BEACON - MetalCraft Marinemetalcraftmarine.com/news/Fall_2013_Beacon.pdf · 45R Main Channel Deepening Proj-ect. This amount represents a $10 million increase from the original al-location

This past June, the U.S. ArmyCorps of Engineers announced atotal of $42 million had been in-cluded in the FY13 Work Plan for the45’ Main Channel Deepening Proj-ect. This amount represents a $10million increase from the original al-location included in the FY13 En-ergy & Water Appropriations (E&W)bills passed by the House and Senatelast year, as well as the amount in-cluded in the President’s FY13 Pro-posed Budget.

“Dredging the Delaware is a greatopportunity for significant job cre-ation and economic growth,” saidSenator Bob Casey (D-PA). “I’vecontinued to push the Administrationand the Army to dedicate adequatefunds to this effort. I’ve raised theissue personally with PresidentObama and Vice President Biden andwill continue to press the Adminis-tration on this until this project iscompleted.”

This announcement follows on

the heels of the release of the Presi-

dent’s FY14 Proposed Budget that

included an additional $20 million

for the 45’ Deepening Project.

In late June, both the Senate and

House Appropriations Committees

included $20 million and $19 million

respectively in their E&W spending

bills for this project.

“I was pleased to work with Con-

gressman Rodney Frelinghuysen (R-

NJ), Chairman of the House Energy

and Water Appropriations Subcom-

mittee, who like me, realizes how

important investing in this project is

to our regional port complex, and to

the jobs and economic activity it will

generate,” said Rep. Patrick Meehan

(R-PA).

The Exchange acknowledges the

dedication of our elected officials to

this critical effort.

The Exchange thanks Pat Newcomb, one of ournightside watchstanders based out of Lewes,Delaware, for his 20 years of service to the Exchangeand its members. Throughout his tenure, Pat demon-strated his unwavering devotion to his job and theExchange. Pat, you will be missed!

MARITIME EXCHANGE240 Cherry Street

Philadelphia, PA 19106

ADDRESS SERVICE REQUESTEDTHEBEACON PRSRT STDU.S. POSTAGEPAIDWILMINGTON, DEPERMIT NO. 1635

Serving Delaware, New Jersey and Pennsylvania

Fall 2013Volume 23, No.3

http://www.maritimedelriv.com w [email protected]

ATHOS I: Decision Has Far

Reaching Consequences for

Terminal Owners, Operators

In May, 2013, the United States ThirdCircuit Court of Appeals issued a deci-sion which will have significant legaland financial consequences for the

maritime industry and particularly thosewho are in involved with the ownershipand operation of marine terminals. Thecase arose out of the oil spill from thetanker ATHOS I in the Delaware Riveron November 26, 2004.

The spill resulted when the tanker,loaded with a full cargo of crude oil,struck an uncharted and abandoned an-chor while navigating through FederalAnchorage No. 9 (Mantua Creek An-chorage) in the Delaware River enrouteto the CITGO Asphalt Refining Com-pany (“CARCO”) terminal at Paulsboro.The contact punctured the hull andcaused the second largest oil spill froma tanker in U.S. history. The tanker was

more than three footballs fields awayfrom CARCO’s berth at the time, and itis undisputed that the entire incident oc-curred within the Federal Anchorage.

The Federal Anchorage, as well as thedeep-draft dredged channels from themouth of the Delaware Bay to Philadel-phia and beyond, are part of theDelaware River “Federal Project.” Thedredged channels and anchorages of theFederal Project were created by theArmy Corps of Engineers pursuant tospecific laws enacted by the U.S. Con-gress, and the Army Corps has the re-sponsibility to conduct hydrographicsurveys and maintenance dredging of allFederal Project waters. The geographicboundaries of the Federal Project waters,including the Federal Anchorage, arespecifically defined in the Code of Fed-eral Regulations, and the locations ofthose boundaries are clearly indicated onall official navigational charts. TheATHOS I never entered CARCO’s bertharea, which was beyond the designatedlimits of the anchorage.

The culprit anchor was a stocklessdesign commonly used by the U.S.Navy. There was no chain attached andthe shank had been cut off, eliminatingall manufacturer’s marks and serial num-bers. The party who was responsible fordepositing the anchor in the Federal An-chorage has never been identified, al-though there are indications that theanchor had been used as a weight to fa-cilitate dredging operations. The onlyparties authorized to dredge in the Fed-eral Anchorage are the Army Corps andits selected dredging contractors.

Evidence discovered at a local uni-versity after the spill indicated that theanchor was present on the bottom for at

continued on page 4

On November 26, 2004 the Athos I hit an

abandoned anchor in the Delaware River,

puncturing the hull and releasing about

265,000 gallons of oil into the river. Job Well Done !!!

45’ Project Receives

Additional Funding

With funding for the regional Physical Oceano-graphic Real Time System (PORTS) maintenance dis-continued earlier this year, a broad coalition of portinterests came together to develop both short-term andlong-term strategies to fund the annual operations andmaintenance of this system. Included in this coalitionare the Pilots’ Association, the Mariners AdvisoryCommittee, the Exchange, the Philadelphia RegionalPort Authority (PRPA), the South Jersey Port Corpora-tion (SJPC), the Port of Wilmington (POW), theDelaware River Port Authority (DRPA) and theDelaware River and Bay Authority (DRBA).

PORTS is a real-time tide/weather monitoring sys-

tem that is a critical aid to safe navigation, among myr-iad other uses.

“Mariners are a prime, but not the only, users ofPORTS data,” according to Captain Stephen A.Roberts, Chairman of the Mariners Advisory Commit-tee (MAC). “Pilots, captains and other mariners reviewthe weather and tidal data prior to beginning a transit ofthe waterway. Municipal and county planners, emer-gency responders, and many others use PORTS datawhen preparing for and responding to environmentalevents and incidents.”

The annual cost to maintain the Delaware RiverPORTS system is $300,000. Realizing how critical this

system is, the PRPA, SJPC and POW each appropri-ated $100,000 to fund the operation and maintenance ofPORTS for the 12 months. Following this action, thePRPA executed a contract with the National Oceanicand Atmospheric Administration (NOAA) for the con-tinued enhancement, management, operation mainte-nance and repair of the system.

With the short-term funding in place, the coalition’sfocus shifted to establishing a sustainable fundingstream to keep PORTS operational.

There are 22 PORTS systems operating throughoutthe U.S. The total cost to NOAA to operate and main-tain these systems is approximately $5 million. Lan-

continued on page 3

Scott Anderson

Pat Newcomb

By: Frank P. DeGiulio, Esq. and

George R. Zacharkow, Esq.

Community Collaborates to Fund PORTS®

The Maritime Exchange takes this opportunity to thank and recognize

two of its Operations staff members who have provided exemplary serv-

ice to the organization for many years.

In June, Scott Anderson celebrated the 30th an-niversary of his employment with the Exchange.Over the years, Scott has proven himself to be avalued member of the Exchange team and a truefriend of the port community. Here’s to another30, Scott!

The Beacon 2 Fall 2013

Back to School – Exchange Style

It’s the dog days of summer as we’re work-ing on this issue of The Beacon. After a drench-ing June and a blistering July, the weather thesefirst few weeks of August has been absolutelydelightful. The traffic is lighter, and meetingsare fewer. Most of us are managing to takesome time off. Congress, too, is in recess.

It’s that perfect time of year. Time to relaxa little, to regroup, and to get ready for what isto come.

Always on our minds this time of year is thepotential for an active hurricane season, partic-ularly after the devastation of SuperstormSandy last October. For the six-month hurri-cane season which began on June 1, NOAA’sAtlantic Hurricane Season Outlook says thereis a 70% likelihood of 13 to 20 named storms,of which 7 to 11 could become hurricanes, in-cluding 3 to 6 major hurricanes, with winds of111 mph or higher. These ranges are well abovethe seasonal average of 12 named storms, 6 hur-ricanes and 3 major hurricanes.

While there’s nothing we can do to prevent

this type of disaster, we can certainly plan for it.

The Exchange and other members of the re-

gional port community are working with Coast

Guard to exercise our MTS Recovery and Sal-

vage/Response plans before the potential del-

uge.

And though there’s little going on in Wash-

ington, DC right now, we can anticipate a busy

fall. The Delaware River port community made

substantial headway on a number of issues in

the first seven months of the current Congress,

but we have our work cut out for us over the

next several months.

