Op-ed: A fair accounting of Maritime Heritage Grant funding

Every question deserves an answer, and as maritime administrator of the United States, I feel that the U.S. maritime industry and community deserve a factual answer to the question “where did the Maritime Heritage Grant money go?”    Over recent months, I’ve been struck by frantic efforts to portray a shady world of legal irregularities, sinister connections and improbable coincidences surrounding the handling of funds from recycled obsolete Federal vessels. Among these, there was even an eyebrow-raising, anxiety-inducing column driven by the conspicuous question: “where did the Maritime Heritage Grant money go?”
   Every question — good or bad — deserves an answer, and as maritime administrator of the United States, I feel that the U.S. maritime industry and our greater community deserve a factual answer.
   So, where did the Maritime Heritage Grant money go?  
   Brace yourselves. The Maritime Heritage Grant (MHG) Money went to — and continues to go to — maritime heritage preservation efforts.
   Since 2001, the Maritime Administration has sent over 200 obsolete federally-owned commercial vessels to domestic steel recyclers. Awarding vessels to U.S. recyclers on a “best government value” criteria consistent with Federal Acquisition Regulation practices (evaluating recyclers’ performance history, dismantling schedule, and other non-monetary factors), ensures a safe and environmentally-responsible final chapter for these aging Federal assets. In addition, by allocating the recycling proceeds to three MarAd program areas, we are enabling these vessels to serve our Nation long past the end of their operational lives. 
   As required by law (54 U.S.C. § 308704)—MarAd allocates vessel recycling proceeds in the following manner:

• 25 percent for maritime heritage preservation efforts, including the National Maritime Heritage Grant Program operated by the National Park Service (NPS).
• 25 percent for the upkeep and care of the U.S. Merchant Marine Academy (USMMA) and six state maritime academies.
• 50 percent for the maintenance and repair of National Defense Reserve Fleet Vessels.

   Since 2005, MarAd has collected nearly $75.8 million from vessel recycling sales, and by law, MarAd maintains a full accounting of these funds. I am proud to report that MarAd has made approximately $19 million, or 25 percent of the collected funds, available for maritime heritage preservation efforts. 
   Of this $19 million,

• $1.3 million funded a myriad of Federal Maritime Heritage Asset preservation projects, including documenting oral histories of surviving WWII merchant mariner veterans, and creating a public database detailing 80 years of federally-owned vessel characteristics, milestones in service, licensure and other points of interest.
• $2.8 million was transferred to NPS in 2014 to administer a round of National Maritime Heritage (NMH) Grant Awards.
• $2 million was transferred to NPS in 2015 for a subsequent round of NMH Grants.

   If you’re thinking “not so fast there, that doesn’t add up to $19 million,” you’re 100 percent correct. 
   The remainder of the funds is slated to be split between the future preservation of Federal Maritime Heritage Assets and annual transfers to NPS of at least $2 million to fund future rounds of NMH Grant Awards. To be clear — just like money in the bank, the fact that the funds has not been spent does not mean that they are “missing.”
   Since our nation’s inception, robust maritime capabilities, industries and services have fueled our prosperity and enabled us to grow into the global economic and military power we are today. MarAd takes great pride in America’s maritime heritage, and we want more Americans to know about the crucial roles mariners have and continue to play for our nation. That’s why we have partnered with the experts at NPS and chosen a sustainable and effective course to fund our Nation’s maritime preservation efforts for the long run.
   President Abraham Lincoln once stated that “if given the truth, (the American people) can be depended upon to meet any national crisis. The great point is to bring them the real facts.” At the end of the day, opinions are not evidence, and manipulating facts to whip people into frenzy does not strengthen our industry.
   That’s why MarAd makes a persistent effort to maintain transparency across all of our agency’s divisions, and bring our industry the real facts driving our actions, including the funding of Maritime Heritage Grants. That’s why you will find all of the figures mentioned above published on our website, readily available for review.
   As a final thought, I’m proud of the work done every day by the men and women of MarAd to support the maritime industry. The maritime industry — and its heritage — is vital to our nation and its economy.

Paul “Chip” Jaenichen
Maritime Administrator,
U.S. Maritime Administration,
Washington, D.C.