2010-11_ANNUAL_REPORTS_-_FINAL_VERSION_(3)

U.S.-Flag Waterborne Domestic Trade
U.S.-flag vessels are an established mainstay of America's national transportation system, providing
essential freight and passenger services to almost all States and territories.
To encourage a strong U.S. Merchant Marine for both national defense and economic security, the Jones
Act (46 U.S.C. § 55101 and 46 U.S.C. § 55102) requires that merchandise being transported by water
between U.S. points (i.e. cabotage trade) must travel in U.S.-built and U.S.-citizen owned vessels that
are registered in the United States. These Jones Act vessels handle a combined total of over 1 billion
tons of cargo annually, mostly bulk products such as petroleum, coal, iron ore, grain, crushed rock and
decorative stone with high-value containerized products dominating the U.S.-flag domestic trade to
Alaska, Hawaii, and Puerto Rico. The U.S.-flag domestic cargo fleet supporting this massive inland and
coast-wise ocean trade is made up of nearly 40,000 vessels (mostly tugs and barges) that represent over
$48 billion in private investment.
Transportation of passengers is also an important component of domestic trade. In calendar year 2010, a
total of 232 ferry operators based in 38 U.S. states and territories transported an estimated 50 million
passengers, generating an estimated $0.98 billion in revenue. 6 Domestic waterborne transportation also
contributes billions to the U.S. economy in the form of freight and passenger revenue, and millions of
dollars of government revenue in the form of Federal, State, and local taxes.
Maritime Administration Assistance to Shippers
The Maritime Administration helps the shipping public comply
with the Jones Act by locating U.S.-flag vessels that can carry
domestic cargo, and advises the U.S. Customs and Border
Protection (Customs) — which has direct responsibility for
enforcing the Jones Act — on the suitability of waivers.
In 2011, assisting the Department of Energy drawing down the
Strategic Petroleum Reserve (23 Jun — 31 Aug), our staff
identified U.S.-flag coastwise qualified vessels that could transport
petroleum products. We also facilitated the Jones Act waiver
process, set up a public website on waiver procedures, and
provided briefing material, record keeping, and analysis as required.
Small Passenger Vessel Waiver Program
46 U.S.C. § 12121, authorizes MARAD to administratively waive
the U.S.-build requirements of the Jones Act for foreign-built
small passenger vessels carrying no more than 12 passengers for
hire. To grant such waivers, MARAD must determine that
6 2010 National Census of Ferry Operators, conducted by the Research and innovative Technology
Administration’s Bureau of Transportation Statistics. Available at http://www.bts.gov/programs/ncfo/.
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