished
Members of Congress, thank you for the opportunity to appear
before you in this great city and the Port of Miami. And as a
sailor, I've got to say, thank you again for hosting next
month's Fleet Week. And as a sailor, I certainly didn't need
another excuse, a good excuse to come to Miami, which I will
take advantage of.
And the Port of Miami does stand out. I think it's worth
kind of commenting a little bit. As it looks to grow its market
presence and lead in smart port technology, it has welcomed the
world's largest cruise ship, the Icon of the Seas. And it can
service some of the largest containerships, the Neopanamax
containerships.
Sadly, however, the Nation's maritime sector is not as
healthy as it needs to be. The American public has become
increasingly aware that assumptions their store shelves and gas
stations will be stocked can no longer be taken for granted.
Since leaving COVID lockdowns, shipping backlogs have ensued,
at times due to decisions in Beijing.
In 2021, grounding of a containership shut down the Suez
Canal, grain supply disruptions due to the war in Ukraine,
Houthi attacks in the Red Sea, and the incident last week, the
very unfortunate sad incident last week in the Baltimore
Harbor, are making the case that our prosperity, which relies
to a great extent on maritime trade, is not as secure as it
once was.
No U.S. port ranks in the top 25 of nations in cargo
handling. China holds eight of those spots. Asia has the most
new commercial shipping entrants, led again by China. The point
is not that our ports don't meet today's need in general, but a
lack of competitiveness has not generated a vibrancy to
modernize nor attract and recruit new mariners and shipyard
workers as needed.
One consequence of this malaise is on display in Baltimore
Harbor where last week the containership Dali collided with the
Key Bridge and the unfortunate killing of six people. While
investigations and recovery operations are ongoing, and it will
be some time before we know all the facts, it's clear our
Nation's maritime industrial sector has not been treated as the
strategic asset that it is. One only has to look at the limited
salvage capacity on hand to reopen the Nation's ninth port.
I go into greater detail about this in my statement. But in
short, a national maritime initiative is needed to rectify our
overreliance on nonfriendly nations to sustain our economy and
ensure safe maritime operations. Such an act would, first,
provide adequate American-flag commercial shipping; second,
expand shipbuilding repair and salvage capacities and
associated workforce; third, harden maritime infrastructure and
shipping to cyber attack and material damages.
On the first, existing approaches are inadequate. Change is
needed, but only while taking a maritime Hippocratic Oath to do
no harm to the legacy Jones Act domestic maritime industrial
sector. At the same time, the March 12th petition against
unfair Chinese trade practices in the maritime logistics and
shipbuilding sectors is an opportunity--an opportunity to not
only strengthen U.S. agencies like the Federal Maritime
Commission to press America's case, but to rally international
support.
Delivering on the second, a stronger and global competitive
maritime sector serves as a deterrent to Chinese economic
coercion and military ventures. This can be done by fostering a
revolution in shipping through a new multimodalism. Achieving
this, American trade can proceed with greater confidence and
resiliency and better sustain our military.
Lastly, and perhaps most relevant, due to recent events,
legal and regulatory frameworks of the post-9/11 era should be
reviewed with an eye to adjusting to the new Cold War that we
find ourselves in with China. To start with, the Maritime
Security Act of 2002, the Container Security Initiative, and
the Proliferation Security Initiatives should be updated with
China in mind, while placing into law measures of both the 2020
National Maritime Cybersecurity Plan and the recently enacted
Executive order to ensure measures that are taken today are
sustained which bolster our maritime sector's cyber defenses.
Safeguarding the Nation's ports, economy, and defense
requires a national maritime initiative, which begins with an
update to the 1989 National Security Directive on Sealift and
enabling legislation from Congress that hardens the Nation's
maritime infrastructure, strengthens U.S. ability to combat
unfair Chinese maritime practices and regain American maritime
competitiveness, creates maritime prosperity zones, establishes
a maritime innovation incubator, trains more mariners and
incentivizes those mariners who maintain their certifications,
and creates a naval guard for disaster response as well as
crisis management.
This is not easy nor cheap, but failing to address the
Nation's sea blindness will further place our Nation's economic
and national security in the hands of nonfriendly parties.
Thank you again, and I look forward to the questions.
[Mr. Sadler's prepared statement follows:]

Prepared Statement of Brent D. Sadler, Captain, U.S. Navy (Ret.), and
Senior Research Fellow, The Heritage Foundation
Securing America's Maritime Security: A National Maritime Initiative to
Regain American Maritime Competitiveness
Bottom Line Up Front: The nation has for too long relied on less
than friendly nations to transport its trade and has failed to
adequately invest in its maritime industrial sector--to include its
ports. The costs of this neglect are plainly visible today, with the
nation's security and continued prosperity at risk. The recent allision
by container ship Dali into Baltimore's Francis Scott Key bridge and
the subsequent loss of life is only the most recent symptom of this
neglect.
Today our nation's prosperity sails on others' ships, while our
ports rely on suspect Chinese cranes, and potentially compromised
logistic software that risks more than trade. From our ports sails the
supplies needed to sustain military operations defending America's
interests and citizens. Moreover, our ports and commercial ships serve
a critical role in any disaster response, moving critical supplies to
areas hit hard such as Puerto Rico by 2017's category five hurricane
Maria.
Our maritime situation is a strategic vulnerability, that China
could use as leverage against us. In fact, a Chinese proverb says it
best with a slight twist this time with the borrower (U.S.)
disadvantaged:

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

Key Vulnerabilities:
Reliance on foreign shipping. Of the more than 80,000 ships
arriving at American ports, fewer than 200 are U.S.-flagged, -owned,
and -crewed.\1\ In a war, the Department of Defense concluded in a 2020
Mobility Capabilities Requirement Study that there is insufficient US
Flag tanker capacity to meet defense requirements, necessitating
enduring need for foreign flag tankers. This shortfall was confirmed in
April 2023 testimony by the current Commander of Transportation
Command, and while the specific numbers are classified it has been
reported that over 80 tankers would be needed--it is unlikely this
number considers the upward demand on tankers from closure of Red Hill
fuel depot in Hawaii.\2\ This says nothing of the need for sustaining a
wartime national economy which would add considerably to the required
number of tankers, as well as bulk carriers and container ships not
accounted for. Making matters worse, a fractured domestic energy
logistic network makes getting fuel to where it is needed tenuous. For
instance, New England has almost no pipeline connectivity to domestic
sources, and the existing pipelines are maxed out. These are also prone
to cyber-attack as demonstrated by a successful May 2021 attack on the
Colonial Pipeline. That incident stopped for six days critical energy
flows from Gulf Coast refineries to New York City.\3\ This situation
makes movement of fuel by ship critical for sustaining parts of the
nation, which in wartime that shipping may not be readily available.
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\1\ In 2015 the Maritime Administration stated there were 82,044
port calls in U.S. ports, as of January 1, 2024 (last MARAD report)
there are currently 185 U.S. flagged ships with 167 militarily useful.
Brent Droste Sadler, U.S. Naval Power in the 21st Century: A New
Strategy for Facing the Chinese and Russian Threat (Annapolis: Naval
Institute Press, 2023), pp. 1-2 and 239-250.
\2\ Caitlin M. Kenney, ``Tanker program adds 9 ships to fuel US
military in a crisis,'' Defense One, July 27, 2023, https://
www.defenseone.com/policy/2023/07/tanker-program-adds-9-ships-fuel-us-
military-crisis/388924/ (accessed April 1, 2024). Hearing To Receive
Testimony on the Posture of United States European Command and United
States Transportation Command in Review of the Defense Authorization
Request for Fiscal Year 2024 and the Future Years Defense Program,
April 27, 2023, pg. 14-15, https://www.armed-services.senate.gov/imo/
media/doc/23-39_04-27-2023.pdf (accessed April 1, 2024).
\3\ Kevin DeCorla-Souza, Matt Gilstrap, and CeCe Coffey, ``East
Coast and Gulf Coast Transportation Fuels Markets,'' EIA, February
2016, pg. 32, https://www.eia.gov/analysis/transportationfuels/padd1n3/
pdf/transportation_fuels_padd1n3.pdf (accessed January 31, 2023) and
EIA, ``Planned shutdown of Philadelphia refinery will change gasoline
and diesel supply patterns for the U.S. East Coast,'' This Week in
Petroleum, July 3, 2019, https://www.eia.gov/petroleum/weekly/archive/
2019/190703/includes/analysis_print.php (accessed January 31, 2023).
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Limited U.S. port infrastructure. Ports in the U.S. able to service
the large container ships (i.e. Panamax and bigger) and tankers is
limited due to access to rail, water depth, piers, and crane services.
This makes the loss of any one of these ports a significant disruption
to the national economy and security. For example, the Port of Houston
handles just over 70 percent of all maritime container trade in the
gulf coast region.\4\ Such a disruption is playing out now with the
closure of Baltimore harbor due to the March 26, 2024, allision already
mentioned. Added to limited number of viable ports, specialization has
also made the loss of some ports hard to make up in others--case in
point, Baltimore is a major port for automotive exports and imports.\5\
Despite the importance of our waterways and ports to the nation's
economic and security well-being, the much championed Build Back Better
effort has only resulted in relative minuscule amounts of funding. For
example, at the end of 2023, after two years and $400 billion dollars
spent, ports and waterways accounted for 4.3% of total budget and 1.1%
of the total projects supported.\6\
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\4\ ``Trade Highlights and Performance Data,'' Port of Houston,
2022, https://porthouston.com/about/our-port/statistics/ (accessed
April 1, 2024).
\5\ ``2023 Foreign Commerce Statistical Report,'' Port of
Baltimore, 2023, pg. 1, 7 and 10, https://mpa.maryland.gov/Documents/
2023FCSR.pdf (accessed April 1, 2024). ``Top 14 Busiest Container Ports
in the United States,'' GoComet, February 25, 2024, https://
www.gocomet.com/blog/top-container-ports-in-the-united-states/
(accessed April 1, 2024).
\6\ ``Fact Sheet: Biden-Harris Administration Celebrates Historic
Progress in Rebuilding America Ahead of Two-Year Anniversary of
Bipartisan Infrastructure Law,'' The White House, November 9, 2023,
https://www.whitehouse.gov/briefing-room/statements-releases/2023/11/
09/fact-sheet-biden-harris-administration-celebrates-historic-progress-
in-rebuilding-america-ahead-of-two-year-anniversary-of-bipartisan-
infrastructure-law/ (accessed April 1, 2024).
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Zero-day dangers in shipyard cranes. Recent reporting has exposed
the potential cyber vulnerability built into Chinese sourced heavy lift
cranes at U.S. ports. Chinese manufacturer, ZPMC, holds a dominant
position in the global crane market, accounting for more than 70
percent of all ship-to-shore container cranes at U.S. ports.\7\ While
not uncommon for heavy equipment to have such features for predictive
maintenance, the option for including these feature were not part of
their purchase agreements. This raises serious concerns given recent
reporting by U.S. Coast Guard Cyber Command of long running, concerted
Chinese effort to access critical U.S. infrastructure, most notably the
recent Chinese cyber-attack known as Volt Typhoon.\8\ Recent efforts
have done much to expose this vulnerability but compromised cranes are
not the only vector available for cyber espionage and attack.
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\7\ ``Chinese-Built Port Cranes May Be Able to Call Home On Their
Own,'' The Maritime Executive, March 7, 2024, https://maritime-
executive.com/article/chinese-built-port-cranes-may-be-able-to-call-
home-on-their-own (accessed April 1, 2024).
\8\ Testimony of Rear Admiral John Vann, U.S. Coast Guard Cyber
Command, ``Port Cybersecurity: The Insidious Threat U.S. Maritime
Ports,'' Subcommittee on Transportation and Maritime Security, February
29, 2024, 34min. 21sec., https://homeland.house.gov/hearing/
subcommittee-on-transportation-and-maritime-security-hearing/ (accessed
April 1, 2024).
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China's LOGINK digital logistics risk. Global transportation of
goods occurs over various logistic functionalities; freight forwarding
services, container/shipment tracking, and national customs data
submissions via Port Single Windows. As a logistics management
platform, LOGINK was designed to improve cost efficiency of shipping
cargo by consolidating various data streams, including price and
tracking information. From inception in 2007, LOGINK has been a product
of the Chinese Communist Party (CCP), with stewardship since 2019 being
the Ministry of Transportation's (MOT) China Transport
Telecommunication & Information Center (CTTIC [Editor's note: pinyin
omitted]). To encourage LOGINK adoption overseas, the CCP has offered
LOGINK free of charge; since 2010 it has been adopted at over 20 ports
in Japan, South Korea, Malaysia, Portugal, Spain, United Arab Emirates,
Ukraine, Israel, Latvia, Netherlands and Germany.\9\ Widespread
adoption of LOGINK standards would provide the CCP a vector to access
logistic and trade data, potentially even manipulating data or severing
access. Similar non-Chinese logistic management platforms include:
Flexport, FreightPOP, Shipwell, Freightview and DHL Salodoo. However,
none of these approaches the scope of sources of LOGINK, but
competitors like Gnosis Freight offer a compelling alternative as it
grows its access to more data streams and customers. Should LOGINK be
adopted in the U.S. it would be subject to the Ocean Shipping Reform
Act of 2022.\10\ That Act, empowers the Federal Maritime Commission to
regulate shipping exchanges beginning from 2025; as of April 1, 2024
LOGINK is not registered.\11\ CCP control of LOGINK poses a national
security risk and exposure to predatory market behavior. U.S. antitrust
law has struggled to address China anti-competitive behavior,
especially Chinese State-Owned Enterprises (SOE), which have claimed
sovereign immunity pursuant to the U.S. Foreign Sovereign Immunities
Act (FSIA).\12\
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\9\ ``LOGINK: Risks from China's Promotion of a Global Logistics
Management Platform,'' U.S.-China Economic and Security Review
Commission, September 20, 2022, pg. 8-9, https://www.uscc.gov/sites/
default/files/2022-09/LOGINK-Risks_from_Chinas_Promotion_of_
a_Global_Logistics_Management_Platform.pdf (accessed April 1, 2024).
\10\ Ocean Shipping Reform Act of 2022, Public Law No: 117-146
\11\ Federal Maritime Commission, April 1, 2024, https://
www2.fmc.gov/FMC1Users/scripts/ExtReportsTOC.asp (accessed April 1,
2024).
\12\ Foreign Sovereign Immunities Act U.S. Code 28 Sec. Sec. 1603
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Navigational GPS spoofing. In 2019 Iran spoofed the navigation
system of the British tanker Stena Impero in the Strait of Hormuz.\13\
The ship's crew thought they were in international waters when they
were actually in Iranian territory. The ship and its crew were held for
10 weeks by Iran. The same year, NATO military exercises in the Baltic
Sea were disrupted by Russian GPS spoofing. Good navigational practices
would dictate system redundancies and independent backup navigational
positioning (e.g. radar fixes, visual fixes, running fixes) to prevent
incidents such as the Stena Impero. That said, sophisticated GPS and
other navigational spoofing is a risk that calls for enforcement of
sound navigational practices and backup measures to ensure ships safely
navigate U.S. restricted waters.
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\13\ ``MARAD Warns of Iranian GPS Jamming in Strait of Hormuz,''
The Maritime Executive, August 9, 2019, https://maritime-executive.com/
article/marad-warns-of-iranian-gps-jamming-in-strait-of-hormuz
(accessed April 1, 2024).
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Fuel tampering and contamination. The March 26, 2024, allision of
container ship Dali into the Francis Scott Key bridge in Baltimore has
raised the specter of tampered fuel. Speculation over fuel
contamination on the Dali emerged after an exclusive report in The Wall
Street Journal cited a U.S. Coast Guard briefing that talked of the
engines sputtering and a smell of burned fuel in the engine room.\14\
While investigations are ongoing, it cannot be ruled out that improper
fuel loading or handling could just as likely be to blame for the loss
of ship's power. Typically, commercial ships use higher grade fuels in
port to meet environmental requirements as well as for greater
reliability, shifting to lower grade fuels once in the open ocean. If
the fuels were switched while still navigating in port it would
represent a procedural violation as well as an opportunity for human
operational error at a critical navigational moment. Finally, improper
maintenance or poor material conditions could also lead to the loss of
propulsion and warrants further investigation. In this case, the
consequence of the allision is the loss of six lives, billions of
dollars in damages, and the shuttering of the ninth largest U.S. port.
---------------------------------------------------------------------------
\14\ ``Investigators Check Dali's Fuel with Speculation of Possible
Contamination,'' The Maritime Executive, March 28, 2024, https://
maritime-executive.com/article/investigators-check-dali-s-fuel-with-
speculation-of-possible-contamination (accessed April 1, 2024).
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Not Enough Mariners and Shipyard Workers. Too few mariners and
shipyards workers has had a deleterious effect on attempts to grow the
maritime industry. Moreover, too few American merchant mariners means
the nation is too reliant on foreign sealift to meet military
operational needs as well as sustain a wartime economy. A 2017 study
released by the U.S. Maritime Administration pointed out that the
nation had a deficit of 1,839 certified and fit-for-service mariners in
case of war--the actual deficit is unknown and likely higher as the
2017 estimate was to support military operations and not to sustain a
wartime economy. As that merchant mariner population retires (in 2021
the average American merchant mariner was 47 years old) as the nation's
need for sealift grows proportional to a potential war with China, the
mariner deficit today is likely much worse. Commercial shipyards and
naval shipbuilders alike have faced endemic workforce shortages. This
is driven by several factors: uncompetitive wages, too few young
workers willing to work in the challenging conditions of America's
antiquated waterfronts, and too few Americans with the requisite
technical skills (e.g. naval architects, welders, pipe fitters, etc.).
The effect has been to outsource American shipping and shipbuilding,
and maintenance to Chinese ports. The most notable in the recent past
has been U.S. company Matson retrofitting three of its container ships
by China's COSCO.\15\ While doing repairs or procuring commercial ships
from China may be cheaper, it poses a potential vector for material and
cyber-attacks and furthers dependencies on a rival nation.
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\15\ ``Matson Proceeding with Third LNG Conversion for its
Containerships,'' The Maritime Executive, February 6, 2024, https://
maritime-executive.com/article/matson-proceeding-with-third-lng-
conversion-for-its-containerships (accessed April 1, 2024).
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A few port safety and security thoughts on the allision in Baltimore:
While it has already been mentioned, the allision of the Dali in
Baltimore harbor provides several key considerations for port safety
and security. Reviewing these in brief:
1. Potential fuel contamination and/or improper handling remains a
risk for large commercial ships losing power in constrained waterways.
The consequence is collision with other vessels or damage to critical
maritime infrastructure (e.g. bridge, gas pipelines).

