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92–325 PDF 2005

S. HRG. 107–1127

OREGON’S MARITIME COMMERCE: PROTECTING

TRADE AND SECURING PORTS

FIELD HEARING

BEFORE THE

SUBCOMMITTEE ON SURFACE TRANSPORTATION 

AND MERCHANT MARINE

OF THE

COMMITTEE ON COMMERCE, 

SCIENCE, AND TRANSPORTATION 

UNITED STATES SENATE

ONE HUNDRED SEVENTH CONGRESS

SECOND SESSION

JULY 2, 2002

Printed for the use of the Committee on Commerce, Science, and Transportation

(

(II)

SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

ONE HUNDRED SEVENTH CONGRESS

SECOND SESSION

ERNEST F. HOLLINGS, South Carolina, Chairman 

DANIEL K. INOUYE, Hawaii 

JOHN D. ROCKEFELLER IV, West Virginia 

JOHN F. KERRY, Massachusetts 

JOHN B. BREAUX, Louisiana 

BYRON L. DORGAN, North Dakota 

RON WYDEN, Oregon 

MAX CLELAND, Georgia 

BARBARA BOXER, California 

JOHN EDWARDS, North Carolina 

JEAN CARNAHAN, Missouri 

BILL NELSON, Florida 

JOHN MCCAIN, Arizona 

TED STEVENS, Alaska 

CONRAD BURNS, Montana 

TRENT LOTT, Mississippi 

KAY BAILEY HUTCHISON, Texas 

OLYMPIA J. SNOWE, Maine 

SAM BROWNBACK, Kansas 

GORDON SMITH, Oregon 

PETER G. FITZGERALD, Illinois 

JOHN ENSIGN, Nevada 

GEORGE ALLEN, Virginia 

KEVIN D. KAYES, Democratic Staff Director 

MOSES BOYD, Democratic Chief Counsel 

JEANNE BUMPUS, Republican Staff Director and General Counsel 

SUBCOMMITTEE ON SURFACE TRANSPORTATION AND MERCHANT MARINE

JOHN B. BREAUX, Louisiana, Chairman 

DANIEL K. INOUYE, Hawaii 

JOHN D. ROCKEFELLER IV, West Virginia 

JOHN F. KERRY, Massachusetts 

BYRON L. DORGAN, North Dakota 

RON WYDEN, Oregon 

MAX CLELAND, Georgia 

BARBARA BOXER, California 

JEAN CARNAHAN, Missouri 

JOHN EDWARDS, North Carolina 

GORDON SMITH, Oregon 

TED STEVENS, Alaska 

CONRAD BURNS, Montana 

TRENT LOTT, Mississippi 

KAY BAILEY HUTCHISON, Texas 

OLYMPIA J. SNOWE, Maine 

SAM BROWNBACK, Kansas 

PETER G. FITZGERALD, Illinois 

JOHN ENSIGN, Nevada 

(III)

C O N T E N T S 

Page 

Hearing held on July 2, 2002 ................................................................................. 1

Statement of Senator Smith ................................................................................... 2

Statement of Senator Wyden .................................................................................. 1

Article dated June 26, 2002, entitled Coast Guard Braces for Fight, 

from The Wall Street Journal ...................................................................... 21

WITNESSES

Browning, Douglas M., Deputy Commissioner, U.S. Customs Service ............... 8

Prepared statement .......................................................................................... 10

Butler, Colonel Randall J., District Engineer, Portland District, United States 

Army Corps of Engineers .................................................................................... 12

Prepared statement .......................................................................................... 13

Cross, Vice Admiral Terry, USCG, Commander, Pacific Area ............................. 4

Prepared statement .......................................................................................... 6

Gaul, Michael, Director of Operations, Oregon International Port of Coos 

Bay ........................................................................................................................ 40

Prepared statement .......................................................................................... 41

Holte, Bruce, President, Local 8, International Longshore and Warehouse 

Union ..................................................................................................................... 64

Prepared statement .......................................................................................... 66

Hrdlicka, Robert, Marine Director, Port of Portland ............................................ 33

Prepared statement .......................................................................................... 34

Isbell, John, Director, Corporate Delivery Logistics, Nike, Inc. .......................... 47

Prepared statement .......................................................................................... 48

Isbell, Monica, Vice President, Pacific Northwest International Trade Association ........................................................................................................................ 51

Prepared statement .......................................................................................... 52

Iverson-Summer, Patrice A., President, Columbia River Customs Brokers and 

Freight Forwarders Association .......................................................................... 54

Prepared statement .......................................................................................... 56

Puzey, Kim B., General Manager, Port of Umatilla ............................................. 35

Prepared statement .......................................................................................... 37

Townley, Captain Jim, Executive Director, Columbia River Steamship Operators Association .................................................................................................... 60

Prepared statement .......................................................................................... 62

(1)

OREGON’S MARITIME COMMERCE: 

PROTECTING TRADE AND SECURING PORTS 

TUESDAY, JULY 2, 2002

U.S. SENATE, SUBCOMMITTEE ON SURFACE TRANSPORTATION AND

MERCHANT MARINE, COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION, Portland, OR. 

The Committee met, pursuant to notice, at 10 a.m. in the Port 

Commission Room, First Floor, Port of Portland Building, Hon. Ron 

Wyden, presiding. 

OPENING STATEMENT OF HON. RON WYDEN,

U.S. SENATOR FROM OREGON 

Senator WYDEN. The Subcommittee will come to order. Thank 

you all very much for coming today. This is a hearing of the Subcommittee on Surface Transportation and Merchant Marine or the 

Senate Committee on Commerce, Science, and Transportation. It is 

being held at the request of Chairman Hollings and Chairman 

Breaux. I am particularly pleased to be able to be here with Senator Smith to address these cogent issues that are part of our bipartisan agenda, and this is a particularly timely hearing. 

Right now there is a conference committee between the House 

and Senate that is working on important issues relating to Port Security, and both of us serve on that conference committee and the 

input that we are gathering at today’s hearing—yesterday I chaired 

a hearing in Seattle, and a number of other hearings have been 

held around the country—is particularly useful as we try to move 

ahead in the conference committee and get this important legislation with respect to our ports to the President of the United States. 

I’m just going to have a few comments to open up and then turn 

to my colleague for his views. 

It is quite clear as we look around the United States that our 

seaports are tempting targets for terrorism. If you look for example 

at geography, if you look at the openness of our ports, the proximity of many of our ports to metropolitan areas, it is very clear 

that these can be prime targets, prime areas of vulnerability that 

would be susceptible to terrorism. And there are very big stakes 

here for the people of Oregon. 

For example, one out of six jobs in Oregon depends on international trade. The trade jobs pay better than the non-trade jobs, 

and it is critically important that those jobs be protected, while at 

the same time addressing these critical security issues. One of the 

things that Senator Smith and I will be examining in great detail 

2

is how you strike a balance between security on one hand, and 

moving goods in and out of the Pacific Northwest. Both of the 

major northwest ports, Portland and Seattle, are in the top 20 

ports in this country, so the stakes are extremely high for our region. 

Among other policy issues that we are going to examine this 

morning, and one that I will be looking at in great detail is how 

the Coast Guard could be merged into the Homeland Security Office; because if you have the Coast Guard performing all the essential tasks it’s performing now, and then taking on new duties with 

respect to Homeland Security, it is very hard to see how you reconcile those two concerns without significant new sums. 

Yesterday in response to my questions in Seattle, the Coast 

Guard said that it could be accomplished through synergies—and 

certainly synergies are useful things to put in place—but I never 

saw any synergies that could come up with billions of dollars the 

way it looks like you’re going to have to have to merge these functions. So we’re looking forward to talking with Admiral Cross and 

others about that issue as well. 

There are technology questions that we will be examining because one of our goals is to promote innovative use of technology. 

I also chair the Subcommittee on Technology for the Commerce 

Committee and if there is one thing that I want to see accomplished in that Homeland Security legislation, it is that I want to 

make it possible for entrepreneurs and business leaders when they 

have promising products in the security field, to go to one stop in 

the Federal Government. Right now we’ve got these people from 

the Northwest and elsewhere traipsing all over the country trying 

to figure out who to deal with in the Federal Government. That’s 

unacceptable and we’re going to examine that issue as well. 

Finally, a set of important issues revolve around international 

discussions that are being held on these issues. In particular, what 

we would like to see is more work done at the point of origin. In 

other words, once you have products that come to our shore, you’re 

playing catch-up ball in order to try to examine some of those risks. 

What we need to do is be far more aggressive in terms of negotiating agreements with our allies and trading partners around the 

world in order to get at these concerns at the point of origin. There 

are a number of sensitive discussions going on right now with respect to that issue that we will discuss with our witnesses as well. 

Again, I’m very pleased to have a chance to team up with Senator Smith on this issue. Our witnesses and audience members 

should know that with the conference committee coming up, this is 

a chance to really get a sense of what the Pacific Northwest and 

what Oregon needs in that conference; and so let me recognize my 

colleague for any statement he would like to make. 

STATEMENT OF HON. GORDON SMITH,

U.S. SENATOR FROM OREGON 

Senator SMITH. Thank you, Senator Wyden. 

Ladies and gentlemen, it is a pleasure to be here with Senator 

Wyden. It is a privilege to work with him in the U.S. Senate for 

the betterment of our country and especially for the betterment of 

the State of Oregon. 

3

I don’t know of another state in America that has two members 

on the Senate Commerce Committee and two members on the Senate conference committee for Maritime security legislation. Therefore, it is important for us to give Oregonians and various witnesses the chance to tell us how we can put this bill together in 

a way that will do two things: 

To increase security to protect our people against the threat of 

dirty bombs and terrorist activities within the Port of Portland and 

other places, and at the same time to do this without unduly compromising the efficiency of business operations for very important 

companies. There are many of them that rely on this economic lifeline of the ports of the State of Oregon. Intel, Nike, Columbia 

Sportswear, and many others come to mind, who count on us having an efficient process as well as a publicly safe process. So efficiency and security right now are intention, and our job is to find 

out from you how to get the job done to protect the people of Oregon, the people of America, but to also insure that the business 

vitality that they depend on for their families is not unnecessarily 

interrupted. 

So next week we will be merging Senate Bill 1214, the Port and 

Maritime Security Act, with the House Bill 3983, the Maritime 

Transportation Anti-Terrorism Act of 2002. 

I would like to indicate our intention to get enough information 

from the different ports that we can come up with legislation that 

is not a one size Federal fits all, that will allow different ports the 

chance to provide security without sacrificing efficiency. 

So we have here representatives today from the Port of Portland, 

the Port of Umatilla, and the Port of Coos Bay, because we need 

these different perspectives. We are very grateful to have the 

United States Coast Guard represented, the U.S. Customs Service, 

and the Army Corps of Engineers as well. 

And Captain Spitzer, I understand you have been given a reassignment, and also Colonel Butler, that you have as well. We regret that in the sense that you will not be in Oregon, but we’re 

glad you are still in the service of our country, and we wish you 

well in your new assignments and look forward to benefiting today 

from your remarks. 

Let me conclude by pointing out that on November 19th, 2001, 

President Bush signed into law the Aviation and Transportation 

Security Act to increase security at our nation’s airports. And on 

May 14th, 2002, the President signed into law the Enhanced Border Security and Visa Entry Reform Act, which will increase security at our nation’s land borders. And so, it is past time for us to 

send to the President for his action this important piece of legislation. 

We do appreciate you coming to this important hearing. Your 

words, your wisdom your experience will be very helpful to Senator 

Wyden and me as we go to this conference to make sure that we 

do the right thing by this port and others, and that we keep if safe, 

but also allow it to be efficient. 

Thank you, Mr. Chairman. 

Senator WYDEN. Thank you very much, and we will move right 

to our hearings and right to the discussion. We are going to have 

on the first panel Vice Admiral Terry Cross, Commander, Pacific 

4

Area, United States Coast Guard, accompanied by Captain James 

Spitzer, Captain of the Port in Portland; Mr. Douglas Browning, 

Deputy Commissioner of U.S. Customs Service; and Colonel Randall J. Butler, District Engineer of the Portland District, the Army 

Corps of Engineers. 

Gentlemen, we welcome you. We have as you know asked that 

you try to keep your opening statements to about 5 minutes. I 

know there is almost a biological compulsion to just read those 

statements word for word. We are going to put them into the hearing record in their entirety and if you could just perhaps summarize some of your principal concerns, that will leave some extra 

time for questions. So, welcome. 

Let us begin with you, Admiral Cross. 

STATEMENT OF VICE ADMIRAL TERRY CROSS, USCG, 

COMMANDER, PACIFIC AREA 

Admiral CROSS. Good morning, Mr. Chairman, Senator Smith. As 

you said, I’m Vice Admiral Terry Cross, United States Coast 

Guard, Pacific Area Commander. In that role I am essentially responsible for just about everything Coast Guard west of the Rocky 

Mountains out to the Hawaiian Islands, including Alaska and beyond. On behalf of Admiral Tom Collins, Commandant of the Coast 

Guard, I want to thank you for including the Coast Guard in this 

morning’s hearing and we are very pleased to be here. 

As you noted, with me this morning is Captain James Spitzer. 

He’s Captain of the Port for Oregon and southwest Washington 

coasts. His area of responsibility includes not only the coastline but 

also the Willamette, Columbia, Snake Rivers, and includes a thousand miles of coastline and river shoreline in over 40 ports. 

Sir, as you’ve noted, I’ve submitted a written statement for the 

record. I ask that it be entered, and I will just make a quick summary of key points here to keep well within your time limit. 

My hope here is to put what Captain Spitzer may add later in 

his efforts here in Portland within the broader context of Coast 

Guard strategies. Coast Guard strategy for Homeland Security, 

Maritime Homeland Security, was developed shortly after the 

events of 9/11, and it consists of five key elements. 

The first of those elements is the control of high interest vessels, 

and we do that primarily two ways. One, through the use of sea 

marshals, and two, with the use of Coast Guard escort vessels. 

The second element is the increased protection for Coast Guard 

people, but also for critical infrastructure. 

The third element is increased presence over and above our waters. We do that for at least two reasons. First of all, we think that 

provides a deterrent effect, but also increased presence provides us 

an ability to respond quicker for late breaking information or intelligence. 

Fourth is maritime domain awareness, and what we mean by 

that, sir, is we currently—let me say it another way. Before 9/11 

we had very little information about ships, cargo and crews that 

were plying our waters or that were en route to U.S. ports. We 

have a lot more information now than we did, but we still don’t 

have enough. And that involves some of the technology I think you 

were talking about earlier, Senator. 

5

And fifth is outreach, and that’s both an international outreach 

which once again I believe the Senator was referring to, but also 

domestic outreach to enhance the relationships and information 

sharing not only between Federal agencies, but also between state 

and local agencies, and private industry. 

Now part of that involves leadership in the ports. And by virtue 

of our Captain of the Port authorities and responsibilities that belonged to the Coast Guard by statute since 1917, we have taken 

a leadership position, and I think Captain Spitzer is to be commended for the leadership he has shown here in the Port of Portland. 

And as key in this role, we are committed to working, once again, 

with all the agencies, state, local, Federal, and with private industry, and we very much understand that the two keys here are, one, 

to enhance the security, but two, to insure the efficient flow of commerce. 

Shifting gears just a little bit, sir, I want to emphasize that the 

Commandant of the Coast Guard supports the President’s government reorganization proposal and he has identified three prerequisites for insuring that Coast Guard services to the American 

people remain at the same high standards that they are today. 

One is that the Coast Guard, if shifted to a Department of Homeland Security, remain intact, that parts of our service are not 

peeled off to other agencies. Second would be that the basic characteristic of our service, our maritime, military, multi-mission characteristic remain unchanged. And, sir, the third piece would be 

that the Coast Guard retains all of its missions. 

Now interestingly enough, some people believe that Port Security 

and coastal security are new missions for the Coast Guard. That’s 

simply not true. We’ve actually been doing those missions that one 

could argue, for about 212 years, and we were specifically assigned 

Port Security responsibilities in the Espionage Act of 1917. And as 

we talked earlier, there were actually more Coast Guard people involved in Port Security operations in World War II than are in the 

entire Coast Guard today. I’m not suggesting we need that many 

people now but it’s just, I wanted to make the point that it’s a historical mission for us. 

And we think that we can do the mission, the expanded port and 

homeland security mission. What we need from the Administration 

and the Congress is clear tasking and resources commensurate 

with that tasking. 

Let me finish up, sir, by saying I think you know, we have been 

very very busy since 9/11. We very much appreciate the Senate 

support for the supplemental that was passed last fall. $209 million 

allowed us to surge operations and develop many new initiatives, 

some of which I talked about earlier. And in addition to Senate 

1214, which is on the Hill right now, we also have the spring supplemental and fiscal year 03 appropriations bills, and we would appreciate your support for those bills. Passage of those bills will 

allow us to continue the efforts that we have initiated post-9/11 

and annualize many of the efforts that we have undertaken. 

I would also point out that from our perspective, this is, the fiscal year 03, that appropriations bill would be the first year of a 

multiyear process to get us the resources we think we’re going to 

6

need to provide the seaports the level of security that the American 

people will demand. 

And, sir, with that, I would be happy to answer any questions 

you might have. 

[The prepared statement of Admiral Cross follows:]

PREPARED STATEMENT OF VICE ADMIRAL TERRY CROSS, USCG, COMMANDER,

PACIFIC AREA

Good afternoon Mr. Chairman, I am Vice Admiral Terry Cross, Commander of the 

Coast Guard Pacific Area headquartered in Alameda, California. I am responsible 

for Coast Guard operations conducted from Alaska to Samoa, and from the Rocky 

Mountains to the Far East. On behalf of the Commandant, Admiral Thomas Collins, 

I thank you for the opportunity to speak to you today about the challenges we face 

in the Columbia River region with respect to our role in law enforcement and maritime homeland security. 

Unique Challenges of Columbia River Region Port Security 

Three Coast Guard Group Commanders are responsible for maritime law enforcement and other missions in Oregon and southern Washington. With me today is one 

of those Group commanders, Portland-based Captain James Spitzer. He is also Captain of the Port for Oregon and southern Washington and is responsible for many 

aspects of port and waterway security on the Oregon coast, the coast of southwestern Washington, and portions of the Columbia, Willamette, and Snake Rivers. 

This region includes nearly 1,000 miles of coastal and river shoreline, some 40 ports, 

and many more port facilities that provide opportunity for illegal entry and exploitation. 

Over 2,000 ocean-going merchant ships call on these port systems each year and 

many dozens of tugs and barges ply these waterways as far up as Lewiston, Idaho. 

Over 35 million tons of goods and a quarter of a million containers are handled annually. These waters attract exports from farmers as far away as the headwaters 

of the Mississippi River. The Columbia River System is second only to the Mississippi River System in its handling of bulk agricultural exports. Vancouver and 

Portland are top auto ports on the West Coast, and imported cars passing through 

their terminals are distributed throughout the nation. The waterways and ports of 

this region also serve petro-chemical and nuclear industry needs. Our coastal and 

Columbia River system waterways contribute substantially to the economic growth 

and stability of our nation, to the quality of life of our citizens, and to our Nation’s 

security. 

Power of Partnerships in Maritime Security 

Last September the Coast Guard developed a five point Maritime Homeland Security strategy emphasizing: Maritime Domain Awareness, High Interest Vessel Control, Presence and Response, Critical Infrastructure and Force Protection, and Domestic and International Outreach. This strategy acknowledged the power and importance of partnerships in defending against the threat of terrorism. Here are a 

few of the many steps the Coast Guard and its partners have taken:

• The Coast Guard worked with Portland area shipping agents early in the development of our new national standards for screening vessels. Shipping agents 

routinely offered cooperation when the Coast Guard asserted direct control over 

their ships.

• Waterfront facility owners and operators improved security on those facilities 

that posed special risk.

• Large passenger vessel operators instituted heightened security measures.

• The Customs Service, local terminals, and the Coast Guard collaborated on operations such as container inspections.

• The river pilots and the towing industry developed emergency response procedures.

• Partners in law enforcement and emergency response management at all levels 

of government coordinated efforts and information sharing to an unprecedented 

degree.

A regional Internet list-server of the National Infrastructure Protection Center 

(NIPC) program known as InfraGard was created for industry and government personnel to share security and crime-related information.

7

• Citizens, port and facility employees lent their eyes and ears as critical elements 

of the security network of our ports, facilities, and waterways. Facilities cooperated with one another on security matters.

• A ‘‘Visa parole program’’, which allows shore visits for particular visiting ships’ 

crewmembers, while minimizing security concerns, was created through an innovative partnership between the Coast Guard and the Immigration and Naturalization Service.

• Our Regional Maritime Security Coalition, made up of shippers, ports, and wa- terfront facilities, recently received approval for $623,000 in federal grant funding to develop methods to more efficiently track goods shipped through our 

ports. A $30,000 grant was approved to improve security in the Port of Vancouver.

Locally, Captain Spitzer has staunchly advocated a maritime security strategy 

that includes a comprehensive security web. This web is not a centrally controlled 

series of operations. Rather, it is focused on multiple security nodes around activities, operations, and jurisdictions throughout the ports, waterways and coastal 

areas. A sustainable security web required the development of partnerships with 

other federal agencies, state and local agencies and the private sector. This 

partnering activity set the tone for leveraging the entire maritime community, both 

public and private, as part of the solution for security... and not just against terrorism, but also for any kind of illegal activity. Key tenets of the security strategy 

are:

• Each employee is sensitized to security concerns and knows whom to call as concerns are observed. (facilitated by company and union leaders);

• Security staffs have improved recognition and support from management and 

employees. (facilitated by management);

• The owner/operator asserts affirmative leadership and emphasis on security 

matters. (facilitated by COTP, state/local LE, fire marshals);

• Physical and procedural security measures are commensurate with risk and consequences. (facilitated by the owner/operator);

• Security audits are conducted. (facilitated individually & jointly by CG, and 

local fire and police);

• Patrol and response activity is jointly coordinated by all agencies with jurisdiction including CO (from shore, water, and air), police/sheriff patrol, fire marshal 

visits, emergency manager planning, and related awareness and preparedness 

of other agencies.