We will continue to work with our congres-

sional delegation to ensure the $19 million in-

cluded in both the House and Senate

appropriations committee bills for the 45’ proj-

ect is included in the all-but-certain Continuing

Resolution (as opposed to a final budget bill)

that Congress will pass to keep the federal gov-

ernment operating beyond September 30th of

this year.

Following the successful inclusion in the

Senate version of the FY14 Water Resources

Development Act (WRDA) of legislative lan-

guage that directs full utilization of the Harbor

Maintenance Tax for its intended purpose of

maintenance dredging of shipping channels and

harbors throughout the U.S., we will be work-

ing closely with our Congressional delegation,and colleagues throughout the country, to en-sure similar language is included in the Houseversion of the WRDA bill that is scheduled tobe marked-up in the Transportation and Infra-structure Committee this Fall.

We’ll also engage with Congress and theFederal Emergency Management Informationto identify opportunities to enhance the Port Se-curity Grant Program. Among the recommen-dations to FEMA are the return of the programto the fiduciary agent model which ensures adedicated pool of funding for certain port re-gions, resumption of a three-year performanceperiod, and ensuring the PSG Program remainsseparate from other Homeland Security grantprograms.

And as you’ll read elsewhere in this issue ofThe Beacon, the Exchange and a coalition oflike-minded agencies and organizations willcontinue efforts to obtain full federal fundingfor the Physical Oceanographic Real-Time(PORTS®) system.

So we’ll enjoy the lull while it lasts. Butwe’re also sharpening our pencils.

guage included in the reauthorizationof the 2002 Hydrographic ServicesImprovement Act provided thatNOAA “shall, subject to the availabil-ity of appropriations, design, install,maintain and operate real-time hydro-graphic monitoring systems to en-hance navigation safety andefficiency.”

Based on this, the coalition soughtsupport for urging the U.S. Depart-ment of Commerce to include thisfunding in its annual budget request aswell as to have this funding included

in the annual Commerce, Justice, Sci-ence and Related Agencies (CJS) Ap-propriations Bill. A wide range ofregional PORTS stakeholders’ inter-ests contacted the tri-state Congres-sional delegation and urged them tosupport this legislative initiative. Inaddition to local efforts, maritime in-terests around the country contactedtheir House and Senate members, re-questing their support as well.

The mark up of the CJS Appropri-ations Bill included the following lan-guage as well: “The Committeeencourages NOAA to request fundingthat reflects the totality of the[PORTS] program’s costs, includingoperations and maintenance, in futurebudget requests, as authorized by theHydrographic Services Improvement

Act (Public Law 110-386) in futurebudget submissions.”

This is a very positive first step inthe process of securing necessary andlong-term PORTS funding and willmove this critical cause forward,hopefully to a successful conclusionwithin the next budget cycle.

“PORTS is a crucial part of ourport’s economic, safety and environ-mental health infrastructure,” said Ex-change Vice President Lisa Himber.“Its loss would have a negative impacton our ability to navigate, monitor andprotect the waterway.”


On June 20, Senator Christopher Coons

(D-DE) was appointed to the influential Sen-

ate Appropriations Committee.

This is the first time in 40 years that a

member of Congress from the State of

Delaware has held a seat on this powerful

committee.

“My priorities on Appropriations will be

consistent with my work in the Senate so far

— helping businesses grow and creating

jobs, supporting innovative research, and

giving law enforcement the tools to keep our

communities safe,” the Senator said.

Senator Coons will continue to serve on

the Judiciary, Foreign Relations and Budget

committees, and will retain his Chairman-

ships of the Senate Judiciary Subcommittee

on Bankruptcy and the Courts and the Sen-

ate Foreign Relations Subcommittee on

African Affairs. Because of Senate rules, he

was required to give up his seat on the En-

ergy and Natural Resources Committee.

“Port stakeholders in all three states

have come to realize that Senator Coons is

a true champion for our industry,” said Ex-

change Vice President Lisa Himber. “In the

short time he has been in office, he’s already

tackled issues such as PORTS funding, re-

sources for Customs-Agriculture Inspectors,

and port security grants on our behalf.” Staff

members in the Senator’s Wilmington and

Washington offices have been doggedly de-

termined in their follow ups with the various

government agencies responsible for pro-

grams that matter to Exchange members,

Himber noted.

The Exchange applauds Senator Coons’

leadership and looks forward to continuing

to work with him in his new position on the

Appropriations Committee.

Coons Appointed to

Appropriations Committee

PORTS Funding

Sought

continued from page 1

Bi-Partisan Vote Gives Voice to Importance of Strong

Ports to U.S. EconomyOn May 15, the Senate passed S.

601, the Water Resources DevelopmentAct of 2013 (WRDA) on an 83-14vote. Section VIII of this legislation,the Harbor Maintenance Trust Fund(HMTF) Act of 2013, is the primarysection that impacts Harbor Mainte-nance Tax (HMT) spending. It ad-dresses the growing surplus of funds inthe HMTF, ensures all revenues will bespent for intended purposes, increasesoperation and maintenance investmentin U.S. ports, promotes equity amongports, prevents cargo diversion fromU.S. ports, and ensures U.S. ports areprepared to meet modern shippingneeds.

In testimony submitted to the U.S.House of Representatives, assistant sec-retary of the Army for Civil Worksstated the Corps of Engineers couldcomplete maintenance dredging proj-ects to authorized dimensions over afive-year period if the total annualamount of HMT collected were ex-pended for its intended purpose.

“Over the years this level of spend-ing has not been possible since approx-imately only half of the HMT revenuescollected were appropriated and used todredge shipping channels and harborsat ports throughout the U.S.,” saidBarry Holliday, Executive Director ofDredging Contractors of America.“The balance of these funds totaling up-wards of $7 billion have in effect been

expended as an offset to the nationaldebt.”

President Obama’s proposed budgetfor FY14 included $834 million formaintenance dredging and related ac-tivities, a slight increase from lastyear’s budget. However, the SenateAppropriations Subcommittee on En-ergy & Water Development appropri-ated $1 billion from the HMTF formaintenance dredging of harbors andchannels. The full Senate Appropria-tions Committee approved this higher

amount at the end of June.It is anticipated full utilization of

the annual HMT revenues will be inplace by FY20. Over the next six years,an additional $100 million of these col-lected tax revenues would be added tothe previous year’s base expenditurelevel.

“Given the expansion of the PanamaCanal and the increase in the number ofPost-Panamax ships that will be serv-ing U.S. ports, there is no earthly rea-son not to fully utilize the harbormaintenance tax revenues to maintainour shipping channels and harbors totheir full capacity,” said Maritime Ex-change President Dennis Rochford.

The Act also includes a formula forhow funds would be used, distinguish-ing between the FY12 funding leveland new monies. It uses a baseline ofFY12 ($868 million) and allows theCorps of Engineers/Office of Manage-

ment and Budget to continue to controlhow the funds are spent. Any amountappropriated in excess of the FY12amount would be subject to certain pri-oritization rules as well as allow for ex-panded uses and HMT rebates toaddress donor equity and cargo diver-sion concerns. None of these excessfunds could be accessed until all portsare maintained to their federally au-thorized dimensions.

Of the excess funds, 80 percentwould go to “high-use” deep-draft portsand 20 percent to Great Lakes naviga-tion, although there are exceptions for

navigational hazards and emergencyevents such as storms. “High-use”deep-draft ports are defined as portswith channels greater than 14 feet deepand that handle more than 10 milliontons of cargo annually. Once all high-use ports are fully maintained, the fundsare to be distributed as follows: 10 per-cent to be divided equally among the 22Corps Districts for their distribution tomoderate- and low-use projects and 90percent to be distributed nationally tokeep minimum clearances in channels.

continued on page 9

In July 2013, the Maritime Ex-change implemented a minor changeto the eNOA/D module of MaritimeOn-Line® (MOL) to allow the trans-mission of I-418 crew data to the U.S.Coast Guard National Vessel Move-ment Center (NVMC). This change,which was part of the larger schemaupdate introduced earlier in the year,allows users to submit answers re-garding crew longshoreman workthrough MOL in order to meet regula-tory requirements.

