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THE JONES ACT
GRASSROOT INSTITUTE OF HAWAII
Jones Act waivers aren't a solution; they're a symptom of the problem
WINSTON & STRAWN LLP
What is the Jones Act? Separating Fact from Fiction
K&L GATES LLP
U.S. Maritime and Public Policy and Law Alert
AMERICAN BAR ASSOCIATION
American Bar Association Adopts Resolution Seeking Permanent Jones Act Waiver
for Puerto Rico
PRESIDENT DONALD TRUMP▫GOVERNOR DAVID IGE
FEMA Emergency Management Declarations for State of Hawaii
_________________________________________________
Grassroot Institute of Hawaii
Jones Act waivers for areas hit by hurricanes have become more common, but
they aren't automatic. Limited waivers were granted after Hurricane Sandy in
2012 and hurricanes Katrina and Rita in 2005. Opponents of the waivers claim
they aren't necessary, won't help or won't result in additional shipments of
supplies. Following Hurricane Rita, the U.S. shipping industry claimed there
were sufcient Jones Act ships to help.
Waivers are granted on the theory that they're necessary for national security.
While this is not necessarily a difcult case to make, someone does need to
request the waiver. In an area like Hawaii, politicians (who would ordinarily
make the request) often have existing relationships with Jones Act interests.
That's why the Grassroot Institute decided to step in when Hawaii was
threatened by Hurricane Lane.
Few major political fgures in Hawaii have dared to oppose the well-heeled
Jones Act interests, so the Grassroot Institute decided not to wait until after the
disaster to ask for help.
On Aug. 22, we sent a letter to President Donald Trump, requesting a Jones Act
waiver for Hawaii if the hurricane were to hit our state.
The fact that a waiver is needed to address emergency situations is eloquent
testimony to the fact that the Jones Act is a continuous burden to businesses
and consumers. In essence, U.S. Jones Act policy could be summarized as: “We
expect you to put up with the expense and inconvenience all of the time — but
if you’re really in trouble, we'll give you a break.”
It is absurd that we are reduced to petitioning for relief from the act during an
emergency. It is more absurd that Congress hasn't acted to modernize the Act
and eliminate the harm that it does when we're not in crisis.
Source: Jones Act waivers aren't a solution; they're a symptom of the problem By Malia Hill,
Policy Director, Grassroot Institute of Hawaii. Published in the Hill. September 15, 2018,
accessed September 15, 2018 http://thehill.com/opinion/international/406571-jones-act-
waivers-arent-a-solution-theyre-a-symptom-of-the-problem
_____________________
Restricting U.S. maritime commerce to U.S. vessels did not start in 1920
Restricting U.S. domestic maritime commerce to U.S. citizens has been the law
of the land since 1789. The third act of the Republic (before Congress
established any department of the U.S. Government) imposed a tarif on all
domestic cargo movements, with foreign ships paying a tarif eight times greater
than the U.S. ship tarif. In 1817, Congress changed the law more or less to the
way it is today—and was prior to the Merchant Marine Act, 1920—restricting
U.S. trade to U.S. ships. The Jones Act has changed over time since 1817, but
the main principle of reserving U.S. domestic maritime commerce to U.S.
citizens has remained consistent.
The Jones Act is not a unique restriction
The U.S. restricts all of its domestic trade—whether by air, rail, truck or
otherwise—to U.S. citizens (or permanent residents or qualifed visa holders),
who must comply with U.S. safety, environmental, labor, tax, and other laws.
The Jones Act waiver law was intended to be used for national security only
The 1950 law that permits waiver of the Jones Act is a Cold War creation. The
Jones Act cannot be waived except where it is in the “interest of national
defense.” The law was never intended to be used for natural disasters. And,
until 2005, it was not used for natural disasters. President Bush created the frst
precedent of waiving the Jones Act to alleviate a regional fuel shortage after
Hurricane Katrina, with a short “period of time waiver.” Similar waivers were
granted after hurricanes Rita, Sandy, and Irma. The recent hurricane Maria
waiver is the frst time a short period of time waiver has been expanded to
cover all merchandise, not just fuel.
