American Shipbuilding Association

American Shipbuilder

Volume 15, Issue 1 January - February 2009

Economic Stimulus Bill Provides No Money in Support of Shipbuilding Jobs

On February 13th, the House and Senate passed the American Recovery and Investment Act (HR 1). Senators Thad Cochran (R-MS), Mary Landrieu (D-LA), David Vitter (R-LA), Roger Wicker (R-MS), and Representative Susan Davis (D-CA) worked in support of including funding for the Title XI Ship Loan Guarantee program. Funding of the Title XI program would have created and sustained tens of thousands of jobs in America’s shipyards and supplier base. However, the $789 billion economic stimulus bill failed to provide money in support of rebuilding America’s merchant fleet and fostering ship construction jobs vital to this country’s national defense and economic growth.

The Title XI Ship Loan Guarantee Program administered by the Maritime Administration provides small and medium sized ship owners with a federal guarantee of 87.5 percent of commercial bank loans for a period of 25 years for the construction of commercial cargo ships in the United States.  With the tightening of the credit market and hesitancy of lenders to agree to large commercial loans, the federal guarantee provided through Title XI is essential to ensuring that ship owners have access to affordable financing to rebuild America’s marine transportation infrastructure.  The Title XI program has historically had a 20 to 1 multiplier, generating $20 million in ship construction in the United States for every $1 million appropriated for the program.  It remains a sound investment of taxpayer dollars, helping to sustain economic growth across the country through increased ship construction. 

During consideration of the Senate version of the legislation, Senator Thad Cochran sponsored an amendment, which was co-sponsored by Senators Mary Landrieu, David Vitter, and Roger Wicker to transfer $50 million from the $100 million included for grants to small shipyards for facility improvements to Title XI loan guarantees.  The amendment, however, was not adopted.  During conference to reconcile the differences between the House and Senate versions of the legislation, Representative Susan Davis (D-CA) wrote a letter to the Speaker of the House of Representatives urging that money be transferred to the Title XI program.  The transfer of the money for Title XI loan guarantees would have ensured that in addition to facility investment, orders for new commercial ships would be placed in shipyards, both large and small. 

The Jones Act fleet of oceangoing ships, which carries liquid and dry cargos between U.S. ports, is past or near retirement age.   Replacement of the aging ships in the fleet is estimated at more than $12 billion.  Without the affordable financing made possible through Title XI, the majority of U.S. ship owners will not be able to replace and expand their fleets.  Funding of the program is instrumental to rebuilding America’s marine transportation infrastructure, in addition to building ships for exploration and development in support of all energy sources. 

Navy Budget Delayed Until April

The Obama Administration has directed the Department of Defense to reduce the budget it presented to the Office of Management and Budget (OMB) under the Bush Administration by as much as $50 billion.  This redo of the defense budget will delay the Administration’s FY 2010 defense budget submitted to Congress until April. 

Last October the Navy submitted its initial FY 2010 ship procurement plan to the Secretary of Defense requesting one Virginia-class attack submarine; one DDG-51 multi-mission destroyer; three littoral combat ships; two T-AKE combat logistics force ships; one mobile landing platform class of amphibious logistic ship; and two joint high speed vessels.  In the FY 2009 Defense Appropriations Act, Congress had split funded the cost of one DDG-1000 multi-mission destroyer and one LPD-17 amphibious transport dock ship, directing the Navy to budget for the completion of these ships in FY 2010.  The remainder of the split funding for these ships was included in the outgoing Bush Administration budget.    

Today’s Navy numbers 283 battle force ships.  In order to achieve a 313-ship Navy, a minimum of 12 new ships must be procured annually. 

House Names Committee Members

The House of Representatives has announced the Committee and Subcommittee assignments for the 111th Congress.  The House Defense Appropriations Subcommittee will continue to be chaired by Rep. John P. Murtha (D-PA), with Rep. Bill Young (R-FL) serving as Ranking Member.  Other members of the Subcommittee include Reps.:  Allen Boyd (D-FL), Sanford Bishop (D-GA), Norm Dicks (D-WA), Rodney Frelinghuysen (R-NJ), Kay Granger (R-TX), Marcy Kaptur (D-OH), Carolyn Kilpatrick (D-MI), Jack Kingston (R-GA), Maurice Hinchey (D-NY), James Moran (D-VA), Harold Rogers (R-KY), Steven Rothman (D-NJ), Todd Tiahrt (R-KS), and Peter Visclosky (D-IN). 