2. Loss of power on today's very large container ships, represents
a hazard that most U.S. infrastructure has not been designed to
withstand--the 1977 build Francis Scott Key bridge is a case in point
and had no barriers (i.e. dolphins) protecting the bridge's supports
and contributed to its collapse. As such, critical ports must be ready
to clear their restricted waterways of obstructions (e.g. collapsed
bridges, sunk ship etc.) rapidly to resume port operations. In a
conflict or natural disaster, delays to regaining operations could be
fatal. An example of what is needed are the floating cranes that began
arriving on scene several days after the Dali incident to remove bridge
debris and free the Dali.\16\ Additionally, the opening of a temporary
channel in Baltimore to resume limited harbor operations also points to
the need to having dredging equipment nearby as well.\17\
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\16\ ``Navy barges assist in removing collapsed Baltimore bridge
from river,'' Stars and Stripes, March 31, 2024, https://
www.stripes.com/branches/navy/2024-03-31/navy-barges-baltimore-bridge-
collapse-13461242.html (accessed April 1, 2024).
\17\ Alejandra Salgado, ``Baltimore preps small, temporary channel
for essential vessel transit,'' SupplyChainDive, April 1, 2024, https:/
/www.supplychaindive.com/news/port-baltimore-alternate-shipping-
channel-reopen-operations-debris-cleanup/711863/ (accessed April 1,
2024).

3. Cyber-attacks have not been adequately investigated in shipping
incidents. The December 2020 National Maritime Cybersecurity Plan was
intended to address these vulnerabilities in the maritime sector, and
would have required forensic cyber-attack investigations.\18\ While
terrorism was ruled out quickly in the Dali allision, due diligence
investigating cyber-attacks are time consuming and require exquisite
skills to detect and have until recently been resisted. A month before
the Dali allision, the White House issued an executive order to bolster
cybersecurity of U.S. ports that granted additional authorities to the
U.S. Coast Guard.\19\ The day after this order was issued, the U.S.
Coast Guard posted proposed cyber security regulation changes for
public comment which will conclude on April 22, 2024.\20\
---------------------------------------------------------------------------
\18\ Donald J. Trump, ``The National Maritime Cybersecurity Plan
,'' The White House, December 2020, pg. 4-5, https://
trumpwhitehouse.archives.gov/wp-content/uploads/2021/01/12.2.2020-
National-Maritime-Cybersecurity-Plan.pdf (accessed April 1, 2024).
\19\ Joseph R. Biden, ``Executive Order on Amending Regulations
Relating to the Safeguarding of Vessels, Harbors, Ports, and Waterfront
Facilities of the United States,'' The White House, February 21, 2024,
https://www.whitehouse.gov/briefing-room/presidential-actions/2024/02/
21/executive-order-on-amending-regulations-relating-to-the-
safeguarding-of-vessels-harbors-ports-and-waterfront-facilities-of-the-
united-states/ (accessed April 1, 2024).
\20\ ``Cybersecurity in the Marine Transportation System,'' U.S.
Coast Guard, February 22, 2024, https://www.federalregister.gov/
documents/2024/02/22/2024-03075/cybersecurity-in-the-marine-
transportation-system (accessed April 1, 2024).

4. China sourced parts and ship maintenance done in China provides
a potential vector for material tampering that could enable future
cyber-attack. The case of modems discovered on ZPMC cranes represents
only the first of likely more cases. After a prolonged period of
review, finally, on the same day the President signed the maritime
cyber security executive order, a maritime advisory was issued on
LOGINK and ZPMC cranes.\21\ Future advisories should be expected, with
the Dali investigation serving as a potential benchmark.
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\21\ ``2024-002-Worldwide-Foreign Adversarial Technological,
Physical, and Cyber Influence,'' Maritime Administration, February 21,
2024, https://www.maritime.dot.gov/msci/2024-002-worldwide-foreign-
adversarial-technological-physical-and-cyber-influence (accessed April
1, 2024).

5. After the Dali's allision, the bridge debris wedged the ship on
the harbor bottom and against high pressure gas lines.\22\ This raises
another port safety and security concern, and how to harden this
submerged critical infrastructure to damage from today's larger vessels
and potential attack. Finally, the mishap investigation should verify
Baltimore Port executed effectively its security plans as mandated by
the Maritime Transportation Security Act of 2002, specifically
regarding securing the gas pipeline after the allision, and assessments
of the Francis Scott Key bridge to resist an allision from modern
container ships.
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\22\ Brandon M. Scott, ``March 31st Update from Key Bridge Response
Unified Command,'' City of Baltimore, March 31, 2024, https://
mayor.baltimorecity.gov/news/press-releases/2024-03-31-march-31st-
update-key-bridge-response-unified-command (accessed April 1, 2024).

6. In what is an unusual occurrence, the ship's Voyage Data
Recorder (VDR)--otherwise known as the ship's black box--stopped
recording sensor data at a key moment of the incident.\23\ While audio
recording continued on backup power, the loss of sensor data should be
investigated and remedies offered to prevent future occurrences that
may hinder future mishap investigations.
---------------------------------------------------------------------------
\23\ Gary Howard, ``What Dali's black box recorder tells us about
Baltimore bridge allision,'' Seatrade Maritime, April 1, 2024, https://
www.seatrade-maritime.com/casualty/what-dalis-black-box-recorder-tells-
us-about-baltimore-bridge-allision (accessed April 1, 2024).
---------------------------------------------------------------------------
Actions to Date Not Enough--Time for a National Maritime Initiative
Our ports are the gateway to the nation's prosperity and security
and are an integral part of a strategically important maritime
industrial sector. Safeguarding our ports necessarily means bolstering
our maritime resiliency to attack as well as supply chain disruptions,
man-made or by an act of God. Doing this will require a national
maritime initiative that:
Provides an adequate American flagged commercial shipping
fleet to sustain the nation in a major war; augmented by treaty ally
shipping as required.
Expands shipbuilding and repair capacities and associated
workforce to mitigate over-reliance on China or non-friendly nations.
Hardens maritime infrastructure and shipping to cyber-
attack and material damage.