• Personal relations are cultivated between key facilities/activities and the various 

law enforcement, patrolling, and response management organizations. (jointly 

facilitated by oversight and LE agencies).

Such a network takes effort to develop and cultivate. However, the cumulative result is powerful. The result is a very strong local and regional security and response 

management network comprised of tens of thousands of eyes and ears, over-laid by 

the agencies of government. 

The Coast Guard’s multi-mission assets, military role as an Armed Service, and 

maritime presence and authorities bridge security, safety, and response capabilities 

between federal, state, local, and private organizations as well as other military 

services. We have been the leader for the non-DoD maritime security needs of our 

nation since 1790 . . . it was the reason we were formed 212 years ago. We possess 

extensive regulatory and law enforcement authorities governing ships, boats, personnel, and associated activities in our ports, waterways, and offshore maritime regions. We are a military service with 7×24 command, communication, and response 

capability. We maintain, ‘‘at the ready’’, a network of coastal small boats, aircraft, 

and cutters, and expert personnel to prevent and respond to safety and security incidents; and we have geographic presence throughout the country, coasts, rivers, and 

lakes, both in large ports and small harbors. We are a formal member of the national foreign intelligence community. We partner with other government agencies 

(OGAs) and the private sector to multiply the effectiveness of our services. The 

Coast Guard is the recognized leader in the world regarding maritime safety, security, mobility, and environmental protection issues. These characteristics form the 

core of our organization and enable a unity of effort among diverse entities whether 

preventing or responding to incidents. 

Conclusion 

In conclusion, the United States Coast Guard is an integral component of our nation’s homeland security efforts and the lead agency for maritime homeland secuVerDate 0ct 09 2002 10:27 May 11, 2005 Jkt 092325 PO 00000 Frm 00011 Fmt 6633 Sfmt 6621 S:\WPSHR\GPO\DOCS\92325.TXT JACK PsN: JACKF
8

rity. We maintain the viability and integrity of the marine transportation system 

by working with other public, private, domestic and international partners so that 

people and goods move safely and efficiently. The Coast Guard is committed to the 

continuing protection of our nation against terrorist threats, as well as maintaining 

our maritime law enforcement missions. Thank you for the opportunity to share the 

unique challenges that the Coast Guard in the Columbia River Region faces today 

and for your continuing support of the Coast Guard. I will be pleased to answer any 

questions you may have.

Senator WYDEN. Admiral, thank you. It’s very helpful and we 

will have some questions in a moment. 

Mr. Browning, welcome. You’re a glutton for punishment, twice 

in 24 hours, both in Seattle and Portland, and you serve our country well, and we welcome you. Let’s get you one of those microphones, and please proceed. 

STATEMENT OF DOUGLAS M. BROWNING, DEPUTY

COMMISSIONER, U.S. CUSTOMS SERVICE 

Mr. BROWNING. Thank you, Senator. I actually may not be so 

much a glutton of punishment since the weather has been particularly lovely. 

Senator WYDEN. It is not hardship duty coming to the Northwest. 

Mr. BROWNING. Senator Wyden, Senator Smith, thank you for 

the invitation to testify today. 

Since September 11th, the U.S. Customs Service’s top priority 

has been responding to the terrorist threat at our seaports, land 

borders and airports. We are doing everything we reasonably and 

responsibly can to keep terrorists and their weapons from entering 

the United States. We are currently at a Level One alert at all border entry ports, including our seaports. 

Level One requires sustained, intensive anti-terrorist questioning 

and includes increased inspections of travelers and goods. Because 

there is a continued threat of another terrorist attack, we will remain at Level One for the foreseeable future. 

To help ensure that Customs develops a coordinated, integrated 

counter-terrorism strategy for border and seaport security, Commissioner Bonner established an Office of Anti-Terrorism. To support our Customs officers operationally, we have also established 

the Office of Border Security. The mission of this office is to develop more sophisticated anti-terrorism targeting techniques for 

passengers and cargo in each border environment and provide a 

single point of contact for events taking place in the field. 

In our fight against terrorism, Customs employs a ‘‘Defense in 

Depth’’ strategy, a layered approach that essentially expands our 

perimeter of security to the point of origin. If terrorists were to succeed in concealing a weapon of mass destruction among the tens of 

thousands of containers that enter U.S. ports every day, the physical and economic devastation would be severe. As the primary 

agency for border security, U.S. Customs should know everything 

there is to know about a container headed for this country before 

it leaves a foreign port for the U.S. We want that container prescreened there and not here. 

A critical component of our ‘‘Defense in Depth’’ strategy is the 

Container Security Initiative, or CSI. The CSI engages the ports 

that send the highest volume of container traffic into the United 

States, as well as their governments in these locations, in a way 

9

that will facilitate the detection of potential problems at their earliest possible opportunity. 

The core elements of the Container Security Initiative are: One, 

establishing security criteria for identifying cargo containers that 

pose a high terrorist risk. Second, maximize the use of detection 

technology to pre-screen high-risk containers. Third, pre-screening 

at the point of export rather than the port of importation. And finally, developing and deploying smart and secure containers. 

About 90 percent of the world’s trade moves in containers, much 

of it carried on ocean-going vessels. Nearly half of all incoming 

trade to the United States by value, and that is about 46 percent, 

arrives by ship and most of that is in containers. Last fiscal year 

approximately 34,000 containers entered the North Pacific CMC, 

which includes the service ports of Portland and Anchorage. 

The effective use of technology depends largely on good targeting 

for which we require advance information. Since September 11th, 

Customs has refocused our resources and technology to increase 

the number and the type of cargo exams we perform. However, to 

some the overall number of examinations may still seem surprisingly low, but be aware that the cargo not(?) chosen randomly. It 

is the result of a careful screening process using information from 

a vast data base, the Automated Manifest System. Using these targeting systems, we are able to choose those shipments that appear 

unusual, suspect or high risk, and in that context we are inspecting 

a hundred percent of those containers. 

Currently the submission of advanced shipping manifests to Customs is voluntary. We can not rest our nation’s homeland security 

on the inconsistent, often incomplete and occasionally inaccurate 

submissions of advance information. Timely, accurate and complete 

information is vital to homeland security and we should mandate 

that it be provided in advance. 

In this regard current legislation such as S. 1214 takes us a 

major step closer to where we ultimately need to be. And that is 

to have full information on incoming cargo before it even leaves the 

foreign port. 

As you can see, technology and information are essential to our 

counter-terrorism mission. Simply put, the more technology and information we have and the earlier in the supply chain we have 

them the better. Customs has a history of positive relationships 

with the trade community. Capitalizing on this experience is the 

Customs Trade Partnership Against Terrorism, or C–TPAT. 

C–TPAT builds on successful security models between Customs 

and the trade that were designed to prevent legitimate commercial 

shipments from being used to smuggle illegal drugs. 

Customs also looks forward to the completion of our Automated 

Commercial Environment or ACE, which, as you know, is an extremely important project for the Customs Service. ACE, our new 

and comprehensive automation system, offers major advances in 

both the collection, sorting and targeting of border transaction 

data. 

The terrorists have already exploited one key component of our 

transportation system and that is commercial aviation. It is not at 

all unthinkable that they will seek to target others, including maritime trade. We believe our seaports and the system of global trade 

10

they support are vulnerable, and we believe that the U.S., the U.S. 

Customs Service and in partnership with the trade community and 

other government agencies must address this threat. 

Mr. Chairman, I thank you for the opportunity to appear before 

the Subcommittee and I would be willing to take any questions 

that you might have. 

[The prepared statement of Mr. Browning follows:]

PREPARED STATEMENT OF DOUGLAS M. BROWNING, DEPUTY COMMISSIONER,

U.S. CUSTOMS SERVICE

Senator Wyden, Senator Smith, thank you for your invitation to testify before this 

Subcommittee today. Since September 11th, Commissioner Bonner’s top priority for 

the Customs Service has been responding to the terrorist threat at our seaports, 

land borders, and airports. His highest priority is doing everything we reasonably 

and responsibly can to keep terrorists and terrorist weapons from entering the 

United States. 

Through our Customs Inspectors, Canine Enforcement Officers, and Special 

Agents we are doing just that: protecting and defending our country against the terrorist threat at all our ports of entry, including our seaports. 

Since September 11th, Customs has been at a Level One alert across the country—at all border entry points, including our seaports. Level 1 requires sustained, 

intensive anti-terrorist questioning, and includes increased inspections of travelers 

and goods at every port of entry. Because there is a continued threat that international terrorists will attack again, we remain at Level 1 alert to this day and will 

be at Level 1 for the foreseeable future. 

To help ensure that Customs develops a coordinated, integrated counter-terrorism 

strategy for border and seaport security, Commissioner Bonner established a new 

Office of Anti-Terrorism. In an operational context and to support our Customs officers in the field, we have also established the Office of Border Security. The mission 

of that office is to develop more sophisticated anti-terrorism targeting techniques for 

passengers and cargo in each border environment and provide a single point of contact for events taking place in our field. 

In approaching our primary priority to prevent terrorists and terrorist weapons 

from transiting our borders, Customs employs a ‘‘Defense in Depth’’ strategy. A layered approach for targeting and screening that essentially expands our perimeter 

of security to the point of origin. If terrorists were to succeed in concealing a weapon 

of mass destruction, even a crude nuclear device, among the tens of thousands of 

containers that enter U.S. ports every day, the devastation would be horrible to contemplate. And the impact on our global economy would be severe. As the primary 

agency for cargo security, U.S. Customs should know everything there is to know 

about a container headed for this country before it leaves a foreign port, such as 

Rotterdam or Singapore, for an American port. Customs wants that container prescreened there, not here. 

A critical component of Customs overall ‘‘Defense in Depth’’ strategy is the implementation of the Container Security Initiative. The Container Security Initiative engages the ports that send the highest volumes of container traffic into the United 

States as well as governments in these locations, in a way that will facilitate detection of potential problems at their earliest possible opportunity. 

The core elements of the Container Security Initiatives are the following:

• First, we must establish international security criteria for identifying high-risk 

cargo containers that potentially pose a risk of containing terrorists or terrorist 

weapons.

• Second, we must maximize the use of detection technology to pre-screen highrisk containers. Much of this technology already exists and is currently being 

used by the U.S. Customs Service. This technology will not only be used for inspection of U.S. Customs targeted cargo but also for cargo identified by other 

federal agencies such as the U.S. Coast Guard, Immigration and Naturalization 

Service, Food and Drug Administration and the Department of Agriculture.

• Third, we must develop and broadly deploy ‘‘smart’’ boxes—smart and secure 

containers with electronic seals and sensors that will indicate to Customs and 

to the private importers or carriers if particular containers have been tampered 

with, particularly after they have been pre-screened.

11

The vast majority of world trade—about 90 percent—moves in containers, much 

of it carried on oceangoing container ships. Nearly half of all incoming trade to the 

United States by value—about 46 percent—arrives by ship, and most of that is in 

containers. In Fiscal 2001, approximately 34,000 containers entered through the 

North Pacific CMC (Service Ports of Portland and Anchorage). 

The effective use of technology depends largely on good targeting, for which we 

require advance information. Since September 11th, Customs has refocused resources and technology to increase the number and the type of cargo exams it performs. However, to some the overall number of examinations may still seem surprisingly low in proportion to the vast amount of trade we process. Yet it is important 

to note that the cargo Customs selects for intensive inspection is not chosen randomly. It is the result of a careful screening process, one that uses information 

culled from a vast database on shipping and trading activities known as the Automated Manifest System. Using targeting systems that operate within AMS, we are 

able to sort through the cargo manifests provided to Customs by shippers and carriers, and chose those shipments that appear unusual, suspect, or high-risk. It is 

a system that has served us well, but one that can and must serve us better in light 

of September 11th. 

Currently the submission of advanced shipping manifests to Customs is voluntary. 

We cannot rest our Nation’s homeland security on the inconsistent submission of advance information that is often incomplete and sometimes inaccurate. Timely, accurate, and complete information is vital to homeland security and we should mandate 

it is provided in advance. Current legislation, such as S.1214 take us a major step 

closer to where we ultimately need to be, particularly for the Container Security Initiative—and that is to have full information on incoming cargo before it even leaves 

the foreign port. This information is needed for all imports and in-bond shipments. 

The Customs Service is also seeking the inclusion of a six-digit harmonized tariff 

code in the manifest for in-bond shipments. The six-digit classification universally 

describes the goods to all governments that subscribe to the Harmonized system. 

Customs has had success in targeting in our entry system, using this level of detail. 

This level provides the specificity necessary to allow for finer targeting, which could 

translate into fewer examinations—a sort of reverse targeting to eliminate unnecessary and timely inspections. With less detailed information, however, the need to 

examine for potential threats increases, particularly as those shipments move inbond. 

As part of our immediate response to September 11th, Customs promptly sought, 

and the Congress promptly enacted, legislation that made the submission of data 

on incoming passengers to Customs’ Advance Passenger Information System mandatory for all airlines. That law was passed last November as part of the Aviation and 

Transportation Security Act. Initially, the Commissioner ordered all international 

airlines flying into the U.S. from abroad to submit advance passenger information 

to Customs, or face 100 percent inspection of people and goods departing their 

flights. This enabled Customs to better secure advance passenger information on all 

incoming international flights before the new law took effect. 

As you can glean from this list, technology and information are essential to a successful container security strategy and to our counter-terrorist mission in general. 

And to put it simply, the more technology and information we have, and the earlier 

in the supply chain we have them, the better. 

Customs has a long history and working relationship with the trade community. 

Another Customs developed initiative is the Customs-Trade Partnership Against 

Terrorism, or ‘‘C–TPAT’’. C–TPAT builds on past, successful security models between Customs and the trade that were designed to prevent legitimate commercial 

shipments from being used to smuggle illegal drugs. 

Customs also looks forward to the completion of the Automated Commercial Environment, or ACE, which as you know is an extremely important project for the Customs Service. ACE, our new and comprehensive automation system, offers major advances in both the collection and sorting of border transaction data. 

The terrorists have already exploited one key component of our transportation 

system: commercial aviation. It is not at all unthinkable that they will seek to target others, including maritime trade. We believe our seaports and the system of 

global trade they support are vulnerable, and we believe that the U.S. and the Customs Service must act now to address this threat. 

Thank you again for the opportunity to testify here today.

Senator WYDEN. Mr. Browning, thank you. You’ve been very 

helpful. Colonel Butler, welcome. 

12

STATEMENT OF COLONEL RANDALL J. BUTLER, DISTRICT

ENGINEER, PORTLAND DISTRICT, UNITED STATES ARMY 

CORPS OF ENGINEERS 

Colonel BUTLER. Thank you, Mr. Chairman. I’m Colonel Randall 

Butler, the district engineer for Portland District, United States 

Army Corps of Engineers. We appreciate the opportunity to testify 

today on the security at our nation’s seaports. 

As you are surely aware, the role of the engineers with respect 

to navigation is to provide safe, reliable, efficient, and environmentally sustainable waterborne transportation systems in channels, harbors, and waterways for the movement of commerce, people, recreation and for national security. 

Currently the Corps of Engineers maintains about 926 coastal 

and inland harbors throughout the nationwide system, including 

4,690 deep-draft and 4,619 shallow-draft and commercial facilities. 

We give budgetary priority to commercial activities. 

Nationwide the Corps also maintains 215 navigational locks 

along shallow-draft waterways and about 23 locks along the deepdraft channels to aid in the movement of commodities and commercial products throughout the nation’s heartland. These navigational 

facilities are the lifeblood of interstate and international trade. 

In addition to commercial traffic, the Corps navigation locks also 

provide an invaluable service to recreational users without charge. 

Regionally, the Corps maintains eight navigational locks on the Columbia and Snake River system with benefits to 36 ports in Oregon, Washington and Idaho and in the export and import of commodities and products. 

While the Corps has no authority and appropriations for Port Security, we do have a keen interest and a vital stake in its effectiveness. The nation’s waterways, along with the civil works infrastructure—the locks and dams we operate—are the nation’s assets, and 

as such we have a responsibility to maintain security throughout 

that system. 

The events of 9/11 brought a sobering realization that our infrastructure could be at risk. In the months following, the Corps of 

Engineers initiated an aggressive assessment of all its dams and 

critical facilities and developed plans to increase the physical security of the navigation system. 

The need for a security assessment was first discussed in 1997 

in the Presidential Decision Directive 63. Nine Federal and nonFederal agencies responsible for security of the nation’s infrastructure developed a process to systematically analyze current security 

risks at our nation’s dams and propose security measures to protect 

all critical missions of these key Federal dams. 

We have completed our initial assessment of 47 dams in the 

Northwest Division and for over 300 critical Corps structures 

across the nation, and we’ve developed protection and mitigation 

measures that are included in the individual project reports. Using 

the funding provided by Congress, we are implementing increased 

security measures. 

The locks and dams in the Columbia River Basin are among the 

highest priority dams within the division. Lockages are performed 

24 hours a day, 7 days a week at Corps navigational locks. Priority 

13

is given to commercial vessels, with recreational lockages scheduled 

five times a day. 

In the wake of 9/11, we have increased our vigilance at our facilities. Operators at each lock maintain a list of the names of vessels 

that frequent the lock, mainly commercial vessels, tugs, commercial 

passenger boats and several navy vessels. The powerhouse and lock 

operators are familiar with most commercial vessels and their 

crews, and should anything sound or look suspicious, the operator 

may refuse lockage. 

The Corps is not only the nation’s leader in water resource management, but the nation’s premier public engineering agency. 

Partnering with similarly committed public and private entities 

can only strengthen the national resolve and sharpen our preparedness. 

We are learning from the tragic events in New York and Washington, DC and now have a better understanding of who the likely 

players would be should a similar incident occur at one of our facilities. We’ve reached out to new and old partners, the U.S. Coast 

Guard and the navigation industry, and are developing new response and communication plans that we hopefully will never have 

to use. 

The Corps of Engineers does not intend to allow the risk of terrorism to cripple our effectiveness as the nation’s leader in water 

resource management. We will continue to execute our navigation 

mission to the best of our ability. 

Mr. Chairman, that concludes my statement. I will submit my 

full statement for the record and I’m open to your questions at this 

time. 

[The prepared statement of Colonel Butler follows:]

PREPARED STATEMENT OF COLONEL RANDALL J. BUTLER, DISTRICT ENGINEER, 

PORTLAND DISTRICT, UNITED STATES ARMY CORPS OF ENGINEERS

Mr. Chairman and Members of the Subcommittee, I am Colonel Randall Butler, 

the District Engineer for the Portland District, U.S. Army Corps of Engineers. 

Thank you for the opportunity to testify on security at our nation’s seaports. 

As you are surely aware, the role of the U.S. Army Corps of Engineers, with respect to navigation, is to provide safe, reliable, efficient, and environmentally sustainable waterborne transportation systems (channels, harbors, and waterways) for 

the movement of commerce, people, recreation and for national security. The Corps 

accomplishes its navigation mission through a combination of capital improvements 

and the operation and maintenance of existing navigation projects and structures. 

Our role in developing the Nation’s water highways dates back to the early days 

of this Nation’s history, beginning in the Ohio and Mississippi basins in 1824, and 

expanding with the new frontier. 

Currently, the Corps of Engineers maintains 926 coastal and inland harbors nationwide, including 4,690 deep-draft and 4,619 shallow-draft commercial facilities. 

It gives budgetary priority to facilities supporting commercial activities. On an average annual basis, Corps of Engineers operations and maintenance at these projects 

removes nearly 300 million cubic yards of sediment from Federally-maintained navigation channels. 

Nationwide, the Corps also maintains 215 navigation locks along nearly 11,000 

miles of inland and intracoastal shallow-draft waterways and 23 locks along 14,000 

miles of deep draft channels to aid the movement of commodities and commercial 

products throughout the nation’s heartland. These navigation features are the lifeblood of interstate and international trade, generating nearly $700 billion in foreign 

commerce. In 2000, almost 3 billion tons of goods and services moved through Federally-maintained facilities and waterways. 

In addition to commercial traffic, Corps navigation locks also provide an invaluable service to recreational users without charge. The Hiram M. Chittenden Locks 

14

in Seattle, for example, passed nearly 50,000 recreational crafts through its lock 

chambers last year. 

Regionally, the Corps maintains eight navigation locks on the Columbia and 

Snake Rivers system, which benefits some 36 ports in Oregon, Washington and 

Idaho in the export and import of commodities and products. A number of these 

ports rank in the top 100 in the nation: the Port of Portland—the nation’s 22nd 

busiest navigation hub; the Port of Vancouver, Washington—the 68th busiest; and 

the Port of Longview, Washington—the 88th busiest. 

While the Corps has no authority or appropriations for port security, we do have 

a keen interest and vital stake in its effectiveness. The nation’s waterways, along 

with the civil works infrastructure—the locks and dams we operate, are national assets, and as such, we have a responsibility to support security measures to safeguard them. 

The events of 9/11 brought a sobering realization that our infrastructure could be 

at risk. In the months following, the Corps of Engineers initiated an aggressive assessment of all its dams and critical structures and developed plans to increase the 

physical security of the navigation system. 

The need for a security assessment was first discussed in 1997 as part of Presidential Decision Directive 63. Nine Federal and non-Federal agencies, responsible 

for security of our Nation’s infrastructure, developed a process to systematically 

analyze current security risks at our nation’s dams and propose security measures 

to protect all critical missions of key Federal dams. 

We have completed our initial assessments of all 47 dams within the Northwestern Division and for over 300 critical Corps structures across the nation, and 

developed protection and mitigation measures that are included in individual project 

reports. Using the funds appropriated by Congress, we are implementing increased 

security measures. 

The locks and dams in the Columbia River Basin are among the highest priority 

dams within the Division. Our end goal is to protect the dams while at the same 

time allowing the continued movement of commerce and people and maintaining the 

environmental and recreational qualities along the river system and through the 

navigation locks. 

Lockages are performed 24 hours a day, seven days a week at Corps navigation 

locks. The majority of these lockages are of commercial tows or private recreational 

vessels, with other vessels being owned by universities or federal, state, or local governments. Priority is given to commercial vessels, with recreational lockages scheduled three times each day. 

