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SCA Weekly Report | July 22-26, 2019

Shipbuilders Council of America

20 F Street NW, Suite 500

Washington, DC 20001



SCA Weekly Report | July 22-26, 2019




REMINDER: Register for the Fall 2019 Meeting


Only 4 Weeks Left to Register for the Shipyard Tour


This is a reminder to register for the 2019 SCA Fall Membership Meeting. You only have 4 weeks left to register for the fall meeting and still be able to attend the shipyard tour of Newport News Shipbuilding. Do not miss out on this exciting opportunity!


Registration for the SCA meeting is $550 per attendee. Please note that the registration fee increases to $650 after August 15, 2019.


A draft schedule of events can be found HERE





Thank you to the following companies for their early commitment to exhibit at the Fall Meeting:

Tri-Tec Manufacturing

Aerotek Recruiting and Staffing

National Inspection Consultants

Radco Industries

Ryzhka International, LLC

STI Marine Firestop


MCG Workforce Solutions

Gibbs & Cox



For more exhibition information, please review the Exhibition Packet. 



EDA Transfer Survey

The US Navy is drafting a survey message regarding the availability of three Powhatan Class Fleet Ocean Tugs for transfer under the Excess Defense Articles (EDA) program. The survey message will be distributed to US Embassy Security Cooperation Office (SCO) personnel. If the vessel is appropriate for country use, and depending on country eligibility, the vessel can be obtained as EDA grant or EDA sale at a reduced price. The vessel is offered in "as-is-where-is" condition. The SCOs will advise interested countries to consider the costs associated with refurbishment, maintenance, training, operation, and sustainment when making a decision to request the EDA item. To the maximum extent practicable, pre-transfer repair and renovation work will be performed in a US private or public shipyard. These vessels are planned to be decommissioned in FY21. Dependent on the needs of the US Navy, the decommissioning date could be delayed one or more years.


For any questions, please contact LeAnn Carpenter: / Bureau of Industry & Security / US Department of Commerce / 202-482-2583 / LeeAnn.Carpenter@bis.doc.gov




Congress & White House Reach Budget Agreement

The House passed a two-year debt ceiling extension and budget bill Thursday in a bipartisan deal backed by President Donald Trump that will lessen the chance of a shutdown this fall and put any risk of a U.S. government default off until after the 2020 election. The measure, passed 284-149, would allow a $324 billion increase in discretionary spending over two years over existing budget caps. The bill would avert a potential default on payments in early September by extending the U.S. borrowing limit through July 31, 2021. Congress will still need to scramble in September to pass spending bills adhering to the new $1.3 trillion spending cap to fund the government when the new fiscal year begins Oct. 1.


The fiscal 2020 base spending caps would be set at:

  • $666.5 billion for defense — $90.3 billion more than the current fiscal 2020 cap, and $19.5 billion more than in fiscal 2019.
  • $621.5 billion for nondefense — $78.3 billion more than the current cap, and $24.5 billion more than in fiscal 2019.


The fiscal 2021 caps would be:

  • $671.5 billion for defense, $81.3 billion more than the current fiscal 2021 cap.
  • $626.5 billion for nondefense, $71.9 billion more than the current cap.


The Senate is expected to pass the agreement next week.






House Passes 2-Year USCG Reauthorization Bill

On Wednesday, the House passed a modified version of H.R. 3409, the Coast Guard Reauthorization Act of 2019. The measure would authorize the following amounts to be appropriated in Fiscal 2020 and 2021. 



To view the SCA summary of the bill, please click HERE.


Esper Confirmed as SECDEF

Army Secretary Mark Esper was confirmed by the full Senate on Tuesday to become the next -- and permanent -- secretary of defense, filling the void left at the top of Pentagon's chain of command by the abrupt resignation of former Defense Secretary Jim Mattis last December. The vote in favor of Esper was 90-8, following a previous 85-6 vote by the Senate on a motion to advance the nomination to the floor. He was sworn in Tuesday night by Vice President Mike Pence and reported for his first day on the job at the Pentagon early Wednesday morning.




SASC to consider top Navy pick next week

The Senate Armed Services Committee will hold a July 30 confirmation hearing for Vice Adm. Michael Gilday to be the next chief of Naval Operations.Now the director of the Joint Staff, Gilday was nominated to be the Navy's top officer after the previous Senate-confirmed pick, Adm. Bill Moran, abruptly withdrew before taking command amid an inspector general investigation. Senate leaders will have just a few days following the confirmation hearing to confirm him before the chamber adjourns for its long summer recess.


Lawmakers Reintroduce Energizing American Shipbuilding Act

The bill would require that vessels built in the U.S. transport 15% of total seaborne LNG exports by 2041 and 10% of total seaborne crude oil exports by 2033. If enacted, the bill is expected to spur the construction of dozens of ships, supporting thousands of good-paying jobs in American shipyards, as well as domestic vessel component manufacturing and maritime industries. 




