"Future of United States Maritime Part 1: Review of Fiscal Year 2026 Federal Maritime Commission Budget Request"
Subcommittee on Coast Guard and Maritime Transportation
2025-07-22
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Source: Congress.gov
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Subcommittee on the Coast Guard Maritime Transportation will come to order. I ask unanimous consent that the chairman be authorized to declare recess at any time during today's hearing. Without objection, so ordered. I also ask unanimous consent that members not on the subcommittee be permitted to sit with the subcommittee at today's hearing and ask questions. Without objection, so ordered.
The FMC is an independent agency responsible for the regulation of ocean-borne transportation in the foreign commerce of the United States. They also protect shippers and carriers from unfair practices of foreign flag carrier alliances. The President's fiscal year 2026 budget request includes $40 million to fund the salaries, operations, and capital needs of the FMC. Today, we welcome our witness, Commissioner Rebecca Dye, welcome Commissioner of the Federal Maritime Commission to discuss the President's fiscal year 2026 budget request as well as the state of the ocean shipping industry and their ongoing work implementing the Ocean Shipping Reform Act of 2022, also known as OSRAH. The FMC has worked diligently since the enactment of OSRA to implement its enhanced authorities. And I look forward to hearing from Commissioner Dial today on the status of FMC's efforts. Earlier this year, the FMC announced an investigation into vessel flagging laws, regulations, and practices of foreign countries. I fear these so-called flags of convenience create unfavorable shipping conditions in the foreign trade of the United States. Many vessels conducting international trade fly flags that differ from the nation where the ownership is based. The FMC is examining whether certain flag states may have standards that provide vessels with lower costs and oversights at the expense of reliability and safety.
In line with President Trump's executive order to restore American maritime dominance, we are working to bolster our domestic maritime capabilities, which are paramount to both the security and economic growth of our nation. I look forward to hearing from our witnesses on how the FMC plans to make United States maritime great again. Commissioner Dye, thank you for being here today.
Thank you, Mr. Chair, and thank you, Ranking Member, for scheduling this hearing on the fiscal year budget for the Federal Maritime Commission. While a small agency, the FMC has a big role. It protects shippers and consumers by monitoring and taking action against unfair and uncompetitive foreign shipping practices. Ocean shipping is dominated by foreign shipping companies with US flight operations comprising less than 2% of imports and exports. The supply chain crisis associated with the pandemic and ongoing international conflicts demonstrate the need for robust oversight to ensure there is a fair playing field. Fluctuations in service and pricing are normal, but it is the role of the FMC to ensure these fluctuations are justified in a competitive market. The President's fiscal year 2026 budget request for the FMC is flat, and I look forward to hearing from our witness how the agency can ensure fair shipping with flat funding. The FMC has begun to use its new investigative and prosecutorial authorities provided under OSRA guidelines of 2022. I look forward to hearing an update on the implementation of these new authorities. And since the passage of the Reform Act, container prices have fallen and queues at ports have evaporated. The FMC has also improved its reporting process, leading to an increase in charge complaints from American businesses, one of which resulted in a $2 million settlement over findings that the shipping company knowingly and willfully violated the Shipping Act. This means lower costs for consumers, thanks to the quick action and passage of this bill by Congress and signature by President Biden. These are positive trends, but I'm concerned this will be short-lived if the administration neglects the FMC. The FMC has lost nearly 20% of its workforce due to the deferred resignation program and the ongoing hiring freeze. This means fewer investigators finding unfair shipping practices and fewer attorneys prosecuting cases.
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