Are our Ports Safe?

By Joan M. Bondareff and Patricia O’Neill, Blank Rome LLP
Friday, July 19, 2013
Joan Bondareff

A Hodgepodge of Maritime Security Laws Come into Question

Two recent reports have raised alarms about the security of our ports and the cargo that enters them by containers every day. The top North American container ports handle more than 35 million containers per year bringing vital goods to U.S. homes and companies every day. Without this freight, our economy would be at a standstill. But one nuclear device placed into a shipping container could wreak havoc not just at the port it enters, but also with the surrounding population of our busiest ports such as New York/New Jersey, Los Angeles, and Long Beach.
This article reviews those reports and asks whether the measures implemented by the U.S. adequately address the increasing concerns surrounding maritime port security, especially in light of the recent Boston bombing.

Discussion

Maritime security for the U.S. consists of a hodgepodge of laws, regulations and agencies responsible for making sure our ports and the cargo that enters it are secure. Since 9/11, Congress has passed a number of laws that address maritime security, including the Maritime Transportation Security Act of 2002, the Security and Accountability for Every Port Act of 2006 (Safe Port Act) and the 9/11 Commission Act of 2007.  Authority to administer those laws falls under the Department of Homeland Security (DHS) and is divided between various DHS entities, including the United States Coast Guard, the Transportation Security Administration, FEMA (which administers the Port Security Grant Program), Customs and Border Protection (CBP), and the Domestic Nuclear Detection Office (DNDO), among others.
DNDO and CBP share responsibility for detecting nuclear materials that may be placed in a shipping container and enter the U.S. undetected. Earlier this year, in February 2013, DHS Inspector General (IG) issued a report on the state of the Radiation Portal Monitoring Program administered by CBP and DNDO.  This report raised a number of serious questions about the program that is supposed to monitor and detect nuclear devices that may be placed on board a ship entering a U.S. port.   Under the Safe Port Act, all containers entering the U.S. at the 22 busiest ports must be screened for radiation.   DNDO tests, acquires, deploys and provides maintenance for large-scale radiation detectors, called radiation portal monitors (RPMs), during the first year of operation; thereafter, CBP has the lead for operating and maintaining the RPMs.
The IG found that while there are 444 RPMs operating at seaports throughout the U.S., and all cargo is being screened, some RPMs were utilized infrequently or not at all.  The IG also found the two DHS components, CBP and DNDO, do not fully coordinate or centrally manage the RPM program to ensure effective and efficient operations.   In response to this critique, the agencies agreed to do better in the future.
The CBP has relied largely on a trusted shipper program, Customs-Trade Partnership Against Terrorism (C-TPAT), to ensure the safety of cargo being shipped into the U.S. from the largest ports around the world.   Participation in this program is voluntary and its members include various groups within the maritime industry, including but not limited to shippers, ocean carriers, logistics providers, freight forwarders and manufacturers. C-TPAT has been effective in pushing the borders of trade and security outside the U.S.; however, its success depends largely on its members to conduct due diligence and ensure the safety of the cargo. This is because only a small percentage of containers bound for the United States, approximately four percent, are actually scanned overseas prior to entering U.S. ports. The remainders are simply screened.
In addition to the RPM Program and the C-TPAT Program, CBP has implemented the 24-Hour Advance Manifest Rule, which allows CBP to screen cargo before it is loaded in a foreign port on a vessel bound for the U.S. by requiring the electronic transmission of vessel cargo manifest information to CBP not less than 24 hours before the cargo is loaded on that vessel in the foreign port.
As the result of a Coast Guard and Transportation Security Administration initiative to improve security in the U.S. transportation system, the Transportation Worker Identification Credential (TWIC) program was implemented in 2007.  The TWIC program mandates the use of a tamper-resistant biometric credential issued to maritime workers, or other authorized individuals, to access secure areas of port facilities and vessels. The goal of the programs is, in part, to enhance security by determining those individuals eligible for authorized unescorted access to secure port facilities and ensuring that unauthorized individuals are denied unescorted access to secure port facility areas. 
At the time the TWIC Final Rule was published in 2007, it did not require maritime owners and operators to purchase and install TWIC compatible card readers, however, through the course of a pilot program, it was anticipated that such card readers would eventually be in place. Six years later, the start-up period for card readers remains slow, with implementation of card readers mostly non-existent due to delays in developing card reader technology.  This has resulted in criticism from the industry and the Government Accountability Office (GAO), which recently identified the program as flawed and proposed that DHS explore other alternatives. 
Notwithstanding the ongoing criticism and delays, the Coast Guard is moving forward with this port security initiative, as evidenced by new rules proposed by the Coast Guard on March 22, 2013, which would require vessels and maritime facilities deemed high risk to install electronic TWIC card readers, rather than rely on visual inspection of the cards alone.  Public comment on the proposed rules remains open until June 20, 2013, and with high level criticism from both Congress and industry members, the future of the TWIC program remains unclear.
Since 9/11, a debate has persisted whether all containers must be scanned for nuclear and other hazardous materials or whether the current process to simply screen a percentage of suspicious containers for harmful goods is adequate.  The 9/11 Commission recommended that all containers be scanned.  As a result,  and in furtherance of this goal,  Congress passed a law, the 9/11 Commission Act, which  required 100% of containers to be scanned by July 1, 2012, and also granted the Secretary of Homeland Security authority to waive this deadline, for a period of two years at a time, under certain circumstances.
Since the implementation of the 9/11 Commission Act, DHS tested the 100% scanning requirement in enumerated ports such as Hong Kong, Oman, Pakistan, South Korea, and the UK, in a program called the Secure Freight Initiative.  However, none of the ports were able to meet the 100% scanning requirement and still keep the cargo moving in an expeditious manner.  As noted by DHS Secretary Janet Napolitano before the House Homeland Security Committee in 2012, the scanning requirement was neither practical nor affordable. 
As a result, in May 2012, the Secretary officially granted a waiver of the requirement for a period of two years, as the law allowed her to do, thereby postponing the mandate that all inbound containers be scanned. In a letter to House and Senate Homeland Security committees, the Secretary noted that the extension was necessary because implementing the requirement at this time would “have a significant and negative impact on trade capacity and the flow of cargo.”Additionally, she found that foreign ports lack the physical space and configuration for efficiently routing cargo through inspection stations.
Recently, in light of the Boston bombing, a number of maritime security experts have questioned whether the U.S. is doing enough to protect our seaports, the cargo entering those ports and the population from a smuggled nuclear device in a container.  At a May 29, 2013 panel on “Nuclear Terrorism: What’s at Stake”, hosted by the American Security Project in Washington, D.C., as reported in “Security Management” (http://www.securitymanagement.com/print/12510), Dr. Stephen Flynn, a professor at Northeastern University, said that “smuggling  through shipping containers is already happening on a daily basis, which demonstrates the possibility of a nuclear device, planted by terrorists to go undetected.”  His concerns were echoed by other panelists, including David Waller, the former deputy director general of the International Atomic Energy Agency (IAEA) and Rear Admiral (ret.) Jay Cohen, former Under Secretary of Homeland Security for Science and Technology.  According to Waller, “[n]uclear material arriving at a U.S. port in a container, in all likelihood, has arrived from elsewhere, and [was]shipped undetected from elsewhere” making international cooperation “very important in securing our ports.”  Cohen agreed that the nuclear threat was very real, stating that “[i]t’s only a question of where, when, and to what magnitude.” 

