Maritime Compliance Report

 While we don't know when the towing vessel inspection regulations contained in Subchapter M will officially come into force, we do know it could be as soon as within the next year, and if published as proposed, it will drastically change the industry forever. Whether a company is dreading the day, or is confident in their readiness, it is interesting to take a look at what we know about the recent Costa Concordia cruise ship disaster and draw some parallels, which may provide some insight into the future.

So why is it OK now if some credentialed mariners don't have TWICs? The Maritime Transportation Security Act of 2002 is counter-terrorism legislation which requires the prevention or deterrence of a transportation security incident (TSI). A "TSI" is defined as a security incident resulting in significant loss of life, environmental damage, transportation system disruption, or economic disruption in a particular area. The Coast Guard, in establishing the applicability of the security regulations, determined some vessels to be at a low risk of being involved in a TSI, and excluded them from the applicability. It is those vessels, which are at low risk of a TSI and have no security plan, which will be allowed to have captains without TWICs. Whether you agree with this or not, one good thing which I hope may come from it is it may help us refocus on the intent of the security regulations, which is to prevent or deter a transportation security incident (TSI), and to avoid the complacency of, to borrow a phrase, "security theater." 

The Coast Guard has offered the industry a compliance option in the proposed towing vessel regulation: traditional Coast Guard inspections, or the Towing Vessel Safety Management System (TSMS). The TSMS was introduced to address the human element in towing vessel incidents, justified in the proposed rule by statistics which showed that human factors accounted for 54 percent of the medium and high severity towing vessel incidents. While the members of the Towing Safety Advisory Committee (TSAC) recommended that the TSMS be the backbone of any inspection program, the Coast Guard has proposed to make the TSMS a choice and not mandatory.

 


The Coast Guard contracted with the American Bureau of Shipping Group (ABSG) in 2006 to study, among other things, the impact of an inspection program on the towing industry. The findings of that study were cited by the Coast Guard, along with input from the TSAC Economic Working Group, as their reasons for making the TSMS voluntary and not mandatory: "a safety management system may not [be] a very cost-effective way to achieve safer operations, "the industry personnel were clear that effective implementation of a safety management system was a very difficult task for a company that had not previously been highly structured and had not formally documented its policies and procedures.'' TSAC Economic Working Group report stated ''[A SMS] will likely have a larger and more devastating impact on smaller companies who do not have the economic means, manpower, or even time to implement a system.'' Therefore, the Coast Guard concluded: "…it is appropriate to propose that all towing vessels subject to this rulemaking have the option of operating within a company implemented TSMS." Federal Register/ Vol. 76, No.155/ Thursday August 11, 2011/ Proposed Rule, pg.49979


This seems like a fair and well-reasoned approach by the Coast Guard. Oddly enough however, there are some in the industry who are opposed to allowing this option and who want the TSMS to be mandatory for all. In fact, reports from the first public meeting on the topic were that there was virtually no support of the traditional Coast Guard inspection option! Perhaps, companies are not concerned about the economic impact projected, but they should heed the warning that, "effective implementation of an SMS was a very difficult task.." Indeed. It is a very difficult task for any company. Why would companies oppose such a choice? Perhaps they do not yet understand what the government means by "effective implementation." But surely they will find out.


If this choice is allowed to remain in the final rule, companies will be faced with a very important choice. I suggest that before companies choose the TSMS option they first ask their captains if they will be willing to operate their vessels in strict conformance with the company's written policies and procedures in the TSMS, and not simply rely upon their experience and license when operating the vessels. If the captains respond, "Of course we will, no problem," and the company is 100% confident in that response, then they should go ahead and bet their vessel's Certificate of Inspection (COI) on it by choosing the TSMS compliance option. Otherwise, a prudent risk-based approach would dictate going with the traditional Coast Guard inspection option.

 When it comes to what constitutes full implementation of a safety management system such as the International Safety Management (ISM) Code, there seems to be a disconnect between what different stakeholders believe to be adequate. Different flag states, recognized organizations, class societies, and port state control authorities enforce the code to their own standards, not to mention each individual auditor's experience and subjective opinions.  The real disparity becomes painfully clear during times of major accident investigations and litigation, when everything is put under a microscope and the level of implementation that was considered "satisfactory" at the last audit can now constitute alleged negligence.

http://homeport.uscg.mil/mycg/portal/ep/home.do?tabId=0&BV_SessionID=@@@@1323623537.1305732674@@@@&BV_EngineID=cccfad 

 http://homeport.uscg.mil/cgi-bin/st/portal/uscg_docs/MyCG/Editorial/20110211/543 Policy ltr 11-01 VGP with enclosure.pdf?id=ee9784ac8e8fecf217d43d6fa6662f42f8c7d2ba 

I hope these comments make you confident and not worried, but in either case, consider attending the WorkBoat Show Professional Series session to hear the rest of the information and get the answers to your questions.  It should be noted that the comments above are paraphrased and not direct quotes and that the EPA does not endorse me, my company or any of our products. They simply listened and provided factual feedback. See you at the show. 

The ship security plan must be useful to the crew.  It should be specific enough to give guidance regarding what the owner/operator and approving authority have determined to be appropriate, without hindering the master who will inevitably arrive on board the ship with his own ideas of what is appropriate and what is not. 