In the wake of 9/11, we have increased our vigilance at our facilities. Operators 

at each lock maintain a list of the names of vessels that frequent the lock, mainly 

commercial vessels, tugs, commercial passenger boats and a several Navy vessels. 

Powerhouse and lock operators are familiar with most commercial vessels and their 

crews, and should anything sound or look suspicious, the lock operator may refuse 

lockage. 

The Corps is not only the nation’s leader in water resource management, but the 

nation’s premier public engineering agency. Using our expertise and authorities, we 

are taking additional measures to safeguard the nation’s investment in waterway 

infrastructure and to protect the safety of the citizens in our region. Partnering with 

similarly committed public and private entities can only strengthen the national resolve and sharpen joint preparedness. 

We are learning from the tragic events in New York and Washington DC and now 

have a better understanding who the likely players would be should a similar incident occur at one of our facilities. We have reached out to new and to long-time 

partners (the U.S. Coast Guard and navigation industry), and are developing new 

response and communication plans that we hopefully will never need to use. 

The Corps of Engineers does not intend to allow the risk of terrorism to cripple 

our effectiveness as the nation’s leader in water resource management. We will continue to execute our navigation mission to the best of our ability. Mr. Chairman, 

this concludes my statement. I would be happy to answer any questions you or the 

other Subcommittee Members may have.

Senator WYDEN. It will be put into the record in its entirety. And 

what we’ll do—I have a number of questions and I know Senator 

Smith does—we’ll just go back and forth. Let me start with one for 

the panel. I think that it is very clear that since September 11, 

there is a real challenge in terms of taking on these new functions 

15

to address terrorism, while at the same time keeping the traditional activities of your agency. 

And the General Accounting Office is looking at this area in particular, and they found, for example, on the east coast that there 

was a dramatic drop in the Coast Guard’s fishing boat boardings. 

They found that since September 11, for example, on the east cost 

of the United States there were only 38 of these boardings compared to 300 in the first quarter of last year. 

So it’s clear that with each of your agencies you have taken on 

new missions with respect to combating terrorism, and what I 

would like you to do is tell us, each of you, for your agencies, what 

additional actions you’ve taken to combat terrorism since September 11, and what functions are you forced to do less of because 

of your new duties? 

Let’s begin with the Coast Guard. 

Admiral CROSS. Yes, sir. Maybe to put the numbers that you addressed into a little bit of context. Prior to the events of 9/11, the 

Coast Guard resources engaged in specifically Port Security operations was something less than 5 percent. In the couple weeks immediately following September 11th, that number surged up to 

something between 50 and 60 percent as we reacted and responded 

to, as we normally do, to emergencies. And that would account for 

the significant drop off in first quarter fishing boardings. 

Since that time we have realigned our resources and we now are 

investing somewhere between 20 and 25 percent of our resources 

in Port Security operations and have gone back as much as we 

think we can to other more traditional—that’s not fair. To other 

Coast Guard missions. 

And as I mentioned in my statement, port and coastal security 

is not a new mission for the Coast Guard, but certainly with the 

increased threat it calls for a greater percentage of our resources. 

And the other question that you asked is what are we doing less 

of? Sir, we’re doing primarily less in the way of our law enforcement missions. Less narcotics, less fisheries law enforcement, 

somewhat less in the migrant interdiction role, and then those resources to some extent have been deployed and shifted, if you will, 

to port and coastal security operations. 

I think you also asked what additional things are we doing? 

What kind of things are we doing? Shortly after the events of 9/

11, we implemented a sea marshal program. I can go into that in 

as much depth as you’d like, but in short those are Coast Guard 

people who are willing to go onto high interest vessels and ensure 

that those vessels can’t be taken over as the aircraft were on 9/11. 

Tomorrow we’re going to commission a maritime security team, 

one of four such teams that we’re going to commission this year. 

This one will be commissioned in Seattle. And these are deployment teams that come—two separate teams within the overall 

team come with six boats, and they’re going to be specially 

trained—these are law enforcement personnel—trained along the 

lines of our Port Security that we already have that are primarily 

focused on overseas Port Security. So there is a different venue 

here in terms of law enforcement work versus a wartime scenario. 

For example, one of those Port Security teams currently is deployed in the Middle East and another in Guantanamo Bay. So the 

16

training for those teams differs somewhat. And I will also mention 

we have just increased our presence on the water. We’re much 

more over and above the water, so that you’re much more likely to 

see a Coast Guard boat, a patrol boat or a helicopter flying over 

than you have before. 

And most importantly, we’ve very much increased our outreach 

efforts. In our efforts to build a team within each port, a security 

committee, for example, to try to bring all the resources of the port 

together to enhance the security of the port. Those are the kinds 

of things that we’ve done. 

Maybe one other issue because you touched on international efforts, we have been very busy working with the International Maritime Organization in helping the United Nations in London. And 

one example of one of the things that we’ve been able to accomplish 

there is there’s a lot of information in the system that was—this 

is a system that will allow us to track ships very much like the current aviation system in the world allows us to track aircraft. 

That system was initially scheduled to go on-line and be required 

in 2008. Working within the IMO, we now have agreement to go 

forward with that system in December of 2004. And the reason we 

couldn’t really go faster than that is we don’t believe the manufacturers could actually provide us the equipment any faster than 

that. We have not yet totally set up a shore-side architecture to 

gain those signals and plot them so we can actually track where 

the vessels go, and there is some bandwidth issues that need to be 

addressed. But that’s an example of the kinds of efforts that we’re 

making in the international scene. 

Senator WYDEN. Mr. Browning, what else have you taken on 

since September 11th, and what areas have you been forced to do 

less of? 

Mr. BROWNING. Thank you, Mr. Chairman. Actually, Mr. Chairman, this gives me an opportunity to sort of outline what I think 

have historically been the four core missions of the U.S. Customs 

Service. We have for quite some period of time been a law enforcement agency. That certainly is one of our four mission requirements. 

Certainly post-9/11 border security has come to the forefront as 

one of the issues, but it has always, and I will join Admiral Cross 

in that, it has always been one of our functions to be involved in 

border security. You will recall that the time of the Y2K that indeed it was a customs officer in Washington state that apprehended a potential terrorist who had intentions of causing an explosion at the Los Angeles International Airport. So we have always been in that business. 

What we have been doing post-9/11, however, is to refocus our 

efforts in that area so that we can provide the security that the 

American people are entitled to and are asking us to provide. 

Along with those two parts of our mission, we also recognize that 

we are an important part of the international global trade arena. 

We have a clear trade compliance function and we have a trade facilitation function. And we have been working those functions along 

with our partners in the trade for quite some period of time. 

And indeed one of the things that I would join Admiral Cross in 

this regard, one of the things that is critically important to the 

17

Customs Service and Commissioner Bonner is at the time the decision was made that we would become part of the Department of 

Homeland Security, the decision was made to take all of our functions over and the organization over in tact. We think that is critically important, because the things that we do on our law enforcement side help us to provide the trade compliance facilitation that 

is so critically necessary to our economy. 

So in that sense I think we’ve been doing this for quite some period of time. As to what we have done differently since 9/11, what 

new initiatives, I mentioned in my oral statement both the C–

TPAT and CSI. As you are aware with respect to CSI, we’ve had 

some considerable successes in that area. Most recently Singapore 

has indicated a willingness to allow us to deploy our inspectors to 

that or to do pre-screening on containers for the U.S. The ports of 

Rotterdam, Antwerp and LeHavre have also agreed and we will be 

deploying resources there shortly. And we have for quite some period of time been engaged in CSI with our Canadian colleagues 

taking a look at over the half a million containers that come into 

the U.S. inbound from Canada to the U.S. And again, we have been 

experiencing some successes. 

In addition to these two programs, however, very quickly, Operation Shield America, in which we have gone out and spoken to 

over 3,000 domestic manufacturers of items that would be of interest to terrorists to alert them to what to look for, and if in fact they 

have customers who are trying to acquire some of these commodities to let us know so that we might be able to do some necessary 

followup, and at least two followup investigations have come out of 

those outreach efforts and those contacts. 

Operation Green Quest, which is the targeted money laundering 

activity going after the terrorists’ financing has resulted in the seizure or freezing of over $49 million worth of suspect terrorist assets 

and numerous indictments. 

The Office of Border Security, which we also outlined in my presentation was started up for the sole purpose of helping us to further refine our rules-based data system, so that when we take information and we start targeting containers, we have a very sophisticated, very in-depth tool that allows us to make decisions on what 

is and is not high risk. 

Finally, on the international front we have been working with 

our international organization, the World Customs Organization, 

that has adopted a resolution and will be undertaking an action 

plan in which we will play a critical role to develop, with other nations, a whole process of supply chain security, from vendor to consignee. 

And then very finally, I want to thank the Congress and the Senate for the support we have received with respect to nonintrusive 

technology. We have accelerated our deployment of nonintrusive 

technology to our seaports. This allows us to do better examinations, quicker examinations of suspect and high risk containers. It 

allows our people to help continue to facilitate legitimate trade 

while still allowing us the ability and flexibility to take a look at 

those things that would be of interest to us from both an enforcement or anti-terrorist standpoint. And in that context those are 

just a few of the things we’re undertaking. 

18

One final point. We have worked diligently to partner with other 

law enforcement agencies, other government agencies involved in 

this, the container working group which has the Customs Service, 

the Coast Guard, several other concerned agencies have been working in concert to try to identify approaches so that we can better 

assist each other in trying to tackle this very difficult problem. 

Senator WYDEN. Mr. Browning, you list many things that you’re 

doing in addition to what you used to do. What are you doing less 

of? Mr. Cross told me he was doing less in the law enforcement 

area, which of course concerns me because we have a serious drug 

problem. Tell me, if you will, what are you doing less of since September 11th? 

Mr. BROWNING. Senator, I can’t say we’re doing less of anything. 

What I can say is we’re doing it differently than the way we may 

have done it pre-9/11. C–TPAT was a recognition and one of the 

things we did with C–TPAT was to provide a whole series of benefits to the trade that made it worth their while to shore up their 

own security. We’re not in a position as a law enforcement agency 

to step back from some of the significant law enforcement activities 

we have, such as counter-narcotics, anti-terrorism, forced child 

labor, IPR violations. 

What I think we have been trying to do is to manage the resources so that we could do it differently and try to enlist the assistance of other partners to help us do that. I will give you one 

very interesting statistic. As a result of what we have been able to 

do in the counter-terrorism area, our narcotics seizures for this 

year are up 17 percent over what they were at this same time last 

year. And again, I think it’s simply a reflection of the fact that we 

have been trying to get processes in place that will allow us to do 

our job better. 

I can’t say that we’ve put any one of our missions aside. Maybe 

some of the commercial trade activities or something that we’ve 

had to step away from to redeploy resources, but generally what 

we’re trying to do, sir, is just try to do it better and do it different. 

Senator WYDEN. Mr. Butler, same question. What are you doing 

more of? What has been an area in which you’ve been forced to 

take a lower priority? 

Colonel BUTLER. Yes, sir. Let me address that from two different 

perspectives. One from a national perspective. On the national side, 

as I said in my opening statement, we’ve done a lot more in the 

security assessment program. We used what we call RAM–D assessment. And RAM–D stands for Risk Assessment Methodology 

for dams. Given that, we’ve done that very intensively. 

Also nationally, we have done a heightened outreach for security 

information. We have now leveraged with our DoD organizations 

and also collectively with other law enforcement agencies looking 

for potential threats to the national infrastructure. 

Internally on a national level, we’ve leveraged our capabilities as 

a premier engineer organization to help the nation. In particular 

we have a protective design center in Omaha that has been leveraged to help other agencies in looking at their abilities to shore up 

security. We have done a tremendous amount of work in the R&D 

community. We also have outreached to the engineer community as 

a whole in partnering with different engineer organizations to come 

19

up with better standards throughout the industry. That’s on the 

national level, so we’ve done a lot more of that. 

Regionally, I as a district engineer have had to divert some of my 

ranger personnel from doing what is their normal activities to 

doing much more law enforcement type or patrolling type activities. 

I have additionally added some temporary security folks to augment at my facilities, so I have a higher level of comfort that I have 

eyes watching around the projects as a whole. Additionally, we 

have just had a heightened awareness throughout all the work 

force. 

Now, specifically on the ‘‘less’’. The ‘‘less’’ that’s happened is that 

the range of personnel that we have typically are not there as security personnel. We hire them to interact with the public to provide 

safe recreational opportunities, and to provide interpretation at our 

facilities throughout the nation. We have done less of that. That’s 

exactly what has happened. We’ve had less interface with the public than what they would like. We’ve had less activities at the 

projects, because we’ve had to restrict certain areas of our projects 

from the public. 

In particular at Bonneville Dam, the lock area has a viewing 

platform that is no longer accessible to the public, so we’re allowing 

less visitation to certain parts of projects where people would like 

to go. 

Additionally, early on we had to divert dollars from our maintenance account in order to supplement our efforts to provide additional security personnel. So we diverted dollars early on in order 

to make that happen, and what that has done in essence is pull 

back on our maintenance and repair activities here toward the end 

of the year. As dollars become available throughout the command, 

we continue now to apply those back to maintenance and repair. 

Basically, that was an early decision to take those dollars to shore 

up on the security side. So that’s what we did less. 

Senator WYDEN. One other question for this round and then I’m 

going to let Senator Smith have his first round. Let’s go into the 

budget issues, Admiral Cross. And again, the people of Oregon and 

I—I have community meetings around the state, as Senator Smith 

does as well—are very concerned because we’ve got a number of 

traditional operations the Coast Guard performs which are extremely important to the people of this state. We’re talking about 

Search and Rescue, fishery protection, and responding to environmental disasters such as the New Carissa in our state. 

Tell me how the Coast Guard is going to take on all of these new 

missions with the primary mission of combating terrorism and still 

perform these essential functions that are so important to coastal 

communities and the people of our state. 

Admiral CROSS. I’ll maybe start with a simple answer and then 

a more complex answer. The simple answer is that the Coast 

Guard, especially since 1950, has had a broad spectrum of missions. We’re responsible for missions from bridge administration to 

national defense. 

And to say that moving the Coast Guard to the Department of 

Homeland Security will somehow make Port Security a primary 

mission over the other missions, I think belies our past a little bit. 

Admiral Loy, he was once asked why the Coast Guard should reVerDate 0ct 09 2002 10:27 May 11, 2005 Jkt 092325 PO 00000 Frm 00023 Fmt 6633 Sfmt 6601 S:\WPSHR\GPO\DOCS\92325.TXT JACK PsN: JACKF
20

main in the Department of Transportation. And he explained that 

about—using rough numbers—about a third of our missions are national defense related, about a third are law enforcement related, 

and about a third are transportation related. So we’re not really a 

good fit in justice or in the defense department, so we might as 

well stay in the transportation department. And that’s what he was 

advocating at the time. 

However, now I think if you take a look at those missions, onethird national defense-type related missions, one-third law enforcement related missions, and terrorism concerns, there are very 

clearly law enforcement and national defense issues. We now have 

an opportunity to move the Coast Guard forward into a department 

where we would have about a two-thirds fit. 

But I don’t think it’s fair to presume that that would somehow 

mean that we will ignore the other missions. For example, we always talk about Search and Rescue being our primary mission before 9/11, and what we did after 9/11 is essentially move Maritime 

Homeland Security and Port Security up on par with Search and 

Rescue. 

That doesn’t mean that we didn’t do Fishery Law Enforcement 

here or off the Bering Sea. It didn’t mean that we didn’t pay great 

attention, for example, to aids to navigation, which I know is greatly important for the transport of goods from the Port of Portland 

a hundred miles to the Pacific Ocean. So we’ve always been an 

agency that had to have a broad spectrum. It’s had a broad spectrum of missions and we’ve been able to attend to those missions. 

So I don’t necessarily see a big change here. And like I said and 

said before, Port Security has been a mission for the Coast Guard 

for many years. It’s not a new mission for us. This is simply a mission that because of the increased threat has increased in our priority. 

Senator WYDEN. Admiral, I guess with all due respect I would 

have to disagree. I mean it’s very clear. It’s stipulated in the president’s proposal that the new primary mission is to combat terrorism. It’s outlined very clearly. And it just seems to me that the 

math doesn’t add up in terms of keeping the functions. 

I was very troubled by The Wall Street Journal’s recent report 

that of the extra money that’s being requested by the Coast Guard, 

more than 90 percent of it is for functions other than security. In 

fact The Wall Street Journal reported that about two-thirds of the 

extra money goes for retirement programs alone. 

So you are a good man and it is not right to put you just solely 

on the grill here for decisions being made in Washington, DC But 

it is clear that the primary mission of the new Coast Guard in 

Homeland Security is to combat terrorism, and certainly people on 

the Oregon coast didn’t see that as the primary mission of the 

Coast Guard over the past several decades. And we’re anxious to 

work with you all to make the math add up. But I will tell you that 

it sure doesn’t look like it does. 

Admiral CROSS. One maybe or two additional points that might 

help us with the math just a little bit. 

Senator WYDEN. Sure. 

Admiral CROSS. First of all, I make the point that we’re going to 

be engaged in coastal security regardless of whether we stay in the 

21

Department of Transportation or whether we go into the Department of Homeland Security. I didn’t mean to imply that we’re going 

to be able to enhance our Homeland Security efforts without impacting other missions without having a bigger Coast Guard. 

In fact our fiscal year 2003 budget that’s on the Hill along with 

the supplementals will grow the Coast Guard by about 2200 people. 

And that’s significant for an organization of about 35,000 people 

now. So there are going to be increased costs and those costs will 

be for increased security. 

Senator WYDEN. Well, again The Wall Street Journal reports otherwise. They make it clear that more than 90 percent of the extra 

money that’s being requested is for functions other than security. 

And without objection I’m going to put that Wall Street Journal article into the record at this point. 

[Information follows:]

COAST GUARD BRACES FOR FIGHT

The Wall Street Journal, Wednesday, June 26, 2002 

By Leila Abboud 

War on Terror Thrusts Service Onto Front Line, Into Controversy 

The Coast Guard has long seen itself as the Rodney Dangerfield of the armed 

services, known best for tending buoys and towing broken-down boats. But lately 

it is getting plenty of Congressional attention as President Bush proposes to put the 

agency on the front lines against terrorism. 

Securing the nation’s borders was only a small part of the Coast Guard’s focus 

before Sept. 11. Now the agency faces nothing less than a drastic reorientation, 

should it become part of Mr. Bush’s proposed Homeland Security Department. And 

that, the Coast Guard says, would require more boats and more money—despite the 

president’s insistence that the new Cabinet department can take form without adding to the deficit. 

At the same time, some powerful members of Congress from coastal states don’t 

want to see moves that shortchange the Coast Guard’s traditional missions, such 

as search-and-rescue operations and fisheries protection. 

Warns Alaska’s GOP Rep. Don Young, a well-known legislative pugilist: Congress 

will alter those Coast Guard missions ‘‘over my dead body.’’ 

These are the kinds of hurdles ahead as Mr. Bush and Congress try to create the 

new bureaucracy from all or parts of 22 existing agencies, also including the Customs Service and the Immigration and Naturalization Service, that have substantial 

jobs unrelated to fighting terrorism. Given budget constraints, agencies may have 

few choices but to neglect old missions for new. 

How this may affect the Coast Guard has some powerful groups and lawmakers 

mobilized for their own battle. Besides Rep. Young, who is chairman of the House 

Transportation Committee, with jurisdiction over the agency, others include his fellow Alaskan, Sen. Ted Stevens, top Republican on the Senate Appropriations committee, and House Appropriations Chairman Bill Young, a Florida Republican. 

Nothing illustrates the tensions better than a current debate over ‘‘Deepwater,’’ 

the largest acquisition program in the Coast Guard’s history. Yesterday, a joint venture of Lockheed Martin Corp. and Northrop Grumman Corp., as expected, won the 

contract. The Coast Guard is expected to spend as much as $17 billion over the next 

three decades to buy new ships, planes and helicopters. 

Conceived well before Sept. 11, Deepwater was supposed to replace 92 large, aging 

vessels and 209 aircraft that work far from shore on missions such as interdicting 

illegal drugs or migrants. But now some other influential members of Congress 

question why the Coast Guard is spending three-quarters of its annual capital budget on Deepwater when most homeland-security programs—for patrols, boarding vessels, and guarding infrastructure—operate close to shore and require smaller boats. 

Leading the fight against Deepwater is Sen. Richard Shelby of Alabama, senior 

Republican on the Senate Appropriations subcommittee for transportation. ‘‘The responsible thing for Congress to do is to withhold further funding for this program 

until it has been restructured to meet the changing mission profile,’’ he says. 

22

The Coast Guard’s Petty Officer First Class Ken Walberg, who oversees its patrols 

of New York’s vast and busy harbor, says the smaller, 30-year-old patrol boats were 

the ‘‘workhorses’’ there after Sept. 11. But Coast Guard officials say Deepwater 

equipment will also be used for homeland-security tasks; if terrorists get as close 

as the port, they argue, that could already be too late. 

Alaska’s Rep. Young, concerned that missions critical for Alaska will be downgraded, defends Deepwater. And he isn’t pleased that the Coast Guard’s move to a 

new department could take it out of his jurisdiction. Rep. Young met with President 

Bush and his staff to discuss the restructuring soon after the plan was announced. 

‘‘Until I have the assurance that the core missions won’t be affected, I am not supporting this,’’ Rep. Young says. 

He offered an alternative: Write the law so each mission would be given a fixed 

percentage of the total budget. That could protect functions that Mr. Young supports, regardless of the preferences of some future secretary of the new department—who, as Rep. Young put it, might not ‘‘know squat.’’ 

Even if it wanted to, the White House can’t ignore Mr. Young, whose committee 

also oversees the Customs Service, the Federal Emergency Management Agency and 

the post-Sept. 11 Transportation Security Administration—all of which would be 

part of Homeland Security. 

For Rep. Young and Sen. Stevens, this is more than a turf war. In Alaskan waters, Coast Guard missions are literally about life-and-death issues: By its count, 

the Coast Guard saved 246 lives in Alaska last year. Coast Guard Lt. Jim Zawrotny 

flies search-and-rescue missions in small aircraft from Kodiak Island, the largest island in the Aleutian chain that reaches far into the Pacific Ocean. In remote wilderness and harsh winter conditions, it can take an eight- hour flight just to get to a 

mariner in distress. Last year, 52 of those lives were saved by Coast Guardsmen 

from Kodiak. 