On the first, the Merchant Marine Act of 1920, known as the Jones
Act, was intended to meet this objective.\24\ Sadly, it has proven
inadequate to the task and has not addressed the needs of sustaining a
wartime economy needed in a war with China. Case in point, the 2019
Turbo Activation 19-Plus exercise demonstrated that only 64 percent of
the Ready Reserve Fleet was able to deploy on time in support of
national defense needs--vessels that are intended to be ready to
support rapid deployment of military forces. Moreover, the average age
of these merchant ships is 45 years, well over the industry end-of-life
average of 20 years, and the DOD faces a gap of approximately 76 fuel
tankers to meet surge sealift requirements.\25\ That said, a wholesale
repudiation of the Jones Act without additional actions would be
counter-productive and not deliver the shipping needed either. In the
near term, fostering stronger cooperation with allies (such as Greece,
Japan, and South Korea) can help to satisfy some clearly defined
national shipping needs in wartime while working to regain American
maritime competitiveness. In short, a Hippocratic oath should be taken
to ``do no harm'' to the domestic maritime industrial sector in
pursuing initiatives to strengthen the sector. The March 12, 2024
petition to the U.S. Trade Representative to take action against unfair
Chinese trade practices in the maritime, logistics and shipbuilding
sectors is an opportunity to not only strengthen U.S. agencies like the
Federal Maritime Commission to press our case, but to rally
international support.\26\ After decades of neglect, the U.S. maritime
sector alone cannot take on China's goliath state-controlled shipping
and shipbuilding sectors, but a consortium of like-minded maritime
nations could. Common interests regarding freedom of navigation, free
trade, and a shared threat perception of China would bind the group
together. This new grouping could together represent a formidable bloc
critical for an American-led revolutionary transformation in shipping--
an informal Maritime Group of Nations not dissimilar to the current
Group of Seven (G7).\27\
---------------------------------------------------------------------------
\24\ Merchant Marine Act of 1920, June 5, 1920, U.S. Code 46, ch.
24, sec. 861, https://uscode.house.gov/
view.xhtml;jsessionid=5142A83A2AAB12A25A2F9AB8A3949F92?req=granuleid
%3AUSC-2000-title46a-
chapter24&saved=%7CZ3JhbnVsZWlkOlVTQy0yMDAwLXRpdGxlND
ZhLWNoYXB0ZXIyNC1zZWN0aW9uODYx%7C%7C%7C0%7Cfalse%7C2000&edition=2000
(accessed April 1, 2024).
\25\ Bryan Clark, Timothy Walton, and Adam Lemon, ``Strengthening
the U.S. Defense Maritime Industrial Base: A Plan to Improve Maritime
Industry's Contribution to National Security,'' Center for Strategic
and Budgetary Assessments, February 12, 2020, pp. 9-13 and 48, https://
csbaonline.org/research/publications/strengthening-the-u.s-defense-
maritime-industrial-base-a-plan-to-improve-maritime-industrys-
contribution-to-national-security/publication/1 (accessed April 1,
2024).
\26\ Petition for relief under section 301 of the Trade Act of
1974, ``China's Policies in the Maritime, Logistics, and Shipbuilding
Sector,'' March 12, 2024, https://ustr.gov/sites/default/
files/Section%20301%20Petition%20-
%20Maritime%20Logisitics%20and%20Shipbuilding
%20Sector.pdf (accessed April 1, 2024).
\27\ Brent D. Sadler and Peter St. Onge, ``Rebuilding America's
Maritime Strength: A Shipping Proof-of-Concept Demonstration,'' The
Heritage Foundation, August 16, 2023, pg. 6-7, https://
www.heritage.org/sites/default/files/2023-08/BG3782_0.pdf.
---------------------------------------------------------------------------
To deliver on the second, regaining America's maritime
competitiveness is required. Fostering a revolution in American
shipping can energize a lethargic industrial sector that is critical to
the nation's defense and strengthen it so that it can sustain a wartime
economy. This new inter-modalism would combine existing and emerging
technologies into a new logistics paradigm comprised of small modular
nuclear reactor powered container ships, unmanned drones (ship and
vertical lift), smart port technologies, blockchain tracking of smart
containers, and additive manufacturing.\28\ A stronger and globally
competitive maritime sector serves as a deterrent to Chinese economic
coercion and military adventures. With a more robust maritime sector,
American trade could proceed with greater confidence that the U.S.
military can sustain combat operations on U.S.-flagged vessels. In
addition to serving U.S. security needs, this shipping revolution could
mitigate the environmental impacts of shipping, promote domestic
production, and expand American exports to global markets, which would
spur wider job growth and advance technological innovation in the U.S.
The primary task is to create a domestic landscape that can foster a
sustainable competitive advantage in American shipbuilding, shipping,
and multi-modal logistics. This will require a maritime legislative
agenda that incentivizes entry in the maritime workforce, rewards
mariners sustaining critical certifications, and establishing maritime
development zones.
---------------------------------------------------------------------------
\28\ Brent D. Sadler and Peter St. Onge, ``Regaining U.S. Maritime
Power Requires a Revolution in Shipping,'' The Heritage Foundation, May
15, 2023, pg. 12-20, https://www.heritage.org/sites/default/files/2023-
05/SR272.pdf.
---------------------------------------------------------------------------
On the third point, the lessons of the Dali bear witness that the
status quo is not tenable and new efforts are required. The current
Maritime Security Act of 2002 was conceived for a different era where
the principal threat was violent extremist and natural disasters. Today
the nation confronts a China, which is able to conduct conventional
attacks as well as highly advanced asymmetric attacks across the
homeland. A new framework is needed that builds on the Maritime
Security Act and incorporates and codifies in law the best elements of
both the 2020 National Maritime Cybersecurity Plan and the recently
enacted executive order (EO 14116). Likewise, two programs that were
devised in a post-9/11 world are perhaps ready for an update and
revitalization: the Container Security Initiative (CSI) \29\ and the
Proliferation Security Initiative (PSI) \30\. As of March 24, 2024,
there are 112 countries supporting the PSI's effort to prevent the
movement of weapons of mass destruction, while CSI is conducting
screening of U.S. inbound cargo in 61 overseas ports to interdict
terrorist movement of weapons via maritime containers. Moreover, to
better respond locally to maritime disasters and provide maritime
support to the Department of Defense, a naval component of the National
Guard should be established in states with strategically important
ports. Already such forces have proven their worth; New Jersey and New
York naval militia provided critical support moving material and first
responders into lower Manhattan following the September 11th
attacks.\31\
---------------------------------------------------------------------------
\29\ ``CSI: Container Security Initiative,'' U.S. Customs and
Border Protection, March 6, 2024, https://www.cbp.gov/border-security/
ports-entry/cargo-security/csi/csi-brief (accessed April 1, 2024).
\30\ ``About the Proliferation Security Initiative,'' U.S.
Department of State, https://www.state.gov/proliferation-security-
initiative/ (accessed April 1, 2024).
\31\ Brent D. Sadler, ``Rebuilding America's Military: The United
States Navy,'' The Heritage Foundation, February 18, 2021, pg. 39,
https://www.heritage.org/sites/default/files/2021-02/SR242.pdf.
---------------------------------------------------------------------------
Next Steps.
Safeguarding the nation's strategically important maritime
industrial sector will be a complex task, and it will only be sustained
by regaining America's commercial maritime competitive edge. To do this
requires a grand design--a National Maritime Initiative. A likely
vehicle for this would be an update to the 1989 National Security
Directive (NSD-28) with enabling legislation from Congress that:
1. Harden the nation's maritime infrastructure. Concerted efforts
are needed to harden U.S. maritime infrastructure to cyber, kinetic,
and acts of God--to include allision from today and future large
commercial shipping. This must include adequate salvage and dredging
capacity to rapidly restore harbor operations at critical ports.

2. Strengthen U.S. ability to combat unfair Chinese maritime
business practices and incentivize U.S. shipping. Currently the
principal agencies (i.e. U.S. Coast Guard, Maritime Administration,
National Oceanic and Atmospheric Administration, Federal Maritime
Commission) responsible for the nation's non-defense maritime sector
are scattered across several departments. Structurally this has not
fostered coherent sustained nor well-resourced maritime initiatives,
reorganizing for task as well as increased investment in the nation's
maritime sector are past due.

3. Create Maritime Prosperity Zones. Incentivize investment in the
maritime industry and waterfront communities, to include attracting
treaty allies like Japan and South Korea in common cause.

4. Establish a Maritime Innovation Incubator. The incubator would
function to mature future maritime capabilities and new concepts of
operations (e.g. small modular nuclear reactors, robotic shipping,
drones/dirigibles useful for moving cargo at-sea etc.), and to train
the next generation of naval architects and shipyard workers to operate
and maintain these new methods and technology.

5. Train More Mariners. Expand existing and establish new state
merchant marine academies to educate and certify merchant mariners. And
prioritize existing educational and technical training grants to
specialties critical to shipbuilding, e.g. naval architects, welders,
and pipefitters.

6. Incentivize Mariners Who Maintain Certification. Attract
American merchant mariners with favorable tax incentives and personal
subsidies, who remain in the maritime sector while sustaining USCG
mariner certifications.

7. Create a Naval Guard. Expand select state National Guards to
include a naval component.

The United States has neglected a core element of its security and
prosperity--its historic maritime strength. As a result, American
shipping and shipbuilding has atrophied, yet domestic industry and
capacity for innovation remain strong. This advantage needs to be
pressed by restoring American maritime competitiveness in pursuit of a
new multi-modalism. Doing this at the same time hardening our maritime
infrastructure is an imperative to deter Chinese economic coercion and
military adventurism.

Mr. Webster of Florida. Thank you.
Now, Mr. McCarthy, you're recognized for 5 minutes.

TESTIMONY OF ED McCARTHY, CHIEF OPERATING OFFICER, GEORGIA
PORTS AUTHORITY, ON BEHALF OF THE NATIONAL ASSOCIATION OF
WATERFRONT EMPLOYERS

Mr. McCarthy. Good morning, Chairman Webster and Ranking
Members and members of the subcommittee. Thank you for the
invitation to testify here at the field hearing today. I thank
Chairman Graves' recent visit to us in Savannah and the
committee's support of all the initiatives that you're
endeavoring in.
I'm the chief operating officer for the Georgia Ports
Authority and a member of the National Association of
Waterfront Employers. We are very appreciative of the Federal
infrastructure grants that will help U.S. ports and marine
terminal operators to become more resilient. Thank you for the
opportunity to talk about U.S. ports and marine terminal
operators on safety, security, and the infrastructure
investments that are needed.
The Georgia Ports Authority employs 1,700 direct employees
and over 3,000 ILA employees. GPA has invested $3 billion since
2012, mostly all of that self-financed Georgia Ports' revenues.
Georgia Ports plans to spend another $4\1/2\ billion over the
next 10 years to build more port infrastructure, which will
primarily be financed by the Georgia Ports Authority.
There are two pillars by the Georgia Ports Authority; one,
containers which are done in Savannah, Georgia. This is the
third ranking volume port in North America, behind L.A.-Long
Beach and New York-New Jersey. The second is automobiles and
machinery in Brunswick, the fastest growing roll-on/roll-off
port and the second largest only behind Baltimore, who our
hearts and prayers go out to all those in the Baltimore city
region.
Ports are an economic engine, creating jobs and keeping
America competitive. According to a recent study by UGA,
University of Georgia, Georgia's ports supported more than
600,000 jobs indirectly in the State of Georgia, contributing
$40 billion in income, $170 billion in revenue, and $5 billion
in local taxes.
The subcommittees' attendance here in the field today
demonstrates the importance of ports and marine terminal
operators as a foundation of the American economy. The Bureau
of Transportation Statistics reports approximately 47.7 million
TEUs of equipment of containers were handled by U.S. ports and
marine terminal operators. This represents 41 percent of U.S.-
international trade value and almost $1.9 trillion.
In addition, U.S. ports and MTOs directly support the
development and sustainment of our U.S. military. Since 9/11,
ports have a robust facility security plan, which is approved
by the U.S. Coast Guard. Most ports voluntarily, with the U.S.
Customs and Border Protection, are certified by a Customs Trade
Partnership Against Terrorism. And I concur with Mr. Wong's
remarks with funding for CBP and headcount.
Georgia Ports contracts on the ship-to-shore cranes are
with a company called Konecranes in Finland. The cranes'
technology is made in the U.S., Japan, and China. These ship-
to-shore cranes are more expensive, but we think that the
higher quality delivers better uptime on the cranes and
justifies a total lifetime cost of ownership.
Turning to cybersecurity, this is our primary priority at a
multitier level approach working with the U.S. Coast Guard
Security Cyber Terrorism Unit and the FBI cyber team. We look
forward to working with the U.S. Coast Guard and this
subcommittee on these matters.
We greatly appreciate the subcommittees' endeavor today and
the important work you are doing for our country. We thank you
for this invitation to the field hearing today. I'm truly
grateful for the support U.S. ports and marine terminals are
securing through the maritime supply chain and your efforts for
the U.S. workforce and ports.
I welcome your questions. Thank you.
[Mr. McCarthy's prepared statement follows:]

