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SCA Weekly Report | November 15 - 19, 2021

Shipbuilders Council of America

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SCA Weekly Report | November 15-19, 2021





*Please note that due to the Thanksgiving holiday, there will not be a SCA Weekly Report next Friday, November 26, 2021*




House Passes Biden’s Economic Bill  

Early Friday morning, the House passed HR 5376, the Build Back Better Act, by a vote of 220-213. One Democrat voted against it and no Republicans voted for it. The bill now moves over to the Senate where it will be subject to scrutiny, and changes are almost guaranteed. 


Senate Majority Leader Chuck Schumer (D-NY) says he wants to pass the bill before Christmas. Given the competing agenda and limited floor time (government funding, debt limit, NDAA, China competition bill, among other things), differences in policy positions compared to the House, the Parliamentarian and the Byrd Rule, Senators Manchin and Sinema, this timeline could be difficult to meet. 


Although passing the bill before December 25 is a self-imposed deadline, it is also a practical one. Aside from election-year politics that make it more difficult to accomplish legislative priorities -- and the threat of “unknowns” cropping up to derail a legislative agenda, bumping the legislation into 2022 will require the bill to be re-scored by the Joint Committee and the Congressional Budget Office (CBO). 


The CBO estimated that the bill would add $367.1 billion to the deficit over 10 years, though that didn’t account for $207.2 billion in expected additional revenue from increased Internal Revenue Service enforcement.


The deficit is front-loaded, which may play into conservatives’ and moderates’ complaints about perpetuating inflation in the near term. While the bill is projected to add $367.1 billion to the deficit over a 10-year period, it was projected to add $791.6 billion between 2022 and 2026, while revenues would outpace outlays from 2027 to 2031.


NDAA Stalls in Senate  

The Senate moved to advance their version of the FY22 National Defense Authorization Act (NDAA) this week, aiming to pass the bill before the Thanksgiving break.


However, after hours of backroom negotiations and hopes that the annual defense authorization bill may advance in the Senate, well-laid plans by Sens. Jack Reed(D-RI) and Jim Inhofe (R-OK) were temporarily defeated Thursday evening.


Several GOP senators objected to allowing a procedural vote and to backing 18 amendments slated for floor consideration. Both the House and Senate bills defy Biden’s $715 billion request for the Pentagon, and would boost spending authorization by $25 billion to $740 billion. The Senate is expected to take up the legislation upon returning from the Thanksgiving holiday.




Navy Officials Highlight the Need for More Dry Docks to Reduce Submarine Maintenance Backlog

Navy officials want to “aggressively” engage industry to help fix the service’s dry dock shortage and optimize submarine maintenance. The service does not have enough dry docks to meet its maintenance needs, said Michael Breslin, executive director of the Navy’s attack submarine program office.


“We have a backlog,” Breslin said today at the Naval Submarine League’s annual symposium. “I think everyone knows that. We have certain ships with idle times, but I’m not going to get into those numbers.”


Breslin mentioned a “very optimistic” 15-year maintenance plan, developed by Naval Sea Systems Command, that would optimize submarine maintenance and cut idle time.




Construction Starts at America’s First Major Offshore Wind Farm

Ground has been broken on a project dubbed the United States’ “first commercial scale offshore wind farm.” The construction’s kickoff, which took place on Thursday, represents another step forward for America’s fledgling offshore wind sector. Located in waters 15 miles off Martha’s Vineyard, near Cape Cod in Massachusetts, it’s hoped that the 800-megawatt Vineyard Wind 1 facility will start sending power to the grid in 2023. 




Jones Act Enforcer Alleges Latest Violation in Offshore Wind Industry

The Offshore Marine Service Association (OMSA) has made its latest accusation of Jones Act violations, this time involving a foreign ship of “illegally” transporting cargo off Virginia in support of an offshore wind project. The report is the second under the organization’s Jones Act Enforcer Program, which it launched earlier this year with the goal of independently documenting and reporting Jones Act violations. The latest report details details how the foreign-flagged, Geoquip Saentis, a Chinese-built and foreign-crewed vessel, transported merchandise from points in U.S. waters to U.S. ports, an activity prohibited under the Jones Act.




Great Lakes Orders First Jones Act-compliant Subsea Rock Installation Vessel

Philly Shipyard, Inc. (PSI) and Great Lakes Dredge & Dock Company, LLC, have signed a contract for the construction of one Jones Act-compliant Subsea Rock Installation Vessel – the first such ship to enter the U.S. market. The vessel will transport and strategically deposit loads of rock on the seabed, laying scour protection for offshore wind farm foundations, cables and other structures. The company said the vessel is expected to help spur additional job growth and regional economic opportunities through the creation of a U.S.-based rock supply chain network, which will be needed to supply subsea rock installation activities, from quarries in states along the East Coast.


Empty Containers Pile Up at Port of Los Angeles as Ocean Liners Add ‘Sweeper’ Ships to Clear Backlog

The number of container ships waiting to enter the busiest U.S. seaport complex hit a new record of 84 on Tuesday, as growing piles of empty containers crowd docks at the Southern California facility that has been racing to remove lingering imports. The conundrum illustrates the challenge faced by a U.S. government task force charged with tackling supply chain snarls that are contributing to product shortages and inflation. There are now roughly 65,000 empty containers on the Port of Los Angeles docks, up about 18% from just a couple of weeks ago, said the port’s executive director, Gene Seroka. He added that “sweeper” ships are inbound to shuttle some of those boxes back to factories in Asia.


Pilot LNG Awards Key Galveston LNG Bunker Port Contract

Pilot LNG, developer of the Galveston LNG Bunker Port (GLBP) project, announced that it has awarded the front-end engineering and design (FEED) contract for the project’s marine infrastructure engineering to W. F. Baird & Associates. Baird will provide a variety of services to Pilot LNG including design of marine structures, metocean modeling including storm surge and tidal currents, dredging design and dredged material placement analysis, and support for vessel maneuvering assessments. Baird’s Houston office will lead the assessment with support from the company’s other North American and international offices.




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