The Jones Act does not prevent foreign vessels from serving Puerto Rico
The Jones Act restricts U.S. domestic maritime commerce to qualifed U.S.-fag
vessels. Cargo movements from the Lower 48 states to Puerto Rico are covered
by the law. The Jones Act does not apply to U.S. foreign commerce. Every
cargo coming to Puerto Rico — like every cargo coming to the rest of the
United States — from a foreign country can be carried in a foreign vessel
because that is international, not interstate, commerce. [Emphasis Supplied]
Source: What is the Jones Act? Separating Fact from Fiction By Charlie Papavizas, Esq.,
Winston & Strawn LLP. September 29, 2017, accessed September 15, 2018
https://www.lexology.com/library/detail.aspx?g=e5180bfb-e70b-492c-bf0b-7243e152ea4f
_________________________________________________
U.S. MARITIME AND PUBLIC POLICY AND LAW ALERT
The Eerie Similarities Between The Gulf Spill In 2010 And Hurricane Maria In Puerto Rico 7
Years Later: How the Facts About the Jones Act Got Thrown Overboard
By Mark Ruge, Esq., Darrell L. Conner, Esq., Sarah M. Beason, Esq. Elle M. Stuart, Esq.
K&L Gates LLP
February 7, 2018, accessed September 15, 2018
http://www.klgates.com/the-eerie-similarities-between-the-gulf-spill-in-2010-and-hurricane-maria-in-puerto-rico-7-years-
later-how-the-facts-about-the-jones-act-got-thrown-overboard-02-07-2018/
The massive public attention focused on the Jones Act in Puerto Rico
immediately after Hurricane Maria was eerily analogous to the public spotlight
on the law during the Deepwater Horizon oil spill (the “Gulf Spill”) in the spring
of 2010. In both cases, the Jones Act was almost immediately singled out for
public criticism as an impediment to the recovery eforts. In both cases, many
of the criticisms refected a material misunderstanding of the mechanics of the
Jones Act and the operational rhythms of the domestic maritime industry. In
both cases, opponents used the Jones Act as a political tool to attack the sitting
president, criticizing him for not waiving the Jones Act to assist with the relief
efort. And, in both cases, at the end of the day, it was clear that the Jones Act
had been falsely accused — that is, that the law had in no way impeded the
recovery eforts. One lesson is abundantly clear: in the middle of a national
emergency, political crisis, humanitarian disaster, and media circus, the facts
sometimes get left by the wayside. Or, as RADM Mark Buzby, Administrator of
the U.S. Maritime Administration, said recently, the true story about Jones Act
shipping after Hurricane Maria was “obliterated by a barrage of false narratives
and uninformed reporting.”
In times of crisis, such as the Deepwater Horizon spill or Hurricane Maria, the
facts sometimes get ignored in the chaos and confusion. During two of the
largest disasters of the last decade, the Jones Act has been unfairly blamed for
preventing the quick provision of necessary support. Yet in both situations, as
the facts now show, the American domestic maritime industry was an integral
part of the recovery efort.
_________________________________________________
MARITIMEFEDWATCH
AMERICAN BAR ASSOCIATION ADOPTS RESOLUTION SEEKING
PERMANENT JONES ACT WAIVER FOR PUERTO RICO
By Charlie Papavizas, Esq., Winston & Strawn LLP
August 10, 2018, accessed September 15, 2018
https://www.winston.com/en/maritime-fedwatch/american-bar-association-adopts-resolution-seeking-
permanent-jones-act-waiver-for-puerto-rico.html
The American Bar Association House of Delegates adopted a resolution on
August 7, 2018 which “urges Congress to enact legislation to provide a
permanent exemption for the Commonwealth of Puerto Rico from the
requirements of the Jones Act, 46 U.S.C. §§ 55101 et seq.”
The statutory citation utilized by the ABA is a section that actually sets forth the
terms of exemption for certain U.S. territories, such as American Samoa and the
U.S. Virgin Islands. The next section, section 55102, is the provision that
mandates that all “merchandise” transported between two “points in the United
States” must be transported by a qualifed U.S.-fag (i.e., U.S. registered or U.S.
documented) vessel.
The term “Jones Act,” although in widespread popular use, is actually a
misnomer because that restriction regarding the transportation of
“merchandise” contained in the current federal statutes derives from section 27
in an Act — the Merchant Marine Act, 1920. Another section of that Act
(section 33) is also called the “Jones Act,” although it has to do with merchant
mariner compensation for workplace injuries — not the transportation of
“merchandise.” There is also yet another “Jones Act,” which is the 1917 Jones-
Shafroth Act. That Act conferred U.S. citizenship upon persons born in Puerto
Rico. In addition, there other laws which restrict towing, dredging, the carriage
of passengers and fshing in U.S. waters to qualifed U.S.-fag vessels that were
not enacted as part of the Merchant Marine Act, 1920. The use of “et seq” in
the resolution could mean that it was intended to seek an exemption for Puerto
Rico from some of these laws as well since several of the laws have been
codifed as sections of Title 46 following section 55101.