Congress has already begun debating how the Coast Guard should handle 

changed priorities. At a recent hearing of the House Government Reform Committee, Coast Guard Commandant Thomas Collins was asked how the Coast Guard 

would choose between rescuing a sinking sailboat or guarding a river said to be a 

possible target for terrorist attack. 

‘‘Search and rescue takes priority,’’ Adm. Collins replied.

Senator WYDEN. Senator Smith. 

Senator SMITH. Thank you, Senator Wyden. Colonel Butler, in 

his state of the union address, President Bush revealed to the 

American people that there were specific threats about plans 

against hydroelectric dams. And no place in America has more of 

them than the Pacific Northwest. There were specific plans made 

against the Grand Coulee dam. 

Without revealing what you’ve done, can you assure the people 

of Oregon and the northwest, the United States, that these facilities are more secure now than they were on September 12th. 

Colonel BUTLER. Yes, sir, I can tell you that the Corps of Engineer facilities that I control, and that General Fastabend, under his 

control here in the northwest controls, are more secure than prior 

to 9/11. But I will carry that out. Can we do better? Yes, clearly. 

There are more things that can be done. That’s what our assessments tell us—clearly there are certain things. We can leverage the 

technologies that my sister agencies and I have talked about to our 

advantage. 

In the past we have been complacent on the topic of security and 

really put more recreation and some of the other purposes higher. 

But with the new emphasis, the new look, at this point we feel we 

have secure and safe facilities. As any facility of the size of a dam, 

it is vulnerable. It is very vulnerable to certain aspects. With that, 

we need to take new steps in order to shore up those 

vulnerabilities. 

23

Senator SMITH. Are you finding in these new budgets for developing that you’re going to have the resources to do these extra 

things? 

Colonel BUTLER. Senator, we’re going to need supplemental funding. In the current budgets, none of the improvements I’ve talked 

about were actually budgeted for. Supplemental funding would be 

required to the operation and maintenance account in order to 

make these kinds of improvements a reality. 

Senator SMITH. Thank you. Mr. Browning, what does the industry generally get from participating in the C–TPAT program and 

is it working? 

Mr. BROWNING. Senator Smith, in fact we started that program 

with roughly seven charter members. At this point we have numbers that are reaching almost 200 and more are coming in now. 

Senator SMITH. What motivates them to participate? 

Mr. BROWNING. There are specific benefits and I’ll just give you 

one of them. We have a number of programs where we audit the 

operations of the imports coming in. An audit can be a very time 

consuming and expensive proposition over an extended period of 

time. One of the things that we have said to our compliant traders 

is that if you join the C–TPAT program and you go through the 

process of developing the necessary internal security control in 

your operation, and they meet the conditions that we’ve set forth, 

we will put you into sort of a gold card group. 

And that gold card group, one of the benefits of which is a new 

program called ISA, importers self-assessment. Which means we 

will allow you to keep your books, to keep the information and 

make that information available. We will periodically go in and 

take a look, but you won’t be subject to the very time consuming 

costly internal audits that we have been conducting in the past. 

That is an extremely big seller for the trade. 

I need to make one other point about the C–TPAT. We initiated 

that program, but we initiated that program not unilaterally. We 

initiated it in partnership with our traders. We talked to them 

about what was important. We talked with them about how to get 

there. We have a book of what we refer to as security standards—

it’s about an inch and a half thick—which was developed by our industry partners in three different areas, in the sea, air and land 

environment, about what types of best practices or measures could 

be implemented by the trade to shore up the security of their 

transactions and the movements of their commodities. 

So throughout this process we’ve tried to be sensitive to our traders about this. If this program works well, C–TPAT, and CSI works 

well, what we ought to really have in a sense is a green lane for 

those people that we have a high level of confidence are taking the 

necessary measures to secure their supply chain which allows us 

to better focus our resources on those areas that are at high risk 

for us. 

Senator SMITH. And when you develop this information, the track 

record, developing a green lane would certainly be a real motivation for companies to participate. I assume you hear from them the 

biggest concern is, What are you going to do to the efficiency of the 

flow of commerce? And are you going to be making a proposal to 

24

Congress for budgetary allocations to develop this green lane process? 

Mr. BROWNING. Actually, Senator, one of the things that’s been 

most helpful is the support Congress has given us on our ACE automation system. We have for a very long period of time been a 

transaction-based organization. What ACE is going to allow us to 

do is to move away from that transaction-based approach entry by 

entry by entry, to one where we start to deal with our importers 

as accounts. And as accounts we will have more information about 

them. As accounts we will know their business better. As accounts 

we will have a higher sense of reliability that the information 

they’re providing us is information on which we can rely in terms 

of how we treat them. And as accounts what there will also be is 

some of the processes that we have to apply, like the imposition of 

fines and penalties when violations occur, will be addressed differently because we’ll have a relationship with these accounts that 

allows us to take a look at them in a more holistic fashion. 

So I think, and I cannot emphasize enough how important the 

support of the Congress has been for the ACE deployment. Two 

things have happened with ACE, our new automated system. We 

are on a track that we have been making submissions for additional funding so that we can put that into a deployment phase of 

4 years instead of 5 years. The information that we’ll be able to 

gather from ACE will allow us to do a better job on the facilitation 

side. We will give the traders things like periodic payments, remote 

filing, a host of things that they have been saying since 1994 that 

would really be critical to them in terms of the operation of their 

business. 

But by the same token it will give us an information platform 

that from a security standpoint will allow us to do our job better 

and to share information with our partners that should allow them 

to do their job better. So we are trying to move on, Senator. 

Senator SMITH. We want to give you every encouragement on 

this front because we’ve got to provide the security. We don’t want 

to retard the commerce. And I suppose if I hear any one threat of 

concern from industry is that they need more return, if you will, 

for the efforts that they’re making in the program. And it would 

be very helpful to us to have a proposal from Customs as soon as 

possible, because I think when people know from the human standpoint, when you go to an airport, catching a plane isn’t like catching a cab any more. And we understand that and we put up with 

that. But eventually we need to get to an efficiency without compromising the security, and these companies are going to need that 

proposal. 

Admiral Cross, is there a set standard for the AIS system, the 

automated information system, and what is the cost of the share 

side components of the system? 

Admiral CROSS. Sir, I don’t have that information available. I can 

provide it for the record if that would be helpful. 

Senator SMITH. If you could do that that would be appreciated. 

[Information referred to follows:]

Standards for equipment required for Safety at Sea Convention (SOLAS)-class 

vessels are complete. Class B standards (equipment required for non-SOLOS-class 

vessels) are under development. 

25

Standards for the AIS shore infrastructure are under development by the International Association of Marine Aids to Navigation and Lighthouse Authorities 

(IALA). IALA plans to have these standards completed by September 2002. 

We estimate that to install a ‘‘receive only’’ AIS system on National Distress Re- sponse System towers will cost approximately $28.3 million over a 3-year period. 

Annual operating costs will be approximately $3.24 million. At this time we do not 

anticipate a requirement for AIS transmit capability, but we are continuing to research this capability.

Senator WYDEN. OK. Let’s go on to some other areas. And I appreciate that you all have taken the time because obviously these 

are important issues. Let me followup on a point Senator Smith 

made with respect to the locks and the dams, and particularly the 

Corps’ role in this important area. And actually it was something 

where I had a colloquy with Senator Hollings, who managed the 

Port Security Bill, to try to address some of the issues that Senator 

Smith was talking about. 

The Corps has the responsibility for maintaining the navigation 

system. That is essentially the key type of Corps function. But protecting that system against terrorism has not been one of the Army 

Corps’ primary missions in the past. And my question to you, Colonel Butler, is where are you all going to get the expertise again to 

take on these new duties or do you think that this is something 

that should be given to somebody else in the whole debate about 

setting up the new Department of Homeland Security? 

Colonel BUTLER. Senator, at my level—I’m not able to answer at 

the national level. 

Senator WYDEN. Just talk about Oregon. Senator Smith raised 

an important issue. The locks, the dams, these are very important. 

That’s not been a primary function of all of you. Where are you 

going to get the expertise, to get the training, to take on this new 

function now? 

Colonel BUTLER. Sir, in doing that we have internal resources, 

like I mentioned, on the engineer side. That of a protection design 

center and capable engineers able to come up with the technologies 

to give us early detection systems, deterrents and such. We have 

also partnered very heavily in working with the Coast Guard, with 

the FBI, with local law enforcement agencies, and tapping their expertise, because, like I said, law enforcement is not a Corps mission. Therefore, when it gets to the law enforcement functions we 

are looking for our sister agencies to provide us that. 

So we don’t anticipate to train up to have folks do it, but what 

we’re looking to have, as you mentioned, is synergy of the efforts 

of all agencies so that we respond to our common goal. One of the 

things that we have done in the past, since 9/11 also, is that we’ve 

had increased table top exercises or simulation exercises, where we 

bring all agencies together. We’ve had those and played certain scenarios to answer, ‘‘How would we react? Can we now function as 

diverse communities with different responsibilities and authorities 

in order to handle this kind of situation?’’

Every one of those exercises provided great learning opportunities, and has reassured folks that we work in tandem and we can 

handle any threat that has been proposed to us. 

Senator WYDEN. I want to go back and take a look in the budget 

for where this concept of synergy has come in. It’s very clear we’re 

going to have a whole lot of it. Mr. Browning, a couple questions 

26

for you. One key one on the technology side. And my sense is that 

clearly screening technology needs to be included and enhanced—

the Customs screening technology—to develop and search small 

aviation luggage. But X-rays of marine containers that can contain 

10 or 15 large shipments carrying up to 60,000 pounds is obviously 

a very different drill altogether. 

Now you all have a pretty small budget for R&D, and it’s a pretty small budget to take a look at innovative technologies. What is 

Customs doing to develop technology to identify threats scientifically as opposed to the old approach of visual identification of huge 

cargo volumes? 

Mr. BROWNING. Thank you, Senator. We, as you indicated, do in 

fact have—I mean our budget for R&D is not a huge budget, but 

we have a very, very talented staff, and more importantly what we 

have is some very good partnerships with other organizations in 

technology development. 

In 1991, and I think I may have mentioned this to you yesterday, 

we had one piece of non-intrusive technology on-line in our organizations, which was an X-ray van. That was in 1991. Today we have 

over 86 pieces of non-intrusive technology and they go the full 

range from personal radiation detector devices to vapor trapping 

devices for determining whether there’s narcotics, explosives in a 

container, to the ability to do full scans of containers. 

Our vehicle and cargo inspection systems, VACIS, have been totally resigned. They are now relocatable. They are mobile. They are 

specifically geared to the sea environment, specifically geared to 

the land environment. So we are doing an awful lot in that regard 

to develop a whole range of different technologies that will help us 

do our job better. 

Working with organizations like Pacific Northwest Laboratories, 

we have given some of our requirements to them and they have developed some of these technologies for us. In fact the personal radiation detector was developed by them based on specifications that 

we gave to them. And this is widely used. Indeed by January we’ll 

have over 8500 pieces of this equipment out in the field. 

Our goal is to have some system of non-intrusive inspection at 

every port of entry in the U.S. In fact the Port of Portland is online to receive two portable detectors which can do all kinds of testing, including for nuclear. So we are on-line. 

I have to say one thing that’s happened and this has been a plus 

up from the standpoint of the emergency supplemental. With our 

appropriated funds for 2002 in the emergency supplemental, we received $102 million in non-intrusive. The 2003 budget has 46.6 million additional in non-intrusive and our 2004 request will have 

somewhere in the neighborhood of 59 million additional dollars for 

non-intrusive. 

Clearly that technology piece is essential for us to do our job 

given the volume of merchandise that moves to the U.S. and the 

fact we want to try to do our level best to facilitate the movement 

of the trade. So we are continuing right now to work with partners 

in a host of other areas to develop the technologies we need, and 

we’re getting good response both from our R&D people as well as 

the other individuals in other agencies that are involved in technology development. 

27

Senator WYDEN. A couple of others for you, Mr. Browning. Obviously it’s critically important to get agreements with other countries to coordinate security at the point of origin. What do you do 

if they won’t go along? What’s going to be the strategy of Customs 

to try to up the ante and make sure that we can have this police 

presence that’s so important for our security? 

Mr. BROWNING. I’ve been actually surprised and delighted by the 

response we’ve gotten thus far from some of the ports that we’ve 

approached as part of our CSI program. I think, as you are aware, 

the whole notion of waiving sovereignty is a difficult one, and when 

you allow Customs inspectors on your soil to do in a sense targeting and making those kinds of decisions, it can be very difficult 

negotiations. We have had success, and I think I indicated to you 

some of the ports we’ve had success with: Rotterdam, Antwerp, 

LeHavre, Singapore. We’re in discussions with Hong Kong. We’re 

in discussions with the People’s Republic of China. We’re in discussion with Taiwan. And of course we’ve had ongoing activity with 

Canada. 

A good bit of that has been Commissioner Bonner himself has 

personally engaged to pushing this forward. That has been a real 

benefit for us to move this forward, because when you get the head 

of the agency himself sitting down at the table across from his 

partner, decisions can get made. And it’s very difficult for people 

to backslide those decisions when you have the two heads of organizations working together. 

So we have had good success. We’ve had very few people that 

haven’t at least been willing to talk to us. And in some respects the 

successes we’ve had thus far will motivate other ports, because I 

think in terms of CSI, what we have said is if you have this in 

place, the treatment that those containers coming out of there will 

receive will be better treatment than from other locations where we 

don’t have that level of confidence in the security system that’s in 

place. That will be a huge motivator simply from a standpoint of 

commercial competitiveness to get some of these other ports moving down the aisle. 

If they don’t, then what we look to do, Senator, is we look to go 

back to our state department and enlist the state department in 

going to those governments and saying it’s in your interests, it’s in 

our interests, it’s in the global trading environment’s interests for 

us to have these arrangements. Now, the good news is we haven’t 

had to do that thus far, although I will say that the state department has been extremely supportive. They’ve been on the ground 

putting out the word. They’ve been on the ground perfecting this 

understanding of what the program intends to do, and they’ve been 

on the ground helping us to interface with our counterparts to 

make some of these things happen. 

Senator WYDEN. I think that’s a constructive strategy. I think it’s 

essential that you all be prepared to up the ante if you don’t get 

the cooperation that is clearly critical to your thinking. I have one 

other question. 

Mr. BROWNING. I just want to make another quick point. Commissioner Bonner at the outset of this process made it absolutely 

clear, as we did with the airline industry, that if they didn’t sign 

on we would subject them to inspections, and people that don’t sign 

28

on will be subjected to inspections. They need to know that. We 

have no intentions wavering on our authority to inspect everything 

that comes into the U.S. to ensure that it’s safe to enter this country. And we have said that to a number of our partners. 

Senator WYDEN. Mr. Browning, how serious a problem is this 

matter of unsealed containers coming in? 

Mr. BROWNING. It’s a huge problem because it is—and when we 

say unsealed, are you saying unsealed meaning no seal or empty 

containers? 

Senator WYDEN. Either one. What we heard yesterday in Seattle, 

and I assume I’m going to get the same answer when I ask the 

question now, is that it is one of those issues that my kids would 

say ‘‘hello.’’ I mean it just is so obvious. You’ve got unsealed containers, or I guess empty could be a possibility as well, where there 

is essentially no inspection system whatsoever. With the people of 

Oregon saying to Senator Smith and I, they want to have assurance that there is an inspection process in place, and they want it 

done in a way that’s also going to allow for the free flow of goods. 

And when you have what we heard yesterday in Seattle, you know, 

unsealed containers, I mean those just strike me as magnets for 

terrorists. And I’d really like to hear what you all think of the 

problem and in fact what can be done about it? 

Mr. BROWNING. Senator, I think actually my 11-year old would 

say, Dad, duh. It is clearly a problem. And I think you’re right that 

it is clearly a problem. I also might add to that the in-bond movements, because those become a bit of a problem also. We recognize 

that empty containers, and there are an awful lot of empty containers moving around, when you look at our inspection rates, the 

examination rates of containers, what’s actually very interesting is 

to see the inspection rate’s considerably higher for empties specifically because empties pose such a problem. 

To be candid about it, we’re going to need to work through that 

because we’re trying to just right now deal with the things given 

the volume of what’s coming in now, trying to shore up that piece. 

We are continuing to look at that issue and continuing to look for 

approaches that indeed what I suspect and what I hope will happen as we go through this process working with committees such 

as yours, perhaps we can come up with some solutions that will 

give us what we need to place requirements on these containers 

also. 

But it is a problem. It is one we’re going to have to continue to 

try to address. We know that and we’re trying to work out some 

solutions within our organization, and hopefully we’ll be seeking 

some additional support from Congress to make that happen. 

Senator WYDEN. I appreciate the candor of that answer and we 

want to work with you on it. One of the suggestions I had is that 

I would really like to encourage you to work with the unions and 

various labor organizations. The longshore and warehouse union 

brought it up yesterday and made it clear that they want to work 

with all of you and business folks in a kind of partnership that’s 

very much been a part of our tradition to try to get everybody to 

the table: the workers, government and business. I just think this 

is a critical problem. You’ve acknowledged it by describing it as 

huge. And we’re anxious to work with you on that. Senator Smith. 

29

Senator SMITH. Just a couple more questions, Mr. Browning. I 

assume Singapore, Rotterdam and other places, they’re willing to 

work with us there as opposed to waiting until it gets here because 

they want to keep the flow of business going with the United 

States. I would hope beyond that there’s a common human desire 

to prevent the terrorism that has beset the whole world. Is that the 

spirit you think this is being done in? 

Mr. BROWNING. Senator, I think there certainly are some concerns in that regard, but I would be less than forefront if I didn’t 

say that a good bit of this is motivated by the commercial interests 

of these ports. 

Senator SMITH. Well, what happens if you find a dirty bomb in 

Singapore, for example? Just hypothetically? What’s the process 

there? 

Mr. BROWNING. We would do the targeting in Singapore. If we 

found something there, we would say to the Singapore authorities, 

This container is high risk based on our having put the data up 

against our data base. You need to take some action, and then it 

would be incumbent upon them to take action. 

If they refuse to take action, then this would be a problem for 

us. We might make a decision that we’re not going to let that vessel or that container come in, and we would communicate that to 

the shipper, and the shipper would be on alert that if in fact you 

try to move that vessel in here, it will not make entry in the U.S. 

We are hopeful that that will not happen. Most of the agreements that we have right now indicate that they have agreed to 

take action at that port. 

Senator SMITH. Mr. Browning, does the Customs have any formal 

process for allowing industry to provide input into the development 

of the Customs program? Is it just informally done or is it a formal 

process? 

Mr. BROWNING. No, sir. There are several organizations, but we 

actually have a statutory mandated advisory group called the 

COAG, the Commercial Operations Advisory Group. It is through 

the Treasury Department, but it is the body that provides advisory 

assistance to Customs on the development of our activities. And in 

fact they were actively involved in developing the guidelines in our 

supply chain security program. We meet with them on an annual 

basis four times a year. In addition to that there are several trade 

representative groups. AAEI, the American Association of Exporters and Importers, the Joint Industry Group, a group called 

BACUM, and several other groups that we have direct interface 

with. The American Steal Association. There are a whole list of 

bodies on a regular ongoing basis for which we have primary points 

of contract that are responsible at the assistant commissioner level 

that are responsible for interfacing with these individuals and providing feedback. 

And then one final group is our trades port network, which has 

been involved with us on the development of ACE and our overall 

modernization strategy. That is about 200 plus people who we periodically report to, importers, exporters, service providers, the whole 

array of our stakeholders. 

30

Senator SMITH. And in this process you describe of interfacing 

with industry, was this process utilized in the develop of the C–

TPAT program? 

Mr. BROWNING. Yes, sir, absolutely. I’ve been with this organization 26 years, Senator, and I have to say that there was a point 

in time when our relationship with trade was very adversarial, us 

against them. I think that the phrase was coined that we had sort 

of a ‘‘gotcha’’ mentality. What we recognized is given the limited resources that we have, that in order for us to be effective as both 

a law enforcement agency and a trade compliance/trade facilitation 

agency, we had to change that mind set. So what we have been 

doing is we have been partnering up very extensively with the 

trades, and we have been lock step in a lot of projects simply because we need their support if we’re going to be able to do our jobs 

better. 

Senator SMITH. Thank you. Colonel Butler, I’m still worried 

about these hydroelectric dams, and I’d like to get Captain Spitzer 

in on this next question. You mentioned a table top exercise. In 

your efforts to protect the dams from terrorist attack, do you have 

a way to involve Captain Spitzer or other branches of the military? 

Colonel BUTLER. Yes, sir. I’ll let Captain Spitzer talk to the Coast 

Guard’s role. Usually the dam structure is an obstacle in the river. 

If it’s the target of the intended terrorism, then we will be looking 

for outside support. Clearly we do not have those kinds of capabilities. We lean to those law enforcement agencies, to the Coast 

Guard, heavily to react with us. So given that, when we look at 

these on these table top exercises, one of the intents is to understand everybody’s capabilities so that we understand, as certain 

events unfold, who should we call out to. 

We’re a very stationary object in the river and therefore we need 

help and we need help from all areas of the government. If it were 

to escalate to the point that we need other DoD assets, yes, that’s 

within my foray to escalate on up, along with Captain Spitzer, at 

that point. 

Senator SMITH. And if there’s a problem everybody knows what 

it is and you push a button, make a call, whatever, and you trigger 

their involvement? 

Colonel BUTLER. Yes, sir. I wouldn’t say there is a formalized 

process, but these table tops opened the discussion lines. Let me 

go back to 9/11. When I rolled into work early morning on 9/11, the 

first thing on my mind was what about my dam facilities? I picked 

up the line, called the air national guard here in Oregon and said, 

What kind of top cover can I get from you? They hadn’t thought 

about it. They put it in their decision cycle. In the same sense, 

Captain Spitzer and I were also on the line talking about navigation security. What was he doing as captain of the port and how 

did I fit into his plans; because I’m a fixed facility, how does he see 

insuring the navigational security? 

