VES-3-01-OT:RR:BSTC:CCI H058647 JLB
Mr. R. Craig Coslett
Project Coordinator
de maximis, inc.
1405 North Cedar Crest Blvd.
Suite 200
Allentown, Pennsylvania 18104
RE: Coastwise Transportation; 46 U.S.C. § 55102; Vessel Equipment; Storage Vessel
Dear Mr. Coslett:
This letter is in response to your correspondence dated April 1, 2009, on behalf of your client, the Butler Mine Tunnel Site Trust Fund (“Trust”), in which you inquire about the necessity of a coastwise endorsement for their vessel. Our ruling on your request follows.
FACTS
The Trust owns a 40-foot, non-self-propelled barge, the PITTSTON, which was designed and built for oil spill response and currently has a coastwise endorsement. The Trust is requesting a determination that a coastwise endorsement is not necessary or required. The barge is only to be used to train for, or engage in, an “emergency response action” for the Butler Mine Tunnel Superfund Site (“Site”). This Site is located on the Susquehanna River in Pittson, Pennsylvania with the actual work zone less than a ½ mile stretch of river. The Site is in essence a river outfall that could require an emergency response action to contain and collect oily liquid that may discharge from the Butler Mine Tunnel Outlet under specific intense weather conditions.
In 1979 and in 1985, oily liquid “flushed out” of the Butler Mine Tunnel Outlet into the Susquehanna River. After cleanup of the 1985 flushout, the Environmental Protection Agency (“EPA”) performed an investigation and determined that under certain weather conditions another flushout might be possible. As a result, a Record of Decision was issued in 1996 that required the design and construction of a weather and tunnel flow monitoring system and the purchase of response equipment to be ready in case of another flushout of oily liquid into the Susquehanna River. The EPA signed a Consent Decree with numerous companies that were potentially responsible for the oily liquids, disposed (illegally, without their knowledge) by a third-party contractor into a borehole that apparently discharged, through the Butler Mine Tunnel, to the outlet. The Consent Decree was completed in 2000, entered into by the federal court in 2001, and required the responsible parties to design, construct and maintain the Record of Decision remedy for the Site. Thus, the barge is only to engage in any “emergency response action” under the Consent Decree with the EPA.
A new anchoring system had to be developed for the barge due to the smooth hard rock bottom in this particular stretch of the Susquehanna River since typical boom deployment and anchoring would not work to clean up any oil spillage. The anchoring system that was developed is a cable system known as a trotline. Upon deployment the trotline will serve as an anchoring framework for the containment boom, also deployed from the barge, which will be floating on the water surface.
The barge may also be anchored at a collection point to be used to temporarily store collected oily waste. During such a process, the oily liquid would be collected, and stored in tanks on the barge. However, for safety reasons, the oily liquid would need to be completely pumped off the barge before any movement on the River would be permitted.
The barge is ordinarily stored on a flatbed trailer in a warehouse in Pittson, Pennsylvania. The only time the barge is deployed in the River is during routine training and drills, usually twice over a three-year period, and if there is a situation requiring an emergency response.
ISSUE
Whether the proposed operation constitutes an engagement in coastwise trade for purposes of 46 U.S.C. § 55102?
LAW AND ANALYSIS
The Jones Act, former 46 U.S.C. App. § 883 recodified as 46 U.S.C. § 55102, pursuant to P.L. 109-304 (October 6, 2006), states that “a vessel may not provide any part of the transportation of merchandise by water, or by land and water, between points in the United States to which the coastwise laws apply, either directly or via a foreign port” unless the vessel was built in and documented under the laws of the United States and owned by persons who are citizens of the United States. (See also 19 C.F.R. §§ 4.80, 4.80b). Such a vessel, after it has obtained a coastwise endorsement from the U.S. Coast Guard, is said to be “coastwise qualified.” The coastwise laws generally apply to points in the territorial sea, which is defined as the belt, three nautical miles wide, seaward of the territorial sea baseline, and to points located in internal waters, landward of the territorial sea baseline.