The report accompanying the resolution implies that the Merchant Marine Act,
1920 was a war time measure. In fact, that Act was enacted primarily to deal
with the problem of how to dispose of all of the vessels the U.S. Government
built to fght World War I. Section 27 of the Act was not central to the purpose
of the 1920 Act and was merely a restatement of a law originating in 1817,
which also restricted U.S. domestic commerce to qualifed U.S.-fag vessels.
Restricting domestic commerce to U.S. vessels has been the law of the land
since 1789.
The report also does not appear to recognize that the Jones Act is legislation
that applies a fundamental attribute of sovereignty, which is to restrict domestic
commerce to domestic citizens. Restrictions similar to the Jones Act apply to
other modes of transportation in the U.S. such as aviation.
Finally, the report cites a number of studies to conclude that “the negative
impacts of the Jones Act on Puerto Rico are undeniable.” The report does not
account for a study released in July 2018 by the American Maritime
Partnership entitled “The Impact of the Jones Act on Puerto Rico” which
concluded the Jones Act has no impact on either retail prices or the cost of
living in Puerto Rico.
_________________________________________________
ALL REQUESTS FOR A DECLARATION BY THE PRESIDENT THAT A
MAJOR DISASTER EXISTS SHALL BE MADE BY THE GOVERNOR OF THE
AFFECTED STATE. A State also includes The District of Columbia, Puerto
Rico, the Virgin Islands, Guam, American Samoa, and the Commonwealth of
the Northern Mariana Islands. The Marshall Islands and the Federated States of
Micronesia are also eligible to request a Declaration and receive assistance.
Source: Department of Homeland Security. FEMA. https://www.fema.gov/declaration-process
KILAUEA
May 9, 2018 - Governor David Ige submits request for Presidential Declaration
May 10, 2018 - President Donald Trump approves request
HURRICANE LANE
May 22, 2018 - Governor David Ige submits request for Presidential Declaration
May 22, 2018 - President Donald Trump approves request
TROPICAL STORM OLIVIA
September 11, 2018 - Governor David Ige submits request for Presidential Declaration
September 12, 2018 - President Donald Trump approves request
___________________________
IS THE JONES ACT BEING OBLITERATED BY A BARRAGE OF
FALSE NARRATIVES AND UNINFORMED REPORTING?

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The Jones Act - Hurricances and Tropical Storms - Emergency Declarations - False Narratives and Uninformed Reporting

  • 1. THE JONES ACT GRASSROOT INSTITUTE OF HAWAII Jones Act waivers aren't a solution; they're a symptom of the problem WINSTON & STRAWN LLP What is the Jones Act? Separating Fact from Fiction K&L GATES LLP U.S. Maritime and Public Policy and Law Alert AMERICAN BAR ASSOCIATION American Bar Association Adopts Resolution Seeking Permanent Jones Act Waiver for Puerto Rico PRESIDENT DONALD TRUMP▫GOVERNOR DAVID IGE FEMA Emergency Management Declarations for State of Hawaii _________________________________________________ Grassroot Institute of Hawaii Jones Act waivers for areas hit by hurricanes have become more common, but they aren't automatic. Limited waivers were granted after Hurricane Sandy in 2012 and hurricanes Katrina and Rita in 2005. Opponents of the waivers claim they aren't necessary, won't help or won't result in additional shipments of supplies. Following Hurricane Rita, the U.S. shipping industry claimed there were sufcient Jones Act ships to help. Waivers are granted on the theory that they're necessary for national security. While this is not necessarily a difcult case to make, someone does need to request the waiver. In an area like Hawaii, politicians (who would ordinarily make the request) often have existing relationships with Jones Act interests. That's why the Grassroot Institute decided to step in when Hawaii was threatened by Hurricane Lane. Few major political fgures in Hawaii have dared to oppose the well-heeled Jones Act interests, so the Grassroot Institute decided not to wait until after the disaster to ask for help.