Rep. Gene Taylor (D-MS) will continue to serve as Chairman of the House Armed Service Seapower and Expeditionary Forces Subcommittee.  Rep. Todd Akin (R-MO) has been named as the Subcommittee’s Ranking Member.  The remaining Subcommittee members include Reps:  Roscoe Bartlett (R-MD), Mike Coffman (R-CO), Joe Courtney (D-CT), Brad Ellsworth (D-IN),  Randy Forbes (R-VA), Duncan Hunter, Jr. (R-CA), Jim Langevin (D-RI), Rick Larsen (D-WA), Eric Massa (D-NY), Glenn Nye (D-VA), Solomon Ortiz (D-TX), Chellie Pingree (D-ME), Tom Rooney (R-FL), Joe Sestak (D-PA), and Rob Wittman (R-VA).

Dugan Shipway Announces Retirement

On February 11th, John F. “Dugan” Shipway, President of Bath Iron Works, located in Bath, ME, and Chairman of the Board of Directors of the American Shipbuilding Association, announced that he will retire on April 1st.  Jeff Geiger will take over as President of the shipyard. 
Dugan Shipway has served as President of Bath Iron Works since April 2003.  A retired U.S. Navy Rear Admiral with 35 years of service, Mr. Shipway served in a succession of high-level posts, including Director of Strategic Systems Programs, Commander of the Naval Undersea Warfare Center, Deputy Commander for Submarines at Naval Sea Systems Command, and Program Executive Officer for Submarines.  Following his retirement from active duty, Mr. Shipway joined Electric Boat as Special Assistant to the President in July 2000, a position he retained until his appointment as President of Bath Iron Works. 
Jeff Geiger currently serves as Senior Vice President of Operations and Engineering at Bath Iron Works.  Mr. Geiger has worked at the shipyard since 1984, were he first served as a Production Planner.  In 1993, he became Vice President of Engineering and Materials, and later became Vice President of Operations.  He holds a Masters of Science in Engineering degree in Naval and Marine Engineering from the University of Michigan. 

New Partners

The American Shipbuilding Association welcomes the following companies to the Association. 

Assett, Inc.
A systems engineering firm located in Manassas, VA, the company provides technical planning, documentation systems engineering, and program assessment support to the Navy and U.S. shipyards.

Buffalo Machine Tools of Niagara, Inc.
Based in Lockport, NY, the company supplies drilling machines, hydraulic shears, sheet metal or plate bending rolls, and other machine tools.

Comsaco, Inc.
Located in Norfolk, VA, Comsaco, Inc., manufactures electrical power distribution and control equipment for naval ships. 

Derbyshire Machine & Tool Co.
A manufacturer of machined products for the Navy and U.S. shipbuilding industry, the company is located in Philadelphia, PA. 

Glenair, Inc.

Located in Glendale, CA, Glenair, Inc. manufactures and supplies electrical connector accessories.

G/O Corporation
A supplier of custom designed products for the nuclear power industry, G/O Corporation is located in Abita Springs, LA. 

International Marine and Industrial Applicators, LLC (IMIA, LLC)
A marine and offshore protective coatings company, IMIA,LLC is located in Theodore, AL.

Juniper Industries
A manufacturer of watertight doors and other marine closures, Juniper Industries is headquartered in Middle Village, NY.

The L.C. Doane Company

Headquartered in Ivoryton, CT, The L.C. Doane Company has been a leading manufacturer of  heavy-duty light fixtures for submarines and surface ships for over 50 years.    

Malcolm T. Gilliland, Inc.
A designer and manufacturer of automatic, semi-automatic, and robotic welding systems, the company is headquartered in Peachtree City, GA.

Mohawk Northeast, Inc.
Mohawk Northeast is a marine construction business that specializes in pier and breakwater construction, in addition to providing dredging and marine towing services.  The company is located in Plantsville, CT. 

Munro & Associates, Inc.

Headquartered in Troy, MI, Munro & Associates, Inc., is a consulting engineering firm that specializes in helping manufacturers improve quality and produce more competitive products. 

Philadelphia Gear Corp.
A designer and manufacturer of gear drives, Philadelphia Gear Corp., is headquartered in King of Prussia, PA.

Schneider Laboratories, Inc.
Schneider Laboratories, Inc. is an independent, AIHA / NELAC accredited, woman-owned, commercial analytical testing laboratory located in Richmond, VA.  The company provides comprehensive analysis for the asbestos, metals, industrial hygiene and environmental industries.

Reliable Pipe Supply Co., Inc.
Located in San Diego, CA, the company is a supplier of pipe, fittings, and structural steel products.

Westfalia Separator, Inc.
Located in Northvale, NJ, the company manufactures centrifugal separators and decanters. 

Well Said!

“Without a decisive naval force we can do nothing definitive,
and with it, everything honorable and glorious.”

President George Washington
November 15, 1781