U.S. Customs and Border Protection (“CBP”) Regulations promulgated under the authority of 46 U.S.C. § 55102 provide that a coastwise transportation of merchandise takes place when merchandise laden at a coastwise point is unladen at another coastwise point, regardless of origin or ultimate destination. See 19 C.F.R. § 4.80b(a). Pursuant to 19 U.S.C. § 1401(c), the word "merchandise" is defined as "goods, wares, and chattels of every description, and includes merchandise the importation of which is prohibited, and monetary instruments as defined in section 5312 of Title 31.” For purposes of the Jones Act, merchandise also includes “valueless material” such as recovered, contaminated oil. See 46 U.S.C. § 55102(a)(2); Headquarters Ruling Letter 110979, dated July 11, 1990. Merchandise does not include, however, the equipment of a vessel so long as it is used by that vessel. Such articles have been defined as those which are "...necessary and appropriate for the navigation, operation or maintenance of the vessel and for the comfort and safety of the persons on board." See Headquarters Ruling Letter 114298, dated July 7, 1998 quoting Treasury Decision (“T.D.”) 49815(4), March 13, 1939. Whether such articles constitute vessel equipment is a case-by-case determination. See Headquarters Ruling Letter 115938, dated April 1, 2003; Headquarters Ruling Letter 114487, dated October 19, 1998.
The barge only operates in the River during routine training and drills or to engage in an emergency response action to contain and collect oily liquid that may discharge from the Butler Mine Tunnel Outlet under specific intense weather conditions. The deployment of the trotlines, stored onboard, will serve as the barge’s anchor and a framework for the containment boom floating on the water surface, which will also be deployed from the barge.
In order for the barge to operate, it is necessary to deploy the trotlines so that it is possible for the barge to anchor in the Susquehanna River. Consequently, the trotlines and containment boom, which are transported aboard the vessel on which they are used, constitute vessel equipment as defined in T.D. 49815(4), not merchandise as defined in 19 U.S.C. § 1401(c). As a result, there would be no transportation of merchandise in violation of 46 U.S.C. § 55102.
The barge may also anchor at a collection point and be used as a temporary storage facility to collect oily waste. For safety reasons, the oily liquid would be pumped off before any movement of the barge would be permitted. CBP has consistently held that a non-coastwise-qualified vessel may be used as a storage facility in U.S. territorial waters provided that the vessel remains stationary. The coastwise laws are not violated if the vessel is being loaded or unloaded and must be moved to another location because of stress of weather or other reason involving the vessel's safety, so long as the vessel is subsequently returned to the same point to continue its loading or unloading, and loads or unloads no merchandise at any other U.S. point. See, e.g., Headquarters Ruling Letter 112879, dated October 1, 1993; Headquarters Ruling Letter 110127, dated April 5, 1989; Headquarters Ruling Letter 110265, dated June 21, 1989. For purposes of 46 U.S.C. § 55102, the point of lading is considered to be the point at which the oily liquid is collected. See Headquarters Ruling Letter 110104, dated April 19, 1989; Headquarters Ruling Letter H050179, dated February 11, 2009. If the vessel is not secured or otherwise moves while in use, then such operations would be a violation of the coastwise laws. See Headquarters Ruling Letter 115844, dated October 30, 2002; Headquarters Ruling Letter H026282, dated May 13, 2008.
The coastwise passenger statute, former 46 U.S.C. App. § 289 recodified as 46 U.S.C. § 55103, pursuant to P.L. 109-304 (October 6, 2006), states that no foreign vessel shall transport passengers “between ports or places in the United States to which the coastwise laws apply, either directly or by way of a foreign port,” under a penalty of $300 for each passenger so transported and landed. See also 19 C.F.R. § 4.80(b)(2). Under 46 U.S.C. § 55103, a “passenger” is any person carried aboard a vessel “who is not connected with the operation of the vessel, her navigation, ownership, or business.” See also 19 C.F.R. § 4.50(b). Consequently, any crew traveling aboard the vessel would not be considered “passengers” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Therefore, the coastwise transportation of such individuals is not in violation of 46 U.S.C. § 55103.
Concerning your request, we also refer you to the U.S. Coast Guard since the vessel documentation laws of the United States are administered by that agency. We note, however, since your vessel is not engaging in coastwise trade, a coastwise endorsement would not be necessary. See Headquarters Ruling Letter 113846, dated May 5, 1997.
HOLDING
The proposed operation described above does not constitutes an engagement in the coastwise trade for purposes of 46 U.S.C. § 55102.
Sincerely,
Glen E. Vereb, Chief
Cargo Security, Carriers and Immigration Branch