The changes come as a result of theefforts undertaken by the Exchange,representing the National Associationof Maritime Organizations, and theWorld Shipping Council to eliminate

the submission of the paper I-418 formin favor of the electronic transmission.After a very successful pilot program,Customs and Border Protectionopened the pilot program up to all in-terested ocean carriers and other filersearlier this year.

As always the Exchange is com-mitted to meeting the needs of MOLparticipants and encourages systemparticipants to contact our Operationsstaff with any suggestions or com-ments.

For more information on the newdata requirements, contact ExchangeDirector of Operations Paul Myhreat 215-925-2615 or [email protected].

Maritime On-Line Update


least three years prior to the incidentand possibly longer. It was undis-puted that neither CARCO nor theArmy Corps of Engineers or the CoastGuard knew of the existence of theabandoned anchor prior to the inci-dent. Annual hydrographic surveysby the Army Corps, including a sur-vey just six months before the inci-dent, failed to detect the anchor.During the three years before the in-cident, hundreds of vessels with draftsas deep or deeper than the ATHOS Iused the anchorage or called at theCARCO terminal, all without inci-dent.

As required by the Oil PollutionAct of 1990, the owner of the ATHOSI engaged contractors to clean up theoil pollution and incurred substantialcosts, some of which were reimbursedby the federal government. The ves-sel owner and the United States suedCARCO as the owner and operator ofthe Paulsboro marine terminal wherethe ship was bound on the voyage inquestion, to attempt to recover dam-ages and pollution cleanup costs. Thecase was tried in 2010 in the U.S. Dis-trict Court at Philadelphia and re-sulted in a decision exoneratingCARCO from all liability to the vesselowner or the government.

The Trial Court’s 2010 DecisionAt the trial the vessel owners ar-

gued that the Federal Anchorage con-stituted part of the “approach” to theterminal for which CARCO was re-sponsible based on the theory that avessel necessarily had to navigate

through those federal waters in orderto reach the terminal. The vesselowner argued that CARCO thereforehad a legal responsibility to survey theFederal Anchorage to ensure that nohazards to navigation were located inthose Federal waters.

In response, CARCO argued: (a)that no U.S. court has ever held that aprivate terminal owner/operator hasany legal responsibility for federalwaters; (b) that the Federal Anchoragewas a public waterway open for useby all vessels of any type for variouspurposes and that a finding that a pri-vate terminal owner has legal liabilityfor the safety of those waters wouldpotentially expose the terminal to lia-bility to all users; (c) that the ArmyCorps, NOAA and the U.S. CoastGuard are statutorily charged with theresponsibility to survey, dredge, chartand issue operating regulations for theFederal Anchorage; (d) that the vesselowner’s argument that the anchoragebecame part of the “approach” simplybecause the vessel had to navigatethrough it created an impossible stan-dard of liability since the same couldbe said for all waters through whichthe vessel navigated on its voyage upthe Delaware River.

Following a lengthy trial the U.S.District Court rejected all of theclaims against CARCO, finding thatit had no liability to either the vesselowner or to the government. In re-jecting the vessel owner’s argumentthat the Federal Anchorage was the“approach” to the CARCO terminalthe court astutely and correctly ar-rived at the following conclusion:

“But the definition of “approach”that [the vessel owner] urges the Court

to adopt is unreasonably expansive.Although the docking pilot wasaboard the ATHOS I, the ship was inan area of the Anchorage open for thepassage of all ships, not an area usedexclusively, or even primarily, by ves-sels docking at the Paulsboro refinery.From 2000 to 2004, a total of 673 ves-sels anchored in the Anchorage (in-cluding repeat visits from the samevessel), and in 2004 alone, 121 differ-ent cargo vessels anchored in the An-chorage…In 2004, 42 vessels dockedat CARCO’s terminal (including re-peat visits from the same vessel)…Al-though not all of these ships wouldhave passed through the area that [thevessel owner] contends CARCOshould have scanned, the volume oftraffic illustrates that CARCO had nocontrol over the use of the Anchorage.To accept [the vessel owner’s] argu-ment would have the effect of poten-tially expanding the definition of“approach” to the entire Anchorage orto the entire Delaware River. A morereasonable definition of “approach” isthe area “immediately adjacent” to theberth or within “immediate access” tothe berth.”…Under these definitions,the Anchorage was not within the ap-proach to CARCO’s berth, andCARCO did not have the legal obli-gation to survey there.”

The Court of Appeals’ DecisionThe vessel owner and the govern-

ment appealed the District Court’s de-cision to the Third Circuit Court ofAppeals. CARCO opposed the ap-peal, and various terminal owners andoperators on the river and throughoutthe country, as well as interested ter-minal and port associations, also fileda brief urging the Court of Appeals toaffirm the District Court’s decision.

In its May, 2013, decision, theCourt of Appeals overruled the Dis-trict Court and held that the tanker’sselected path through the Federal An-chorage was the “approach” to the ter-minal. Although the Court recognizedthat CARCO neither controlled normaintained the Anchorage and that the

Anchorage is available for use by anyvessel regardless of its intended desti-nation, the Court nevertheless heldthat CARCO had a legal responsibil-ity for the “safety” of the Anchorage.

The decision is unprecedented andignores both legal precedent and therealities of industry custom and prac-tice, as well as the role and responsi-bilities of the Army Corps and theCoast Guard for the Federal Projectwaters of the river. No other U.S.court has ever held that a private ter-minal operator is responsible for thesafe navigation of vessels in FederalProject waters. For more than a cen-tury the law here and throughout thecountry has provided that a terminaloperator’s responsibility is limited tothe berth itself and the immediatelyadjacent waters providing entranceand exit, and that a terminal operatorhad no responsibility for the safety ofsurrounding waters in the “vicinity”of the berth over which it has no con-trol.

In 1976 the same Court of Appealsaffirmed a district court decisionwhich held that the Army Corps wasliable to a vessel owner for damage toits vessel caused by an unreported ob-struction in one of the Delaware Riverdredged channels. In that decision thecourt held that the industry was enti-tled to rely on the Army Corps to sur-vey and maintain the specified depthof all Federal Project waters and to ac-curately report conditions throughpublic notice.

Even more troubling than its hold-ing that a private terminal operatornow is responsible for the safety ofthe Federal Project waters outside itsberth is the Court’s new and unprece-dented definition of what will consti-tute the “approach” to a terminal infuture cases for the purpose of deter-mining a terminal operator’s legal re-sponsibility. The Court of Appealsheld that in any specific instancewhen a ship is bound for a berth, the

Athos 1 Consequences


Shown here is the anchor that punctured the hull of the Athos I in November of 2004.

Ownership of the anchor has never been established.

continued on page 10

The Maritime Exchange has servedas the Fiduciary Agent for the Port Se-curity Grant Program (PSGP) sinceAugust of 2007. Since that time, portstakeholders, working through theArea Maritime Security Committee(AMSC), have had more visibility intowhat projects are being implementedin the tri-state region and how they’redoing.

“There is a tremendous benefit toour port planners to understand thelevel of preparedness among the publicand private port operators,” saidAMSC Chairman Kurt Ferry. “Thishelps us determine where gaps maystill exist and how resources shouldbest be allocated.”

With the FY07 Supplemental grantaward finishing up last year and theclose-out process for FY08 and FY10grants currently underway, the AMSCis in a position to evaluate how effec-tive the grant program has been.

To that end, the Committee hascontracted for a review the status of allsub-projects awarded under the grantsand to update the region’s StrategicRisk Management Plan. Work beganin May, and the effort will be com-pleted by year’s end.

But even before the formal analysisis complete, there are clearly indica-tions that the PSGP is meeting its de-sired goals.

“Our bridges have been hardened,there are more cameras looking intoplaces humans could not possibly pa-trol on a regular basis, facilities haveimproved their communications sys-tems and redundancy/recovery capa-bilities, and law enforcement in eachof the three states has acquired addi-tional assets and training. The 90-mileport complex now boasts a larger fleetof fire response boats, and firefightersup and down the river have obtainedadditional gear and training for marinefire response. All of this will help pre-vent and minimize the impact of anypotential incident,” said ExchangeVice President Lisa Himber.

Several regional Maritime DomainAwareness projects have been devel-oped over the last several years as well.These systems have placed cameras,radar, and computer-based audio com-

munications at strategic locationsthroughout the region. Many of the in-dividual projects installed at public andprivate port facilities have been de-signed specifically to integrate into thelarger area-wide initiatives.

