Proceedings Of The Marine

SUM 2016

Proceedings magazine is a communication tool for the Coast Guard's Marine Safety & Security Council. Each quarterly magazine focuses on a specific theme of interest to the marine industry.

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62 Proceedings Summer 2016 www.uscg.mil/proceedings Commercial First To ensure the long-term renewal, recapitalization, and growth of the U.S.-flagged commercial fleet, the Department of Defense adheres to the longstanding policy of utilizing com- mercial transport as the most optimal and cost-effective means of provid- ing sealift support. National Security Directive 28, National Security Directive on Sealift, provides guidance on sealift transportation and requires DOD to use the commercial sector for sealift transportation to the maximum extent practicable when the commercial sector can meet operational requirements. This policy also indicates that only to the extent that U.S.-flagged commer- cial vessels are unavailable will DOD rely upon its own vessels. First articu- lated in 1954 under the Wilson-Weeks Agreement, a memorandum of understanding between the Departments of Defense and Commerce, this policy fur- nishes incentive for the U.S.-flagged industry to invest in shipping under the U.S. flag, promotes a sustainable sea- lift partnership with DOD, and serves as the backbone of a viable U.S.-flagged commercial fleet. While the policy requires utilizing U.S.-flagged commercial carriers to the maximum extent practicable, it is important to balance the various components of sealift capacity — com- mercial, charter, and DOD-owned. The Department of Defense is required to, at least annually, determine the number of ships it needs to own or have under charter to meet its peacetime, contingency, and wartime projected requirements. The U.S. Transportation Command (TRANS- COM) also adheres to the policy of utilizing the U.S.-flagged commercial fleet to the maximum extent practicable, and to determine what other assets are necessary to carry out its mission when it is not possible to use U.S.-flagged com- mercial assets. Current maritime programs are structured to function in a mutually beneficial manner through the Maritime Secu- rity Program and Voluntary Intermodal Sealift Agreement. Using these resources, TRANSCOM acquires access to global sealift from commercial sources using the privately owned U.S.-flagged vessels and intermodal networks of the U.S.-flagged ocean carriers at significantly lower cost than if those needs were to be met from DOD-owned resources. As a bonus, TRANSCOM is also able to avoid substantial up- front capital investment. However, though the MSP program crewing, and operating a U.S.-flagged vessel. The program permits companies to re-flag foreign-built or foreign-flagged vessels less than 15 years old to U.S. registry, thereby provid- ing U.S.-flagged operators with the flexibility and increased efficiency to remain competitive in the international market- place. The program also requires all participating carriers to sign the Voluntary Intermodal Sealift Agreement (VISA), which sets forth obligations to the Department of Defense, specifying how the companies' vessels and intermodal sys- tems may be utilized in support of U.S. national emergencies. Funding for the Maritime Security Program is subject to the annual appropriations process. Congress authorized the current 60-ship MSP fleet on the basis that it was (and con- tinues to be) the most prudent, economical, and necessary solution to address the current and projected U.S. sealift requirements. A key part of the MSP value proposition is the carriers' net- work of global services. A study prepared for the National Defense Transportation Association (NDTA) by Reeve & Associates in August of 2006, The Role of the United States' Commercial Shipping Industry in Military Sealift, indicated that the cost to the U.S. government to replicate the ves- sels provided for by the MSP is estimated at $13 billion. The study also noted that it would cost the government a fur- ther $52 billion to replicate the related global intermodal system provided by the carriers that participate in the MSP program. The sum of $186 million previously paid in total each year to the MSP participants seems moderately small, in comparison. 4 American Roll-on Roll-off Carrier's M/ V Freedom discharges U.S. Army cargo for NATO exercise Trident Juncture 2015.

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