What are the Administration and Congress Doing to Respond to the Threat?
Recently, the Administration has proposed merging all security grant programs into a block grant that would be primarily administered by the states. This block grant would include the port security grant program, known as the “Port Security Grant Program” (PSGP) administered by FEMA. This program gives grants to the highest risk ports to acquire equipment on a DHS approved list and awards grants for other port infrastructure improvements to further port security.  The program was originally authorized at $400 million a year and funded largely at that level.  However, the authorized and appropriated level of funding has declined substantially since 9/11 and the current 2013 fiscal year funding remains only at $94 million, leaving scant resources to be divided among the major U.S. ports.  This funding is directed towards the implementation of Area Maritime Security Plans (AMSP) and Facility Security Plans (FSP) among port authorities, facility operators, and State and local government agencies that are required to provide port security services. 
The American Association of Port Authorities (AAPA) has objected strenuously to both the block grant approach and the reduction in funding.  In a May 14, 2013 letter to the leadership of the House Homeland Security Appropriations Subcommittee, AAPA stated that “[o]ur economy, our safety, and our national defense depend largely on how well we can construct and maintain a security infrastructure at our ports,” and urged the Subcommittee to increase Port Security Grants to prior years’ funding levels.
On June 7, 2013, the House passed H.R. 2217, the Homeland Security Appropriations bill for FY 2014.  The bill reduced overall funding for DHS by $617.6 million below the FY2013 enacted level, and $34.9 million below the President’s request.  On the House Floor, Congresswoman Julia Brownley (D-CA) offered an amendment to cut, then add back, $97.5 million for port security grants to stress the importance of these grants.  Her amendment was agreed to.  Subsequently, the White House advised Congress that the President will veto H.R. 2217 because it reduces funding for the Department and is not part of an overall budget for FY2014.  The White House did credit Congress for giving some additional flexibility to the Secretary in allocating grant funds.

Conclusion

Ports are certainly more secure than they were before 9/11.  But since 9/11, we have also lost sight of the critical role ports play in our economy and transportation system.  Funding on port infrastructure and port security has steadily declined.  And, in some ways, port security has been the stepchild of our transportation security program.  Yet, one nuclear device smuggled into a container and into a U.S. port could wreak devastation on that port, the surrounding community, and our economy.  The Congress and Administration should work together to improve funding for port security and port infrastructure and to ensure closer coordination among the responsible agencies, giving thought to creating a lead agency in DHS for port security and in the Department of Transportation for a new port promotion agency.

(As published in the July 2013 edition of Maritime Reporter & Engineering News - www.marinelink.com)

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