One example is the recently-com-pleted MDA Enhancement Project atthe Port of Wilmington, which addedcameras, license plate readers, videoanalytics and additional fencing andlighting. “In addition to meeting ourown needs, our system was developedin collaboration with New Jersey Stateofficials,” said Sylvia Floyd-Kennard,Director of HR and Security for the Di-amond State Port Corporation. Shenoted that the Port of Wilmington has

also worked with the Delaware Infor-mation and Analysis Center and Wilm-ington Police.

Other projects implementedthroughout the region were also de-signed in concert with various law en-forcement and response organizations.

Ferry, who is also Facility SecurityOfficer at the Packer Avenue MarineTerminal said his organization con-sulted with the Philadelphia Police andDelaware Valley Intelligence Center –a four-state fusion center – when de-veloping his “Secure InformationSharing” systems.

“Now the time has come to look atthese systems from a macro level,”said Coast Guard Captain of the PortKathy Moore. “As we look to addressfuture port security needs, we need tobe aware of new and evolving threatsand take an integrated or enterprise ap-proach to reducing risk.”

Though the Maritime Exchangeand other stakeholders throughout theU.S. support a continued vibrant PSGprogram, the reality is funding hasbeen decreased substantially in recentyears.

“Given the likely potential de-creases in federal funding for port se-curity initiatives, we must collectivelywork to identify a mechanism to fundthe ongoing integration of these im-portant initiatives, allow for future up-grades as technologies evolve, andprovide for future operational sustain-ment without relying on Port SecurityGrants.” Capt. Moore said.


Grant Program a Success in

Sector DelBay

More work still needed

With funds provided by the PSGP for its new boat, the Wilmington Fire De-

partment responds to a reported fuel leak. Photo is courtesy of the Wilming-

ton Fire Department and John Randolph.


Paul Ives Inducted into Delaware

Maritime Hall of Fame

Congratulations go out to Capt.Paul Lane Ives, Maritime ExchangeDirector Emeritus, who will be in-ducted into the Delaware MaritimeHall of Fame on October 12.

Each year, the Delaware Mar-itime Hall of Fame selects individu-als who, among other criteria, musthave made a significant impactupon the lives of others, with theircontributions to maritime heritagehaving a lasting significance.

Capt. Ives is a retired licensedpilot for the Delaware Bay and theChesapeake Canal. He is recog-nized for implementing the VHFSingle Channel bridge-to-bridgecommunications, a system that en-sures that all ships and pilots will bein constant communication, im-proving safety and reducing colli-sions. He traveled around the

country giving presentations pro-moting the adoption of the SingleChannel System as an industry stan-dard.

Also being inducted this year areHazel Brittingham, a Lewes histo-rian; John (Jack) L. Gallagher, PhD,Professor of Marine Biosciences atthe University of Delaware; Mal-colm Mackenzie, who played ameaningful role in the revitalizationof Wilmington’s Waterfront; andSuzanne Thurman, who founded theMarine Education, Research & Re-habilitation Institute, Inc. (MERR)in 2000.

The banquet and induction cere-mony will be at the Lewes YachtClub in Lewes, Delaware. Theevent is sponsored by the OverfallsMaritime Museum Foundation(OMMF), an all-volunteer organi-zation that is committed to preserv-ing one of America’s last remaininglightships.

Tickets are $75 per person. Visit

www.overfalls.org/maritime_hall_in-

troduction.html for event registration

or contact Denise Seliskar at

[email protected] or 302-542-6797

for additional information and spe-

cial requests. Sponsorships are

available.

The Delaware River regional portcomplex continues to be transformed asit navigates through a sluggish econ-omy and an ever-changing global mar-ketplace. This transformation reflectsthe entrepreneurial spirit and resiliencyof port operators, labor and other portstakeholders who work every day tocapitalize on the infrastructure that sus-tains this economic engine – one whichcontributes over $6 billion to our re-gional and national economy.

In large measure, our success is oc-casioned by the leadership and supportof our federal and state elected officialswho continuously champion those ini-tiatives critical to keeping our port com-petitive.

After the Great Recession hit in2008, the impact on our port was dra-matic. Three oil refineries shut down,container, bulk and break-bulk cargoesdropped precipitously, and vessel ar-rivals declined about 22%, from 2,500to 1,950. These tough economic timeshit our port, and ports throughout thecountry, as hard as at any time since theDepression of the 1930s.

But as we said, we are an enterpris-ing and hardy bunch. Because of this,good things are happening.

The three previously shuttered oilrefineries are now operational. PBF ac-

quired the Delaware City Refinery,Monroe Energy (Delta Airlines) re-opened the Trainer Refinery, and,Sunoco Logistics Partners are nowmoving propane and ethane from theliquid-rich Marcellus Shale areas inWestern Pennsylvania through theonce-idled Marcus Hook Refinery tomarkets throughout the United Statesand overseas. While some crude oilshipments to these refineries are beingdiverted from inbound tankers to railshipments from North Dakota andCanada, there will be an overall in-crease in the number of tankers movingrefined product and related chemicalby-products to export markets world-wide.

Container traffic on the DelawareRiver has rebounded as well. Most re-cently, in January of this year HorizonLines’ shifted its Puerto Rico servicefrom the Port of NY-NJ to the PackerAvenue Marine Terminal in Philadel-phia. Other cargoes have rebounded aswell, and based on the first sevenmonths of this year, annual vessel ar-rivals are projected to come in at around2,200.

Other major projects, eitherplanned or underway, will position ourport for future growth and expansion.

The South Jersey Port Corporationis constructing a new 180-acre bulk andbreak-bulk cargo terminal in Paulsboro,New Jersey which is scheduled to openin 2015.

The Philadelphia Regional Port Au-thority plans to start construction of a

new 190-acre container terminal on theold U.S. Navy Base at Philadelphia,currently scheduled to open in 2017.

The Diamond State Port Corpora-tion, which operates the Port of Wilm-ington, Delaware, will soon announcenew infrastructure investments in thePort of Wilmington.

There’s new business at the KinderMorgan Fairless Facility, Tioga MarineTerminal and at Penn Terminals as well.

Amid all of this activity, the AkerPhiladelphia Shipyard, also located atthe Philadelphia Naval Ship Yard, justannounced an agreement with CrowleyMaritime Corporation of Jacksonville,

Florida to build up to eight producttankers at a cost of $500 million. Aker,the nation’s second largest commercialshipbuilder, adds a unique dimension toour port that complements the its diver-sity and resourcefulness.

We have weathered some very dif-ficult years, though neither we nor therest of the country is seeing pre-2008activity levels.

But here on theDelaware River, wehave a lot more reasonto be optimistic thanmost. The future looksbrighter than it has for a longtime.


More Reason for Optimism

To meet our goal of facilitating communi-

cations among maritime stakeholders in our

region and beyond, the Exchange has devel-

oped a database containing contact informa-

tion for over 5,000 maritime professionals,

legislators, federal and state officials, and

members of the press. We also maintain a

significant number of committee and subject-

related distribution lists, and keeping the in-

formation current can be a daunting task.

Although we update our database

throughout the year as information changes,

we recognize that some individual updates will

be missed. So each fall, we reach out to our

entire constituency to ask for the latest con-

tact information. In addition to keeping our

database current, the information is used to

publish the annual Delaware River Port Direc-

tory.

The Exchange contacted everyone in the

system via email to request confirmations or

updates. The response has been very posi-

tive, and to those who have already replied,

we thank you.

If our email didn’t get through to you, or

you haven’t yet responded, we would appre-

ciate your sending us your current contact in-

formation, including name, company,

phone/fax numbers, email addresses, mailing

address, web addresses, etc.

And if someone forwarded a copy of this

newsletter to you, and you’d like to be added

to the list directly, please let us know.

Send your updated information to

[email protected].

Thank you!