Senate Commerce Committee: Markup of USCG Authorization Bill

July 31, 2019 | 10:00 AM

216 Hart Senate Office Building 




Schultz: Coast Guard Expanding Western Pacific Operations

The U.S. Coast Guard will increase its presence and deployments to Asia – particularly around Oceania and U.S. Pacific territories – and test out a new operational deployment concept in the region, service head Adm. Karl Schultz told reporters last week. The operation is a 30-day deployment of a 225-foot Juniper-class buoy tender and a Fast Response Cutter to partner with Pacific island nations. The buoy tender’s presence is a proof-of-concept operation to see if it could function as a mothership to smaller patrol craft. If successful, Schultz said this could be the start of similar operations with partner nations. While he said he believed the Coast Guard will continue to contribute to security and freedom of navigation in the South China Sea and East China Sea, he added that the most suitable way for the Coast Guard to exert influence in the Pacific is to operate at a partner-nation level. 







Kim Jong Un Touts North Korean Submarine’s Looming Deployment

North Korean leader Kim Jong Un inspected a new submarine that would soon be deployed to waters between the peninsula and Japan, state media said, a move that comes as his regime tries to step up its ability to launch missiles from subs. There was no indication in the Korean Central News Agency report Tuesday whether the submarine was capable of carrying ballistic missiles that could threaten nearby U.S. allies including South Korea and Japan. Kim has used the testing and deployments of weapons in recent months to remind the region of his military might, amid stop-and-go talks on ending his nuclear program.


Novatek Secures Financing for Arctic LNG 2 Terminal

Russian energy company Novatek has completed the sale of participation interests in its Arctic LNG 2 terminal near the port of Sabetta, giving it the funds needed to move forward with a final investment decision. Novatek and its partners have chartered a fleet of specialized icebreaking LNG carriers to carry the plant's production along Russia's Northern Sea Route.




Maryland Offers Offshore Wind Grants

The Maryland Energy Administration (MEA) is launching two offshore wind grants for the 2020 fiscal year with combined funds of approximately $3 million. Nearly $1.6 million will go the Maryland Offshore Wind Capex Program, and the remaining to the Maryland Offshore Wind Workforce Training Program. 







Vigor Industrial Sold to Private Equity Firm; Will Merge with MHI Holdings

Global investment firm The Carlyle Group and private equity firm Stellex Capital Management announced a definitive agreement to acquire and merge shipbuilder Vigor Industrial LLC, Portland, Ore., and MHI Holdings LLC, a ship repair, maintenance, and other ship husbandry services company based in Norfolk, Va. The combined company will create a bicoastal company involved in ship repair services and commercial and defense-related fabrication services. Read more HERE


U.S. DOT Proposes $856 Million in INFRA Grants

The U.S. Department of Transportation (DOT) has announced $855,950,000 in proposed grants through the Infrastructure for Rebuilding America (INFRA) discretionary grant program. The funding targets major highways, bridges, ports, and railroads around the country. The American Association of Port Authorities notes that of the 20 projects, three are port-related - in Baltimore, Cleveland, and Miami.


United States Army Puts Watercraft Sell-Off on Hold

The United States Army is putting its plan to divest nearly all its Army watercraft on hold. The cease order came from the office of the Secretary of the Army Ryan McCarthy in a memo late Wednesday. Units have also been ordered to put on hold the inactivation of watercraft positions and the transfer of Army mariners to other non-watercraft units. Those in favor of the sale argue that the assets were no longer needed due to the Navy’s introduction of Expeditionary Transfer Docks and the proposed replacement of the Navy’s LCAC fleet. However, experts say U.S. Army’s maritime capabilities would be drastically reduced under the plan.


Great Lakes Region Creates 123K+ Maritime Jobs

According to a new study conducted by PricewaterhouseCoopers (PwC) on behalf of Transportation Institute (TI), the Jones Act continues to fuel a strong maritime industry throughout the Great Lakes region, where the PwC report shows 123,670 Jones Act-related jobs – or 20% of the national total – are based. Between 2011 and 2016, maritime employment in the region increased by 25,400 jobs. Overall, the industry generates $30 billion of economic activity and $8.45 billion in worker income in the eight Great Lakes states. 


Sea Machines and MARAD to Demonstrate Autonomous Tech in Oil-Spill Response Operations

Boston-based Sea Machines Robotics says it has entered into cooperative agreement with the U.S. Maritime Administration to test the use of autonomous technology in marine oil-spill response operations. Under the agreement, Sea Machines will install its autonomous-command system aboard a MARCO skimming vessel and execute simulated oil-spill recovery exercises in the harbor of Portland, Maine. The purpose of the test is to demonstrate the ability of Sea Machines’ autonomous technology in increasing the safety, response time, and productivity of marine oil-spill response operations.


Port of LA Sets Up New Cybersecurity Coordination Center

Los Angeles' harbor department has issued an RFP for a new privately-operated cyber resilience center for the Port of Los Angeles. In addition to defensive measures, the center would provide information resources that terminals and other port partners could use to help restore operations following an attack. In part, this will take the form of a secure cyber threat data portal, accessible through stakeholders' dashboards and mobile devices, along with real-time threat notifications.


Imports Fuel Port of Virginia’s Record Fiscal Year 2019

The Port of Virginia handled a record 2.9 million TEUs in fiscal year 2019, a result mainly driven by an increase in imports. The result represents an increase of 4 percent when compared with last fiscal year.


Tank Barge Deliveries Spiking in 2019

According to River Transport News, the pace of inland tank barge deliveries during the first half of 2019 are up 52% compared to this time last year. However, deliveries of inland tank barges dropped significantly during the first six months of 2019, falling from 30 deliveries during the first half of 2018 to 17 through June 2019. 



If you have any questions, please do not hesitate to contact Paula Zorensky on the SCA staff.