Prepared Statement of Ed McCarthy, Chief Operating Officer, Georgia
Ports Authority, on behalf of the National Association of Waterfront
Employers
Good morning, Chairman Webster, Ranking Member Carbajal, and
members of the Subcommittee.
My name is Ed McCarthy, and I serve as Chief Operations Officer of
the Georgia Ports Authority (GPA). Thank you for the invitation to join
you for today's field hearing and site visits.
Chairman Graves recently visited us in Savannah and we would like
to thank him for his recent visit to the Port and his and the
committee's continued support.
I appreciate the opportunity to discuss the steps that United
States ports and marine terminal operators are taking to address port
safety and security, as well as federal infrastructure investment
opportunities that exist to support such endeavors while enhancing the
efficiency of the U.S. maritime supply chain.
Georgia Ports Authority employs 1700 employees directly and
approximately 3000 longshore labor employees.
Investment-wise, Georgia Ports Authority has invested $3.27 billion
since 2012 building new port and inland infrastructure.
This amount has been mainly self-financed from Georgia Ports
revenues--and has not cost Georgian taxpayers. (Aside from Federal
grants).
We're also planning on spending an additional $4.5 billion the next
ten years to build more port infrastructure--which will again be
primarily financed by ourselves.
We operate two major ports:
The Port of Savannah--which is one of the fastest growing container
ports in the nation. We currently rank third in volumes behind LA/LGB
and NY/NJ.
The Port of Brunswick--which is the fastest growing Roll-On/Roll-
off port for cars and High and Heavy machinery like excavators and
tractors and is ranked 2nd nationally behind Baltimore.
We are investing $262 million in new improvements to expand
capacity in Brunswick.
We expect this year to become the largest automobile port in the
nation in both cargo volume and actual physical space.
Ports are economic engines, creating jobs and keeping American
business competitive in world markets.
Every country in the world wants access to a competitive port
system.
According to a study recently completed by the University of
Georgia, in 2023, Georgia's ports and inland terminals supported more
than 609,000 jobs throughout the state annually, contributing $40
billion in income, $171 billion in revenue and $5.3 billion in state
and local taxes to Georgia's economy.
As part of GPA's community engagement efforts, $6 million will be
donated to communities located near the Port of Savannah to support a
multi-year, local workforce housing initiative.
CNBC ranked Georgia #1 in the U.S. for infrastructure in America's
Top States for Business in 2023.
I am also here today on behalf of the National Association of
Waterfront Employers (NAWE), of which the GPA is a proud member.
NAWE is a non-profit trade association whose member companies are
public operating port authorities, privately-owned stevedores, marine
terminal operators (MTOs), and other U.S. waterfront employers.
NAWE's member organizations and companies engage in business at all
major U.S. ports on the Atlantic and Pacific Coasts, the Gulf of
Mexico, the Great Lakes, and Puerto Rico.
In that manner, NAWE, as the voice of operating ports and MTOs in
Washington, DC, ensures that there are open lines of communication
between Congress, regulatory agencies, and the gateways to our Nation's
international commerce.
Importance of Ports and Marine Terminal Operators
The Subcommittee's attendance in the field today further evidences
the fact that ports and MTOs are a foundational element of the American
economy.
Operating ports and MTOs employ and ensure the safety of hundreds
of thousands of American waterfront workers, fund the purchase of cargo
handling equipment and security infrastructure at U.S. ports, and
connect the U.S. economy to the world.
We serve the nation's agriculture, retail and manufacturing
sectors--both large businesses and small rely on American ports to
deliver their goods.
Operating ports and MTOs transition cargo between various modes of
transportation (ships, trucks, and rail cars), while managing the
orderly, safe, and secure collection and distribution of cargo between
countless transportation stakeholders.
This dynamic environment--with the constant movement of
containerized, bulk, rolling, and project cargo, intermodal equipment,
and cargo handling machinery--creates endless safety risks to the
waterfront workforce and stakeholders entering marine terminals that
must be accounted for, and materially mitigated, by ports and MTOs.
In addition, as the critical connection point of the U.S.
international trade and projection of economic power, security risks
are an ever-present reality of port and MTO operations that require
constant diligence, oversight, and investment to identify and mitigate.
The latest Bureau of Transportation Statistics reports that in 2021
approximately 47.7 million twenty-foot equivalent units (TEUs) were
handled by U.S. ports and MTOs, representing 41 percent of U.S.-
international trade value in 2021--almost $1.9 trillion.
As the critical connection of the leading transportation mode for
U.S.-international trade in goods, efficient port and MTO operations
are foundational to the success of the U.S. economy.
In addition, U.S. ports and MTOs directly support the deployment
and sustainment of the American military, serving as the baseline point
for the projection of U.S. power throughout international areas of
operation.
Correspondingly, U.S. ports and MTOs can become critical physical
and cyber security targets for actors looking to negatively impact U.S.
trade and military operations.
As such, U.S. ports and MTOs must be ever-vigilant regarding such
security threats, constantly identifying potential risks and developing
best practices and procedures--while making the accordant
infrastructure investments--to mitigate such risks.
Working with our Government partners, including this Subcommittee,
the U.S. Coast Guard, and Customs and Border Protection, is a key
aspect of success in ensuring the security of the U.S. port
environment.
In addition, to meet the just-in-time delivery focus of the modern
supply chain, U.S. ports and MTOs must leverage new technologies and
advanced infrastructure to ensure that the skilled waterfront workforce
can meet stakeholder needs in a safe operating environment that seeks
to mitigate the risk of injury.
Quite simply, there are no days off at U.S. ports, as evidenced by
the fact that ports and MTOs maintained continuous operation during the
entirety of the COVID-19 pandemic, working tirelessly to meet
unprecedented consumer demand and mitigate the associated supply chain
congestion effects.
Accordingly, developing new safety procedures and investing in
cleaner and safer cargo handling equipment is critical to ensuring the
efficient operation of the maritime supply chain to meet consumer
demand.
Port Security in a Unique Environment
Security of the maritime supply chain and the safety of the
waterfront workforce are of paramount importance to ports and MTOs.
To address ever-present security risks, and in accordance with the
Maritime Transportation Security Act of 2002, GPA developed a robust
and dynamic Facility Security Plan (FSP), which has been approved by
the U.S. Coast Guard under applicable regulations at 33 CFR Part 105.
The FSP addresses, among numerous other areas, screenings for
dangerous devices and substances, restrictive access control measures,
proactive patrols, monitoring of the facilities and surrounding areas
for suspicious activity, training, information sharing and multilevel
collaboration.
GPA is also a certified partner of the Customs Trade Partnership
Against Terrorism (CTPAT), a voluntary program led by U.S. Customs and
Border Protection (CBP) focused on improving security from point of
origination and throughout the global supply chain to point of
distribution.
In accordance with CTPAT, GPA has entered into an agreement that
outlines GPA's commitments to protect the supply chain, identify
security gaps, and implement specific security measures and best
practices.
GPA's Port Police force numbers approximately 180 sworn officers
and 40 additional security personnel and are leaders in their field of
practice.
Many of our Police have joined from local police departments which
means they bring local awareness of nearby towns and have strong
working relationships with Law Enforcement at Federal, State and Local
levels.
Port Police are physically present and visible every time a ship
enters the port. They observe the docking procedure and then also check
gangway access and manning to ensure secure procedures and staffing is
in place.
Port Police also work closely with CBP and USCG to ensure every
vessel entering the port has passed a security and safety check with
both agencies.
Port Police are also working in tandem with State of Georgia
Officials to prevent Human Trafficking as part of a multi-level
approach to this issue.
Let's Talk About Ship-to-Shore Cranes at Ports
Georgia Ports uses ship-to-shore cranes (STS) constructed by a
Finland-based company called Konecranes.
Finland is a recent and critical NATO partner to the United States.
These cranes use technology made in the U.S., Japan and
Taiwan.
We're the only port in the U.S. that use these cranes.
These cranes are more expensive than other crane brands
on the market, but their higher quality delivers very high uptime usage
which justifies their total cost of ownership over the lifetime of the
cranes.
Turning to Cybersecurity--This Topic Remains a Primary Concern of All
U.S. Ports and MTOs
Given the importance of the maritime supply chain to the overall
U.S. economy, the risk of cyber-attacks upon U.S. ports and MTOs cannot
be overstated.
However, to address such risks, GPA has developed a sophisticated
cybersecurity plan:
Cybersecurity is the number one priority and is a multi-level
approach to thwart this issue, working closely with the USCG Security
Cyberterrorism unit and the FBI.
We use best practices for industry hygiene which means we keep all
systems up-to-date.
We immediately install fixes and patches as driven by our IT
software and hardware vendors--along with ethical testing of our
employees to train and retrain them on phishing and other cyber
tactics.
We keep a constant dialogue with our IT vendors on the current
cyber threats.
GPA and NAWE are currently reviewing the Notice of Proposed
Rulemaking on Cybersecurity in the Marine Transportation System
published by the U.S. Coast Guard on February 22, 2024.
Our primary concern is that any cybersecurity standards developed
by the U.S. Coast Guard must be specific to U.S. ports and MTOs to
address the unique threats and operating environment of our industry.
Generic cybersecurity recommendations, even when developed in
coordination with the U.S. Government's leading cybersecurity experts,
can add unnecessary cost without appropriately mitigating cybersecurity
threats faced by ports and MTOs on a daily basis.
We look forward to working with both the U.S. Coast Guard and this
Subcommittee to ensure that any ultimate regulations governing port and
MTO cybersecurity measures will be consistent with industry threats and
operational realities, and to identify and develop opportunities for
federal support to implement any necessary infrastructure, network,
training, and workforce enhancements.
Port and MTO Investments in Safer Cargo Handling Equipment
With a workforce exceeding 1,700 employees and numerous partners
contributing to operations within GPA terminals, safety remains
paramount in our daily activities.
Annually, we facilitate the movement of over 5 million TEUs and
600,000 vehicles through GPA terminals, underscoring the critical
importance of maintaining a safe work environment.
To further enhance the safety culture, the GPA has introduced the
Safety NONSTOP program.
This comprehensive initiative ensures that safety awareness remains
a constant focus for all employees and partners, around the clock,
seven days a week.
Through Safety NONSTOP, we prioritize proactive measures like
training, hazard reporting, and observations to safeguard the well-
being of everyone involved in our operations, reinforcing our
commitment to a culture of safety excellence.
Last fiscal year, we achieved significant improvements in our
safety performance, being 37% below the recordable rate and 60% below
the lost time rate compared to the most recent BLS Industry Average
(2022).
This positive trend continues into this fiscal year, with a
continued decrease in injuries.
This success is attributed to the unwavering safety commitment
across all levels of our organization.
Now let me touch on the future of biofuels . . .
One key aspect of creating a safer, healthier, and a cleaner
working environment for the waterfront workforce is transitioning from
diesel-driven cargo handling equipment to lower emission alternatives.
The Inflation Reduction Act (IRA) appropriates $3 billion for
maritime decarbonization to help ports and MTOs switch to zero- or
near-zero emissions equipment to decarbonize port operations and
improve air quality in port communities.
NAWE are extremely grateful to Congress for its leadership in
passing the IRA and supporting investment in next-generation cargo
handling equipment.
However, although U.S. ports and MTOs want cleaner, safer, and
healthier ports, the IRA's timelines for getting new equipment are
challenging for several reasons, including:
1. The much higher cost of electric equipment;
2. Lost value in replacing existing equipment before the end of
its useful life;
3. The need for expensive electric or alternative fuel
infrastructure; and
4. The availability of U.S.-manufactured zero- or near-zero
emissions cargo handling equipment.

