New jobs for AMO in renewed, revised MSP

New jobs for AMO in renewed, revised MSP

Car carriers, heavy-lift vessel to join fleet; tanker construction issue remains unsettled

      The American Maritime Officers deep-sea fleet roster will grow by four ships under Maritime Security Program renewal contracts announced Jan. 14 by the Maritime Administration after a down-to-the-wire struggle over funding.
     In all, AMO will represent the engine and deck officers on five ships enrolled in the MSP for the first time, beginning next Oct. 1. The additional MSP tonnage under AMO contract will join seven AMO-manned ships already participating in the program, which guarantees a core fleet of suitable U.S.-flagged vessels for strategic sealift and other military support services in defense emergencies.
     The new vessels are the car carriers Takasago, Otello and Aida and the heavy-lift ship Industrial Chief. Each will be brought into U.S. registry for service in commercial foreign trade markets, and each will be available to the Department of Defense as needed.
     Interocean Ugland Management Corp. (IUM), which has collective bargaining agreements with American Maritime Officers, will operate the car carriers for American Roll-On/Roll-Off Carriers (ARC). IUM currently operates five ARC car carriers--the Liberty and Independence and, in the MSP, the Patriot, Freedom and Resolve.
     Pacific Gulf Marine (PGM), which also has labor agreements with AMO, will operate the Industrial Chief and a second heavy-lift vessel, the Industrial Challenger, in the MSP for Intermarine Inc. The Industrial Challenger now operates without a Maritime Security Program contract.
     "The new Maritime Security Program agreements represent new jobs for our union on four ships," said AMO National President Michael R. McKay. "The contracts also ensure long-term employment on eight other vessels already manned in all licensed positions by AMO." The eight ships referred to by McKay are the Industrial Challenger and the container vessels Maersk Georgia, Maersk Carolina, Maersk Missouri and Maersk Virginia, operated by Maersk Line Limited, and the car carriers Patriot, Freedom and Resolve.
     "We're pleased with the outcome," McKay continued. "We did well, all things considered fairly."
     McKay explained: "The Maritime Security Program was intended from the start to prevent the foreign flag-out of the U.S. liner fleets, most of which had received operating differential subsidies each year until President Reagan pulled the plug on ODS." ODS was authorized in the Merchant Marine Act of 1936, but the Reagan administration eliminated funding of the program. The last ODS contract expired in 1998.
     "The liner fleets never were under AMO contract," McKay continued. "These fleets--and the jobs they provided--were worth saving in the interest of national security. AMO saw real if limited opportunity in the Maritime Security Program, but we also saw it as a matter of principle. We supported the authorizing legislation strongly, even though we as a union had the least to gain from it."
     The Maritime Security Program was authorized in Public Law 104-239, the Maritime Security Act of 1996. The legislation provided limited direct operating aid each year to 47 U.S.-flagged commercial merchant ships with military utility as determined exclusively by DOD. The legislation required that the 10-year program be paid for in annual installments through direct appropriations.
     Legislation enacted in November 2003 renewed the Maritime Security Program through September 2015 and expanded the program to cover 60 ships, beginning in October 2005. The amount of aid available to each vessel each year will rise gradually from the current $2.1 million to $3.1 million, and the money must be approved by Congress and the President each year in budget authorization and appropriation bills.
     The 47 ships already in the MSP when the 2003 legislation was signed were guaranteed participation in the renewed and expanded program.
     The MSP renewal legislation also made tankers eligible for Maritime Security Program contracts for the first time. The legislation held up to five of the 13 new MSP positions for U.S.-built double-hulled tankers that can carry defense fuels and authorized $250 million to assist in the U.S. construction of such vessels. The measure allowed the U.S. reflagging of suitable foreign-built tankers for operation under MSP contracts until U.S.-flagged vessels are available.
     However, Congress in December 2004 appropriated only $75 million for the domestic construction of U.S.-flagged product tankers--enough for only one vessel. Despite the shortfall, MARAD--an agency in the Department of Transportation--awarded OSG Shipholding Group Inc. Maritime Security Program contracts for three tankers still to be acquired. OSG does not employ AMO engine or deck officers.
     Meanwhile, the Office of Management and Budget (OMB) at the White House opposed all MSP tanker spending and sought to limit participation in the renewed program to the current 47 ships.
     "This was a perfect example of what can go wrong in Washington, even when everything appears to be going right," McKay said. "The House of Representatives, the Senate and the President agreed in November 2003 to extend the Maritime Security Program's scope from 47 ships to 60, and to authorize enough money to encourage construction of five tankers. But, when it came time to actually appropriate the money during fiscal 2006 budget deliberations, it became a battle."
     OMB "had its eye on spiking budget deficits," McKay continued. "The staff there was looking to cut spending anywhere and everywhere, and they apparently saw the MSP as an easy target. But the seagoing unions, the ship operators and the maritime industry trade associations worked in unison to persuade key lawmakers and the administration to fund the program as agreed to in November 2003. Our friend Mike Sacco, president of the Seafarers International Union and president of the AFL-CIO Maritime Trades Department, coordinated the effort, and we appreciate his leadership."
     In September 2004, the Bush-Cheney campaign said the President would continue to support the Maritime Security Program and other U.S. merchant fleet promotion laws and programs in his second term.
     "President Bush understands the maritime industry has long played a vital role in our nation's commerce and defense," the campaign said in a prepared statement. "Safe, reliable and efficient marine transportation of goods and passengers is essential to sustaining growth in the U.S. economy and to our international trade--in time of war or national emergency, the U.S. military depends on shipping and seafarers drawn from the U.S.-flag commercial fleet to deploy our military overseas and ... to transport the supplies necessary for them to fight and win anywhere in the world."
     The statement said the President would pursue "a maritime policy tailored to 21st Century needs" and defend "laws that have contributed to the growth of our domestic fleet, such as the Jones Act," and initiatives "that guarantee intermodal cargo lift ... when needed in times of crisis ... such as the Maritime Security Program."

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