Exchange Annual Database Update Underway

The first round of the Transatlantic

Trade and Investment Partnership talks

(now referred to as TTIP) between the U.S.

and the European Union were concluded

on July 12, with both sides congratulating

themselves (with some justification) for

their commitments in moving the talks for-

ward. But if you are a betting person, I rec-

ommend you stay clear of the stated

commitment of the parties to conclude the

trade talks by the end of 2014. Such a

schedule appears to be wildly optimistic

considering the fact that the almost-as-

important Transpacific Partnership talks

have been in earnest since March of 2010

with no end in sight after 17 negotiating

sessions. If it took three years to conclude

the agreement with Australia; two years to

conclude the agreement with Bahrain and

six years to conclude NAFTA, it appears

unlikely that we will conclude a 29 State

U.S.-EU agreement with such break-neck

speed. At some point, reality takes over.

Indeed, in a stakeholder survey that was

undertaken jointly by the Atlantic Council

and the Bertelsmann Foundation, pub-

lished in April of this year, only seven per-

cent of those surveyed believed that the

2014 deadline would be met. But least one

become too despondent by the statistic, the

same survey found that the largest number

of those surveyed (28%) believed that the

Agreement would be concluded by 2015,

and a whopping 88% of those surveyed be-

lieved that some Transatlantic Agreement

would be forged. Those are impressively

optimistic figures.

The question that is only second in im-

portance to the most obvious question (“will

an agreement be reached?”) is “what,

specifically will be agreed upon?” Of

course, in broad terms, only three out-

comes are possible. Either the parties

reach a broad consensus on all issues;

they fail to reach an agreement on any-

thing; or they land somewhere in the mid-

dle. Again, if you are betting, bet on the

middle ground. At this stage, the parties

are not even sure whether the issue of the

trade in genetically modified foods and cer-

tain subsidies given to the European music

and film industry are even on the table. We

say they are; the EU says they are not.

In its survey, the Atlantic Council and

Bertelsmann Foundation identified to the

surveyed parties 17 negotiating objectives

and asked that the objectives be placed

into two categories. “What are the most im-

portant negotiating objectives to undertake;

and secondly, what are the negotiating ob-

jectives most likely to be achieved?” Pre-

dictably they were not the same, but the

outcomes were extremely informative. The

issue that was considered the most impor-

tant of the negotiating objective was a term

we are sure to hear more frequently in the

days ahead - “regulatory convergence.”

This is the process by which the regulatory

frameworks of the two trading giants ad-

dressing comparable social objectives are

harmonized to increase manufacturing effi-

ciencies. Imagine, for example, if cars in

Europe and the U.S. were allowed to run

under the same average fuel efficiency

standards; or the highway safety standards

in Europe and the U.S. were exactly the

same; or the lead content standards were

identical in the manufacture of chinaware;

or factory carbon emission standards were

identical in both the U.S. and Europe. In

the words of the late Sam Cooke “what a

wonderful world it would be.” A harmo-

nization of regulations would increase pro-

duction efficiency remarkably without

creating an offsetting risk. Both societies

have addressed comparable risks, but

have regulated those risks slightly differ-

ently and at horrible costs. Suppose those

rules were harmonized? And if you think it

is impossible, consider this provision of the

U.S. Korean Free Trade Agreement.

Under that Agreement, a U.S. produced

automobile, manufactured to U.S. automo-

tive fuel economy and greenhouse gas

emission standards, will be deemed com-

pliant with the comparable but more strin-

gent Korean auto emission standards if the

U.S. made automobiles are within 19% of

the comparable South Korean standards.

The rules are not identical, but they have

been harmonized. In the survey, regula-

tory convergence across “multiple sectors”

and regulatory convergence for “manufac-

tured goods” were the two most important

negotiating objectives reported. Unfortu-

nately, however, the same survey found

that of the 17 negotiating objectives, these

were numbers 13 and 16 in their degree of

difficulty of being achieved. The most im-

portant are being perceived as the most dif-

ficult. The challenge for the negotiators

now begins to emerge. Do they undertake

the very difficult but important negotiating

objective and run the risk of imploding the

talks, or do they ensure an agreement of

only the easy points? The opening re-

marks of U.S. Trade Representative

Michael Froman at the July 8 Plenary Ses-

sion seemed to take the “all or nothing” ap-

proach. He urged them to “resist the

temptation of downsizing” their ambitions

simply to get a deal.

In terms of the likelihood of accom-

plishment, the item number one on the

stakeholders list is the elimination or sig-

nificant reduction of duties. The second

subject for which the parties are optimistic

about an agreement will be of great interest

to Pennsylvanians – there is significant in-

terest in reductions in all barriers (tariff and

non-tariff) in the export of energy from the

U.S.

Are there any obstacles? Two immedi-

ately come to mind. The first is the notion

of transparency. Certain constituencies on

both sides of the ocean appear to be con-

fusing their right to contribute to the nego-

tiating process with the government’s view

that it has the right to negotiate in secrecy.

They insist on participating at every stage,

including the right to review draft agree-

ment language. And the bigger unknown

is now the question of the NSA leaks and

the extent to which negotiations on a

greater relaxation of the rules related to

ecommerce have been undermined.

Everyone agrees that the NSA release has

impaired the ecommerce negotiations. The

only question is how badly.

The two diplomatic statements re-

leased at the conclusion of the first round of

trade talks were quite different, but both

were remarkably upbeat. Both sides are

optimistic; both sides see increases in

trade opportunities and positive benefits to

both economies. Let’s all hope the opti-

mism continues as the talks become more

substantive.

John P. Donohue is a Partner in the

firm of Clark Hill/Thorp Reed and is a

member of the Firm’s International

Trade Practice Group. He is member

of the Board of the Exchange.


By: John P. Donohue, Esq., Clark Hill Thorp Reed

Opening Round of TTIP Talks with the European Community Ends on

Optimistic Note but Don’t Count on a Completed Agreement by 2014


Aker and Crowley Announce Joint Venture PlansAker Philadelphia Shipyard ASA

(APSI) recently announced that itswholly-owned subsidiary, AkerPhiladelphia Shipyard, Inc. and Crow-ley Maritime Corporation are expand-ing the cooperation initiated with thesale and delivery of two producttankers in 2012 and 2013. The ex-panded partnership includes four newproduct tankers with deliveries in 2015and 2016, with the possibility to buildfour additional product tankers withdeliveries through 2017. The partieshave signed binding shipbuilding con-tracts for the first four tankers with atotal contract value of approximately$500 million.

Consistent with the requirements ofthe Jones Act, Crowley will maintaincontrol over the ownership, technicaloperation, and commercial manage-ment of the vessels. APSI and Crow-ley will share in the economics of theoperation and chartering of the newvessels.

APSI expects to make an invest-ment of approximately $115 million in

the first four vessels through a combi-nation of existing shipyard equity andnew debt. Funding is expected to bemet without any equity capital is-suance. The new debt and the con-struction period financing are expectedto be fully committed by the end ofSeptember.

“The shale revolution is creating in-dustrial opportunities throughout theUnited States and specifically here inPhiladelphia. We are pleased to ex-pand our partnership with a first-classoperator like Crowley to help meet thenation’s longstanding goal of energysecurity,” said Kristian Rokke, Presi-dent & CEO of AKPS. “This strategicopportunity allows us to capitalize onthe increased demand for Jones Acttankers in a way that will transformAPSI in the years ahead.”

The new 50,000 dwt producttankers are based on a proven HyundaiMipo Dockyards (HMD) design whichincorporates numerous fuel efficiencyfeatures, flexible cargo capability, andthe latest regulatory requirements. The

vessels will be constructed with con-sideration for the use of LNG forpropulsion in the future. Design andprocurement activities are already un-derway to support the start of con-struction of the first tanker in January2014.

“We are very pleased to be partner-ing again with Aker in the constructionof these new tankers,” said Rob Grune,Crowley Senior Vice President andGeneral Manager, petroleum services.“They are a well established andhighly respected shipbuilder.”

The joint venture transactions re-lated to the operation and chartering ofthe new vessels are subject to agree-ment on definitive documentation andfulfillment of customary closing con-ditions. The transactions are expectedto be completed by the end of the thirdquarter 2013.

APSI is currently constructing two115,000 dwt crude oil carriers forSeaRiver Maritime, Inc., ExxonMobilCorporation’s U.S. marine affiliate.Both of these crude oil tankers arescheduled for delivery in 2014.

There is an exception provision to thehigh use prioritization for hazardousnavigation conditions or impacts of nat-ural disasters.

Equity is also addressed by S. 601,as it expands the eligibility of operationand maintenance (O&M) funds to in-clude berth and contaminated sedimentremoval in certain HMT donor states ifthe funds available for O&M are abovethe FY12 levels, and if high-use deep-draft ports are fully maintained and theother priorities noted above are funded.