Senator SMITH. And was there any way to include the river pilots 

in this discussion? We stopped all the airplanes from flying, but 

what did we do with the pilots on the river? 

Colonel BUTLER. Sir, I’ll defer to the Coast Guard to answer to 

that. 

31

Captain SPITZER. Senator, getting back to the dams. Right after 

9/11, representatives from my planning staff were in touch with the 

planners at the Corps of Engineers and we were looking at things 

like the structural integrity, the strength of the dams, the vulnerability to a similar attack to the World Trade Towers, and a lot of 

our review and analysis has been done. 

Some of the exercises have been even more than table tops. They 

involve the maritime industry. We did one with Tidewater Barge 

Lines and using their resources at Bonneville Dam, and it was just 

a tremendous amount of coordination done there. What we have 

done even more importantly, a lot of our leveraging and coordination has been done not just focused on civil resources, but consequence management in general. 

For example, we did a mass casualty exercise on the Columbia 

River at the Portland airport simulating the crash of an airliner. 

This is an exercise that was just done about a month ago, although 

we originally intended to do the exercise on September 12th. For 

obvious reasons it was delayed. But there was tremendous planning done toward exercises that ultimately involved about 500 people, and with primary benefits being the coordination of the agencies working together before the exercise to interact together. 

And when we have to come together, it could be at a dam or it 

could be anywhere in the system, it could be downtown Portland, 

but the important thing to emphasize is that there are lots of planning efforts similar to this going on in all sorts of different communities. And the Coast Guard is going to many of those efforts. 

Senator SMITH. Thank you. 

Senator WYDEN. Gentlemen, did you all participate in the summit that was held in Oregon, or your agencies, on technology and 

cybersecurity when Mr. Clark came? 

Colonel BUTLER. Sir, I’m not aware that my organization did. 

Admiral CROSS. Sir, neither Captain Spitzer nor I are aware that 

the Coast Guard participated or not. We can get back to you. 

Senator WYDEN. Well, let me wrap up on this technology point, 

because it really highlights a very significant concern on my part. 

This was a hearing of the merchant marine subcommittee, but I 

chair the Technology Subcommittee for the Commerce Committee. 

And Oregon is now becoming a center for cybersecurity. In fact if 

you read Oregon Business Magazine this month, there is a significant discussion of many jobs coming in this field which can help 

our national security. It’s very good for this sector as well. And I’m 

troubled that the Federal Government really is botching this job 

with respect to technology in many respects. 

First, after 9/11 thousands of ideas came in to the Federal Government unsolicited from business people and entrepreneurs, and 

there was no system for reviewing any of these. Basically I’ve 

heard from scores of businesses and entrepreneurs who said, not 

only is there no test bed to evaluate what we’re doing, we can’t get 

an answer from anybody. 

And I think that we have got to have you all in your agencies 

at the table in every one of these significant discussions with respect to technology, if we’re going to get a jump on the terrorists. 

They’re not technological simpletons; they’re looking at what’s 

going on out there in the commercial world, and they’re getting on 

32

top of the state-of-the-art and they’re using it against us. And I 

don’t want to put you on the spot with respect to the meeting with 

Richard Clark. 

This is an area where the administration is doing some very good 

work. They work very closely with me. We’re going to have a technology package that will go to the president by the fall. Senator 

Smith has been very supportive of this as well. It’s gotten through 

the Commerce Committee. But I think we’ve got really two problems. First, we don’t have a one-stop process in order to make sure 

that entrepreneurs, many of them who live in our state and right 

in this area, can get their ideas evaluated. And second, we don’t 

seem to be reaching out in a proactive way in going to them to get 

their ideas. 

And, Mr. Browning, you’re nodding and I’m just going to take 

note of that, and I think you all are aware of that. But we have 

got to have you all much more proactive with respect to technology 

in getting these ideas. Even the CSI initiative, which we’ve been 

talking about is so important; we’re going to try to get as far as 

we can with those foreign governments. But it may be that somebody in Beaverton or somebody here in our area of technology may 

be able to come up with a way to get exactly that accomplished 

through products in this country that helps put people to work in 

an area of the country that’s very high in unemployment. 

So we are going to be following up with each of your agencies, 

and I would just ask ultimately that when you see significant meetings with respect to technology and cybersecurity, we want you to 

be proactive. I’ll get you all a copy of the Oregon Business Magazine or you can get a copy yourself. The organization doing very 

good work in this area is called RAINS, and they’re going to be one 

of the cybersecurity leaders in the country; and it’s something that 

would be good for our state’s employment and also good for our national security. I just wanted to close with that final comment. Senator Smith, anything you wanted to add? 

Senator SMITH. No. 

Senator WYDEN. OK. Thank you all. We thank you for your professionalism. I know that I asked some questions that involved 

some decisions being made in Washington, DC that are not exclusively within your province to decide; but do know that feelings run 

very strong in our part of the world on these issues. Your agencies 

are part of our community and part of our family, part of the Oregon family. You do important work and we want to make sure 

that we’re taking every step to deal with terrorism. We know that 

the seaports are vulnerable. We’ve got to figure out a way to perform these other functions and address it in a balanced way along 

the way. Anything further? If not we’ll excuse you and we thank 

you for your professionalism. 

Our next panel Is Robert Hrdlicka, Marine Director of the Port 

of Portland; Mr. Kim Puzey, Executive Director of the Port of 

Umatilla; Allan Rumbauch, General Manager, Oregon International Port of Coos Bay. 

All right, gentlemen, we thank you and you all have been very 

patient. I must have mangled the pronunciation of your name. Is 

it Hrdlicka? 

Mr. HRDLICKA. It’s Hrdlicka. 

33

Senator WYDEN. Hrdlicka, OK. 

Mr. HRDLICKA. But I’m used to it, Senator. 

Senator WYDEN. We’ll put your statements into the record in 

their entirety, and if you would please just speak for 5 minutes or 

so about the concerns that are important to you, that’ll be great 

and we’ll have some time for some questions. Mr. Gaul is it? 

Mr. GAUL. Yes, sir. 

Senator WYDEN. And you’re going to be speaking for? 

Mr. GAUL. I’m speaking for Mr. Rumbaugh. 

Senator WYDEN. OK. Welcome, everybody. 

STATEMENT OF ROBERT HRDLICKA, MARINE DIRECTOR, 

PORT OF PORTLAND 

Mr. HRDLICKA. Good morning, Senator Wyden and Senator 

Smith. First of all, I’d like to commend you for holding this hearing 

here today in the Port of Portland. The Port of Portland is pleased 

to be able to host this event here today. I also appreciate the opportunity to present the port’s views on this very important issue. 

By way of background, the Port of Portland owns five marine terminals. Together with the other deep-draft ports in the lower Columbia, we do as a port range handle a significant amount of cargo. 

Last year about 2,000 ocean-going vessels called on the Columbia 

River and carried about $14 billion worth of cargo. I’d like to take 

just a moment if I could to outline some of the unique characteristics of the maritime trade on the Columbia River. They’re not all 

that common among U.S. Ports and we feel they must be taken 

into account as we develop a framework for national maritime security. First of all, as you know the Port of Portland is a river port 

about a hundred miles from the ocean. Private and public terminals that comprise the deep water system are spread over a large 

area between downtown Portland on the Willamette River on down 

throughout the lower Columbia. Second, about 80 percent of the 

cargo that’s handled through our port range is export cargo, primarily being exported to the Pacific Rim. 

Third, most of our export cargo consists of bulk grains and minerals. In fact the port system on the lower Columbia River is the 

largest wheat handling port range in the United States. And if you 

take into account other grains, such as barley, feed corn, and that 

sort of thing, it is the second largest grain handler for grains in the 

world. Portland is also the largest automobile handler port on the 

west coast and the third largest in the nation, and we also, as you 

know, serve a niche market in the handling of import and export 

containers. 

Fourth, to bear in mind that Portland is only one component in 

a sophisticated system of ports along the Columbia and Willamette, 

and upriver 465 miles to the port of Lewiston, Idaho. And finally, 

due to the port’s traditional placement as the last port of call in 

a typical ocean vessel sailing schedule, a significant share of the 

import cargo that comes into the Portland area arrives as an inbond shipment from another port, typically Puget Sound or somewhere in California. In other words, a container would come off in 

Seattle and move by truck or by rail into the Portland area and 

then finally be inspected and declared at Customs in Portland before being turned over to the importer. 

34

Given those unique characteristics, I would like you to consider 

the following recommendations as we look at maritime security legislation. 

First of all, this is not a one-size-fits-all proposition. The final security law should provide reasonable flexibility and discretion to 

the Transportation Security Administration, and the Coast Guard, 

to implement the machinery of that law. Second, the Federal Government should fully fund the security requirements that it imposes on the port. Most ports simply do not have the financial 

wherewithal to fund the potential requirements of any new Federal 

legislation. 

Third, Federal legislation must recognize that marine facilities in 

a port area are often owned by various public and private entities. 

In our case in the lower Columbia River, the facilities owned by the 

Port of Portland are really only a very small part of the 40 facilities 

that comprise the system on the lower Columbia and the Willamette. On the in-bond movements of imports that I mentioned earlier, in the case of Portland as well as other inland ports, the inbond process sustains a local customs and broker forwarding community that’s essential to the movement of goods in international 

trade. I urge you to develop a compromise Port Security bill that 

would require the same type of advanced information for in-bond 

movements as for direct imports. 

With that, Mr. Chairman, I will conclude my remarks, but I’ll be 

more than happy to answer questions that you may have. Thank 

you. 

[The prepared statement of Mr. Hrdlicka follows:]

PREPARED STATEMENT OF ROBERT HRDLICKA, MARINE DIRECTOR, PORT OF PORTLAND

My name is Bob Hrdlicka, and I am the Marine Director at the Port of Portland. 

I would like to commend you for holding this hearing on marine security today, and 

I appreciate the opportunity to present the Port’s views on this important issue. The 

Port’s Executive Director, Bill Wyatt, very much wanted to be here for this hearing, 

but he regrets that he has to be out-of-town today for a longstanding commitment. 

The Port of Portland owns and operates several aviation facilities, marine terminals, and business parks. In addition to Portland International Airport, the Port 

owns five marine terminals on the Willamette and Columbia Rivers. Together with 

other deep-draft ports on the Lower Columbia River, the Port of Portland’s facilities 

handle a significant amount of cargo. Last year, about 2,000 ocean-going ships 

called on the Columbia River, and they carried about $14 billion in cargo. 

I’d like to briefly outline some of the characteristics of our marine business. They 

are not all that common among U.S. ports, but they must be taken into account in 

developing a national framework for marine security. 

First, as you know, the Port of Portland is a river port about 100 miles inland 

from the ocean. Our maritime access to the world depends upon a 600-foot wide federal navigation channel that must be dredged every year to maintain its authorized 

depth of 40 feet. Public and private marine terminals in Portland are spread out 

over a large area between downtown on the Willamette and Terminal 6 on the Columbia River. 

Second, about 80 percent of the cargo moving through the Port of Portland is exported, primarily to Asia. 

Third, most of our exported cargo consists of bulk grains and minerals. In fact, 

the Port exports more wheat than any other U.S. port and is the second largest 

grain exporting center in the world. Portland is also the largest automobile handling 

port on the West Coast and third largest in the nation. We serve a niche market 

for container exports originating in Oregon, southwest Washington, and Idaho. 

Fourth, the Port of Portland is only one component of a sophisticated system of 

Columbia, Willamette, and Snake River marine terminals and navigation locks. 

Barges carry both bulk and container cargo from as far upriver as the Port of LewisVerDate 0ct 09 2002 10:27 May 11, 2005 Jkt 092325 PO 00000 Frm 00038 Fmt 6633 Sfmt 6621 S:\WPSHR\GPO\DOCS\92325.TXT JACK PsN: JACKF
35

ton—465 miles from the ocean—to the Port of Portland and other downriver deepdraft ports. 

Finally, due to Portland’s traditional placement of ‘‘last port of call’’ in the West 

Coast sailing schedules of container carriers, a significant share of the import containers arriving in the Portland area move ‘‘in-bond’’ by rail or truck from Puget 

Sound ports. As an example of the ‘‘in-bond’’ process, a container is transported by 

ship from Asia and unloaded at the Port of Seattle without declaring formal entry 

to the Customs Service. The container is then carried by rail or truck to a freight 

facility or distribution center in the Portland area, where it is declared to Customs 

and handed over to the importer. 

Given our unique characteristics, I would like you to consider the following recommendations when considering port security legislation:

• ‘‘One size does not fit all.’’—The final port security law should provide reasonable flexibility and discretion to the Transportation Security Administration and 

the Coast Guard to implement security arrangements adapted to each port’s 

particular requirements.

• The Federal Government should fully fund the security requirements that it imposes on ports. Many ports simply do not have the resources to comply with potential provisions of a new federal law. Uniform federal funding is the surest 

way to secure maritime ports.

• Federal legislation must recognize that marine facilities in a port area are often 

owned and managed by various public and private entities. In our case, the Port 

of Portland’s are but a small part of more than 40 marine cargo deep-draft facilities in the Willamette and Lower Columbia. It is not enough to simply improve security at publicly owned terminals while neglecting the vast amount of 

private port infrastructure. Federal legislation should view the entire public and 

private terminal infrastructure as one system.

On the in-bond movement of imports that I mentioned earlier, I urge you to recognize the value of the in-bond process to importers located around inland ports such 

as Portland, Dallas, and Memphis. Delaying formal entry of a container until it 

reaches its final destination enables local importers and brokers to resolve questions 

and problems with local Customs personnel, rather than Customs personnel at the 

initial port of unloading. In the case of Portland, the in-bond process also sustains 

a local Customs and broker/forwarder community that is essential to our direct call 

service. Finally, without the in-bond movement of cargo, congestion problems at initial ports of unloading, such as those in Puget Sound and southern California, would 

only grow worse. 

The Senate-passed port security bill would require importers to provide in advance much more detailed information on in-bond cargo than on regular imports. 

The Port and its trade partners in this region are concerned that these additional 

data requirements could be extensive enough to convince importers to just declare 

all their cargo at initial ports of unloading. If that were to occur, the in-bond process 

and all its benefits would be lost. 

I urge you to develop a compromise port security bill that would require the same 

advance information for in-bond imports as for other imports. The Customs Service 

could then use that information to assure the security of all import containers, 

whether they are formally declared for entry at their initial port of unloading or 

moved inland through the in-bond process. 

Thank you again for the opportunity to testify on these important issues and for 

conducting this hearing at the Port of Portland.

Senator WYDEN. You’re welcome. It’s good to see you and thanks 

for all the work that you’ve done. Mr. Puzey. 

STATEMENT OF KIM B. PUZEY, GENERAL MANAGER,

PORT OF UMATILLA 

Mr. PUZEY. I appreciate the opportunity to be here and testify before the Committee and appreciate the work that you and Senator 

Smith do for the state of Oregon. My name is Kim Puzey. I’m general manager of the Port of Umatilla. The Port of Umatilla is a 

river port. We have no seagoing vessels that call at our port. We 

are located on the Columbia River mile 292, upstream from here 

considerably. 

36

We have at our facilities a grain elevator with a belt conveyor for 

exporting of the wheat that Bob spoke about. We have a fuel and 

liquid fertilizer terminal mostly incoming. We serve the Hinkel 

switching yard in our port district with diesel fuel that we receive 

at that terminal. And then we have a container-on-barge facility 

primarily exporting value-added agricultural products. 

Because of the population around the Port of Umatilla, the location, product mix, and so forth, in my opinion the port is not a target and therefore not very vulnerable to acts of terrorism. However, 

we do receive empty containers that are coming in. We do a process 

which is called pre-tripping: Open them, clean them, inspect them, 

test the equipment and bring the temperature down, especially for 

the perishable products that we export from there. So we are inside 

the containers at our port facility. 

The Port of Umatilla, although it may not be very high on the 

food chain for a target, it is part of that system that’s been spoken 

of today, the Columbia-Snake River System, that is vulnerable because of the Federal projects there. The dams are without question 

the most vulnerable part of that system to attacks of terrorism, but 

I would suggest to you that the locks are the most vulnerable. So 

we support any kind of land, water, air protection for the locks 

themselves. 

The destruction or disruption of one of those locks not only could 

significantly impact navigation, but also irrigation, hydropower, 

and flood control. I’m glad that Grand Coulee has been brought up. 

That’s obviously the big target, but any of them could seriously 

compromise the economy of the region. 

The second issue that I’d like to speak to is not in our region, 

but it has to do with what I think is the most vulnerable port in 

the United States, and that is Port Arthur, Texas. I have included 

in my testimony as Attachment A, a New York Times article that 

speaks to this that came out in March. Port Arthur has more than 

200 pipelines, more than a dozen refineries, large refineries, some 

of the largest in the nation, and the vessels that are coming in and 

out of that port are floating bombs. 

I don’t know how we would be able to prevent those who would 

do harm at that port from doing so. An incident with a freighter 

carrying inflammables that come in and out of Port Arthur would 

be environmentally catastrophic, would impact the national economy because we’re talking about oil, and could disrupt the shipping 

in that area. So I would like you to put on your radar screen Port 

Arthur, Texas. I know that Senator Hutchins is on the Committee 

as well. 

The third, and to me it is the most horrifying and the most significant threat to our country, has to do with biological terrorism. 

I have recently read seven books on biological warfare. I’ve attached a list and a brief synopsis of each of those as Attachment 

B. I live downriver from 11 percent of the chemical weapons in the 

United States, and I have six children and I sleep every night 

knowing that they’re safe and well cared for. And that chemical repository is pale by comparison to the amount of smallpox that could 

be in that ballpoint pen. 

As you know, in recent decades there has been research and development done in germ warfare programs across this planet, espeVerDate 0ct 09 2002 10:27 May 11, 2005 Jkt 092325 PO 00000 Frm 00040 Fmt 6633 Sfmt 6601 S:\WPSHR\GPO\DOCS\92325.TXT JACK PsN: JACKF
37

cially in the former Soviet Union, where they have dealt with anthrax, tuleremia, ebola, salmonella, glanders, smallpox and so 

forth. And at the end of the cold war we had those weapons programs come to an end and had literally thousands of microbiologists in the former Soviet Union out of work, unemployed. Clearly 

they have given information to the North Koreans, to the Iranians, 

Iraqis. 

I think one of the most important things with respect to Port Security is to search and destroy. So I would advocate that we fund 

the intelligence community to help us with respect to that to get 

to the root of these things rather than to the branches. We need 

to be able to find those who would do harm on their own soil before 

they begin to come into our ports. We are far too vulnerable. All 

of the things that we’ve spoken about notwithstanding, given those 

who are intent to do evil, I’m absolutely convinced as I’m convinced 

we’re sitting here talking to one another, that anthrax will be used 

in this country again. 

You saw it disrupt the U.S. mail. It’s clear to me that it would 

be very easy to taint our currency, to do so in a major retail outlet, 

to do so in fast food restaurants and so forth, and spread terror 

throughout the country. Minimal loss of life, but any loss of life is 

significant, and we could stall the economy with the slightest of effort. I think anthrax would be the agent of choice because compared to smallpox and some of the others, it is easier to handle, 

easier to control. The contagion component of it is not as wildly destructive. 

And in conclusion I guess I would say we need to be vigilant 

about the river system, especially the locks. We need to get Port 

Arthur, Texas, and other ports like it on our radar screen, and I 

still think we’re standing in the headlights on the biological issue. 

[The prepared statement of Mr. Puzey follows:]

PREPARED STATEMENT OF KIM B. PUZEY, GENERAL MANAGER, PORT OF UMATILLA

Thank you for this opportunity to testify before the Committee on port security 

and marine transportation. 

My name is Kim B. Puzey. I am General Manger of the Port of Umatilla Oregon. 

The Port of Umatilla is a river port. We are served by barges, not seagoing vessels. 

Our marine operations consist of grain elevators and belt loaders, petroleum and liquid fertilizer terminals, and a container-on-barge dock. These facilities are located 

at Columbia River mile 292. 

First, because of the location, product mix, surrounding population, and proximity 

to strategic facilities of national importance, the docks at the Port of Umatilla are 

quite secure because the threat to destruction or disruption is very low. We are 

quite frankly, pretty low on the food chain. 

However, the Port of Umatilla is a component of the larger Columbia Snake River 

navigation system. This system, created by the construction of the federal dams and 

locks to provide flood control, hydropower, navigation, and irrigation reservoirs is 

of great collective importance to national security and the economy. 

The navigation channels themselves are quite secure. The locks are the most vulnerable component in the entire system. If one were to damage or destroy a set of 

locks the entire system is either compromised, disrupted, or possible destroyed. 

Focus on securing the locks on each dam from threats by land, air, or water should 

be a national priority. 

We support the Columbia River Steamship Operators Association in their objectives to help secure the entire river system. 

Second, because scarce resources must be allocated to the greatest need I would 

like to take this opportunity to draw your attention to what is in my opinion the 

most vulnerable port in the United States. I speak of Port Arthur, Texas. 

38

Port Arthur has more than a dozen oil refineries and related facilities that process 

volatile, noxious chemicals. There are more than 200 pipelines in the port area. 

Most vessels that call are floating bombs. A mutiny or an intentional misuse of a 

petrochemical vessel bound for Port Arthur would be very difficult to stop without 

doing what those who would do harm intended in the first place. 

An incident at Port Arthur could easily disrupt shipping, degrade the environment, and substantially undermine the national economy. Port Arthur deserves a 

closer look. I have included an article from the New York Times of March 5, 2002 

on this issue as (Attachment A) to my testimony for your review. 

Third, I have recently read seven books on the weaponization of biological agents. 

A list of the books, authors, and a brief synopsis of each appears below as (Attachment B). Whether for defensive or offensive purposes, the history of biological warfare is not only very interesting, but extremely frightening. As dreadful as conventional, chemical, or even nuclear weapons systems are, they are pale by comparison 

to biological agents. 

I believe that viruses and certain types of bacteria are our greatest threat to national security. The agents are not only invisible, but dynamic. Some bacteria and 

many viruses are more than dangerous, they are dangerous and contagious. Some 

agents can be carried on the wind, others require a host such as an insect as tiny 

as a flea. With some agents, each victim becomes a carrier of more dread. Everything from anthrax to smallpox has been cultivated for evil purposes in recent decades. 