  • 2. On Aug. 22, we sent a letter to President Donald Trump, requesting a Jones Act waiver for Hawaii if the hurricane were to hit our state. The fact that a waiver is needed to address emergency situations is eloquent testimony to the fact that the Jones Act is a continuous burden to businesses and consumers. In essence, U.S. Jones Act policy could be summarized as: “We expect you to put up with the expense and inconvenience all of the time — but if you’re really in trouble, we'll give you a break.” It is absurd that we are reduced to petitioning for relief from the act during an emergency. It is more absurd that Congress hasn't acted to modernize the Act and eliminate the harm that it does when we're not in crisis. Source: Jones Act waivers aren't a solution; they're a symptom of the problem By Malia Hill, Policy Director, Grassroot Institute of Hawaii. Published in the Hill. September 15, 2018, accessed September 15, 2018 http://thehill.com/opinion/international/406571-jones-act- waivers-arent-a-solution-theyre-a-symptom-of-the-problem _____________________ Restricting U.S. maritime commerce to U.S. vessels did not start in 1920 Restricting U.S. domestic maritime commerce to U.S. citizens has been the law of the land since 1789. The third act of the Republic (before Congress established any department of the U.S. Government) imposed a tarif on all domestic cargo movements, with foreign ships paying a tarif eight times greater than the U.S. ship tarif. In 1817, Congress changed the law more or less to the way it is today—and was prior to the Merchant Marine Act, 1920—restricting U.S. trade to U.S. ships. The Jones Act has changed over time since 1817, but the main principle of reserving U.S. domestic maritime commerce to U.S. citizens has remained consistent. The Jones Act is not a unique restriction The U.S. restricts all of its domestic trade—whether by air, rail, truck or otherwise—to U.S. citizens (or permanent residents or qualifed visa holders), who must comply with U.S. safety, environmental, labor, tax, and other laws.
  • 3. The Jones Act waiver law was intended to be used for national security only The 1950 law that permits waiver of the Jones Act is a Cold War creation. The Jones Act cannot be waived except where it is in the “interest of national defense.” The law was never intended to be used for natural disasters. And, until 2005, it was not used for natural disasters. President Bush created the frst precedent of waiving the Jones Act to alleviate a regional fuel shortage after Hurricane Katrina, with a short “period of time waiver.” Similar waivers were granted after hurricanes Rita, Sandy, and Irma. The recent hurricane Maria waiver is the frst time a short period of time waiver has been expanded to cover all merchandise, not just fuel. The Jones Act does not prevent foreign vessels from serving Puerto Rico The Jones Act restricts U.S. domestic maritime commerce to qualifed U.S.-fag vessels. Cargo movements from the Lower 48 states to Puerto Rico are covered by the law. The Jones Act does not apply to U.S. foreign commerce. Every cargo coming to Puerto Rico — like every cargo coming to the rest of the United States — from a foreign country can be carried in a foreign vessel because that is international, not interstate, commerce. [Emphasis Supplied] Source: What is the Jones Act? Separating Fact from Fiction By Charlie Papavizas, Esq., Winston & Strawn LLP. September 29, 2017, accessed September 15, 2018 https://www.lexology.com/library/detail.aspx?g=e5180bfb-e70b-492c-bf0b-7243e152ea4f _________________________________________________ U.S. MARITIME AND PUBLIC POLICY AND LAW ALERT The Eerie Similarities Between The Gulf Spill In 2010 And Hurricane Maria In Puerto Rico 7 Years Later: How the Facts About the Jones Act Got Thrown Overboard By Mark Ruge, Esq., Darrell L. Conner, Esq., Sarah M. Beason, Esq. Elle M. Stuart, Esq. K&L Gates LLP February 7, 2018, accessed September 15, 2018 http://www.klgates.com/the-eerie-similarities-between-the-gulf-spill-in-2010-and-hurricane-maria-in-puerto-rico-7-years- later-how-the-facts-about-the-jones-act-got-thrown-overboard-02-07-2018/
  • 4. The massive public attention focused on the Jones Act in Puerto Rico immediately after Hurricane Maria was eerily analogous to the public spotlight on the law during the Deepwater Horizon oil spill (the “Gulf Spill”) in the spring of 2010. In both cases, the Jones Act was almost immediately singled out for public criticism as an impediment to the recovery eforts. In both cases, many of the criticisms refected a material misunderstanding of the mechanics of the Jones Act and the operational rhythms of the domestic maritime industry. In both cases, opponents used the Jones Act as a political tool to attack the sitting president, criticizing him for not waiving the Jones Act to assist with the relief efort. And, in both cases, at the end of the day, it was clear that the Jones Act had been falsely accused — that is, that the law had in no way impeded the recovery eforts. One lesson is abundantly clear: in the middle of a national emergency, political crisis, humanitarian disaster, and