Good morning, Mr. Chairman, I am Paul Kaipo Pomaikai, Sr., Assistant Port Captain for Sause Bros., Inc., in Honolulu, Hawaii. I want to thank you for holding this hearing and for the support you have shown for our industry.

 

Sause Bros., headquartered in Coos Bay, Oregon, is a privately held towing company, carrying forest products, building materials and petroleum to and from Alaska and Hawaii and up and down the U.S. west coast.  We employ over 500 people, including 300 mariners as crew on our boats.  Sause Bros. owns and operates a fleet of 35 tugboats and 25 barges, and has been in the marine transportation business since 1937.

Sause Bros has been engaged in common carrier service to the Hawaiian Islands since 1966. Our Hawaiian Island division was incorporated in Hawaii in 1983 to more effectively serve Island customers. The Hawaiian fleet provides inter-island and Military Sealift Command towing services, and distributes West Coast cargoes to Island customers. Our Island barge fleet carries products ranging from lumber, plywood, sand, and containers, to heavy equipment and petroleum products. Our ship assist fleet has gained a reputation among the Island shipping industry for safety, reliability, and professionalism.

As Assistant Port Captain for Sause Bros., I am responsible for all of our operations in the Hawaiian Islands.  In addition, in 2003, my wife, Donna Laurie, who is also a licensed mariner, and I founded the Wai’anae Maritime Academy, located at Leeward Community College at Wai’anae, a unit of the University of Hawaii, to provide young people with the education necessary to begin a career in the maritime industry.  We have graduated 180 cadets in nine classes, and this May we will be holding our tenth class.  One of our commitments to our students is to help them find employment on board vessels following their graduation.  We help them to meet the qualifications and get the documents they need, and we also help them develop the lifestyle that allows them to be productive workers in the maritime industry or other places they may decide to go with their lives.

 

I am appearing before the committee today on behalf of The American Waterways Operators. AWO is the national trade association for the tugboat, towboat, and barge industry.  The industry AWO represents is the largest segment of the U.S.-flag domestic fleet and a vital part of America’s transportation system.  The industry safely and efficiently moves over 800 million tons of cargo each year with a fleet that consists of nearly 4,000 tugboats and towboats, and over 27,000 barges. Our industry employs more than 30,000 mariners as crewmembers on our vessels.  While a few companies in the towing industry are relatively large, according to the U.S. Army Corps of Engineers, over 90 percent of U.S. towing companies are actually smaller than Sause Bros.

 

Mr. Chairman, Sause Bros. and the other members of The American Waterways Operators have been, and will continue to be, partners with Congress and the Department of Homeland Security in ensuring the security of our country.  Immediately after the September 11, 2001 attacks, the members of AWO worked in cooperation with the Coast Guard to develop security plans for our vessels, even before they were required by the Maritime Transportation Security Act of 2002.  We take security seriously, and we are proud of the fact that our vessels and their crews are considered to be the “eyes and ears” for the Coast Guard on our nation’s waterways.

 

Nevertheless, we have serious concerns about the impact of the Transportation Worker Identification Credential (TWIC) program on our industry and the men and women who work in it.  Our primary concern is that the process for obtaining a TWIC card will become a barrier to entry into the maritime industry for new hires, and this will exacerbate an existing shortage of personnel for our vessels.  We are also concerned that requiring card readers on small vessels like towing vessels will add no practical security value and should not be part of the proposed rule that TSA and the Coast Guard will issue later this year. Allow me to elaborate on these concerns.

 

The May 2006 NPRM contemplated a TWIC enrollment process taking 30 to 60 days.  In its comments on the NPRM, AWO said that such a time frame would “seriously impede the ability of companies to bring new mariners into the industry in a timely manner.”  AWO and many of the 2,000 other organizations and individuals commenting on the NPRM suggested that the Department of Homeland Security include an interim work authority provision in the TWIC rule which would enable new hires in the industry to begin working immediately once they have passed an initial security screening.

 

We are enormously grateful that the Congress recognized these concerns, and as a result, a provision of the SAFE Port Act, Public Law 109-347, signed into law on October 13, 2006, required the inclusion of an interim work authority in the final rule.  The statute provides: “The regulations shall include a background check process to enable newly hired workers to begin working unless the Secretary makes an initial determination that the worker poses a security risk.  Such process shall include a check against the consolidated and integrated terrorist watch list maintained by the Federal government.”  This language embodied the request we had made in our comments to the NPRM and made mandatory a process to allow new hires to begin working after an initial screening unless there is a determination that the worker poses a security risk (emphasis added).

 

The final rule issued on January 25, however, does not follow the intent of the statute to avoid creating barriers to new hires entering the industry.  The proposal would deny a new hire the ability to begin work until the expensive and burdensome application process for a TWIC has been completed.  Under the process called for in the final rule, new applicants must first travel to a TWIC enrollment center to make application for a TWIC in person, as well as pay the TWIC enrollment fee of $137, before undergoing an initial check against the terrorist watch list.

 

For many applicants in Hawaii and other parts of the country, this trip to the TWIC enrollment center will not be quick, easy or inexpensive.  In Hawaii, for example, an applicant might have to fly from one island to another simply to apply for a TWIC.  In other parts of the country where there is not a TWIC enrollment center nearby, applicants will also have to travel significant distances in order to make the application.  This process creates a very high barrier to entry for new entrants to the industry who are not sure whether a career in the maritime industry is right for them.