The likelihood of another incident using anthrax is nearly certain. It is invisible, 

deadly, and disruptive, but not as wildly dangerous as smallpox and other viruses 

that cause hemorrhagic fevers and wide spread death. I believe that anthrax will 

be used repeatedly against the people of the United States. The targets will go beyond the mail system to tainting currency in major retail outlets and fast food businesses. We are extremely vulnerable because we are a free society. 

My recommendations are that we be vigilant within our own borders, but that 

more importantly, we may need to increase appropriations to the Intelligence community. It is imperative that we detect and destroy foreign operatives before they 

can harm us on our soil. 

The dissolution of the former Soviet Union unleashed a cadre of unemployed and 

underemployed microbiologists who have quite certainly sold harmful information to 

nations such as North Korea, Iran, and Iraq. Bolstering the economy of former Soviet Union provides an important disincentive to those who would otherwise do us 

harm out of their own personal desperation. 

In conclusion, protect the locks of the Columbia Snake River system; take a closer 

look at Port Arthur and similar facilities; increase appropriations to the Intelligence 

community; seek and destroy germ factories controlled by our enemies on foreign 

soil; and continue to improve relations with the former Soviet Union. 

Thank you again for this opportunity to testify before the Committee. We live in 

trying times. Great wisdom is needed. May God bless each of you and may God bless 

America. 

Attachment A 

A Nation Challenged: Border Security; Tinderbox of a Texas Port Points to a Threat 

by Sea 

By Joel Brinkley 

PORT ARTHUR, TEXAS—March 2—Few seaports in the nation seem as vulnerable as this one. 

It is home to more than a dozen oil refineries and related plants, each with its 

own pier, that process noxious, volatile chemicals. In addition, more than 200 pipelines carrying fuel and other hazardous chemicals snake under Port Arthur in every 

direction. 

All of it makes this place a tinderbox. 

Immediately after Sept. 11, local governments, federal agencies and industries 

strengthened security on the ground and at sea. Marc Blanton, the assistant chief 

of police, began noticing clusters of residents standing at the fences, staring at the 

huge refineries that define this small port town, whose motto used to be, ‘‘We oil 

the world.’’

‘‘I think they were assessing the threat for themselves,’’ Chief Blanton said. 

Now, almost six months later, security is certainly more intense than it was in 

August. But a kind of complacency seems to have set in, even as senior officials in 

Washington begin to talk more urgently about the terrorist threat from the sea. 

39

Many of the off-duty Port Arthur police officers who were hired to patrol the refineries in the fall have been sent back to the station. The two additional Coast Guard 

boats sent here to patrol the harbor have left. 

Federal officials call port security the largest and most glaring weakness in the 

nation’s security network. A presidential advisory commission concluded in August 

2000 that ‘‘the state of security in U.S. seaports generally ranges from poor to fair, 

and in a few cases good.’’

In an interview on Thursday, Senator Bob Graham, the Florida Democrat who is 

chairman of the Intelligence Committee, called ports ‘‘a clear area of serious vulnerability.’’ Senior Coast Guard officials in Washington now talk urgently about the potential for terrorists to use ships as weapons. 

‘‘Ships can be used to transport terrorists or weapons of mass destruction,’’ Rear 

Adm. Terry Cross of the Coast Guard said in February. ‘‘They can be used as weapons, and they are going to try to blend in and look like regular traffic. We think 

it is important to publicly recognize how vulnerable seaports are.’’

When the refineries asked to hire the off-duty police officers last fall, ‘‘we didn’t 

have enough people for all the requests,’’ Chief Blanton said. Now, the refineries 

‘‘have slowly backed off,’’ he said. Many of the off-duty officers have been replaced 

by private unarmed security guards. 

Before the morning of Sept. 11 had ended, Capt. Eric A. Nicolaus, head of the Port 

Arthur Coast Guard Station, requested more personnel and more boats to protect 

the refineries and the public ports, even though port security had been a low priority for the Coast Guard before then. 

‘‘We got two extra patrol boats,’’ raising the total to five, Captain Nicolaus said, 

‘‘and we brought in about 100 reservists.’’

With the extra resources, the Coast Guard began searching many ships before 

they docked, looking for unusual cargo or crewmen. 

Now, Captain Nicolaus said his Coast Guard crews remain at a high level of alert, 

but the two extra patrol boats have been sent back to their regular ports. The number of ships searched has declined, but he noted that local port pilots board each 

inbound ship to guide it in and would most likely notice anything amiss. 

In the fall, representatives of local, state and federal law enforcement agencies in 

the area began meeting every week to discuss security issues. Recently the meetings 

were cut back to every two weeks. 

Three major oil refineries lie within the city’s jurisdiction, and more than a dozen 

others line the Sabine-Neches shipping channel that flows from Beaumont, slightly 

less than 20 miles upstream. Some of these refineries are among the nation’s largest. 

Crude oil and other volatile liquids flow into the plants by ship, five tankers a 

day, on average, and by pipeline from Mexico and other points south. 

Refined products—gasoline, diesel fuel, butane, ethylene, benzene, propane, kerosene, jet fuel and other noxious liquids—pour out, tens of thousands of gallons a 

day, by truck and by train but mostly by pipeline. 

‘‘We had 216 of them at last count,’’ Leslie E. McMahon, Port Arthur’s director 

of public works, said of the pipelines. 

While all here acknowledge that a port with fixtures as explosive as this one has 

could be a target, many now seem little concerned. 

‘‘It’s almost back to normal here,’’ said Ronnie Hicks, technical supervisor for the 

Port of Port Arthur. 

But in Washington, Senator Graham has taken on port security as a major concern, saying, ‘‘Any smart terrorist would have to think of this,’’ since ports offer ‘‘the 

lowest risk of detection and the highest chance of success.’’

Security officials in speeches and interviews describe three possible ways terrorists might use ships. 

One, terrorists could sink a ship in a narrow shipping lane, like the SabineNeches channel, closing it for days or weeks. 

‘‘It would be hard to get a ship like that up, no doubt,’’ said John J. Durkay, general counsel for the refineries’ Plant Managers’ Association. 

In Washington, Admiral Cross, speaking at a Defense Week seminar, said, ‘‘We 

think shutting down one or two major ports would do more damage to our economy 

than Sept. 11.’’

Two, terrorists might blow up a ship in an important port. 

Or three, terrorists could hide an explosive weapon in one of the 600,000 cargo 

containers that arrive at American ports each day; fewer than 3 percent are opened 

and inspected. 

Robert C. Bonner, commissioner of the United States Customs Service, often talks 

about this concern, which he calls ‘‘a nuke in a box.’’

40

‘‘One of the most lethal terrorist scenarios is the use of oceangoing container traffic as a means to smuggle terrorists and weapons of mass destruction into the 

United States,’’ Mr. Bonner said. ‘‘And it is by no means far-fetched.’’

Shortly after Sept. 11, the Coast Guard issued a new rule: cargo ships approaching the United States would have to relay detailed crew lists to the Coast Guard 

96 hours before reaching this country. Before, they had to report 24 hours in advance. 

The agency set up the National Vessel Movement Center, in Martinsburg, W. Va., 

whose mission is to check those names against national criminal and terrorist databases. 

After a few weeks, a federal official said, many shippers began moving seamen 

with Middle Eastern names onto ships not bound for the United States. 

In Port Arthur, the refineries quickly put up fences, installed lighting and barriers and hired the off-duty officers to patrol their grounds around the clock. 

The physical security measures remain in place. The way Mr. Durkay sees it: 

‘‘After Sept. 11, a lot of the things this community had been preparing for were tested and found to be sound.’’ (Copyright 2002 The New York Times Company) 

Attachment B 

Germs; Biological Weapons and America’s Secret War, Judith Miller, Stephen 

Engleberg, and William Broad. (This is an investigative book on the history of biological weapons in America including the attack on The Dalles, Oregon). 

The Cobra Event, Richard Preston. (This is a novel of a fictional terrorist attack 

on a major city in the United States). 

The Hot Zone, Richard Preston. (This book reports on an Ebola outbreak in Reston, Virginia with research primates). 

Living Terrors; What America Needs to Know to Survive the Coming Bioterrorist 

Catastrophe, Michael T. Osterholm, Ph.D., M.P.H., and John Swartz. (Written by a 

public health official, this book tells of the government agency jurisdictional challenges that would arise in the event the United States were targeted with 

weaponized biological agents). 

Virus Hunter; Thirty Years of Battling Hot Viruses Around the World, C. J. Peters 

and Mark Olshaker. (This is an autobiographical account of an official with the Center for Disease Control and his experiences across the world). 

Guns, Germs, and Steel; The Fates of Human Societies, Jared Diamond. (This book 

touches briefly on the role of disease in the formation and outcome of societies). 

Biohazard; The Chilling True Story of the Largest Covert Biological Weapons Program in the World-Told from Inside by the man who Ran It, Ken Alibek with Stephen Handleman. (This is an autobiographical account of a defector from the former 

Soviet Union who headed their biological weapons programs).

Senator WYDEN. Thank you. Mr. Gaul. 

STATEMENT OF MICHAEL GAUL, DIRECTOR OF OPERATIONS, 

OREGON INTERNATIONAL PORT OF COOS BAY 

Mr. GAUL. Please bear with me. I’m a simple sailor by trade. My 

name is Mike Gaul. I’m director of operations for the Oregon International Port of Coos Bay. I want to thank you for holding this 

maritime security hearing in Portland today and for allowing us 

the opportunity to appear before you. 

Last year 65 deep-draft vessels and 135 loaded barges called on 

Coos Bay. The primary commodity was wood chips (nearly two million tons) exported to Japan. Ten years ago, prior to the loss of a 

number of wood mills, we experienced on average of 250 deep-draft 

vessels calling a year, carrying nearly five million tons of commerce. 

Although our agency as port authority takes responsibility for 

working with a variety of entities to ensure the safe and efficient 

operation of maritime commerce, we are a non-operating port authority. All deep-draft terminals in the Port of Coos Bay are privately owned. These terminals are located along a 15-mile, 37-foot 

41

federally maintained deep-draft navigation channel with immediate 

access to the Pacific Ocean. 

We greatly appreciate the interest and assistance of the Federal 

Government in reviewing and enhancing maritime security. At the 

same time, we urge the Committee to be aware of the difficulties 

facing ports in accomplishing the Federal mandates that are eventually enacted. We ask that you consider the following: 

The Federal Government should fully fund the security requirements that are imposed on ports. As our agency has learned in 

managing the North Bend Municipal Airport (the only full commercial service airport on the Oregon coast) many ports do not have 

the financial resources necessary to comply with Federal mandates. 

Federal funding is imperative to the success of any maritime security law, and we believe this applies both to publicly owned and 

privately owned terminals. 

We believe the Federal Government should keep the efficient 

continuation of trading commerce as a top priority even while imposing security requirements. And it’s important that these regulations go to the problem, perceived problem, and also to remember 

that all ports are different. A blanket approach to all ports of everything fits one will not work. 

We are also concerned about possible adverse changes to the mission of United States Coast Guard as currently proposed. The historic mission of the Coast Guard in the Pacific Northwest is Search 

and Rescue. The waters off Washington and Oregon are some of 

the most treacherous in the world. The Search and Rescue presence 

is vital to safety of commercial and recreational boaters and to the 

economic health of the local communities where the Search and 

Rescue stations exist. Any additional responsibilities assigned to 

the Coast Guard under a new maritime law should include significant and appropriate increases in personnel and other resources for 

these Coast Guard units. 

As a former master chief in the Coast Guard and manager of the 

Charleston Life Boat Station in years past, I believe I speak with 

some experience in these matters. 

With that I’d like to thank you for the opportunity to testify and 

I’ll be happy to answer any questions you have. 

[The prepared statement of Mr. Gaul follows.]

PREPARED STATEMENT OF MICHAEL GAUL, DIRECTOR OF OPERATIONS, OREGON

INTERNATIONAL PORT OF COOS BAY

My name is Mike Gaul and I am the Director of Operations for the Oregon International Port of Coos Bay. Thank you for holding this maritime security hearing in 

Portland today and for giving us the opportunity to testify before you. My General 

Manager, Allan Rumbaugh, sends his regrets at being unable to testify before you 

today because of a prior commitment. 

Last year, 65 deep-draft vessels and 135 loaded barges called on Coos Bay. The 

primary commodity was wood chips (nearly 2 million tons) exported to Japan. Ten 

years ago, prior to the loss of a number of wood products mills, more than 250 deepdraft vessels called Coos Bay carrying nearly 5 million tons of commerce. Although 

our agency as port authority takes responsibility for working with a variety of entities to ensure the safe and efficient operation of maritime commerce, we are a nonoperating port authority. All deep-draft terminals in the port district are privately 

owned, including three active wood chip terminals, one general cargo terminal, one 

log handling terminal and two major inactive terminals owned by international companies. These terminals are all located along a 15-mile 37-foot federally maintained 

deep-draft navigation channel that offers immediate access to the Pacific Ocean. 

42

We greatly appreciate the interest and assistance of the federal government in reviewing and enhancing maritime security. At the same time, we urge the Committee 

to be aware of the difficulties facing ports in accomplishing the federal mandates 

that are eventually enacted. 

We ask that you consider the following:

1. The federal government should fully fund the security requirements that are 

imposed on ports. As our agency has learned in managing the North Bend Municipal Airport (the only full commercial service airport on the Oregon coast) 

many ports do not have the financial resources necessary to comply with federal 

mandates. Federal funding is imperative to the success of any maritime security 

law, and we believe this applies both to publicly owned and privately owned marine terminals.

2. The federal government should keep the efficient continuation of trade and 

commerce as a top priority even while imposing security requirements or restrictions on that trade. It is important to gear the regulation to the perceived 

problem rather than simply applying a blanket approach or to treat all ports 

in all situations as the same. Many ports around the nation have quite different 

circumstances and physical characteristics, and therefore require flexibility 

when implementing a maritime security program.

3. We are concerned about possible adverse changes to the mission of the 

United States Coast Guard as it is currently proposed. The historic mission of 

the Coast Guard in the Pacific Northwest is search and rescue. The waters off 

Washington and Oregon are some of the most treacherous in the world. This 

search and rescue presence is vital to the safety of commercial and recreational 

boaters and to the economic health of the local communities where search and 

rescue stations exist. Any additional responsibilities that are assigned to the 

Coast Guard under a new maritime security law should include significant and 

appropriate increases in personnel and other resources for these Coast Guard 

units. As a former Master Chief in the Coast Guard and manager of the 

Charleston Life Boat Station in years past, I believe I speak with some experience in these matters.

Thank you again for the opportunity to testify before you today, and for offering 

us the convenience of a hearing in the state of Oregon.

Senator WYDEN. Gentlemen, thank you very much. Senator 

Smith is going to begin questioning and then I’ll go right after him. 

Senator SMITH. Mr. Hrdlicka, I wonder if you could tell us if 

you’ve noticed a difference in the operation of the Port of Portland 

since 9/11? 

Mr. HRDLICKA. Senator, certainly there have been some differences. Immediately following 9/11 it was very clear that we had 

entered a new era in terms of vessel security, notification requirements by the Coast Guard, Customs and INS and that sort of 

thing. I will say, though, that some new procedures were implemented around our terminals. 

Primarily around our terminals initially there were some noticeable differences which now have pretty much worked themselves 

into the norm. It’s pretty well under control now. 

Senator SMITH. Do you feel like the port facilities themselves, 

such as fencing and security, that no one can just breach them? 

Mr. HRDLICKA. Following 9/11 we met with the Coast Guard and 

did an immediate assessment of our facilities. We shored up and 

tightened our perimeters around our primary facilities to address 

that. Also put up some barricades in place. We do not allow vehicles out in the face of the dock and have implemented procedures 

to enforce those sorts of things. 

Certainly there’s always more you can do. From the land side 

particularly there are some things that we can do. Unfortunately 

we did apply for some grants recently and we were not successful 

in getting some additional funding to do some additional tightening 

43

of that perimeter. The real weak spot however, as I’m sure you can 

appreciate, is from the water side. And that does require continuing attention from the Coast Guard and other law enforcement 

agencies. 

Senator SMITH. Do you have a pretty good relationship with the 

Coast Guard? 

Mr. HRDLICKA. Yes, we have an excellent relationship with the 

Coast Guard and work very closely with them on a continuing 

basis. 

Senator SMITH. Umatilla and Coos Bay, what changes have you 

seen in your ports in terms of security since 9/11? 

Mr. PUZEY. We haven’t had any significant changes. We were 

fenced. We had 24-hour security. We’re so small, we’re not one of 

those where if you’ve got a white hard hat you’re out of place. Everybody knows each other. I feel like given a target matrix with respect to population and whether or not anybody would target us, 

we’re just fine. 

Senator SMITH. Mr. Gaul. 

Mr. GAUL. I’d say as far as Coos Bay goes, all of our docks are 

privately owned. What the port has done, of course, and the Coast 

Guard has conducted dock assessments of all our facilities. The 

port hosted meetings with the local law enforcement agencies, the 

Coast Guard, emergency management people, the FBI, to just kind 

of get everybody to sit down around the table and talk and start 

putting some kind of game plan together. 

We also had dialog with private dock owners and with the longshoremen. I believe the longshoremen are some of the first guys on 

those docks that they know what goes on on those docks and if 

something is different they will immediately recognize it. 

Also, working with our pilots association and just the general 

maritime community and our own staff that, both at the airport 

and at the maritime site, just making everybody more vigilant and 

aware of what’s going on around them. We also applied for grants 

for a communication system that all the local agencies should all 

talk on one channel if need be, but we were not successful in that 

grant. 

Senator SMITH. Kim, you mentioned Port Arthur, Texas. What is 

there about that port that makes it in your view more vulnerable 

than, say, Long Beach or Seattle or Portland? 

Mr. PUZEY. The product mix, I think, primarily. More than a 

dozen refineries; I believe some of largest in the world; chemical 

plants; 216, I believe, pipelines coming in and out of there. Every 

word that ends in i-n-e and e-n-e, toluylene, diesel fuel, gasoline, 

fuel oil. 

Senator SMITH. Do you have reason to believe they’re not responding to the realities of post-9/11? Do we need to let our colleague, Senator Hutchison know, or I suspect the former Governor 

of Texas, President Bush, knows about this? 

Mr. PUZEY. I’m sure of that. The vulnerability in my opinion is 

the vessels that call there are filled with flammables. Let’s suppose 

that someone wants to do harm. Stopping them would do the harm 

that they intended to do. You put a vessel down in the shipping 

channel, you create an environmental catastrophe. If it’s their clear 

intention to do something, how we prevent that, it’s the same as 

44

someone who wants to use the police force to take their life. We 

have in that port such dangerous cargo, and I suppose that it is 

true for others who receive similar products, you have such dangerous cargo, if it’s coming in and the intent is to do harm and evil, 

that the only way to prevent it is to do what they would like us 

to do which is to destroy that vessel. 

Senator SMITH. Let’s hope that the processes are being put in 

place to interdict it before it gets there. 

Mr. PUZEY. That’s why I suggest that we search and find those 

cells of people who would do harm to this country and we make the 

appropriate appropriations in the intelligence community to be able 

to do so. 

Senator SMITH. Thank you. 

Senator WYDEN. Gentleman, we’ve been talking about how diverse the ports are in Oregon. We’ve got river ports, small ports, 

medium ports, large ports, bulk cargo, container cargo. The list just 

goes on and on. And it’s our view that it’s absolutely critical that 

in this legislation that we’re working on now, the conference report 

on Port Security, that Congress provides the flexibility in order to 

make sure that Oregon’s wide variety of ports and their individual 

security needs are addressed. Is there anything beyond the general 

provisions and flexibility here that’s important to you? And pretend 

you’re writing the flexibility provision of the conference report, 

what would you want to be included there? Kim. 

Mr. PUZEY. Senator, I have three things. One is that we protect 

the system, specifically the locks. In that context we support the 

efforts of the Steamship Operators Association in trying to secure 

the whole system from Lewiston, Idaho to the Pacific Ocean. And 

I don’t know what all of that would entail, but that would secure 

the channels. If we do that then we can have relative comfort about 

the products that are at least moving on the river system. 

Second, I appreciate your interest in technology. I was in Quincy, 

Washington recently and saw a rail car, a Trinity Car I believe is 

how it’s referred to. It has a global positioning system. It has some 

other surveillance equipment on it that has to do with monitoring 

temperature, opening and closure of the doors. It has movement 

sensors so that if someone were there that was not authorized to 

be there, a tape could be made of them and their activities. 

I think that the kind of security that we could have around technology of that type is available. And on higher end products we 

could afford to have that kind of security on the containers. Second, 

I’ll come back to it because I forget the third point—I know what 

it was. I’m not an expert in this clearly, but it seems to me that 

we ought to be able to test the inside of the container if you just 

simply had two ports, one where pressurized air came in, another 

where a testing instrument is able to do parts per billion analysis 

of whatever was in there, whether that had to do with something 

that was biological, radioactive or whatever. 

So I believe that the instrumentation technology is available. 

And if there were some support from the government on the security side so that it didn’t have to be borne by the customers, that 

we would be able to know what is inside the empty containers and 

filled containers. If you did the risk matrix that the immigration 

official here spoke about earlier, where you could simply target this 

45

with instrumentation, I think that that would be a useful thing as 

well. 

Senator WYDEN. Gentleman, other points with respect to flexibility that you really would like to see? You’re writing the flexibility provision. You’re on the conference committee and you’re 

writing them and you want to make sure that the ports aren’t 

something that one size fits all. 

Mr. HRDLICKA. Senator, thank you. I think one thing that is critical, first of all, we certainly agree with the necessity to have flexibility written into the legislation that recognizes the diversity of 

the port systems within the United States. But I think a key part 

of that flexibility needs to allow the local captain of the port for the 

Coast Guard or some other authority to have the final word in approving any final recommendations for security within a special 

port range. I think that assignment of clear responsibility is critical 

to the success of that. 

Senator WYDEN. Mr. Gaul, anything you want to add? 