The formula contained in the bill es-tablishes eligible states as those thatcontribute no less than 2.5 percent ofHMT collections annually and that re-ceive less than 50 percent of the totalamounts collected by that state. A pri-ority is given to projects at ports thathave received the lowest amount offunding from the HMTF in comparisonto the amount the ports contributed inthe last three years.

The bill also includes several otherprovisions that relate to ports, such as:

w giving the Secretary the author-ity to approve assumption of main-tenance for channel improvementsand extensions constructed beforeDecember 2012;

w setting a framework for envi-ronmental reviews of channel im-provement studies and, includingfinancial penalty provisions for Fed-eral jurisdiction agencies that fail toissue decisions in a timely manner;and

w enabling funds donated for anO&M activity, such as maintenancedredging, to be credited toward cost-sharing on a subsequent project forup to 20 percent of the constructioncost.

“We believe that “full use” of HMTrevenues for maintenance dredging isthe right thing to do, and it is in keepingwith the commitment made to both thenation’s shippers and ports when theHMT law was first passed in 1986,”said Thomas Valleau, who runs theNorth Atlantic Ports Association. “Weapplaud the intent of S. 601 tostrengthen that commitment.”

WRDA Addresses

HMT Issue



geographic area that will constitutethe “approach” depends entirely onthe route to the berth chosen unilater-ally by the vessel’s navigators.Specifically the Court held that “whena ship transitions from its general voy-age to a final, direct path to its desti-nation, it is on an approach” even ifthe selected path is through FederalProject waters.

The Court has created a “movingtarget” definition of “approach” thatwill result in legal and commercialchaos for terminal owners and opera-tors. The “path” to a terminal is a deci-sion within the sole province of avessel’s navigators and local pilots, andit varies from ship to ship based on thetides, currents, winds, and number ofassisting tugboats. There is no “usualpath,” and a terminal owner cannot pre-dict or control the vessel’s navigationaldecisions, nor should it be charged withthat responsibility. By defining a ter-minal owner’s duty in terms of a ship’snavigational choices, rather than a fixedgeographical area that is within the ter-minal owner’s control, as had been thecase before, the Court’s decision putsterminal owners in an impossible posi-tion – there is no ability to accuratelydetermine the area for which they nowhave responsibility as it will vary fromship to ship.

Ships docking at the vast majority ofterminals on the Delaware River typi-cally take a docking pilot and assist tugsand begin maneuvering along the“path” to the berth while in the main

dredged river channels or Federal an-chorages. Thus, under the Court’s newdefinition of “approach” each terminalwill be responsible for the safety of por-tions of the Federal Project waters in-cluding the main channels andanchorage areas.

The Court of Appeals has imposeda costly, onerous, and amorphous bur-den on terminal owners by creating anaffirmative duty to survey, locate andremove hidden obstructions in theirnow expanded but unbounded ap-proaches. It is impossible to know whattypes of survey techniques and methodswill satisfy a terminal owner’s duty,how often surveys must be undertaken,or how terminals are supposed to coor-dinate their responsibilities in publicly-used waterways over which the ArmyCorps and Coast Guard have exclusivejurisdiction.

CARCO intends to petition the U.S.Supreme Court to review and reversethe Court of Appeals’ decision. Therewill be an opportunity for concerned in-dustry groups to support this appeal tothe U.S. Supreme Court through the fil-ing of amicus or “friend of the court”briefs to inform the Supreme Court ofthe adverse impact the decision willhave on day-to-day port operations andthe legal liability of marine terminalsthroughout the United States.

If you have questions or require ad-ditional information please contact oneof the authors, Frank P. DeGiulio ofPalmer Biezup & Henderson, LLP([email protected]; 215-625-7809) orGeorge R. Zacharkow of Mattioni, Ltd.([email protected]; 215-629-1600).

Athos 1 Consequences



PRPA: Early 2013 Stats Indicate Continued GrowthThe Philadelphia Regional Port Au-

thority (PRPA) is reporting notable in-

creases in cargo volumes during the

first half of 2013. With 2,519,967 met-

ric tons of cargo handled during this

time compared to the 2,217,803 metric

tons of cargo handled during the same

period of 2012, PRPA facilities experi-

enced a 13.62 percent gain in cargoes

handled. If current cargo trends con-

tinue throughout the remainder of the

year, 2013 will be the fourth straight

year of double-digit cargo growth.

“The Port of Philadelphia is a very

versatile port,” said PRPA Chairman

Charles G. Kopp, Esq. “This is demon-

strated by the fact that containers,

breakbulk cargoes, and liquid bulk all

showed strong gains during the first six

months of this year.”

Highlights of these Year-To-Date

cargo figures include:

PRPA facilities handled 1,184,147

metric tons of containerized cargoes

from January to June, 2013, compared

to 1,002,911 tons handled during the

same period of 2012; tonnage was up a

healthy 18%. In total 168,820 TEUs of

containers through June compared to

the 135,656 TEUs handled during the

same period last year, resulting in a

24% gain.

Breakbulk cargoes overall were up

a strong 18%. This is due in part to

healthy growth among the following:

n Steel: 116,249 metric tons ofsteel handled YTD 2013 compared

to the 89,292 tons handled during the

first half of 2012, up 30% by mid-

year. Steel cargoes, much of which

is destined for the automobile and

construction industries, arrive at

PRPA’s Packer Avenue and Tioga

Marine Terminals.

n Forest Products: received209,823 tons of forest products Jan-

uary-June 2013 compared to the

168,012 tons handled during the

same period of 2012. Forest prod-

ucts, which include newsprint, fine

coated paper, pulp, and lumber, were

up 25%. These cargoes principally

arrive at PRPA’s Forest Products

Distribution Center at Piers 78/80

& 74.

n Cocoa beans: experienced a21% gain, with 86,438 metric tons

handled in the first half of 2013 com-

pared to 71,631 tons handled during

the same period of 2012. Cocoa

beans, eventually manufactured into

candy bars, cocoa powder, and a

wide variety of chocolate products,

arrive at PRPA’s dedicated cocoa

bean handling facility at Pier 84.

Fruit (126,121 tons), project cargo

(21,884 tons), and automobiles (96,240

tons) performed at about the same lev-

els as last year. Sugar, a cargo that re-

turned to the Port of Philadelphia in the

latter half of 2012 after a long absence,

continued to make a mark at the port

during the first half of this year, with

23,479 metric tons handled. Sugar ar-

rives at the Tioga Marine Terminal.

Liquid bulk cargoes also showed a

healthy gain in the first half of the year.

With 655,448 metric tons of liquid bulk

arriving at the Port of Philadelphia Jan-

uary-June 2013 compared to 611,022

tons handled during the same period of

2012, liquid bulk was up over 7%. Liq-

uid bulk cargoes arrive at the Tioga Ma-

rine Terminal and are pumped via an

elevated pipe bridge to Kinder Mor-

gan’s liquid bulk facility located across

the street from the terminal.

“With the deepening of the

Delaware River’s main channel and our

Southport Marine Terminal Project, the

Port of Philadelphia is making the nec-

essary improvements to our facilities

and infrastructure to assure growth in

the future,” Kopp said. “But these im-

pressive year-to-date cargo statistics

demonstrate that PRPA and its terminal

operators are out there right now build-

ing our business, before those enhance-

ments come online. Further, these

cargo statistics justify the ongoing sup-

port of Pennsylvania Governor Tom

Corbett, who has recognized the im-

portance of the international seaport in

Philadelphia with strategic and sub-

stantial investment.”

A container vessel prepares to discharge cargo at the Philadelphia Regional Port Au-

thority’s Packer Avenue Marine Terminal. Containerized cargo tonnage was up a

healthy 18% during the first half of 2013 compared to the same period of 2012.


Norfolk Southern Discloses

Initiatives to Reduce Green-

house Gas EmissionsNorfolk Southern has disclosed

its business strategy for reducinggreenhouse gas emissions and envi-ronmental footprint in a filing withthe international not-for-profit CDP,formerly known as Carbon Disclo-sure Project.

The railroad’s annual public dis-closure to CDP provides customers,investors, employees, and commu-nities information about how Nor-folk Southern is addressing potentialrisks and benefits related to green-house gas emissions.