 

Under the final rule, the “initial” security screening can only occur after the applicant has gone through the time and expense of completing his or her application.  At that point, the employer may enter the individual’s information into the Coast Guard’s Homeport website to obtain the results of the check against the terrorist watch list.  The rule indicates that a response can be expected within 24 to 72 hours after enrollment is completed.  The problem is that for new hires and their employers, the TWIC enrollment process is only one step in a larger process of coming to work in the maritime industry.  The first thing a company does when a new hire makes application is put him or her through a drug screen.  If he or she passes that test, the next step is a physical exam, followed by a reference check.  In the real world, neither the applicant nor an employer will want to invest in a trip to a TWIC enrollment center until those steps are taken.  What that means is that it could easily take more than a week before an applicant is ready to travel to an enrollment center and make application for a TWIC, and then wait an additional three days for the results of the terrorist watch list check to be available.

 

Mr. Chairman, we are concerned that requiring new applicants to undergo such a burdensome process will deter individuals from entering the maritime industry.  My company, and companies like mine, provide entry level opportunities for high school graduates looking to begin a career in the marine industry as deckhands on our vessels.  These men and women come to our company with a need to begin earning a paycheck and providing for themselves and their families right away.  Faced with the burdensome requirements surrounding the TWIC process, many will seek employment in another industry where the barriers to entry are not so high.  Even without the TWIC rule, we are struggling with a chronic shortage of personnel to man our vessels.  AWO estimates that the annual turnover of entry level personnel in the towing industry is 50 percent.  New hires may find that they get seasick or homesick and choose not to continue with a maritime career.  Companies must also evaluate an individual’s ability to perform on the job.  Both the new hire and the company must come to the conclusion that a career as a working mariner is the right “fit” for the individual and the company before a long term commitment is made.  For many new hires, the first manifestation of that commitment is the trip to the TWIC enrollment center and the payment of the application fee.  That commitment should not be required until both the company and the applicant have concluded that the individual will continue in the industry.

 

In this environment, we are very concerned that the burdensome requirements for obtaining a TWIC card will exacerbate the current personnel shortage and could even force companies like ours to tie up boats for lack of crewmembers to operate them.  Such an outcome would have a very negative impact on our ability to deliver the cargoes that are the building blocks of the economy in Hawaii, and would have the same negative impact on the national economy by affecting hundreds of towing companies around the country that also deliver the goods that are essential to maintain America’s economic vitality. 

 

As an alternative, we would propose that the process begin with a computerized check against the terrorist watch list, not a trip to the TWIC enrollment center.  (This could be done concurrently with the drug screen or physical exam described earlier.)  With an employee’s consent, the employer could enter the new hire’s name, birthdate, and Social Security number into the Coast Guard’s Homeport website to initiate a check against the terrorist watch list.  Provided this initial screening turned up no red flags, the individual could be put to work on a vessel on an interim basis.  Later – once the new hire has a taste of life and work on a vessel, and sees that it works for him or her – the mariner could be required to complete the TWIC enrollment process.

 

Another significant concern for the towing industry is the potential requirement for TWIC card “readers” on every towing vessel.  The NPRM proposed a requirement for readers at both facilities and vessels.  The Department subsequently announced that the card reader requirement would not be implemented as part of the initial TWIC rule but would be considered further as part of a separate rulemaking.  This was a proper response to the many comments that were received about the card reader requirement, but the issue of card readers for towing vessels remains an open one.

 

Card readers are simply unnecessary for towing vessels.  As AWO pointed out in its comments on the NPRM, crew sizes on tugboats and towboats typically range from four to ten mariners.  In a typical U.S.-flagged towing vessel operation, every employee is known to management and fellow crewmembers.  A stranger onboard the vessel is immediately obvious.  Personal knowledge of fellow employees provides a higher security standard than reliance upon an electronic reader, no matter how sophisticated the technology employed.  Access control procedures can be included as part of a vessel security plan.  The validity of TWIC cards can be checked through means other than mandating computerized equipment on board each vessel to constantly communicate with the database.

 

Mr. Chairman, even if card readers could be operated reliably in the severe marine environments where towing vessels routinely go – and that has not yet been demonstrated – there is simply no need to require their installation on every towing vessel in order to ensure the security of those vessels, or to ensure the security of the maritime transportation system.  The SAFE Port Act gives DHS the authority to limit the card reader requirement to vessels with more than a certain number of crew, to be determined by the agency.  On behalf of AWO, I would like to suggest that, at a minimum, vessels with 10 or fewer crew members requiring a TWIC should not be required to have a card reader installed on board.

 

These problems with the TWIC program are very significant, especially for the many small businesses in the towing industry. They also have serious implications for companies throughout the towing industry and for the economy we serve.  The provision for an interim work authority for new hires into the industry must be a workable one.  The requirement to begin the process by traveling to a TWIC enrollment center must be eliminated.  Failure to do so will have a significant negative impact on the ability of vessel operators to attract and retain the individuals necessary to crew their boats. In addition, card readers provide no additional security value in a small vessel environment and should not be required for vessels with ten or fewer crewmembers.

 

Mr. Chairman, I very much appreciate the opportunity to appear before you today.  AWO and its member companies stand ready to work with this committee and with TSA and the Coast Guard to ensure the security of our country while keeping mariners working, vessels moving, and the commerce of the United States flowing.  Thank you.