NAWE and its members continue to investigate the anticipated costs
and timelines of switching from existing cargo handling equipment to
zero- or near-zero emissions equipment.
However, given the above-listed challenges, we anticipate that the
aggregate costs to bring U.S. ports into compliance with the IRA's
decarbonization goals will be in the tens (and possibly hundreds) of
billions of dollars and will far exceed the IRA's timelines, even if
U.S. manufacturing of next-generation cargo handling equipment can be
rapidly expanded.
Given these challenges, GPA and NAWE will continue to engage with
Congress to find flexibility in the IRA and other port investment
opportunities--such as the Port Infrastructure Development Program and
private investment supported by the Capital Construction Fund as
proposed by H.R. 4993--to account for the realistic costs, timelines,
and U.S. equipment availability to achieve port decarbonization.
While the IRA is outside this Subcommittee's jurisdiction, we
appreciate the members' support for our efforts, including with regard
to programs within the Subcommittee's jurisdiction.
I encourage your support for a study to deepen the Savannah harbor
in the upcoming WRDA as requested by the entire GA delegation.
While that legislation does not go through this subcommittee, it is
the larger T&I Committee that puts it together.
Georgia Ports is seeking authorization for a Savannah
Harbor Improvement Project study in the 2024 Water Resources
Development Act (WRDA).
The study would define the optimal depth and width of the
Savannah Harbor in a potential future improvement program, balancing
cost-benefits for the nation and environmental impact.
With greater channel depth, the Port of Savannah will
reduce shipping costs and delays while maximizing access for the global
fleet of container ships.
Widening the river would allow more opportunities for
two-way vessel traffic, improving safety and preventing delays for
American commerce. Faster vessel service will enable the Port of
Savannah to handle more ships each year.
Savannah Harbor improvements will benefit the nation, not
just Georgia, and keep pace with the global shipping industry's future
ships.
Enhancing the channel would not only allow larger, more
cost-effective and sustainable vessels to call on Savannah. Addressing
impediments to larger ships at the Port of Savannah will allow carriers
to deploy 18,000- to 24,000-TEU vessels to the entire U.S. East Coast.
Each ship could take on more cargo and transit the
channel more quickly, getting U.S. exports to global markets with
greater efficiency, lower cost and lower emissions.
Modernizing the shipping channel will expedite the flow
of cargo for mega-ships transiting the Savannah River. American
exporters will have greater opportunity to move goods overseas, because
ships will be able to take on more cargo.

In closing, let me thank you all for the important work you do for
our country. Thank you for inviting me to join you for this field
hearing to share first-hand updates and concerns on the critical safety
and security issues that impact our industry. I am truly grateful for
your support of U.S. ports and marine terminal operators in ensuring a
secure maritime supply chain and safe working environment for our
waterfront workforce.
And now, I welcome any questions you may have.

Mr. Webster of Florida. Thank you so much for your
testimony. Mr. Morgan, you're recognized.

TESTIMONY OF DAVE MORGAN, PRESIDENT AND CHIEF EXECUTIVE
OFFICER, COOPER/PORTS AMERICA, ON BEHALF OF THE NATIONAL
MARITIME SAFETY ASSOCIATION

Mr. Morgan. Good morning, Chairman Webster and Chairman
Gimenez, Ranking Member Carbajal, Ranking Member Thanedar, and
Congressman Cohen. It's a pleasure to be here.
My name is Dave Morgan. I'm the president of Cooper/Ports
America, and also I am the current president of the board of
directors at the National Maritime Safety Association, better
known as NMSA. And I can assure the committee that being from
Texas, I never have a tie on, ever, ever, ever. However, today,
it's an honor to wear a tie for the system, but it's also a
Ports America Baltimore tie in honor of my colleagues and
families up in the Baltimore area.
By way of background, Cooper/Ports America is a joint
venture between Cooper, the Cooper group of companies, and
Ports America. C/PA operates in the Texas ports. We handle
approximately 25 percent of the container volume handled in
Houston and about 82 percent of the general cargo handled in
the Port of Houston and outports in Texas. We employ over 3,300
company and international longshoremen union labor and operate
an average of about 1.65 million man-hours annually.
On port safety, at C/PA, safety drives everything we do and
is led by the participation of all personnel. A safe workplace
will result from positive attitudes, behaviors, and beliefs of
our C/PA team. We strive to create a healthy and injury-free
environment for all employees and visitors to our facilities
and operations. We measure our business success by safety
excellence and will never waver in this commitment.
Very similarly, in parallel, the focus and purpose of NMSA
is marine cargo handling safety, which has been our mission
since NMSA was formally established in 1972 through the
Occupational Safety and Health Act of 1970. Prior to that
formation, NMSA's predecessor was the Management Advisory Cargo
Handling Safety Committee that was launched in 1956.
NMSA is a diverse association focused on safety, and one of
the main objectives of NMSA is to maintain a network of
professionals capable of addressing the evolving safety issues
of the cargo handling industry. NMSA members are all dedicated
volunteers, and this collective of progressive expertise serves
as a primary resource to the industry to keep workers healthy
and injury-free.
NMSA also has a Technical Committee that holds regular
meetings at ports across North America and invites guests from
port employers; local, State, and Federal agencies; and local
union representatives to join our discussions to promote
maritime safety. During these open meetings, ports are toured,
safety management is discussed, accidents and injuries are
examined for increased hazard recognition and new preventive
methods, new safety training products are prepared, and experts
are invited to present technical aspects of equipment,
including technical engineering details. Importantly,
professional networks are expanded through this collegial
information sharing environment and continually drive a
proactive approach for addressing safety at the workforce.
Some of NMSA's current areas of focus are: the safety of
alternative fuel sources for cargo handling equipment; anti-
collision technologies to detect people working around
machines; fulfilling OSHA's new requirements for e-filing of
injury and illness data; improving pre-shift safety talks;
ensuring safety on elevated working surfaces when working on
gondola railcars; recognizing and addressing drug and alcohol
matters; heat illness prevention best practices; training
workers on powered industrial trucks, PIT; mooring line
snapback injury prevention; lockout tagout program best
practices; and split rim wheel safety best practices.
We are also very concerned on security. We and the MTOs
follow the local and State and Federal guidelines on security,
and we have our own internal systems on security--that's all
part of my testimony.
And in closing, I encourage both of your committees and
your key staff to engage with NMSA and its Technical Committee
to share information and any concerns about the maritime
transportation system. I would also like to extend an
invitation to committee members and your staff to come visit
our terminals in Texas and meet the hard-working people that
keep cargo moving and play an integral role in our supply
chain. Our industry experts stand ready to answer any questions
you may have, serve as a resource on any safety related
matters, and assist you in any way we can.
Thank you for providing me with the opportunity to be with
you at today's field hearing and share my perspectives on
critical safety and security issues. Again, I appreciate the
attention of your two committees on ensuring the safety and
security of U.S. ports, marine terminal operators, and all the
workers we employ in our maritime supply chain.
I welcome any questions. Thank you.
[Mr. Morgan's prepared statement follows:]

Prepared Statement of Dave Morgan, President and Chief Executive
Officer, Cooper/Ports America, on behalf of the National Maritime
Safety Association
Good morning, Chairman Webster, Chairman Gimenez, Ranking Member
Carbajal, Ranking Member Thanedar, and members of the Coast Guard and
Maritime Transportation and Transportation and Maritime Security
Subcommittees. My name is Dave Morgan, and I am President and CEO of
Cooper/Ports America.
It is an honor to appear before you today. I applaud both of your
committees' interest in port safety, security, and infrastructure
investment and desire to better understand how the marine cargo
handling industry works with the U.S. Maritime Administration (MARAD)
and U.S. Department of Homeland Security (DHS) to support and secure
our maritime supply chain. We are at a critical juncture for port
safety and security and given the recent tragic incident in Baltimore
this hearing could not be more timely.
Cooper/Ports America, LLC (C/PA) is a joint venture operation that
is the combined businesses of Ports America and The Cooper Group and
integrated Shippers Stevedoring, Chapparal Stevedoring, and Integrated
Marine Services (IMS). C/PA is the premier provider of full-service
stevedoring, terminal operations, container stuffing and stripping,
container yard depots, container and chassis maintenance and repair,
and truck brokerage and logistics in the Texas markets. The Cooper
Group and Ports America merged their breakbulk operations in the
Houston and surrounding ports on October 1, 2016. C/PA currently
operates at Houston City Docks, Barbours Cut, Bayport, Beaumont, Point
Comfort, Corpus Christi, Freeport, Galveston and Brownsville. C/PA has
a long-term contract with USTRANSCOM and handles 25,000 pieces of US
Army assets via truck, rail, and vessels annually. C/PA has
approximately 28% & 25% of the total market share of the BCT-BPT total
TEU's respectively and 82% of the total tonnage in 2023 that moved
across the City Dock Terminal. C/PA employs over 3,300 company and
International Longshoremen's Association Union Labor & operates at an
average of 1.65M labor hours annually.
I also appear before you today as President of the Board of
Directors of the National Maritime Safety Association (NMSA). NMSA is
the forum for maritime industry leaders and Labor to gather and discuss
proactive and preventive safety measures with the goal of protecting
the health and safety of our dedicated waterfront workers at U.S.
marine terminals. C/PA is a longtime member of NMSA, and we take great
pride in not only C/PA's commitment to safety, but our industry's
overall commitment to protecting the men and women that work at ports
and terminals around the country day and night so they can return home
safely to their loved ones when their shift is over.
While intricately connected, consistent with the theme of the
hearing title, I have divided my written testimony into three parts:
the first part addressing ``port safety,'' second focusing on
``security,'' and third addressing ``infrastructure investments.''
Port Safety
At C/PA, safety drives everything we do, and is led by the
participation of all personnel. A safe workplace will result from
positive attitudes, behaviors, and beliefs of our C/PA team. We strive
to create a healthy and injury-free environment for all our employees
and visitors to our facilities and operations. We measure our business
success by safety excellence and will never waver in this commitment.
Similarly, the focus and purpose of NMSA is marine cargo handling
safety which has been our mission since NMSA was formally established
in 1972 through the Occupational Safety & Health Act of 1970. Prior to
its formation, NMSA's predecessor was the Management Advisory Cargo
Handling Safety Committee (MAXIE) that was launched in 1956.
NMSA is a diverse association focused on safety, and one of the
main objectives of NMSA is to maintain a network of professionals
capable of addressing the evolving safety issues of the cargo handling
industry. NMSA members are all dedicated volunteers, and this
collective of progressive expertise serves as a primary resource to the
industry to keep workers healthy and injury free.
NMSA also has a Technical Committee (TC) that holds regular
meetings at ports across North America and invites guests from port
employers, Local, State and Federal Agencies, and local union
representatives to join our discussions to promote maritime safety.
During these open meetings, ports are toured; safety management is
discussed; accidents and injuries are examined for increased hazard
recognition and new prevention methods; new safety training products
are prepared; and experts are invited to present technical aspects of
equipment--including technical engineering details. Importantly,
professional networks are expanded through this collegial information
sharing environment and continually drive a proactive approach for
addressing safety on the worksite.
Some of NMSA's current areas of focus are:
The safety of alternate fuel sources for cargo handling
equipment
Anti-collision technologies to detect people working
around machines
Fulfilling OSHA's new requirements for e-filing of injury
and illness data
Improving pre-shift safety talks
Ensuring safety on elevated working surfaces when working
on gondola rail cars
Recognizing and addressing drug & alcohol matters
Heat illness prevention best practices
Training workers on Powered Industrial Trucks (PIT)
Mooring line snapback injury prevention
Lockout tagout program best practices
Split rim wheel safety best practices
Security
Cooper/Ports America and other stevedore companies and marine
terminal operators (MTOs) are central pillars of the global intermodal
marine transportation system. We have extensive systems, practices, and
processes in place to address the full and evolving spectrum of
threats--from those of a physical nature to those in the cyber realm.
C/PA and other MTOs have a system of layered physical and cybersecurity
countermeasures in accordance with the Marine Transportation Security
Act (MTSA), the Department of Homeland Security, the Department of
Justice and the Cybersecurity and Infrastructure Security Agency at the
federal level and with support from appropriate state and local law
enforcement agencies.
Since the enactment of the MTSA in 2002 and its implementation by
the United States Coast Guard, MTOs are required to have an approved
Facility Security Plan (FSP) and a designated Facility Security Officer
(FSO). C/PA's FSOs work closely with the U.S. Coast Guard within the
MTSA framework to address the ever-evolving nature of threats we face
at our facilities. In addition, C/PA is currently reviewing the Coast
Guard's recently published Notice of Proposed Rulemaking on
Cybersecurity in the Marine Transportation System. C/PA and its team of
security terminal operators will work with other MTO's to ensure that
any ultimate regulations governing port and MTO cybersecurity measures
will be consistent with industry threats and operational realities, and
to identify and develop opportunities for federal support. We look
forward to continue working with the U.S. Coast Guard on this endeavor.
Of note, C/PA falls under the Port Authority's FSP in all ports in
Texas.
Regarding cyber threats, C/PA partners with government entities
like the National Institute of Standards and Technology (NIST) to
replicate frameworks created by the U.S. Department of Commerce to
protect critical infrastructure. In addition to government partnerships
and programs, terminal operators have a high isolation level on crane
control and auxiliary function systems, and monitoring access is
strategically implemented to detect and capture threats. C/PA, like
other MTO's, proactively engage with control system and auxiliary
system providers regarding their latest offerings and demand the
highest level of security.
NMSA also is focused on security threats to marine terminal
operations that could jeopardize the safety of our waterfront workers,
and our association has been closely tracking such threats for some
time. Through our Technical Committee, NMSA proactively engages experts
from within and outside the industry to assess and understand potential
risks, gather data, investigate and conduct fact-finding reports,
review and evaluate best practices, and disseminate and encourage
adoption of solutions to improve safety for waterfront workers.
Protecting cargo handling equipment from cyber intrusions, damage,
or sabotage--particularly systems where our workers are at risk of
injury or potentially life threatening injury--is a significant concern
for NMSA and C/PA, and we are work vigilantly to safeguard all of our
systems and workers. This is why in February of 2023, NMSA's Technical
Committee received a presentation from officials with the U.S. Coast
Guard Sector's Jacksonville Cyber Division on cyber threats at U.S.
ports and marine terminals. We plan to continue this discourse both
internally and publicly to ensure comprehensive and protective measures
are in place and that our workforce remains safe and secure in their
operations.
Infrastructure Investments
Forecasts projecting continued growth in international trade and E-
commerce are expected to drive a significant increase in the volumes of
goods transported across the globe over the next few decades. The
greatest volume of this cargo will be transported via shipping
containers handled by our workforce. Congress and the Biden
Administration's recent investments in port infrastructure through
federal grant programs such as the Port Infrastructure Development
Program (PIDP) and the new EPA Clean Ports program are very helpful and
we thank you. Unfortunately, even if robustly funded for the next
decade, these programs alone will not be sufficient to address the
anticipated increase in cargo volumes.
Other approaches to infrastructure development and transportation
network expansion will be required to meet global demand in the
maritime cargo and intermodal freight transportation systems. One such
innovative approach would be the enactment of legislation to expand the
Maritime Administration's (MARAD) Capital Construction Fund (CCF)
program to allow MTOs to use a portion of their own revenues, on a tax-
deferred basis, to purchase new and replace aging cargo handling
equipment with new, zero-emission equipment that has built-in state-of-
the-art safety features manufactured here in the U.S. as proposed in
H.R. 4993. It has the added benefit of not requiring appropriated
funding and is distinctly beneficial to U.S. taxpayers.
H.R. 4993 is a bipartisan bill introduced by Congressmen Mike Ezell
(R-MS) and Troy Carter (D-LA) and has 17 cosponsors so far. Chairman
Webster, we are grateful that you are one of them. I respectfully urge
all of you take a look at this bill and consider cosponsoring this
important legislation.
Another approach that should be considered is to increase cargo
volumes at U.S. ports that currently have excess capacity for
additional volume or have room to expand their terminal operations with
additional investments. For instance, the U.S. Army Corps of Engineers
should be authorized and adequately funded to carry out additional
projects to deepen and expand navigation channels and approaches to
several ports--particularly in the Gulf of Mexico. Such investments
will not only expand our port capacity to move higher freight volumes,
they will also strengthen the resiliency of the entire U.S. Maritime
Transportation System (MTS); a need made abundantly clear by the recent
collapse of the Francis Scott Key Bridge and closure of the vessel
traffic to the Port of Baltimore.
In closing, I encourage both of your committees and your key staff
to engage with NMSA and its Technical Committee to share information
and any concerns about the marine transportation system. I would also
like to extend an invitation to committee members and your staff to
come visit our terminal in Houston and meet the hardworking people that
keep cargo moving and play an integral role in our supply chain. Our
industry experts stand ready to answer any questions you may have,
serve as a resource on any safety related matters, and assist you in
any way we can.
Thank you for providing me the opportunity to be with you at
today's field hearing and to share my perspectives on the critical
safety and security issues that affect our industry. Again, I
appreciate the attention of your two committees on ensuring the safety
and security of U.S. ports, marine terminal operators and all the
workers we employ, and our maritime supply chain. I welcome any of your
questions.

