Ranking Member Garamendi: Maritime Administration Title XI Loan Guarantee Energizes Shipbuilding Projects and Creates Hundreds of California Jobs
MARYSVILLE, CA – Today, Congressman John Garamendi (D-Fairfield, CA), Ranking Member of the Committee on Transportation and Infrastructure’s Subcommittee on the Coast Guard and Maritime Transportation, praised the Department of Transportation and the Maritime Administration (MARAD) for green lighting a $324.6 million Title XI loan guarantee to TOTE Shipholdings, Inc. to finance the construction of two container ships that will utilize liquefied natural gas as a propulsion fuel. The Title XI Loan Guarantee program promotes the growth and modernization of U.S. shipyards and the U.S. merchant marine by ensuring U.S. vessels are manufactured in U.S. shipyards by U.S. workers.
Congressman Garamendi said, “I commend Transportation Secretary Foxx and Maritime Administrator Jaenichen for this job-creating, business generating, and environment improving action. Every dollar guaranteed by the Maritime Administration generates $10 of private sector funding. This cost-effective approach to help massive shipbuilding projects get off the ground is a win for American taxpayers, businesses, and workers. I am excited that the project will create solid middle-class jobs in California. By using LNG fuel, which has a lower carbon footprint than diesel, these vessels are also a significant step toward building a ‘green’ U.S. flag fleet and promoting environmentally sustainable commerce.”
Garamendi added, “Our nation is also about to embark on the export of LNG. When and where we do so, we should do so responsibly on American ships. I have authored the bipartisan Growing American Shipping Act (H.R. 5270), which makes clear that we want LNG exports to be on U.S. flagged ships and to create American jobs. Our Subcommittee hearing on the U.S. Merchant Marine focused attention on this GAS Act and its potential to strengthen the maritime industry and I will continue to advocate for this proposal. Also, for the first time in a generation, the Administration is creating a comprehensive National Maritime Strategy. I hope that, as part of this Strategy, they will call for the expansion of the Title XI program, as well other policy reforms and innovations to restore the prominence of the U.S. flag among seafaring nations”
The TOTE vessels financed by this Title XI program loan will be constructed at National Steel and Shipbuilding Company (NASSCO) in San Diego, California. Construction of the vessels will generate 600 jobs at NASCCO, support companies throughout the nation that supply the materials and equipment, and once in service, the two new vessels will provide for 60 new U.S. merchant mariner jobs.
As dual fuel vessels, primarily operating with LNG, but with light diesel as needed, the vessels will be the most environmentally friendly containerships in the world. The engines will reduce the discharge of particulates to well below the levels mandated by U.S. Environmental Protection Agency regulations and International Maritime Organization (IMO) requirements.
Expected to be delivered in 2015 and 2016, TOTE intends to operate each vessel in the coastwise trade between the Port of Jacksonville and Puerto Rico, transporting containers, automobiles and other cargoes. The ships will provide greater efficiencies and increase the available volume of refrigeration equipment used for shipping, which is critical to ensuring pharmaceuticals, produce, and other vital products are delivered in the best possible condition to the residents of Puerto Rico.
The Title XI program guarantees the repayment of loans, obtained in the private sector by ship owners, for the construction, reconstruction, or reconditioning of vessels in U.S. shipyards. MARAD currently guarantees approximately $1.7 billion in U.S. shipyard projects.