Mr. GAUL. I would agree with that last comment from the Port 

of Portland. I guess the only thing that I would add, you know, 

given a perfect world if funds were available, the Port of Coos Bay 

and the Coos Bay area have just a load of displaced lumber workers and commercial fishermen that I think would love to retrain as 

security watch guys down in that area and help the economy. 

They’re used to working on the water, used to working around the 

docks. I think technology is very important, but so if the fact of 

having eyes and people on the street just watching. 

Senator WYDEN. Well said. For the Port of Portland one of the 

big issues in the conference has been to figure out how to get all 

this extra money that’s going to be needed for the country’s 300 

ports of entry, and we’re talking about an estimated $600 million 

per year being needed. 

Now, the Northwest ports have opposed new user fees, any kind 

of, you know, funding arrangement to pay for Port Security, and 

yet we’re going to have a witness on the next panel, Jim Townley, 

representing the carriers, who’s going to essentially propose the approach taken in the Oil Pollution Act. And that’s the approach 

where government and industry works together in partnership to 

reduce various kinds of terrorist threats. And that he in effect 

thinks that if you have something that really did show some cooperation with respect to businesses and our ports, that there 

would be an openness to then generate some financial contributions 

for Port Security funding if there was a more cooperative approach 

in the maritime-business community. What’s your sense? Is what 

Mr. Townley is talking about out of the question? Off the board? 

Have any reaction to that? 

Mr. HRDLICKA. Thank you, Senator. First of all, I think the approach that Captain Townley is going to be discussing is certainly 

interesting and I think could be a very effective approach to dealing with this whole subject. We’ve seen a history of that with the 

Maritime Fire and Safety Association here in the Columbia River 

following some of the guidelines from OPA 1990, and we would certainly be supportive and look forward to working with them on 

that. I think that the notion does have a lot of merit. 

46

Senator WYDEN. We want to look at it with you. This is a tough 

time to be talking about anything relating to user fees or anything 

like that. So I go in, you know, with a considerable concern about 

what the ramifications of that would be, but if the maritime community working with the ports wanted to look at it, we will certainly pick up on their suggestions and evaluate them at that 

point. 

The Coos Bay folks of course dealt with the New Carissa and the 

Coast Guard played a critical role in responding there. And of 

course situations like the New Carissa require immediate response. 

Are you concerned about how the whole homeland security effort 

is going to affect you all in terms of being able to deal with those 

kinds of situations, Mr. Gaul? 

Mr. GAUL. I guess I would say I’m concerned about the homeland 

security and how it’s going to affect our operations overall, but it’s 

my belief that hopefully it will never happen. This was a once-ina-lifetime and if we get another New Carissa on the beach, I feel 

confident that we’ll get the appropriate response from both the 

state and Federal agencies and local agencies. We will address the 

issues as they come up and overcome them. 

Senator WYDEN. In the Senate Coast Guard bill which we’re 

working on as well, I proposed having the Coast Guard work with 

local ports to create security committees to develop local homegrown approaches for maritime safety concerns. You all have 

worked with the Coast Guard on this kind of approach. Do you 

think this is the kind of cooperative effort that could enhance Port 

Security and be a better way than having these sort of run from 

Washington, DC approaches? 

Mr. GAUL. I do, Senator. I think you need to start right at the 

grass roots to really look at this. And that type of partnership has 

worked well in Coos Bay and I believe throughout the areas. 

Senator WYDEN. Well, I will just tell you that the New Carissa 

in my view just highlights this whole question of what you have 

in a new homeland security agency. It’s very hard to see right now 

how you’re going to be able to respond to those kinds of efforts as 

well as take on all the primary missions involving terrorism with 

these resources. And I say that synergy notwithstanding. There are 

going to be some opportunities to do things differently, to use technology. But for communities like Coos Bay, having the Coast Guard 

there to perform those functions is priority business, and we’re 

going to do everything we can to make sure it’s maintained. So we 

thank all of you. Senator Smith, any other questions? 

Senator SMITH. No. Thank you, gentlemen. 

Senator WYDEN. We’ll let you go. The next panel is John Isbell, 

Director, Corporate Delivery Logistics, Nike; Monica Isbell testifying on behalf of the Pacific Northwest International Trade Association; Patrice Iverson-Summer, President, Columbia River Customs Brokers; and Captain James Townley, Executive Director, Columbia River Steamship Operators; and Bruce Holte, President, 

Local 8, International Longshore and Warehouse Union. 

All right. Welcome. Let’s go first to Mr. Isbell. We are going to 

make your prepared statements part of the record. I can just tell 

all of you are anxious to have lunch. The blood sugar level is down. 

Mr. Isbell, you go ahead. 

47

STATEMENT OF JOHN ISBELL, DIRECTOR, CORPORATE 

DELIVERY LOGISTICS, NIKE, INC. 

Mr. ISBELL. Senators Wyden and Smith, on behalf of Nike I 

thank you for the opportunity to testify at this hearing and for 

your leadership on this critically important issue. Nike believes 

U.S. business economic and the nation’s security goals are not mutually exclusive. Realizing these mutual goals will require coordination between Congress, the administration and the trades, so that 

legislative and regulatory initiatives can achieve their intended result without adding undue cost or complexity to the supply chain. 

In terms of Port Security legislation currently being considered 

by Congress, Nike would measure success in terms of implementing a process that sends relevant shipping information to U.S. 

Customs as the containers move toward the United States and in 

maintaining an effective in-bond program. 

As the legislation moves through conference, we are focusing on 

the following issues: Manifest information. We believe the information currently provided by cargo owners like Nike to Customs is 

sufficient to protect our borders from shipments that would contain 

weapons of mass destruction. To our ocean carriers and U.S. Customs Nike is a known importer with a proven track record of providing accurate and complete information. Nike enjoys a low risk 

importer status with U.S. Customs. 

In addition, Nike was an early signer of U.S. Customs C–TPAT 

program and believes this effort will strengthen an already wellmanaged process. This known importer concept is perhaps the best 

form of security. Rather than reinvent the wheel, Nike would ask 

the conferees to consider applying current manifest information to 

all importers and making the C–TPAT program mandatory. 

Nike has concerns about additional information requests beyond 

what is currently provided today. All Nike products are clearly 

identified at the style and color level on the manifest. Additional 

information like digitized product descriptions are perceived as 

adding little value to the cost involved by all parties to provide national security relevance. 

Nike is concerned that additional information will expose our 

containers to greater risk of theft. It seems reasonable that if more 

information is required for national security purposes, that legislation be enacted to protect the privacy and property rights with respect to the cargo involved and do not make public any information 

beyond what is currently provided for census and/or commercial 

statistics. 

Nike is concerned about manifest information being required 24 

hours in advance of container loading. If this comes to pass, then 

Nike would have to shift our Thursday or Friday origin production 

to the following week’s ocean carrier sailing. This would mean adding 1 week of inventory to our supply chain process. The cost of 

that to Nike could be significant in terms of increased inventory 

levels with the associated risk and cost. 

Nike does hope U.S. Customs will continue to receive all manifest information. We encourage Congress to increase funding on 

U.S. Customs ACE systems in order to expedite its development 

time line. Nike also asks the conferees to leave the current U.S. 

Customs in-bond program unchanged. 

48

Nike relies heavily on moving containers in-bond to our interior 

destinations. Today Nike moves approximately 170 20-foot equivalent containers weekly from the west coast to interior custom ports 

for cargo clearance. This represents about 25 percent of Nike’s 

weekly container volume. An effective in-bond program eliminates 

congestion at west coast ports, promotes better distribution of U.S. 

Customs’ resources, and is a key program for Oregon importers 

who file consumption entries for containers in Portland that have 

been discharged in Seattle/Tacoma. 

In summary, U.S. Customs seems to have confidence in their selectivity process to find suspicious containers using current data 

that is transmitted by carriers during the voyage via U.S. Customs 

Automated Manifest Systems, AMS. The process can be improved 

further if all importers fully disclose container content and identify 

the ultimate cargo owner on the bill of lading. This is what Congress should mandate for all shipments, including those managed 

by non-vessel operators, commonly referred to as NVOCCs. 

If we raise all importers to this higher standard, we believe this 

will negate the need to have 24-hour pre-notification at the port of 

origin. Of course we also protect our contents of our containers by 

working with our consolidators and ocean carriers to maintain the 

integrity of the container seal. Much more can and needs to be 

done if this area. 

Senator Wyden, certainly we see the need for more intelligent 

seals. Technology that allows seal numbers to be electronically read 

and matched to the seal number provided on the manifest as the 

container moves through the various stages of its voyage to final 

destination. 

Moreover, regulations for in-bond shipments should not be more 

extensive than those for other shipments. Given the above, Nike 

believes legislation can be enacted to achieve our mutual goals of 

developing a more secure maritime infrastructure while maintaining an efficient system for the movement of products. 

Again on behalf of Nike I thank you for your consideration of our 

views as well as your exceptional leadership you and your staff continue to have on this critically important issue to Oregon and the 

nation. Thank you. 

[The prepared statement of Mr. Isbell follows:]

PREPARED STATEMENT OF JOHN ISBELL, DIRECTOR, CORPORATE DELIVERY LOGISTICS, 

NIKE, INC. 

Senators Wyden and Smith, on behalf of Nike, I would first like to thank you for 

agreeing to have Nike testify at this hearing on U.S. port security and would like 

to thank you for your leadership on this critically important issue. My name is John 

Isbell, and I am Nike’s Director of Corporate Delivery Logistics. 

Nike, Inc. is the world’s leading supplier of athletic footwear, apparel, and equipment. Today, Nike is the only Oregon Fortune 100 Company and currently employs 

22,000 employees worldwide including nearly 6,000 Oregonians. Oregon is the home 

of Nike’s World Headquarters and one of our 2 major footwear distribution facilities. 

Nike also ships containers to its other distribution facilities in Memphis, Tennessee 

as well as to over 30 customer distribution centers across the United States. Nike 

utilizes U.S. Customs’ in-bond program to manage container distribution to these 

interior locations. 

Currently Nike brings 35,000 TEU’s (20-foot equivalent containers) into the 

United States from over 50 countries around the world. Today, Nike files consumption entries in Los Angeles, Seattle, Portland, Memphis, Chicago, Kansas City, and 

49

Atlanta. Getting the right product to the right customer in the right way requires 

an efficient and effective inbound delivery supply chain. 

Nike actively manages its inbound delivery process through selected logistics service providers who handle origin consolidation, ocean shipping, airfreight forwarding, 

and destination de-consolidation. Nike’s overseas liaison offices oversee the contract 

manufacturing process and the interface between our factories and consolidators. 

This entire process is well coordinated through the use of standard operating procedures. 

Recent information technology investments will allow Nike to operate in a more 

just-in-time environment. Our end goals are to reduce inventory and time to market. 

Of course, Nike is the first to recognize that these goals are secondary to our national security efforts to enact and implement needed legislation and programs to 

protect our country and its people from terrorist organizations who may use ocean 

containers to conceal weapons of mass destruction. But we believe that our country’s 

national security needs and commercial interests are not mutually exclusive and 

there are ways to craft an appropriate balance. Realizing these mutual goals will 

require coordination between Congress, the Administration, and the trade so legislative and regulatory initiatives can achieve their intended result without adding 

undue cost or complexity to the supply chain. We believe President Bush’s recent 

proposal to create a new office of Homeland Security is a major step in coordinating 

the proper focus around these initiatives. 

In terms of the Port Security legislation currently being considered by Congress, 

Nike would measure success in terms of implementing a process that sends relevant 

shipping information to U.S. Customs as the containers move toward the United 

States and in maintaining an effective in-bond program. 

As the legislation moves through conference, we are focusing on the following 

issues: 

Manifest Information 

Today, U.S. Customs’ Commissioner Bonner believes his agency’s selectively 

guidelines—that identify 2 percent of containers for inspection—is sufficient. We 

likewise believe the information currently provided by cargo owners like Nike to 

Customs is sufficient to protect our borders from shipments that could contain 

weapons of mass destruction. This information includes the following:

• Name of shipper 

• Name of consignee (Nike or Nike affiliate) 

• Container number 

• Carrier booking number (Bill of Lading not known until after vessel sails) 

• Commodity description and weight 

• Place of cargo receipt 

• Port of loading 

• Port of discharge 

• Final destination as known at export

Currently, this information is passed to the ocean carriers who in turn submit it 

by electronic transmission to the U.S. Customs’ Automated Manifest System after 

the vessel has departed from the port of export. To our ocean carriers and U.S. Customs, Nike is a ‘known’ importer with a proven track record in providing accurate 

and complete information. Nike enjoys a Low Risk Importer status with U.S. Customs. Ocean carriers know their customers. In addition, Nike was an early signer 

of U.S. Customs’ C–TPAT (Customs Trade Partnerships Against Terrorism) program 

and believes this effort will strengthen an already well-managed process. This 

‘‘known importer’’ concept is perhaps the best form of security and Customs should 

continue to promote and create incentives for companies to fully participate in these 

types of programs. 

Requirements for container information and shipper/consignee details are clearly 

needed to support any effective program to enhance our country’s security. In making decisions that will ultimately require several new compliance measures, Nike 

would like the conferees to consider the following issues related to what information 

is going to be required, when it will be sent, who is going to send it, what Government organizations will receive it, and will that information be made public. 

Timing of Requested Shipping Information 

Should the information be required 24 hours in advance of container loading, as 

envisioned in the House bill, Nike would have to shift our Thursday and Friday production to the following week’s ocean carrier sailing. This would mean adding over 

one week of inventory to our supply chain process. The cost impact to Nike would 

50

be significant in terms of increased inventory, higher margin costs from closeouts, 

additional airfreight, and additional interest costs. 

Requested Information 

Nike has concerns about additional information requests, beyond what are listed 

after the first paragraph in this section. All Nike products are clearly identified at 

the style, color level on the manifest. Additional information like digitized product 

descriptions are perceived as adding little value to the cost involved by all parties 

to provide and transmit this information and have questionable national security 

relevance. 

We are also concerned that additional information will expose our containers to 

greater risk of theft. Today, manifest information is not confidential and is sold to 

the media and published. It seems reasonable that if more information is required 

for national security purposes, that legislation be enacted to protect the privacy and 

property rights with respect to the cargo involved and to not make public any information beyond what is currently provided for census and/or commerce statistics. 

Who Receives the Information 

Nike believes U.S. Customs should continue to receive all manifest information. 

U.S. Customs can then share that information with any relevant Governmental 

agency who needs it for national security purposes. Again, we believe there should 

be limited public access to this information. We encourage Congress to increase 

funding of U.S. Customs’ ACE system in order to expedite its development timeline. 

Who Sends the Information 

Ocean carriers are in the best position to transmit manifest information. 

In-Bond Provision 

Nike currently moves approximately 170 TEU’s weekly from the West Coast to 

interior U.S. Customs’ ports for cargo clearance (file consumption entry). This represents about 25 percent of Nike’s weekly container volume. The in-bond provision 

provides an efficient and effective process to rapidly move containers from the port 

to the rail and on to its final inland destination. An effective in-bond program eliminates congestion at West Coast ports, promotes better distribution of U.S. Customs 

resources, and is a key program for Oregon importers who file consumption entries 

for containers in Portland that have discharged in Seattle/Tacoma. Users of the inbond program request that carrier manifest document and processing requirements 

for in-bond shipments shall not be more extensive than those placed on other import 

shipments. 

Summary 

U.S. Customs seems to have confidence in their selectivity process to find rogue 

containers. The system can be enhanced if all shippers/importers and their cargos 

are properly identified and that shippers/importers work cooperatively with U.S. 

Customs in designated security programs. It’s not obvious to Nike that additional 

information is needed from all shippers/importers. Instead legislation should focus 

on those shippers/importers who presently provide less information than cargo owners who deal directly with ocean carriers and/or airfreight forwarders. 

The ‘known’ relationship between shippers/importers and their carriers may be 

the biggest security shield we can construct. The challenge may be with shippers/

importers who use non-vessel operators, commonly referred to as NVOCC’s. It is far 

more likely that through this transport arrangement, where no relationship exists 

between the ocean carrier and the ultimate cargo owner, that suspect cargo could 

pass, unimpeded, through the nation’s transport network. Even so, with properly 

identified cargo and the current cargo manifest information transmitted to U.S. Customs’ Automated Manifest System, that System should be capable of identifying suspect containers for inspection. 

With this view, Nike believes legislation can be enacted to achieve our mutual 

goals of developing a more secure maritime infrastructure while maintaining an efficient system for the movement of goods. 

Again, on behalf of Nike I thank you for your consideration of our views as well 

as the exceptional leadership you and your staff continue to have on this critically 

important issue to Oregon and the nation.

Senator WYDEN. Thank you very much. Very helpful. Let’s keep 

this in the Isbell family. 

Really, I’m going to make your statement part of the record, so 

if I can ask you again not to read them and just highlight some 

51

of your key points it would be great and we’ll have some extra time 

for questions. 

STATEMENT OF MONICA ISBELL, VICE PRESIDENT, PACIFIC 

NORTHWEST INTERNATIONAL TRADE ASSOCIATION 

Ms. ISBELL. I’m speaking to you in my capacity as the vice president of the Pacific Northwest International Trade Association, 

which is commonly known as PNITA. I think you are very well 

aware of what PNITA is so I won’t go into that. 

We are very appreciative of the time and consideration that 

you’ve given to us over the last 6 months or so in listening to our 

thoughts on this very important issue. PNITA members have been 

very closely monitoring this development of Port Security legislation. I believe that you know that we’re all very committed to making sure that our supply chains are more secure. We’ve done an 

awful lot of things so far in that regard. 

We recognize that the cost of complying with new security provisions will be significant, but that the negative repercussions of us 

not doing that could be even greater if there was a terrorist act. 

We ask Congress to carefully evaluate the pending legislation that 

aims to protect our country, but also keep in mind that reasonable 

legislation should be enacted that has practical rules that don’t 

have a deleterious effect on our national economy. 

There are many things that importers can do to secure their supply chains. Many PNITA members are already doing things in this 

regard. One of the things that I can mention is that some members 

are including security procedure checklists to their factory audits 

that are done on an official basis. Just as they are evaluated on 

labor practices and on the quality of the products that they 

produce, these factories are going to be evaluated on their security 

procedures as well. 

As part of the import supply chain, PNITA logistics service provider and broker members are doing their part to comply with U.S. 

Customs’ and other Federal regulations in terms of security to ensure that the products they move through their networks are coming from known shippers and are protected from tampering as 

much as they can. 

Positive voluntary steps like these will go a long way to protecting Americans. But despite all of these efforts to secure our 

supply chains, it may still be possible for terrorists to introduce 

weapons of mass destruction even in sealed containers without the 

knowledge of exporters, importers, logistic service providers. We 

need to acknowledge this fact and develop legislation that will 

make it difficult for terrorists to use containers for harmful purposes, while not jeopardizing the effectiveness that American businesses have fought so hard to gain over the years. 

PNITA members were pleased that the provision for the container data pre-notification 24 hours prior to vessel loading was deleted from H.R. 3983. If legislation is enacted or the Secretary, as 

defined by H.R. 3983, determines that risk assessment must be 

done at the port of loading prior to loading, then PNITA members 

will have to change their import processes. Importers will most 

likely have to build extra time in their supply chains in case factories cannot provide this information prior to vessel loading in a 

52

timely manner. This could result in increased inventory levels with 

the associated risks and costs. 

In many parts of the world vessel sailings are weekly or maybe 

twice a week at best, so if documentation is not made available by 

the factories early enough, that means that those containers will 

miss that vessel and possibly have to be air freighted at a higher 

cost to the importers. Adding time to the importers’ supply chain 

could have a dramatic impact. Depending on the level of requirements that the government might end up enacting, the negative effects on companies would most likely result in lost revenues and 

strained customer relationships for those importing companies. 

Another area of concern is the potential requirement that importers provide a digitized product identifier to supplement the detailed 

product description that’s already being provided via the vessel 

manifest. PNITA believes that fairly sophisticated importers 

shouldn’t have too much trouble providing this type of detail with 

some programming and business process changes, but it’s the small 

guys that are really going to have a tough time complying. 

Congress needs to keep this in mind. As an alternative, we recommend that accurate and detailed cargo descriptions be required 

from all shippers at time of transmission of the vessel manifest to 

Customs. The cost for PNITA importers to comply with Federal security regulations will be passed on to consumers—it’s just the way 

it’s going to be—through higher retail prices. These costs may be 

especially hard on small and medium sized importers who are unable to pass these along to consumers. The ripple effect on the nation’s economy could be enormous as consumers pay more and more 

for imported products. 

This is not the result that the legislators intend when they’re 

crafting this legislation, we’re sure of that. But this is what’s going 

to happen if the legislation includes provisions that are difficult for 

importers to follow. We believe that it would be far better to allow 

U.S. Customs to perform risk assessment while cargo is in transit 

as is the current practice, since this is an effective method. 

As I stated earlier, PNITA members and importers understand 

and support congressional efforts to protect our borders from further terrorist attacks. However, we appeal to Congress to enact legislation that achieves a balance between the need for greater maritime and border security and the increased cost and disruption to 

the supply chain and the nation’s economy. 

[The prepared statement of Ms. Isbell follows:]

PREPARED STATEMENT OF MONICA ISBELL, VICE PRESIDENT, PACIFIC NORTHWEST

INTERNATIONAL TRADE ASSOCIATION

In my capacity as Vice President of the Pacific Northwest International Trade Association (PNITA), I want to thank you, Senators Wyden and Smith, for the invitation to speak at this hearing, as well as for your continued interest in listening to 

our thoughts and concerns on maritime and border security issues over the past six 

months. 

PNITA is a private, non-profit organization committed to supporting global competitiveness under a fair and equitable trading system. We work hard to have a direct impact on trade, tax and transportation policies that affect the region’s economic competitiveness. We are non-partisan in politics and regional in our approach, representing leading corporations and small businesses located in Oregon, 

Idaho, and Washington State. Our members include importers and exporters in all 

sectors of the economy including agriculture, service and manufacturing, as well as 

53

customs brokers, logistics service providers, trade consulting firms, port authorities, 

legal firms, banks, and other interested companies and individuals. 