Mr. Webster of Florida. Thank you all for your testimony.
We now turn to the questions for the third panel, and I
recognize myself for 5 minutes.
Mr. Fowler, given the large range of vessels that Crowley
operates, are there any categories on the shoreside part of
this that are lacking and that don't quite meet the needs that
are necessary?
Mr. Fowler. Thank you, Mr. Chairman. I appreciate the
question. I want to make sure I answer your question
adequately. Specifically as it relates to the shoreside, how
can I direct my response?
Mr. Webster of Florida. Well, just from the--are there
certain services that are lacking----
Mr. Fowler [interposing]. Understood.
Mr. Webster of Florida [continuing]. That need to be
provided?
Mr. Fowler. Thank you. I appreciate the question. So,
Crowley operates many, many different types of vessels, right?
We operate container vessels, we operate petroleum and chemical
transportation vessels, we operate general cargo vessels, we
operate Government vessels. So, as our vessels come in and out
of the U.S. ports, the U.S. ports are adequate. They offer
great service for us.
The areas in which we operate when we talk about after--in
the COVID and the congestion that occurred on the west coast,
the areas that Crowley is operating, servicing the Caribbean,
servicing the islands, servicing South America, really weren't
met with those challenges. And so, we have a great system that
operates well, and in conjunction with our partners and ports
across the country, we've had great service here and in large
part of the continued investment in those ports.
Mr. Webster of Florida. So, from an operator's perspective,
what are the most pressing immediate needs for our Nation's
ports?
Mr. Fowler. Thank you for your question. For us operating--
Mr. Chairman, I'll say that the greatest challenges that we as
operators face right now relate to mariner shortage. And this
is something that we can take action on. And it's something
that's of critical importance to us in ensuring that our
vessels maintain in operation.
Today, we have vessels that at times are not operating
because of inadequate mariner levels that we'd need to operate
those vessels. And so, I would put that in two different
categories. The first category would be in attracting new
talent to our system and making aware our industry. And this is
an industrywide problem. We need the support from MARAD and
others to make aware and bring in more to our industry.
The second I would say is that we have, as it relates to
the mariner shortage, we have mariners who want to continue to
progress through the system and upgrade their licensing and are
struggling to do so. In some cases, it will take 100-plus days
of classroom time and up to $80,000 of their personal funding
to see those upgrades. And you can imagine that if you've been
at sea for 120 days, to come back then on your off time, when
you want to be with your family who you've been away from, to
have to then go spend 100 days in a classroom and to invest
significant dollars. There are ways for us to modernize that
process, to reduce the financial burden, to have more internet
delivery, e-delivery of that material that makes it easier for
those mariners to upgrade their licensing.
But if you're--from an operator standpoint, the critical
need that we have now is ensuring that we have adequate
mariners in our system. Today, we're in a mariner shortage, and
it's a crisis across our industry, and we certainly need some
support in ensuring that we can solve this together.
Mr. Webster of Florida. It's kind of a crisis everywhere.
Mr. Fowler. It is.
Mr. Webster of Florida. For every kind of worker.
Mr. Wong, during the pandemic, we saw substantial supply
chain disruptions driven by numerous factors, all kinds of
inability just to move cargo. Have you seen any improvement in
the intermodal side of what's happening?
Mr. Wong. Thank you, Mr. Chair, for the question.
Absolutely. Here at PortMiami and the majority of the
Florida seaports, beneficially, we didn't really have as much
of the stock hold of vessels out in anchorage. Be that as it
may, the Florida seaports, they have efficient operations and
sufficient equipment.
As far as the challenges that I think the Nation ended up
encountering was most definitely staffing, rotation of shifts,
to make sure that everyone wasn't hit by COVID at the same
time. There were a lot of mechanisms that ports had to take as
an industry as a whole to be safe during COVID. But as far as
the Florida seaports as a whole, we were blessed that we didn't
have any of that congestion here in our Florida seaports.
Mr. Webster of Florida. Chairman Gimenez, you are
recognized for 5 minutes. Or did I--no, I've got Carbajal,
sorry.
Mr. Carbajal. It's OK. I'm easy.
Mr. Webster of Florida. OK. You're recognized for 5
minutes.
Mr. Carbajal. Thank you, Mr. Chairman.
Mr. Wong and Mr. McCarthy, the Bipartisan Infrastructure
Law provided $2.25 billion in advance appropriations for the
Port Infrastructure Development Program. How important is that
funding to your ports, and how will it help you lower emissions
from your facilities? It's a softball for a good answer.
Mr. Wong. All right. I'll take it first since it's a
softball. Thank you. Thank you, Congressman.
As far as funding goes, one thing I would say about the
maritime industry and infrastructure, nothing is cheap in the
maritime industry. Infrastructure, such as specifically
PortMiami, we have a lot of infrastructure that we're operating
on, but it's towards the end of life.
And as far as processes, funding that's available, let me
tell you, our port will take any funding available. Our north
bulkhead, for example, where almost all of our cruise vessels
end up berthing at--we only have one cruise terminal on the
south side specifically for smaller vessels--but our entire
north side, our entire bulkhead needs to get replaced. And that
infrastructure and that funding is essential for us to continue
to grow and just to continue to operate on a daily basis.
The phasing of construction is essential as well. And when
you talk about aging infrastructure, we're talking about
upwards of $500 million on estimates as far as our north
bulkhead. So, it is expensive. It is a length of time for
construction, especially during operations.
Mr. Carbajal. Great.
Mr. McCarthy. Thank you for the question.
The infrastructure bill and the amount of funds is critical
to the United States and to ports and the infrastructure. For
Georgia Ports Authority, as you could see by what we submitted
as our attachment, three pages of grants over the last 36
months that we have been blessed to get from Congress and
Federal grant programs. We are currently applying for a
resilient grant to make our electric more robust so we can
shift from rubber-tired gantry cranes to electric gantry cranes
in our yard. So, the infrastructure bill is critical not only
to Georgia, but to the entire Nation. Thank you.
Mr. Carbajal. Thank you.
Mr. Fowler, first, I wanted to give you credit for Crowley
stepping up to embrace the EMBARC program. There's still a lot
of work that needs to be done. So, with that praise comes great
responsibility. But I do want to recognize how your company
stepped up and led on that issue.
So, with that, domestic cabotage laws require vessels
carrying cargo between two U.S. ports be built, owned, and
crewed by Americans. Those vessels are also governed by
stricter Coast Guard regulations. What role does the Jones Act
have on economic security and port security?
Mr. Fowler. Thank you, and thank you for your comments. I
very much appreciate the recognition of our embrace of the
EMBARC program.
The Jones Act is critically important for our Nation's
security. So, Jones Act, of course, we have U.S. mariners on
these vessels. And I think with the conflict going on around
the world, there's a heightened sense and awareness of the
importance of having U.S. mariners that are not only coming in
and out of our ports, but in our inland waterway system, that
we have U.S. mariners where you don't have the robust security
of a port, but in our inland waterway system along the coastal
U.S. It's critically important to our Nation's security that
those are American vessels owned by American companies and
crewed by American mariners.
So, in terms of the reliability, of course, you talked
about the heightened regulations around U.S. vessels as it
relates to vessel requirements, it relates to audits, as it
relates to crew training, crew regulations. It gives us a,
certainly, resiliency in having those Americans on those
vessels, creates great economic impact for those families. Many
of these jobs are six-figure jobs, well into six figures. These
are high-paying jobs that support American families across the
country, and they ensure at a greater level that our ports
remain resilient and safe.
Mr. Carbajal. Thank you. This is to all the panel. I'm
going to be out of time, so, I'm going to submit this question
for the record and ask that you follow up with an answer, if
you could, to all the witnesses. This question is for all the
witnesses, as I mentioned.
Every maritime port obviously happens to be on the water
and is therefore subject to rising sea level and extreme
weather events. What are you doing to prepare for the future,
and how expensive is that preparation? I'll submit that for the
record, if you could follow up, that would be great. Mr.
Chairman, I yield back.
Mr. Webster of Florida. Mr. Gimenez, you are recognized,
Chairman, for 5 minutes.
Mr. Gimenez. Thank you very much, Mr. Chairman.
Mr. Wong, are you familiar with all the cruise ships that
dock here at Port of Miami? Home port here?
Mr. Wong. Yes, Mr. Chair.
Mr. Gimenez. How many were built in the United States?
Mr. Wong. From what I can recollect, none of the cruise
vessels that are coming here right now.
Mr. Gimenez. None of the cruise ships are----
Mr. Wong [interposing]. That's correct, sir.
Mr. Gimenez. Are you familiar with most of the cargo ships
that dock here?
Mr. Wong. Yes, Mr. Chair.
Mr. Gimenez. How many of those were built in the United
States?
Mr. Wong. From what I can recollect, none, sir.
Mr. Gimenez. Mr. Sadler, that's a sad state of affairs, to
say the least. What has caused this? I'm going to give a little
bit of a brief history. During a World War II, for every
aircraft carrier that the Japanese built, we built six. If we
were to get into a conflict with China now, we would be Japan
and they would be us, although much worse. How did we get to
this, and how do we rectify it? How do we strengthen our
shipbuilding capacity here in the United States? Also another
little tidbit, the largest navy in the world now is the navy of
the PRC.
Mr. Sadler. No. I love this question, and I'll be very
cognizant of the limited time that we have on this. Looking
forward, I mean, we can go and look at the history, but looking
forward, the way that we can best address this is focusing on
our competitiveness. I mean, we have a legacy fleet and the
Jones Act, which has been that way for 100 years.
We have to get more competitive in the global marketplace.
We have to change and reorganize for the task. Our maritime
agencies are scattered about several different departments. We
need to organize for task, we need to focus on competitive
measures. Make it lucrative to be a merchant mariner, make it
lucrative to be a shipyard worker, because those are high-
paying jobs. We just need more people there. We need to start
building more competitively than we have been.
Mr. Gimenez. Does the PRC--are they engaged in some unfair
practices that give them an advantage?
Mr. Sadler. Absolutely. It's a state-owned enterprise, and
so, they benefit both from direct and also indirect subsidies.
They also take their orders, most often, not from an economic
perspective, but from a Communist Party's perspective. So, they
are not a free market entity. And so, that allows them to put
national assets behind whatever their strategic interests are.
If it's buying access into a port, if it's designing ships at a
lower cost so that they can elbow in or to take over market
share, they'll do it.
Now, there's still a lot of comparative advantages that our
allies and that we have in this sector. We just have not taken
full advantage of it, and that's probably where the solution
lies where we are today.
Mr. Gimenez. Is there legislation needed to accomplish
this?
Mr. Sadler. Absolutely. I think there's probably a family
of legislation that can't come soon enough, quite frankly.
Mr. Gimenez. OK. Since this is an interesting or a great
kind of melding of the three committees that I actually serve
on--I serve on HASC, Armed Services; I serve on the Select
Committee on China; and I obviously serve on Homeland