“Norfolk Southern is committedto being an industry leader in envi-ronmental stewardship,” said BlairWimbush, vice president real estateand corporate sustainability officer.“Efforts to improve our perform-ance and to mitigate the environ-mental impacts of businessoperations are part of daily life onour railroad. We are proud to offercustomers a fuel- and carbon-effi-cient means of transporting theirgoods.”

In the CDP filing, Norfolk South-ern describes key strategic initia-tives to reduce greenhouse gas

emissions. These include purchas-ing new, more fuel-efficient loco-motives, expanding use ofidle-reduction and train-handlingtechnologies, making infrastructureimprovements, continuing researchand development of alternativepower, and recycling older locomo-tives.

Norfolk Southern has made con-siderable progress toward its goal toreduce greenhouse gas emissions by10 percent per revenue ton mile be-tween 2009 and 2014. By the endof 2012, the company had reachednearly 69 percent of the goal.

Longer term, the railroad’s in-vestments in infrastructure, includ-ing public-private partnerships, areexpanding the nation’s freight railcapacity and providing shippers away to reduce their supply-chaincarbon footprint. For example, bydiverting long-haul freight to trainsfrom trucks, Norfolk Southern’sCrescent Corridor – which spans 11states from Louisiana to New Jersey– has the potential to reduce green-house gases by 1.9 million tons an-nually when fully developed.


Editorial

The U.S. Army Corps of Engi-neers’ chief civilian, Director ofCivil Works Steve Stockton, re-cently participated in a webinar forUSACE “communicators” on thesubject of “transforming” the CivilWorks program. In his presentationis what sounds like a stunning callto the professionals of his organiza-tion:

In a budget constrained era, wemust do what we can to BE RELE-VANT!!

Whether one’s reference point isthe America of the recent 20th cen-tury or the present 21st century it ishard to imagine the Corps of Engi-neers and its Civil Works programstruggling to be relevant. Theessence of the program is no less rel-evant today than it was when theemerging nation needed trained en-gineers to clear waterways to enablethe flow of vital commerce.

Today, the need for shippingchannels and other navigation fea-tures is as great as ever.

Today, the need for protectionfrom flooding in urban PassaicCounty and on Iowa farm land haspersisted for generations.

Today, the rising sea level anddropping Great Lakes levels posesignificant threats to human life andthe economy.

Mr. Stockton’s cry for relevancereflects those and other water relatedchallenges for our human and eco-nomic welfare as a continuing es-sential role for the Corps ofEngineers. But he also was refer-ring to a number of growing chal-lenges facing the USACE and, I willadd, government itself.

Much in government is not func-tioning as it should, which is to saynot functioning well. In short, thepolicy making and funding roles ofCongress are not being fulfilled andto a great extent the federal agenciesare hampered by declining resourceseven as they are given more respon-sibility and seem to do little to im-prove their management and clearthe decks of old regulation and pro-cedure.

The Corps of Engineers and, con-sequently, the Civil Works program,have been diminished over theyears. The ranks of the engineers,planners and economists have de-clined through attrition and so hasthe resident institutional experience.Congress has given USACE more todo — adding to its mission and theworkload — and fewer resources towork with.

The statement on the webinarslide is telling of the frustrationbeing felt within the storied organi-zation. “In a budget constrained era,we must do what we can…” sug-gests both conditions put upon theCorps and put upon by itself.USACE leadership understands thatwhile it has little power to changethe overall fiscal situation that keepsa tight lid on Civil Works budgets ithas some power to change how itworks and how well it works.

Diminishing federal resourcesand a slow, slow process causeports, communities, and municipaland state governments to look for al-ternate ways to clear the channelsand, literally, hold back the floodwaters. We see that most vividly inthe port sector where governors inFlorida and South Carolina havetold Washington “we can’t wait” —a favorite Obama phrase — andcommitted state funding to build

commercially driven federal chan-nel projects.

USACE leadership has identifiedand acknowledged the problems.Mr. Stockton’s address to his civil-ian troops points to things they needto change and improve. For themost part this is not a new prescrip-tion as other speeches and presenta-tions have said much the same inrecent years.

Mr. Stockton’s presentation in-cludes wording that also shouldhave shock value were it not for thefact that we are inured to the obser-vations that there is “political andgovernance turmoil” that con-tributes to there being “no focus onAmerica’s needs and investment.”

The United States is awash inwater resource challenges. We haveknown for ages that there are fewerimportant resource needs central tosurviving and thriving than water todrink, grow and flow. Economicglobalization has put a spotlight onports and shipping and thus the un-derwater infrastructure. There is noargument that oceans are rising.And decades of experience haveshown that we cannot ignore therole that coastal and riverine watersplay in maintaining the ecosystem.(A USACE video makes quick workof the facts and can be found here:http://youtu.be/486TdJ501LM.)

All these point to the long termrelevance of the Corps of Engineersand the need to be organizationallyand productively “RELEVANT!!”as Mr. Stockton intends it.

More importantly it points toCongress — in addition to states —being central to both the problemand the solution. These are serious,complex problems that require up-dated water policy, genuine consen-sus on how we shall address thesesurvival issues, and long term in-vestments.

We must insist on governmenttackling these issues. We have hadplenty of reasons for pessimism butlet us acknowledge a few recent,promising signs.

House and Senate AppropriationsCommittees, including the HouseEnergy & Water Development sub-committee chaired by Rep. RodneyFrelinghuysen (R-NJ), producedUSACE funding bills for FY 2014that would boost port channel main-tenance funding to a record$1,000,000,000, recognizing thatHarbor Maintenance Tax user-paidrevenues have been underutilized.This year we have seen the first se-rious action toward producing waterresources (WRDA) legislation since2007. The Senate passed its policyladen bill and we now look for theHouse to act on a draft bill duringthe coming autumn session.

Paul Bea, the principal of PHB

Public Affairs, is a government re-

lations and policy advisor in Wash-

ington, DC. He blogs on marine

transportation system matters at

www.MTSmatters.com. Contact

him at [email protected].

By: Paul Bea

PHB Public Affairs

Water Issues are as Demanding as Ever

The Beacon is the official newsletter of the Maritime Exchange for theDelaware River and Bay. The Exchange encourages its readers to submitletters to the editor at any time in response to articles that appear in The

Beacon or to address other topics of interest to the port community.

Please direct any correspondence or inquiries regarding the

contents of this newsletter to:

MARITIME EXCHANGEfor the Delaware River and Bay

240 Cherry Street, Philadelphia, PA 19106tel: 215-925-2615 w fax: 215-925-3422

[email protected] w www.maritimedelriv.com

John Reynolds, Chairman

Uwe Schulz, Vice Chairman

Dennis Rochford, President

Lisa B. Himber, Vice President

A. Robert Degen, Esq., Secretary/Solicitor

Dorothy Mather Ix, Treasurer

MARITIME EXCHANGEfor the Delaware River and Bay

We Want to Hear From YOU . . .

Attention all Maritime Ex-

change members! Beginning

with the next issue of The Bea-

con, there will be a new feature

to enjoy.

Members are invited to sub-

mit organizational profiles that

tell our readers a little bit about

who you are and what you do,

news about your company’s his-

tory and future plans, and the

people in your company who

make it all happen. Photos are

welcome as well.

Interested members should

send their company profile of 500

words or less to Beverly Ford at

[email protected]. Se-

lection will be based on a first

come first serve basis, so submit

your information as early as pos-

sible. Articles are subject to

available space and editor’s ap-

proval.


NY SNAFU a Teaching Moment for All PortsLike gapers at a traffic accident, we

outside the New York-New Jersey areaare morbidly fascinated by the delayswhich plagued the port during the sum-mer months. You can’t help thinking,“oh, that poor guy.” And then, perhapssomewhat guiltily, “thank the Lord itwasn’t me.”

In its simplest form, a computerglitch at one terminal facility caused achain reaction which paralyzed the en-tire port region. A nightmare for anymaritime executive: cargoes simplyweren’t moving. “Delays were so se-vere that container line Hapag-Lloydurged customers to reroute cargo toother ports,” according to one Journalof Commerce story.

Now, we could use this space to talkabout how Delaware River port cus-tomers would never have to face thesame problems and take advantage ofthe opportunity to solicit a host of newbusinesses. But that’s not the takeawayfrom this story.

