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October 19, 2005

Oberstar joins Jones Act waiver debate

Rep. James L. Oberstar, Ranking Democratic Member of the House Committee on Transportation, has gotten into the debate over the blanket waivers of the Jones Act granted by the Bush Administration following Hurricanes Katrina and Rita.

In a letter to Secretary of Homeland Security Michael Chertoff dated October 17, Congressman Oberstar notes that "President Bush's public statements and the rationale in your waiver statementattribute the Jones Act waiver to national defense and the requirement to transport certain petroleum products within the domestic commerce of the United States. No one disputes the importance of those goals. Howver, it is not clear to me how this recent waiver contributes to the Administration's effort to meet those objectives."

Oberstar writes that "there is considerable U.S.-flag tonnage currently available and standing by in the Gulf. Unfortunately, the Jones Act waiver has the effect of encouraging the use of foreign low-cost flag-of-convenience tankers and discouraging the use of American vessels and crews."

Oberstar notes that Chertoff's authority to waive the Jones Act is based on Public Law 81-891.

"In 1990," writes Oberstar, "the Customs Service (now part of your department), the U.S. Maritime Administration (in the Department of Transportation) and the Department of Energy agreed to a program for situations involving an 'actual or imminent energy supply shortage.' Under this system, if no qualified U.S. flag vessel is available, the Jones Act could be waived on a case-by-case basis for that specific voyage. I understand this is a sysem that has worked for the past 15 years. It also has the benefit of allowing the government to track waivers to ensure a working knowledge of the number and type of waivers, something not possible under a blanket waiver."

Oberstar says he believes this syetem "would provide an efficient system of waivers where necessary without sacrifing the Jones Act."

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