Security--I would love to get all of your perspectives on the
legislation that we need in order to keep America safe.
I mean, we're talking about port security, but now we're
really talking about the security of the United States. And it
really concerns me that of all the ships that come here, none
of them are built in the United States. Probably none of them
either are staffed by American sailors. They're probably
staffed by foreign sailors.
So, final question, on the licensing, Mr. Fowler, which you
talked about. Are the licensing requirements different for U.S.
sailors versus maritime personnel from around the world?
Mr. Fowler. Thank you for your question. And certainly
there are differences. And so, for us, some of the challenges
that we face in applying for those licenses today, to give you
some perspective, we've got at Crowley 100 jobs today that, if
we could work through a more efficient licensing process, could
be immediately filled. Over 100 jobs that are waiting to be
filled that mariner licensing, if we could expedite that
process, would resolve. Today----
Mr. Gimenez [interrupting]. All right. I need to cut you
off because I've got one more thing that I want to follow. I
only have 30 seconds.
The ships that dock here that don't have American sailors,
they have different licensing requirements, but yet we allow
them to dock in American ports. Is that a disadvantage for
American sailors also? I mean, why do we have these licensing
requirements for our folks and yet we allow folks from other
countries that aren't licensed the same way to operate on U.S.
ports if, in fact, it's all about safety?
Mr. Fowler. It should be about safety, Congressman, and I
would ask that we defer to the Coast Guard to understand the
differences and to provide that detail to make sure that that
safety element is being satisfied.
Mr. Gimenez. Fair enough. Thank you, and I yield back.
Mr. Webster of Florida. Thank you. Mr. Thanedar.
Mr. Thanedar. Thank you, Chairman Webster. And again, thank
you, Mr. Wong, for hosting us here today in this beautiful
venue. The collapse of the Key Bridge impacted all of your
organizations in one way or another. What lessons, if any, can
we learn from this collapse and look from a point of safety?
And my second question is, do we have the right perspective
in terms of our spending, our budget, our spending on security,
protecting our homeland in general? Are certain areas given a
higher emphasis than other areas, and is that justified? Are we
leaving some areas so vulnerable to the attacks because we are
all focused on certain different areas?
So, I just wanted to get a perspective from all of you on
lessons learned and how do you see the budgets and how does
that impact?
Mr. Sadler. I'll take the first stab at it. Great question.
And first up, on the bridge, I mean, we are still in the
process of discovery, but there are clearly, clearly a few
lessons that--right, first off, one, protective dolphins, which
would have prevented or deflected the full force of the Dali
from taking out the bridge, were not in place. This was based
on a similar incident that happened in 1980, but yet in the
intervening years, nothing was done.
How many other bridges are likewise not hardened because
shipping has changed dramatically in the intervening years? So,
there's a task that doesn't take very long to figure out that
needs to get done.
When it comes to priorities, which is what I really think
the issue is, on resourcing, it's been easier to focus on other
areas. It's been easy to kick the can down the road because we
had the best infrastructure, we had the best fleets, but now
our competitors have caught up. And a lot of that
infrastructure, the educational for merchant mariners, and the
ability for us to have that present, the market share, has been
eroded. So, it's time now to basically kind of get back to the
gym and to get competitive again, in my mind.
Mr. Thanedar. Thank you, Mr. Sadler.
Mr. McCarthy. I'll take the next part of it. It really
comes down to infrastructure, that it's not just the bridges
that need to be resilient or tunnels that need to be
constructed to remove those impediments. But it's also about
the infrastructure of our waterways. Some of our waterways in
the country are not deep enough or wide enough, and we need
funding for that. I know the WRDA bill is being discussed at
the T&I Committee and deepening harbors and widening them.
I know Savannah is requesting a study being done for the
Savannah River, and I know there are other regions of the
country that need more infrastructure, as a lesson learned and
what we need to do.
As far as the cost and the funding goes, it's in the
trillions of dollars, if you look at the whole country. And
what you are doing with the Federal grants is very appreciated
as a step for us to get moving in the right direction. Thank
you.
Mr. Thanedar. Thank you.
Mr. Sadler. Just one thing, to come back. One of the other
lessons from the Baltimore issue is the salvage capacity that
we have. I think that's something that needs to be looked at.
The ability to dredge as well as to remove debris. We're 10
days into it. It took less time to clear the Suez Canal. So, we
need to do better. We do have vulnerable ports, based on that
question in the last session.
Mr. Thanedar. Thank you so much. Quick question. How should
I say this? Are we more reactive to attacks and dangers as
opposed to being proactive in anticipating what could happen?
Mr. Sadler. I think we have been probably worse than
reactive. We have been complacent for far too long. We need to
get more proactive in the competitive spirit with our
adversary, China, because we have a lot of vulnerabilities to
their economic state craft that we need to get up to speed to.
But when it comes to the threat, we were focused and
fixated on a terrorist threat, a physical terrorist threat, and
we need to update our framework and our approaches to look at a
great power competitor. And it's not just China, it's also the
Russians and the Iranians that are in this space that are
harming us day to day.
Mr. Thanedar. All right. Thank you so much. I'm out of
time. So, Chairman, I yield back.
Mr. Webster of Florida. Thank you very much. Mr. Cohen,
you're recognized.
Mr. Cohen. Thank you, sir.
What is the liability of a shipping company? And maybe Mr.
Fowler would be appropriate. I'm not sure who would be the
right person. Right now, when there's a disaster like such has
happened in Baltimore, are there limits on liability in
statute?
Mr. Fowler. Thank you for your question. I appreciate that.
I'd like to follow up with you after about the specifics, and
I'll get our staff involved to make sure that we're providing
you the adequate results on that.
Mr. Cohen. Well, my staff can do that for me afterwards,
but for right now, tell me what your liability is.
Mr. Fowler. So, our liability would be to respond. And so,
we have contracts in place that would ensure that in the event
that we would respond accordingly. Take, for example, in this
particular instance you're referring to in Baltimore, they had
salvage contracts and responding contracts already in place, so
that immediately in hours after, those salvage responders were
immediately responding to that incident. I know that because we
were in communication with some of our services to offer our
services and support to do that.
So, what's going on in Baltimore is a joint effort. And
beyond, the shipowner plays a part, but absolutely, we would
have the responsibility to respond and would do that
proactively.
Mr. Cohen. How about--I mean, I thought I read there were
damages and there was a limitation on damages because of some
old statute. And if this shipping company was negligent, what's
the liability?
Mr. Fowler. Thank you again, Congressman. I'll come back
with some more details, the specifics of that and----
Mr. Cohen [interrupting]. All right. Well, I'll find out
from my staff. But what I'm getting at is there could be
liability on the companies, and there shouldn't be limitations
that are on some ancient law. The limitations, if there any at
all, they ought to be current.
But we shouldn't give a free pass to the maritime industry
if they are negligent in causing a damage to a bridge or other
facility that causes an injury to a port, which causes an
economic injury to the community. So, we'll look into that.
Is there any particular port, Mr. Wong, in your opinion,
that's more vulnerable than another right now?
Mr. Wong. Thank you for your question, Congressman. I think
as the Coast Guard alluded to this morning, they do risk
assessments with ports every single day. Our port here in Miami
is vulnerable as well. We continuously train, we drill for
response in active mitigation for what we can control.
But to answer your question more precisely, I do think
every port has specific critical infrastructure that will
hinder their operations. Here at PortMiami, we're a 522-acre
island. We have two points of access through our bridge, which
is critical, and through our tunnel, which is another critical
infrastructure. But as far as our waterways, we have one single
inbound and outbound channel. It is not a two-way channel. So,
when a parade of vessels is going in, they're going in. When a
parade of vessels is going out, it's single out.
We recently, last November, had an issue where we had a
down recreational vessel strike a barge. She did go down in the
channel. There was one fatality in the channel. The response
was we had five cruise vessels cutting water, standing by to
come in. We had thousands of passengers coming inbound,
thousands of passengers on hold on the outbound, and three
container vessels as well. So, when you talk about planning,
mitigation, Coast Guard, our local sheriffs, our community
here, as port stakeholders, we drill, we take it very seriously
to react as quickly as possible.
Mr. Cohen. Thank you, Mr. Wong.
Mr. Wong. Yes, sir.
Mr. Cohen. Mr. McCarthy, you mentioned safety as being
paramount to port operations, which, of course, they are. Based
on what you know so far, could anything have been done
differently with the Francis Scott Key Bridge? I read a lot
about some kind of supports they could have put around the
pylons and that would have diffused the impact. Could that have
happened and----
Mr. McCarthy [interrupting]. I'm not privy to the details
of the Francis Scott Key Bridge. I can talk about what's going
on in Georgia around the Sidney Lanier Bridge, which is down in
Brunswick, Georgia. There are actually 2-acre rock walls around
the abutment of the bridge to protect the stanchions of the
bridge down in the Sidney Lanier Bridge down in Brunswick.
Mr. Cohen. Were they constructed when the bridge was
constructed, or were they added later?
Mr. McCarthy. I'll have to get back to you on the details
of that question.
Mr. Cohen. Do you know how old that bridge is
approximately?
Mr. McCarthy. I do not. I'll have to get back to you on
that as well.
Mr. Cohen. Because that was an issue about--I think they
said there had been--they could have gone back in Baltimore and
reinforced those stanchions, but it hadn't been done. Do you
know of situations, or anybody on the panel know of situations
where folks have gone back and refortified the stanchions to
guard against a potential strike?
Mr. McCarthy. I do not.
Mr. Sadler. I think Tampa, the incident in 1980, they
actually did, but there are other cases, I'm sure, just not in
the top of my mind right now.
Mr. Cohen. There was something that happened in New Orleans
some years ago. I'm not quite sure what it was. A friend of
mine was in NTSB back in the nineties, and he said after that
there was a need for a major study, and it was mandated by
Congress, then it never took place. Can you edify us on that,
Mr. Sadler?
Mr. Sadler. I'm not familiar with the specifics of that,
but I'm not surprised that other issues, other priorities at
the time intervened to make it not possible, too expensive, not
urgent.
Mr. Cohen. Thank each of you for what you do. And thank
you, Mr. Wong, for being the first person to recognize me
today. I appreciate that very much. I yield back the balance of
my time.
Mr. Webster of Florida. All right. So, that concludes the
joint subcommittees' hearing today, and I'd like to thank each
of the witnesses for coming and testifying and giving some
insightful information about what's going on in the industry.
So, the joint subcommittees, between Coast Guard and
Maritime Transportation of the Committee on Transportation and
Infrastructure and the Subcommittee on Transportation and
Maritime Security of the Committee on Homeland Security, stand
adjourned. Thank you for coming.
[Whereupon, at 11:54 a.m., the subcommittees were
adjourned.]