media circus, the facts sometimes get left by the wayside. Or, as RADM Mark Buzby, Administrator of the U.S. Maritime Administration, said recently, the true story about Jones Act shipping after Hurricane Maria was “obliterated by a barrage of false narratives and uninformed reporting.” In times of crisis, such as the Deepwater Horizon spill or Hurricane Maria, the facts sometimes get ignored in the chaos and confusion. During two of the largest disasters of the last decade, the Jones Act has been unfairly blamed for preventing the quick provision of necessary support. Yet in both situations, as the facts now show, the American domestic maritime industry was an integral part of the recovery efort. _________________________________________________ MARITIMEFEDWATCH AMERICAN BAR ASSOCIATION ADOPTS RESOLUTION SEEKING PERMANENT JONES ACT WAIVER FOR PUERTO RICO By Charlie Papavizas, Esq., Winston & Strawn LLP August 10, 2018, accessed September 15, 2018 https://www.winston.com/en/maritime-fedwatch/american-bar-association-adopts-resolution-seeking- permanent-jones-act-waiver-for-puerto-rico.html
  • 5. The American Bar Association House of Delegates adopted a resolution on August 7, 2018 which “urges Congress to enact legislation to provide a permanent exemption for the Commonwealth of Puerto Rico from the requirements of the Jones Act, 46 U.S.C. §§ 55101 et seq.” The statutory citation utilized by the ABA is a section that actually sets forth the terms of exemption for certain U.S. territories, such as American Samoa and the U.S. Virgin Islands. The next section, section 55102, is the provision that mandates that all “merchandise” transported between two “points in the United States” must be transported by a qualifed U.S.-fag (i.e., U.S. registered or U.S. documented) vessel. The term “Jones Act,” although in widespread popular use, is actually a misnomer because that restriction regarding the transportation of “merchandise” contained in the current federal statutes derives from section 27 in an Act — the Merchant Marine Act, 1920. Another section of that Act (section 33) is also called the “Jones Act,” although it has to do with merchant mariner compensation for workplace injuries — not the transportation of “merchandise.” There is also yet another “Jones Act,” which is the 1917 Jones- Shafroth Act. That Act conferred U.S. citizenship upon persons born in Puerto Rico. In addition, there other laws which restrict towing, dredging, the carriage of passengers and fshing in U.S. waters to qualifed U.S.-fag vessels that were not enacted as part of the Merchant Marine Act, 1920. The use of “et seq” in the resolution could mean that it was intended to seek an exemption for Puerto Rico from some of these laws as well since several of the laws have been codifed as sections of Title 46 following section 55101. The report accompanying the resolution implies that the Merchant Marine Act, 1920 was a war time measure. In fact, that Act was enacted primarily to deal with the problem of how to dispose of all of the vessels the U.S. Government built to fght World War I. Section 27 of the Act was not central to the purpose of the 1920 Act and was merely a restatement of a law originating in 1817, which also restricted U.S. domestic commerce to qualifed U.S.-fag vessels. Restricting domestic commerce to U.S. vessels has been the law of the land since 1789.
  • 6. The report also does not appear to recognize that the Jones Act is legislation that applies a fundamental attribute of sovereignty, which is to restrict domestic commerce to domestic citizens. Restrictions similar to the Jones Act apply to other modes of transportation in the U.S. such as aviation. Finally, the report cites a number of studies to conclude that “the negative impacts of the Jones Act on Puerto Rico are undeniable.” The report does not account for a study released in July 2018 by the American Maritime Partnership entitled “The Impact of the Jones Act on Puerto Rico” which concluded the Jones Act has no impact on either retail prices or the cost of living in Puerto Rico. _________________________________________________ ALL REQUESTS FOR A DECLARATION BY THE PRESIDENT THAT A MAJOR DISASTER EXISTS SHALL BE MADE BY THE GOVERNOR OF THE AFFECTED STATE. A State also includes The District of Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands. The Marshall Islands and the Federated States of Micronesia are also eligible to request a Declaration and receive assistance. Source: Department of Homeland Security. FEMA. https://www.fema.gov/declaration-process KILAUEA May 9, 2018 - Governor David Ige submits request for Presidential Declaration May 10, 2018 - President Donald Trump approves request HURRICANE LANE May 22, 2018 - Governor David Ige submits request for Presidential Declaration May 22, 2018 - President Donald Trump approves request TROPICAL STORM OLIVIA September 11, 2018 - Governor David Ige submits request for Presidential Declaration September 12, 2018 - President Donald Trump approves request ___________________________ IS THE JONES ACT BEING OBLITERATED BY A BARRAGE OF FALSE NARRATIVES AND UNINFORMED REPORTING?