FMC needs proper funding to fulfill maritime mandate

By: | Issue #625 | at 08:00 AM | Channel(s): Liner Shipping  

FMC needs proper funding to fulfill maritime mandate

The Federal Maritime Commission (FMC) has the mission to administer the nation’s ocean borne commerce. Last year, 31.5 million TEUs passed through the nation’s ports and that number is certain to double within 14 years. But the FMC’s challenge isn’t just with ports and terminals – it’s about how the U.S. will handle a lengthy supply chain. FMC Chairman Mario Cordero knows the FMC’s job is big and getting bigger, and he has set his sights on preparing the Commission for the sizable demands of the future. Commissioner Cordero has asked for a budget of $27.49 million. Given the task, is it enough?

As ships get bigger, responsibilities rise but for the FMC (Federal Maritime Commission), budgets and staffing are failing to keep pace.

The mandate to monitor and administer this vast array of maritime trade issues falls on a staff of less than 125 employees with a budget in FY 2015 and 2016 of only $25.6 million. Recently, the FMC made a budget submission of $27,490,000 to support 134 full-time equivalent employees. The real question is less about budget approval and more about whether this increase is enough.

At this writing (May 4, 2016) the FMC has launched (see box on page 10) a “Supply Chain Innovation Team Initiative” to examine the challenges of the global supply chain of the nation. This holistic vision of the maritime trade is a commercial imperative for the U.S. to economically keep pace with the dramatic changes in the maritime industry including the deployment of significantly larger ships, and the consolidation and shifting of alliances. But it isn’t just about the ocean carriage – every mile outside of the terminal gates is just as critical to the supply chain as those at sea. What happens on rail and road and with data processing and how to go green is just as critical to the supply chain as every nautical mile plied by the box ships. This is the real challenge of the global supply chain.

The FMC’s sizeable task is to referee the supply chain stakeholders (at home and abroad). In a sense the FMC’s overriding mission statement is to provide a level playing field to enable the smooth flow of cargo. That playing field changes all the time.

Recently the container weight (VGM-SOLAS) controversy hit the headlines while truck congestion remained an unresolved problem at many U.S. ports. Environmental and socio-economic concerns potentially can kink each link of the supply chain. Straightening out these knotty problems has become the new role of the FMC. Compared to many other U.S. government agencies, the FMC is playing major league ball with double A league funding.

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George Lauriat's avatar

American Journal of Transportation