MARAD MAY OPEN CCF PROGRAM TO STIMULATE SHORT-SEA SHIPPING
The U.S. Maritime Administration may free up capital already set aside in the Capital Construction Fund to stimulate the country’s emerging U.S.-flag short-sea shipping sector.
The fund, which was created under the 1970 Merchant Marine Act, assists U.S.-flag vessel operators to accumulate capital to build, acquire, and reconstruct vessels through the deferral of federal income taxes on certain CCF deposits made by fund holders.
The program currently allows operators to use private funds from company earnings to build vessels for U.S. foreign trade, Great Lakes, noncontiguous domestic trade, and fisheries.
“If the CCF program, which includes approximately $1 billion in deposits, is opened to include the construction or reconstruction of vessels to be used in the contiguous coastwise domestic trade, short-sea shipping would be en route to a high level of success,” said Maritime Administrator William G. Schubert at a recent Propeller Club luncheon in New York.
“In short, our nation’s coastal shipping system is underutilized and provides a practical, safe and efficient means of transporting freight,” Schubert said. “To decrease freight congestion along our nation’s rail and highway system we must develop a robust domestic coastal shipping system.”
By 2020, it’s expected that there will be 10,000 more trucks per day on the East Coast’s I-95 corridor alone. Highway expansion costs about $32 million per mile.
Short-sea shipping is currently a small piece of the U.S. maritime sector. The Port of New York/New Jersey recently started the InLand Distribution Network. The port will share information with the Port of Rotterdam to develop the network and will soon begin service to Albany, N.Y.