AAPA Testifies on Seaport Security

Thursday, March 09, 2006
Kurt J. Nagle, president and CEO of the American Association of Port Authorities (AAPA), testified on seaport security before the House Transportation and Infra­structure Subcommittee on Coast Guard and Maritime Transportation. On the issue of the proposed acquisition of P&O Ports by DP World, Nagle indicated that in reviewing a transaction of this type, “it is the appropriate role of the federal government to determine if there are national security concerns with any proposed business arrangement involving non-U.S. interests, whether that involves port operations or any other business.”

Nagle urged Congress to allow the current 45-day investigation of the transaction to run its course “prior to taking any action either on this proposed arrangement, or on any blanket prohibition against a foreign government affiliated company from providing terminal operating services at U.S. ports.” He also noted that, with regard to individual business arrangements, “Public port authorities often have leases with terminal operating companies to operate port-owned facilities. Those leases typically provide that any assignment of a lease to a successor company, in the event of a merger or acquisition, must be approved by the port authority. Leases generally cannot be transferred or assigned without permission.”

On other port security issues, Nagle said that while the federal Port Security Grant program has provided much-needed assistance to pay for seaport facility security, it still had several problems, including (1) an inadequate amount of Congressional appropriations; (2) limits on eligibility; (3) the port industry’s concern about the Administration’s proposals to lump port security into the larger Transportation Infrastructure Protection program (TIP); and (4) the slow release of the federal funds. “Limited port security funds have placed burdens on ports as security programs compete with general maintenance of facilities, channel dredging or port expansion projects,” said Nagle. “The biggest impact of these limited funds, however, is a delay in making security enhancements. Limited funds means slower progress.”

Nagle’s testimony, available on-line here, also stressed the need for quicker implementation of the Transportation Worker Identification Credential (TWIC), as well as the need to ensure that adequate resources are available for federal agencies with responsibility for port security, particularly the U.S. Coast Guard and Customs and Border Protection.

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