So if regulators are either industry rejects or wannabes, the challenge for reformers is to figure out who, then, or what, makes a good regulator? A few year ago the U.S. Coast Guard instituted changes to its marine safety program in response to complaints from industry and Congress regarding a shift in focus toward security in the wake of 9/11, at the expense of the marine safety program. The jury is still out on whether the Coast Guard got to the root of its problems and only time will tell if the former MMS actually fixes its issues. But I'm not convinced that growing brand new, industry-free, regulators is a viable solution, or a wise one. 

Years ago my psychology professor told us that in order for punishment to be effective, it must be swift, severe and consistent. The example he used was that if you want a child to stop playing with matches you should immediately hold his hand over a lit stove every time you catch him doing it. Of course, that was an extreme example used to make an important point. But based upon recently published reports, it seems that Hollywood actor Brad Pitt may be of the same mind. According to Mail Online, UK, Brad Pitt has weighed in on the Gulf oil spill controversy and said he would consider the death penalty for those to blame for the disaster which killed 11 men and spilled millions of gallons of oil into the Gulf of Mexico. When asked about the people responsible for the crisis, Pitt reportedly said: "I was never for the death penalty before - I am willing to look at it again." While Mr. Pitt's comments may seem over the top, and based upon emotion, they raise an important point about compliance.

 


The truth is no regulatory program can be effective without significant consequences being consistently imposed. As a Coast Guard inspector years ago a representative of a barge company admitted to me that the owner had made a conscious business decision to not bring barges in for inspection if they were on charter. The company had half of their fleet operating with expired Certificates of Inspection in violation of federal regulations. The owner's reasoning was that any fine that the Coast Guard might issue would be less money than he would lose by taking the barges off charter and bringing them in for inspection. In this case he was correct, and then some. Following an internal disagreement between two departments on how to address the issue, the barge company received no fine at all.

 

But even when a fine is issued, is it severe enough to compel compliance, or is it just seen as the cost of doing business? According to CBS 60 Minutes, BP was fined $108 million dollars for the disastrous 2005 Texas City refinery explosion. That seems like a great deal of money, but perhaps not to BP. Was it significant enough to inspire a cultural shift?

 

Surely we will see a number of changes as a result of the recent Gulf of Mexico oil disaster, and perhaps the process of assessing fines will be reviewed as well. Assessing fines based upon a percentage of a company's gross revenue might not be perceived as fair, but might be more effective in compelling compliance from companies with the greatest resources. Although a rational solution of any kind might not appease someone considering the death penalty.

Port security funds are supposed to be allocated to projects that will have the greatest impact. So, why would scarce taxpayer dollars be spent on fences and cameras to protect non-threatening areas such as settling ponds far away from the nearest waterway? The answer, most likely, is human error. The International Ship and Port Security (ISPS) Code requires port facilities around the globe to comply with the maritime security requirements of the Code. For U.S. port facilities, the U.S. Coast Guard regulations derived from Maritime Transportation Security Act (MTSA) of 2002 provided a definition of the term "facility." However, many years later, there are still conflicting opinions regarding what portions of a facility must be included under the maritime security regulations. The definition of a facility, beyond the description of the waterfront portion, calls for "any contiguous or adjoining property" to be included. Despite this definition, some facilities simply fenced off their docks, called that their facility, and got away with it. Other similar facilities were required to spend tens of thousands of dollars on fencing and other access control issues for their entire property.To clarify "contiguous property," the Coast Guard published guidance which states that in a case where a public street (such as a river road) splits a facility property, the maritime security regulations may only apply to the water side of the road. The example used in the policy guidance is an oil or hazardous material transfer facility with a pipeline crossing over the road. Despite this guidance, there are many facilities where the regulations have been applied to both sides of the road. In addition to costing facilities a great deal of money having to implement a set of regulations where they shouldn't apply, port security grant money is allocated in some cases to secure areas that are no threat at all of a transportation security incident (TSI). It's important to get a facility's footprint correct, not only to save the facility money on implementation issues such as Transportation Worker Identification Credential (TWIC) requirements, but to ensure that the country's limited maritime security resources are spent where the threat is the greatest.   Some Coast Guard personnel may attribute this disparity to individual Captain of the Port (COTP) authority. But in reality, many of these mistakes were made initially due to a lack of understanding of the applicability and policy guidance. We have been successful in getting a number of these facility footprints corrected through the Coast Guard's formal appeals process, saving the facilities thousands of dollars and hopefully avoiding future misappropriation of port security grant money.   Industry should not shy away from questioning the opinions of enforcement personnel out of fear of retaliation. The Coast Guard's policy is that it encourages appeals from industry. Everyone benefits from a constructive dialogue. Going along with things that you know are incorrect usually just leaves you chasing your tail every time a new inspector shows up. 

The Coast Guard may be guilty of officiousness but certainly not conspiracy. It is difficult to win in the court of public opinion when local officials have the upper hand when dealing with the media. But the media spin must be considered on every action taken these days, even when drafting letters not intended for public disclosure. Who would have thought that five years after the Coast Guard performed heroically in the saving of over 24,000 lives during Hurricane Katrina, that they would be publically booed by the same citizens when their presence was announced at a minor league baseball game?