While the geopolitical environmentsof the NY-NJ and Delaware River portregions are somewhat similar – withboth having multiple states, a combina-tion of private and public terminal fa-cilities, and a range of truckingproviders from the owner-operator tothe large conglomerates – they are dif-ferent enough that it seems unlikely thata similar problem at one of our facili-ties would cause the same catastrophicchain reaction.

Unlikely, but not impossible.Certainly, we don’t have the con-

gestion problems that hamper our

neighbors to the north. While theDelaware River ports don’t handle nearthe volumes, we do enjoy the luxury ofa much larger waterfront that is ripe forport development. Witness the South-port and Paulsboro projects currentlyunderway.

Beyond that, our relationship withthe longshore labor force is one of mu-tual understanding and respect. Whileboth employers and labor are dedicatedto making the best deals they can, asthey should be, overall the dialogue ispositive, and our work force has timeand again demonstrated its understand-ing of the business drivers that governport customer choices. That is dramat-ically different from the environment inwhich the NY-NJ port operates.

But that doesn’t insulate us from asingle issue that could hamper opera-tions throughout the region. Thinkback to 1989 and the grape issue, orperhaps the next superstorm veers in aslightly different direction and slamsthe Delaware Valley.

Our friends in NY-NJ are trying tolearn from their experiences and they’retaking steps to prevent future similarevents where possible and improvetheir resiliency when disaster cannot beprevented.

We should be doing the same.First, our terminal operators – and

federal agencies, and all the other busi-ness which rely on a smooth supplychain – should become more active inthe Area Maritime Security Committeeresiliency planning efforts. In addition,our port community ought to look at

other ideas which can help prevent orminimize the impact of events whenthey do occur. Some new initiativeswill even improve the day to day oper-ations of our port.

In the aftermath of the Sandy recov-ery and this latest incident, port busi-nesses in NY-NJ are now looking atideas such as standardizing gate proce-dures so drivers don’t face a differentsystem at each terminal and developing

universal performance indicators forthings such as truck turns. There areundoubtedly other opportunities to pur-sue.

Our port community is known forworking closely together on issues ofregional importance. The ideas underconsideration in NY-NJ may or may notbe useful in our area, but it’s a discus-sion we should have.

The Independence Seaport Mu-seum will host its annual Old CitySeaport Festival on October 11, 12and 13, 2013. The Old City SeaportFestival is a weekend-long event overColumbus Day weekend that bringstall ships, antique and classic boats,traditional small crafts, model shipsand on-the-water family fun to thePort of Philadelphia.

The main feature of the Old CitySeaport Festival is the participatingships and boats that make their way toPhiladelphia. There are seven con-firmed tall ships that will providedeck and river tours. Boat enthusiastsand curious onlookers alike will havethe experience of acquainting them-selves with the ships firsthand. Theships include: AJ Meerwald, Gazela

Primiero, Pride of Baltimore II,

Kalmar Nyckel, Mystic Whaler, Hindu

and Virginia. Also in attendance willbe Summer Wind, Patriot, small craftsfrom the Traditional Small Craft As-sociation – Delaware River Chapter aswell as classic boats from the Antiqueand Classic Boat Society – Philadel-phia Chapter.

The Seaport Museum is excited topartner with the TSCA DelawareRiver Chapter to manage the smallboat races in the basin on Saturdayand Sunday.

Boaters the Delaware River andbeyond are invited to volunteering orshowcase their vessels and shouldcontact Gina Pickton [email protected] or (215)413-8688.

Tall Ships to Sail In for the 2013

Old City Seaport FestivalBy: Darrah Foster, Independence Seaport Museum


Upcoming Events

9/07/13 Independence Seaport Museum 2013 Coast Day

09/10/13 Tri-State Maritime Safety Association Board Meeting

Port of Wilmington Maritime Society Board Meeting

09/11/13 Maritime Exchange Board Meeting

Seamen's Center of Wilmington Fall Fun(d) Raiser

Contact Joan Lyons: 302-575-1300 or [email protected]

09/12/13 Mariner's Advisory Meeting, La Veranda, Philadelphia, PA

Contact Scott Anderson: [email protected] or 215-925-1524

09/13/13 Ports of Philadelphia Maritime Society Russ Larsen Memorial Golf Outing

Springfield Country Club, Springfield, PA

Contact Mike Scott: [email protected]

Ports of Philadelphia Maritime Society Annual Crab Feast

The Deck at Harbor Pointe, Essington, PA

Contact Theresa Penot: 484-496-7305 or [email protected]

09/17/13 Seamen's Center of Wilmington Board Meeting

Philadelphia Regional Port Authority Board Meeting

09/18/13 DRPA/PATCO Board Meetings

World Trade Association of Philadelphia Annual Banquet

Cescaphe Ballroom, Philadelphia, PA

Contact Deborah Ingravallo: 856-642-3957

10/01/13 Maritime Exchange Executive Committee Meeting

Port of Wilmington Maritime Society Fall Luncheon

Contact Lindsay Penning: [email protected] or 302-656-7000

10/15/13 Philadelphia Regional Port Authority Board Meeting

10/12/13 Delaware Hall of Fame Banquet & Induction Ceremony

Lewes Yacht Club, Lewes, DE

Contact Denise Seliskar at [email protected] or 302-542-6797

10/16/13 DRPA/PATCO Board Meetings

For a complete schedule and event details, visit www.maritimedelriv.com

Welcome Aboard

Notes & News

The law and professional service firms of Clark Hill PLC and Thorp Reed &Armstrong, LLP recently announced an agreement to merge the two firms, eachwith more than 100 years of history. The combined firm includes more than 300attorneys in a wide variety of practice areas, will operate in 12 offices in sevenstates and will utilize the brand name Clark Hill Thorp Reed in chosen mar-kets, including all geographic markets where Thorp Reed & Armstrong has apresence today.

In June Holt Logistics Corp. presented four graduating seniors from GloucesterCity with $500 scholarships each to be used for their matriculation to the UnitedStates Military Academy at West Point and the Naval Academy in Annapolis inthe fall. Each of the four scholarship recipients exemplify the physical, mentaland social prowess needed to be accepted into the prestigious Military and NavalAcademies, and all share a goal of entering into military service from a veryyoung age. The scholarships are a first for Holt Logistics Corp, which has a longhistory of hiring returning veterans. The company had been seeking ways to fur-ther support local young adults who choose to serve their country.

Advance Customs Brokers & Con-

sulting LLC

1400 NW 79th Avenue

Miami, FL 33126

Phone: 786-476-0700

Fax: 786-476-0706

acbocean@advancecustoms-

brokers.com

www.advancecustomsbrokers.com

Delaware River Waterfront Corpo-

ration

121 North Columbus Boulevard


Phone: 215-629-3200

www.delawareriverwaterfront.com

Honeywell Resins & Chemicals,

LLC

Frankford Plant

Margaret & Bermuda Streets


Phone: 215-533-3000

www.honeywell.com

MTC Logistics

2 Dock View Drive

New Castle, DE 19720

Phone: 302-654-3400

[email protected]

www.mtccold.com

Nicom IT Solutions

6960 Mumford Road, Suite 2030

Halifax, Nova Scotia, B3L 4P1

Canada

Phone: 902-454-5656

[email protected]

www.nicomit.com

Stratus IP

600 Delran Parkway, Suite B

Delran, NJ 08075

Phone: 856-375-8161

[email protected]

www.stratusip.com

Wyndham Garden Hotel

Philadelphia Airport

45 Industrial Highway

Essington, PA 19029

Phone: 610-521-2400

www.wyndham.com

WTA Names Holt Logistics as Company of the Year

Since 1931, the World Trade Association of Philadelphia has chosen tohonor a company or individual who best supports the Port of Philadelphia.This year that recognition goes to Holt Logistics Corporation, named as theWTA “Company of the Year” award for 2013.

The event will take place on September 18 at Cescaphe Ballroom, 923North 2nd Street, Philadelphia, starting at 6:00 pm.

For more information or to reserve your place, call 856-642-3957 or [email protected].

Documents

BEACON - MetalCraft Marinemetalcraftmarine.com/news/Fall_2013_Beacon.pdf · 45R Main Channel Deepening Proj-ect. This amount represents a $10 million increase from the original al-location