Appendix

----------

Question to William K. Paape, Associate Administrator for Ports and
Waterways, Maritime Administration, from Hon. Salud O. Carbajal

Question 1. Mr. Paape, at the hearing I asked, ``what is MARAD
doing to help ports become more resilient to rising oceans and extreme
weather events?'' of which you requested to take it for the record.
Please provide that answer.
Answer. The Port Infrastructure Development Program (PIDP)
authorized by Congress in 2009 and first funded in 2019, funds projects
that address a number of factors, including resilience. As provided in
46 U.S.C. 54301(a)(6)(B)(iii), the Secretary shall, in making grant
awards, assesses whether, and how well, a proposed project improves a
port's resilience as part of its review of PIDP funding requests.
The Notice of Funding Opportunity for Fiscal Year 2024 PIDP grants
defines port resilience as the ability to anticipate, prepare for,
adapt to, withstand, respond to, and recover from operational
disruptions and sustain critical operations at ports, including
disruptions caused by natural or climate-related hazards (such as sea
level change, flooding, and extreme storms) or human-made disruptions
(such as terrorism and cyberattacks).
In considering a project's role in improving a port's resilience to
natural or climate-related hazards, reviewers consider how well the
project incorporates evidence-based climate resilience and adaptation
measures or features. Projects will score more highly on this element
of the criterion if the narrative demonstrates that the project: uses
best-available climate data sets, information resources, and decision-
support tools (including DOT and other federal resources) to assess the
climate-related vulnerability and risk of the project; develops and
deploys solutions that reduce climate change risks; is included in a
Resilience Improvement Plan or similar plan incorporates nature-based
solutions/natural infrastructure; advances objectives in the National
Climate Resilience Framework; follows the Federal Flood Risk Management
Standard, consistent with current law; and includes plans to monitor
performance of climate resilience and adaptation measures.
Many PIDP projects include elements that improve resilience by
elevating, strengthening, or relocating critical port infrastructure or
otherwise implementing systems and strategies to make port facilities
better able to withstand rising sea levels and extreme weather events.

Question to Frederick Wong, Jr., Deputy Port Director, PortMiami, on
behalf of the American Association of Port Authorities, from Hon. Salud
O. Carbajal

Question 1. Mr. Wong, every maritime port is subject to rising sea
level and extreme weather events. Following up from the hearing, what
are you doing to prepare for the future, and how expensive is that
preparation?
Answer. Recognizing the potential impact of sea level rise, the
Port understands that climate resilience must be integrated into future
decision-making for operations, maintenance, and capital investments.
Therefore, the Port proactively approached future flood resilience by
developing an initial Sea Level Rise Vulnerability Assessment and
Adaptation Guidance document. The document identified areas of the Port
that are projected to be exposed to sea level rise hazards through the
coming decades, provided an overview of the Port's asset
vulnerabilities, presented a suite of strategies to adapt the Port over
time and provided a framework to consider future sea level conditions
in the Port's capital planning process. By preparing for future sea
levels, the Port will become more resilient to future flood and storm
events and remain a solid economic engine locally, regionally, and
nationally.
The costs of implementation vary. Grant funding is being pursued,
with success, for projects that improve Port resilience. Other costs
are associated with modifying projects to ensure the longevity and
resilience of new construction in the coming years. The aforementioned
study did include a range of anticipated construction costs for each
strategy as well as the cost of inaction over the coming years.
These efforts reflect PortMiami's commitment to building resilience
against climate-related challenges, ensuring the Port's continued
functionality and safety in the face of environmental changes.

Question to Ed McCarthy, Chief Operating Officer, Georgia Ports
Authority, on behalf of the National Association of Waterfront
Employers, from Hon. Salud O. Carbajal

Question 1. Mr. McCarthy, every maritime port is subject to rising
sea level and extreme weather events. Following up from the hearing,
what are you doing to prepare for the future, and how expensive is that
preparation?
Answer. The Port of Savannah is located on the Savannah River 18
nautical miles from the ocean which is a different environment than a
seacoast port.
Extreme weather events such as hurricanes are covered in our
Georgia Ports Authority Hurricane Plan which is reviewed annually with
the U.S. Coast Guard Captain of the Port of Savannah.
From an infrastructure standpoint, Georgia Ports (Port of Savannah,
Port of Brunswick) are well-suited for any sea-level rise that may
occur over the next century because our terminals in Savannah are built
with the 7-foot tide differential of the Savannah River taken into
account, eliminating any long-term flooding impacts.
Our Port of Brunswick facilities are being raised with a
combination of FEMA grants and Georgia Ports costs totaling $14.9
million while any facilities built since 2016 have all been designed to
be above the 100-year storm surge.
In the last 8 years, Georgia has weathered six Tropical Force Storm
winds in the region. Each storm was slightly different regarding storm
track, wind force and water surge. No storm has impacted Georgia Ports
in a significant manner and the highest storm surge was from Hurricane
Matthew which was still below our Savannah berths.

Question to Dave Morgan, President and Chief Executive Officer, Cooper/
Ports America, on behalf of the National Maritime Safety Association,
from Hon. Salud O. Carbajal

Question 1. Mr. Morgan, every maritime port is subject to rising
sea level and extreme weather events. Following up from the hearing,
what are you doing to prepare for the future, and how expensive is that
preparation?
Answer. All Marine Terminal Operators (MTOs) are governed by their
respective US Coast Guard Captains of The Port (COTP) with regards to
hurricane/weather preparations (copy of Houston/Galveston attached).
The pre and post work for a hurricane is funded 100% by the MTO's with
no external sources of revenue to offset the cost of this work. These
preparations include directives from the US Coast Guard that warn MTOs
to prepare for operational interruptions that could extend into 96
hours both during and after storm passage, and may have a direct effect
on public safety, energy, and transportation needs \1\.
Nearly all MTO's employ Union Labor such as the International
Longshoremen's Association (ILA), and the International Longshore and
Warehouse Union (ILWU), and our pre and post work is paid at full wage
and fringe benefit scales according to our Collective Bargaining
Agreements. In the US Gulf Coast and US East Coast alone there are
historically 12 or more hurricanes per season which require these pre
and post preparations, and in polling Port Authorities and MTO's, most
budget for these preparations, but can spend in excess of $100,000.00
per hurricane season which is non-recoverable to the Ports and MTO's.
Further to the point made in your question regarding sea level rise
the Cybersecurity and Infrastructure Security Agency (CISA) has
indicated that every 3-20 years we may expect a 100-year storm surge
which has the potential to cost billions in direct damages resulting
from only one foot of sea-level rise \2\. CISA further estimates that
higher seas will cause increases in flooding in nearly all U.S.
mainland and Pacific Island coastlines by the mid-2030s, and a third of
coastal sites in the US will experience 100-year storm surges becoming
10-year or more frequent events by 2050 \2\. It has been estimated that
some of the world's largest Ports, including here in the U.S., may
become unusable by 2050 due to rising sea levels \3\.
The National Maritime Safety Association closely monitors and
engages the work of industry stakeholders and Subject Matter Experts
regarding this issue. As an example, the Southeast Florida Regional
Climate Change Compact has reported that a NOAA assessment shows high-
tide flooding days has been increasing for locations along the U.S.
East Coast, and offered Miami as an example in that it will likely
suffer 60 days of high-tide flooding per year by 2050 with this number
possibly exceeding 150 days per year (Figure A-7, personal
communication, Sweet et al., 2018) (Sweet et al., 2018) \4\.
It has been further reported that tropical cyclones have caused
extensive damages that present crippling costs towards recovery
including Category 5 Hurricane Katrina causing approximately $2.2B in
damages to Category 1 Hurricane Sandy causing approximately $147M in
damages \5\. As an example of costs related to guarding against sea
level rise port elevation is a one accepted engineering control against
this risk. However, a recent study approximated that raising port
infrastructure could cost $71-101B to elevate all existing commercial
coastal ports in the United States to address sea level rise by 2070
\5\.
NMSA and its maritime transportation stakeholders remain diligent
to protect our vital supply chain in the face of these challenges, but
any assistance is not only welcomed, it is critical to ensure the
stability of our Nation's infrastructure. It is well noted that the
Maritime Transportation System Emergency Relief Act (MTSERA),
authorized in the FY 2021 National Defense Authorization Act (NDAA)
would greatly assist our industry of ports, terminal operators and
approximately 40 additional eligible maritime partners by providing
relief to maritime industry entities from declared national and
regional disasters and emergencies.
The MTSERA program, administered by the U.S. Maritime
Administration (MARAD), has yet to have appropriations provided by
Congress. NMSA is ready to engage in further discussion how this
program would directly protect, and affect, billions of dollars at risk
by lack of protective actions and recovery operations resulting from
extreme weather changes and sea level rise due to insufficient funding
in these endeavors.
It is our understanding that Congress has recognized and authorized
an authority to allow financial assistance, and we encourage this
Subcommittee to consider, and agree to support, funding this critical
program through appropriations. MTSERA Grants would allow MARAD to
provide financial assistance to stabilize our maritime industry when it
suffers a national emergency or disaster \6\.
A resilient and efficient maritime supply chain is fundamental to
protecting American citizens and our economy. Congress has long
recognized the critical importance of the maritime supply chain by
virtue of establishing a permanent Harbor Maintenance Trust Fund to
maintain and ensure the approaches, channels, and berthings in our
ports so they remain open, safe, and of sufficient depth to ensure safe
and reliable vessel traffic which in turn assures the movement of
trade.
In addition to the far-reaching benefits of MTSERA we also ask that
this Subcommittee consider a smaller, but permanent fund, to provide an
expeditious source of revenue that addresses the immediate needs of
ports and MTOs damaged after natural disasters. NMSA feels it would
benefit our industry, and the Nation's economic stability, for Congress
to take this holistic approach to our supply chain by assigning a
percentage of excise tax revenue to provide emergency response for
ports and MTOs.
We thank you for the opportunity to participate in this critical
discussion, and look forward to further engagement with this
Subcommittee.
References:
\1\ chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://
www.maritime
delriv2.com/storage/app/media/Agencies/USCG/USCG_Hurricane/2018_
COTP_DelBay_Port_Hurricane_Contingency_Plan.pdf

\2\ https://www.cisa.gov/topics/critical-infrastructure-security-and-
resilience/extreme-weather-and-climate-change/sea-level-rise

\3\ https://www.reuters.com/business/environment/top-global-ports-may-
be-unusable-by-2050-without-more-climate-action-report-2023-09-07/

\4\ chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://
southeastflorida
climatecompact.org/wp-content/uploads/2023/10/2019-sea-level-
projections.pdf

\5\ chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://
www.edf.org/
sites/default/files/press-releases/RTI-EDF%20Act%20Now%20or
%20Pay%20Later%20Climate%20Impact%20Shipping.pdf

\6\ https://democrats-transportation.house.gov/news/press-releases/
chairs-defazio-
maloney-legislation-to-provide-relief-to-maritime-sector-amid-
ongoing-covid-19-pandemic-passes-through-house

[all]