October 02, 2017 | Industry Insights, Shipping

Jones Act Temporarily Waived as Puerto Rico Is Ravaged in the Wake of Hurricane Maria

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Category 4 Hurricane Maria hit Puerto Rico with a vengeance and caused unprecedented devastation to the entire island, destroying roads, structures and its electrical grid. To help get desperately needed supplies to the island, the Department of Homeland Security (DHS), upon the request of the governor of Puerto Rico, this past Thursday waived the enforcement of the Jones Act for 10 days to allow foreign ships to carry aid to the U.S. territory.

The waiver is “intended to ensure we have enough fuel and commodities to support lifesaving efforts, respond to the storm, and restore critical services and critical infrastructure operations in the wake of these devastating storms,” said DHS Acting Secretary Elaine Duke. The DHS had also issued a temporary Jones Act waiver to help facilitate deliveries of petroleum products to hurricane-impacted areas along the Gulf and East coasts. That waiver expired on Sept. 22.

Also known as the Merchant Marine Act of 1920, the Jones Act requires that all goods shipped between American ports travel on U.S.-flagged ships with American crews. As we noted noted in a previous article, the Jones Act has been on Senator John McCain’s (AZ-R) radar to repeal for some time.

How effective the Jones Act waiver will be for Puerto Rico in getting much-needed supplies is up for debate. Jones Act carriers and shipping executives say there is ample humanitarian aid reaching the ravaged island on U.S.-flagged ships and foreign tankers are already allowed to supply fuel. The issue is a logistics problem and lies with the lack of ground transportation to distribute the goods. Thomas Allegretti, chairman of the American Maritime Partnership, which did not support the waiver for Puerto Rico, said, “What we are seeing clearly on the ground is thousands of cargo containers piling up at the port of San Juan, filled with essential goods that the Puerto Rican people desperately need, but not nearly enough trucks and clear roads to distribute the goods. So, the problem at the port is a lack of trucks and delivery routes, not a lack of vessels.”

Officials at Crowley Maritime Corp., a Jacksonville, Fla.-based cargo shipping company that benefits from the Jones Act, in an article in the Wall Street Journal, stated: “For some days in serving Puerto Rico we have been searching for where we might need additional help in the supply chain and we haven’t identified anything related to the Jones Acts.” The company said it had 4,100 containers with both relief supplies and commercial cargo waiting at the seaport on Thursday. In addition, another carrier, TOTE Maritime, said earlier this week it had more than 3,000 shipping containers stacked up at the port awaiting transport.

The administration also sent Lt. Gen. Jeffrey Buchanan to the island Thursday to ramp up relief efforts.

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