PNITA members have closely monitored the development of Congressional maritime and border security legislation and initiatives introduced by such government 

entities as the U.S. Customs Service. A PNITA delegation spoke to you, Senators 

Wyden and Smith and your staff during our April trip to Washington DC about our 

thoughts on these issues. You know we are committed to doing all we can to improve security in our supply chains and protect Americans from harm. We recognize 

that our costs of complying with new government regulations could be significant, 

but that the negative repercussions of another terrorist act could be even greater. 

We ask Congress to carefully evaluate the pending legislation that aims to protect 

our country but with a view of enacting reasonable and practical rules that do not 

have a deleterious affect on our national economy. 

There are many things importers can do to better secure their supply chains. 

Some PNITA importers are already in the process of voluntarily implementing security guidelines they expect their factories and logistics services providers to follow. 

These include adding security procedure checklists to annual factory audits. Just as 

they are evaluated on labor practices and quality of products they produce, factories 

will be graded on how well they adhere to recommended security procedures. 

Many PNITA importers have already notified their ocean carriers, airfreight forwarders, customs brokers and consolidators that they expect these logistics service 

providers to exercise sound security procedures when handling their cargo. Moreover, PNITA importers are working to create company-wide security programs. 

As part of the import supply chain, PNITA’s logistics service providers and customs brokers are also doing their part to comply with U.S. Customs and other federal security guidelines to ensure the products that move through their networks 

come from known shippers and are protected from tampering as much as possible. 

Positive, voluntary steps like these will go a long way to protecting Americans. 

But despite all the efforts to secure our supply chains, it may still be possible for 

terrorists to introduce weapons of mass destruction into containers without the 

knowledge of exporters, importers, and logistics service providers. We need to acknowledge this fact and develop legislation that will make it difficult for terrorists 

to use ocean containers for harmful purposes, while not jeopardizing the efficiencies 

that America businesses have fought so hard to gain over the years. 

PNITA members were pleased that the provision for container data pre-notification for risk assessment 24-hours before vessel sailing was deleted from H.R. 3983. 

If legislation is enacted or the Secretary, as defined by H.R. 3983, determines that 

risk assessment and/or container inspection be done at the foreign port prior to 

cargo loading to a vessel, then PNITA members and importers in general will have 

to make changes to their import process. Importers will most likely need to build 

extra time into their supply chains in case factories are unable to present documentation in a timely manner. This could result in increased inventory levels with 

the associated risks and costs. In many parts of the world, vessel departures are 

weekly or two times per week at best. Delays necessary to complete such risk assessment or inspections will likely result in scheduled shipping dates being missed. 

Importers may then have no alternative but to ship time-sensitive product by more 

expensive airfreight. 

Adding time to an importer’s supply chain could have dramatic impact. Depending 

upon the level of requirements that the government might end up enacting, the negative effects on companies would likely result in lost revenues and strained customer relations for importing companies. 

Another area of concern is the potential requirement that importers provide a 

digitized product identifier as a supplement to a detailed product description prior 

to vessel arrival at the first U.S. port. PNITA believes that fairly sophisticated importers should be able to abide by this requirement in the future through systems 

programming and substantial changes in business processes, particularly as it relates to earlier presentation of commercial documents by factories. However, Congress needs to keep in mind that most importers are small with limited means, and 

will, therefore, have a very difficult time becoming compliant. As an alternative, we 

recommend that accurate and detailed cargo descriptions be required from all shippers for transmission to U.S. Customs via the vessel manifest. 

We also understand that container content information will be shared among government entities for risk assessment and intelligence purposes. We understand and 

accept the necessity of this, but request that confidential information beyond what 

is currently collected in transport carrier manifests for census purposes not be made 

public. It is important that the rights of importers be protected and the efforts 

they’ve made to prevent cargo theft not be compromised. 

54

The cost for PNITA importers to comply with federal security regulations will be 

passed on to consumers through higher retail prices. It is not unrealistic to think 

about this scenario multiplied thousands of times as importers across America do 

the same thing. These costs may be especially hard on small and medium size importers who are unable to pass them along to their customers. The ripple effect 

through the nation’s economy could be enormous as consumers pay more to purchase imported products and businesses struggle to remain profitable. 

This of course is not the result that our national leaders intend when they craft 

maritime security legislation. But this is what will happen if the legislation includes 

provisions that importers find difficult to implement and follow. All forms of government regulation cause increased cost regardless of what inspires it. PNITA believes 

that it would be far better to allow U.S. Customs to perform risk assessment while 

cargo is in transit as is the current practice, since this is an effective method. 

As I stated earlier, PNITA members and importers understand and support Congressional efforts to protect our borders from further terrorist attacks. However, we 

appeal to Congress to enact legislation that achieves a balance between the need 

for greater maritime and border security and the increased costs and disruption to 

supply chains and the national economy. 

Thank you very much for your time and consideration. I am happy to answer any 

questions that you may have.

Senator WYDEN. Very good. Let’s go to our non-Isbell witnesses. 

Ms. Patrice Iverson-Summer. 

Senator SMITH. Mr. Chairman, at the risk of being rude to our 

witnesses, I have an audience awaiting me at a luncheon speech, 

and I want you to know I have staff here who’ll have some questions we’ll submit to you for the record. But I apologize. I have to 

leave before everyone is concluded. Thank you so much all of you 

for being here. It’s a very important hearing and each of you from 

labor to the Coast Guard are making a great contribution in getting this important piece of legislation just right. Thank you very 

much. 

Senator WYDEN. Thank you, Senator Smith, as well. This is exactly the kind of issue that requires all hands be on deck in terms 

of protecting Oregon’s position in the conference. I look forward 

very much to working with you when we get back to DC following 

up. 

All right. Let’s go to our next witness. 

STATEMENT OF PATRICE A. IVERSON–SUMMER, PRESIDENT, 

COLUMBIA RIVER CUSTOMS BROKERS AND FREIGHT

FORWARDERS ASSOCIATION 

Ms. IVERSON-SUMMER. I will comply with your request not to 

read my statement. 

Senator WYDEN. Please do. 

Ms. IVERSON-SUMMER. I think that there’s some advantage to not 

having my reading glasses; I can’t read it. 

Senator first of all, I do thank you for the opportunity to testify 

in this most important legislation, and I want to take the time to 

thank your staff people, Joshua and Gerhard and also Rob Freeman for all the time they spent with us lending their ear, lending 

their advice, and I just want to give you my thanks for that. 

Senator WYDEN. Very good. 

Ms. IVERSON-SUMMER. I am a small business owner. I’ve had my 

own company for 8 years now. Just had our eighth anniversary 

yesterday. After lots of trials and tribulations. I’m also the president of the Columbia River Customs Brokers and Freight Forwarders Association, and as such I’m speaking on the their behalf. 

55

I’ve spent 25 years working for promotion of international trade 

in Oregon, helping both customers, particularly small and mid-size 

companies, to form really the foundation of business through this 

state. Thanks to Nike and Columbia Sportswear and Intel, the 

large folks, they help hold it together, but there are hundreds and 

hundreds of small and mid-size companies, mom-and-pop shops, 

mother-and-daughter teams, family operations, that do international trade. And so I’m going to be speaking on their behalf as 

well. 

A customs broker is kind of an unknown entity in this whole 

process, and I just want to explain a little bit of what we do and 

how we’re an integral part of this whole process. I look at customs 

brokers as being the head of the octopus. We have our tentacles 

throughout the whole network of international trade. We have faceto-face contact with of course our customers. We know them and 

we know how they do business. 

We connect with all modes of transportation: the airlines, the 

rails, the ocean carriers, the truck lines. We touch with international bankers on the financial part of the transactions that we 

see. We are the filter through which raw data gets merged through 

regulations and requirements by different government agencies so 

that the information we receive is good and consistent and is complaint with what is required legislatively. 

We work with 40 other Federal agencies and we certainly support the talking or the working together of these agencies after a 

long time of not doing so. When I say Columbia, a key role in understanding how all these players fit together, we’ll orchestrate 

these so that the ultimate goal is that the customer has the merchandise delivered in the time they need. 

There are, you know, essential things that are currently in the 

bill that we highly support. More information. I call it the four W’s: 

the who, the when, the where and the what. The who is no problem. We support security requirements to know who’s making the 

shipment and to whom it’s going. We support what in the legislation about when it’s to be filed. 

We support a good description. And this is where we do differ. 

We support a good description and I would like the legislation to 

keep in mind a good description may or may not necessarily be a 

six digit tariff description. In the third panel we talked about flexibility. I would like flexibility in a multi-faceted and multi-level approach to providing the information. All the customers on the small 

and mid-size companies do not have a tight supply chain. They get 

the information as best they can and they can supply it as best 

they can, but the tariff classification may not be the best way to 

describe their product. It is certainly open to a lot of interpretation 

and a lot of error. 

So what we’re suggesting is that information be able to be supplied by the carrier electronically absolutely, but also be able to be 

supplied by the consolidators directly with benefit of confidentiality 

so that the end user is known to the people who are hands on, who 

handle the shipment when it is initiated is known. And that a description, however best can be described either by text in the case 

of chemicals, a cast number, which very definitely describes what 

that chemical is, by an import license issued by whichever agency 

56

issued in the area of arms, those can all be part of the equation 

so that we’re not limited by that particular 15E or 14. There’s over $2 trillion worth of cargo that moves by land, sea and air; $150 billion of that moves by sea. The port of Long Beach, 

Los Angeles moves over 8,000 containers a day, 3,000 of which are 

in-bond moves. Sixty-five percent of those direct arrivals, the entry 

port is filed prior to arrival. That leaves the other 35 percent that 

doesn’t have to be filtered through definitely the system that Customs is using now. All the other agencies use these texts. 

In a January 3, 2002 Washington Post article, Jan Holmes of the 

Coast Guard cited that a port shutdown of the port of Long Beach, 

Los Angeles could be sustained for approximately a week to 10 

days. After a month we’re talking economic devastation. He was 

addressing this particularly to weapons of mass destruction and 

what could happen to the port. 

I’m suggesting there are two ways. One is weapons of mass destruction and one is in the legislation as it’s written in that particular text. It could cause so much congestion in the port of Los 

Angeles that we will never see the cargo coming up to Portland in 

any length of time. We’re talking approximately 1750 containers a 

day that could be held. Multiply that by ten and that’s 17,000. Multiply that by 30 and you get my picture. 

Senator WYDEN. Let me do this because we are short of time and 

I’m going to have some questions. I’m going to direct our staff to 

work with you to followup on each one of the suggestions that 

you’re making. I think it is critically important that this be seen 

through the prism of someone like yourself, a small business person. Somebody who’s sweated and toiled for 8 years. Joshua and 

Gerhard both are going to followup on each of your suggestions and 

just sort of walk through the system and try to do everything we 

can to get it right. OK. 

Ms. IVERSON-SUMMER. Thank you, Senator Wyden. And about 

how important in-bond moves are for Oregon. 

Senator WYDEN. Sure. 

Ms. IVERSON-SUMMER. We think that there are 48,000 to 52,000 

jobs in Oregon that depend on international trade. Seventy percent 

of our cargo comes in-bond. The maintenance of the in-bond program is vital. If we are forced to file basically entering at the port 

of arrival, what’s going to go away is your customs people, your 

other Federal agencies. They won’t be needed any more. Your 

ground handlers. All those people will be out of work. 

[The prepared statement of Ms. Iverson-Summer follows:]

PREPARED STATEMENT OF PATRICE A. IVERSON-SUMMER, PRESIDENT, COLUMBIA

RIVER CUSTOMS BROKERS AND FREIGHT FORWARDERS ASSOCIATION

Good Morning, my name is Patrice Iverson-Summer. I am the President and 

Founder of Global Trading Resources, Inc., located in Portland, OR. We are a customs brokerage and international transportation logistics provider. We just celebrated our Eighth year in. business yesterday, July 1, 2002, surviving and flourishing even in these difficult times. I am also the President of the Columbia River 

Customs Brokers and Forwarders Association which counts over 30 customs brokerage and forwarding firms in Oregon and Southern Washington as well as having 

20 other firms involved in international trade in the region. I am also a Director 

of the Pacific Coast Council of Customs Brokers and Forwarders. I also serve on the 

Oregon-SW Washington District Export Council and teach International Trade 

classes for the Small Business International Trade Institute. Overall, I have 25 

57

years of experience in International Trade and particularly in the movement of 

cargo in and out of the country. I have worked for the promotion of trade and trade 

policy and most notably for trade moving through Oregon. 

Today I am addressing you as President of the Columbia River Customs Brokers 

and Forwarders Association. The majority of our members represent small to midsize companies like mine whose livelihoods and those of its clients depend upon the 

steady flow of goods in and out of the country. As a small company, most of my clients are based in Oregon. While we do everything possible to have cargo move directly through the Port of Portland, the reality is that nearly 70 percent moves inbond, which is a Customs Program that allows goods to move from the first port 

of discharge to Portland where final Customs entry is made. 

I am exceedingly grateful for the opportunity to testify before you this morning. 

Everyone knows where they were on September 11th, 2001 when they first heard 

the news of the events of the World Trade Center. We spent the day silently unloading an ocean container of Zambian artifacts for a warehouse sale to be held at our 

facility. Be assured that no one in our industry takes the issue of port security more 

seriously than we do. Since all of us in one way or another are either ourselves (or 

have close friends or colleagues) handling vast amounts of freight on a daily basis. 

Our organization has been following the developments of Port Security legislation 

very closely, more closely than at any other time in my career. We approach this 

with utmost seriousness and wish to contribute in the creation of legislation that 

not only promotes security but that makes sense and can be implemented in the 

real world of trade and transportation. We have had endless conversations via email, phone calls and panel discussions with our association of Customs Brokers and 

Forwarders, Port representatives, and importers and exporters for the purposes of 

analyzing and evaluating the proposals to synthesize what really makes sense for 

real security. 

As Customs brokers who are licensed by the Dept. of Treasury, we work as independent agents on behalf of our clients leading them through the maze of laws and 

regulations so that their goods are properly valued and classified at the time of 

entry and that they receive release of their goods in a timely manner. In this capacity we interface with carriers (Air, Land and Sea) as well as all other Federal agencies that have jurisdiction over imported cargoes i.e. the Coast Guard, U.S. Dept. 

of Agriculture, Food and Drug Administration, FCC, DOT, EPA, Bureau of Alcohol 

Tobacco and Firearms, The State Dept, Bureau of Export Administration as well as, 

of course, U.S. Customs. We are also in contact with the International Banking 

Community, Port officials and dock-workers. In the overall scheme of cargo movement, we act like the head of the octopus orchestrating its movement each step of 

the way. 

Who are our customers? While some of us do handle the large importers that register on Custom’s radar screen, the majority of brokers across the country handle 

small to mid-size customers much like mine. These are companies who do not have 

the big databases to control the entirety of their supply chain nor who are capable 

of electronic transmissions of all purchase orders within their system. Most of them 

are struggling just to get documents prior to arrival of their freight ... at the inland 

destination. More often than not, we receive copies of invoices only days before arrival if even that. Then we struggle to gather enough information to properly classify the entries. It is a certainty that carriers will not do this and cannot. 

The process of entry filing is like one of taking pieces of a puzzle and making a 

complete picture out of it. We take steamship information, importer information and 

then apply rulings and regulations, other agency coding and notifications, then finesse it into intelligible computer speak. We verify quantities and take actual shipper and consignee information, verify values and descriptions and sort through literally thousands of rulings to make sure the tariff classifications are correct. In 

other words, we act as filters for the oil that goes into the engine. If the oil or gasoline is not refined, the engine chokes. We are in a unique position to see the broad 

picture of how trade really works today, to see where improvements can be made, 

who can handle them, and what could potentially be a loose nut in the engine of 

trade. You know what can happen in a car engine if a part becomes dislodged. When 

it gets stuck, the engine freezes. We do not want this to happen. 

There are two types of terrorism, one type uses explosives and chemicals to kill 

and maim. Another uses fear to erode the public spirit and undermine its economy. 

The U.S. has over 2 trillion dollars worth of cargo moving by land, sea and air. 

$750 billion moves by vessel. The largest port on the West Coast, the port of Los 

Angeles/Long Beach sees over 5 million containers a year across its docks (8,000/

day). 3000 containers are scheduled to move inland. J.M. Holmes of the Coast 

Guard, cited in a January 3, 2002 article in the Washington Post, that a shutdown 

of the port for a week could possibly be sustained, but a month would cause the 

58

economy of the Western U.S. to come to a screeching halt. The cause of this could 

be a terrorist action or it could be done by ourselves by drafting legislation that is 

overly detailed in its requirements which does not allow for possibilities of providing 

fundamental information necessary for port security via a multi-layered and multimode approach. The language of this legislation should not be so specific or micro 

managing in its scope so as to preclude participation by the smaller and mid sized 

companies who together represent a major component in the equation.

What are the facts:

• Terrorists are worldwide and they are amongst us. A weapon of mass destruction of chemical/biological means could easily be put into place from within, as 

well as outside our borders.

• Terrorists are long range in their planning and terrorists do not necessarily rely 

upon sophisticated technology... i.e. box cutters, etc...

• The U.S. does not have the capability to physically examine all cargo that comes 

into the country, but must rely on shared intelligence.

Conclusion: We need as much (not limited) shared information by ALL parties of 

the trade.

Customs brokers have long advocated government agencies sharing information. 

We also are well aware that the current level of information is not adequate. I spoke 

recently to local inspectors on the Manifest Review unit who were pleading for more 

information so that they could do their profiling. Currently they are receiving descriptions of ‘‘freight all kinds’’, ‘‘general cargo’’, shippers and consignees who are 

forwarders and forwarders agents and piece counts that are skids rather than number of boxes. 

We believe first that the U.S. Customs Service is the appropriate agency to receive and manipulate important arrival information. They have a system in place 

and can currently handle information as their systems such as the Automated Commercial Environment (ACE )and the International Trade Data System (ITDS) are 

being developed. 

We have specific comments on the legislation as passed: 

Section 108 of S. 1214 ‘‘Mandatory electronic filing of manifest information in a 

time frame needed by respective federal agencies.’’ We suggest that this be done via 

the AMS system as most carriers already use this system. Programs are readily 

available and we have been advised that they are in the process of being enhanced 

to allow multilayered reporting by OTI’s (Other transportation intermediaries). The 

way business is currently done, carriers only have the names of the consolidator 

where as the consolidators (non vessel ocean common carriers or NVOCC’s) do have 

actual shipper and consignee information. This is done purposefully for purposes of 

confidentiality. 

Sec. 431A Requiring full shipping papers 24 hours prior to loading. We submit 

that shippers filing via AES be allowed partial information particularly for agricultural products whose full quantity may not be known until after the ship has fully 

loaded. 

Sec. 115(e)(A) Still remains the most problematic part of this bill. It distinguishes 

in-bond cargo from direct discharge cargo. In our minds a container containing 

weapons of mass destruction is as dangerous to the port of arrival as it is anywhere 

along route to a final inland destination. This section requires that the consignee/

consignor, the country of origin and a description of the cargo by means of the Harmonized Tariff Code to the sixth digit level. 

As stated above, we agree that actual consignee/consignor information is vital. It 

can be provided via the above means. 

The country of origin is difficult to ascertain in this day of multi-country manufacturing. For entry compliance purposes, the country of origin can be very complex 

to ascertain. We feel much more germane to security is the country of export. Where 

the goods came from and who shipped them. Up until now only the last port of loading was part of the manifest. We feel that place of receipt should be part of the 

manifest data. 

The most detrimental issue presently is the requirement for a 6 digit harmonized 

tariff number. While I do not wish to get into too much detail here, my colleagues 

and I feel that this issue is the most critical shortcoming. I will describe the issue 

briefly and be happy to provide additional testimony for the record, if you wish me 

to do so. 

The harmonized code system is a complex and extensive nomenclature, which intends to cover all commodities. To its credit it is expansive, to its discredit it is subject to interpretation and error. This is the reason that there are thousands of rulings and disputes in the Court of International Trade. The usage of the 6-digit tariff 

59

number has been suggested as being the best means of describing the goods being 

shipped. While we most certainly agree that there needs to be better descriptions 

than ‘‘freight all kinds’’ and ‘‘general cargo’’, we cannot agree that the 6 digit requirement is appropriate language for the legislation. Once you get to 6 digits in 

many areas there is wide room for error and interpretation. 

Case in point: I have several small textile importers whose jacket classifications 

change at the 4 digit level depending on whether or not the jacket length is above 

or below mid thigh. Sufficient information to determine a correct six digit classification is most likely not going to be provided on the carriers list of information that 

they have to file with the Coast Guard and Customs. It therefore would be incorrect 

and it does not add anything for security. The same goes for whether shoes have 

rubber soles or not. In addition, we do not find that this requirement allows for cargoes that may have 15, 20, 50, or 100 different classifications. In discussions we 

have had with Customs, they have suggested that the 6 digits would be required 

for all cargo not just in-bond. While this change would level the playing field for 

all cargo, there are major concerns about how this information will be provided. The 

result could likely be an even greater negative impact. It also does not address the 

issue of in-bond freight still being on the chopping block, as importers will not want 

to file ‘‘almost an entry’’ at the port of arrival, then add 3 more data elements at 

the port of entry. Customs has stated that importers and shippers would collaborate 

and provide this information to the carrier, who would in turn, report it on the 

manifest. This is a very unrealistic scenario. 

We submit that Customs is now able to take text data. The customs automated 

targeting system takes text, INS takes text and so does the Coast Guard. It seems 

unreasonable that the legislative language should stipulate something that Customs 

cannot currently accept and that it should preclude any and all descriptions. Areas 

of particular concern are those covering chemicals and arms. Chemicals are much 

more appropriately described by using a CAS number and/or hazardous materials 

information, which in many cases are far more specific than the catch all ‘‘other’’ 

categories of the harmonized system. All arms or nuclear materials must have as 

part of their documentation import licenses. The issuing agencies have full details 

of all pertinent information. 

If profiling is the main objective in information gathering and this profiling is 

being done to distinguish the legitimate cargo from those shipments that have incongruities, it would appear that a large portion of small and mid-size companies 

could significantly be disadvantaged by not having an HS number available prior 

to arrival when in fact they would otherwise have good descriptions on the manifest. 

This is a portrait of what could happen to a large portion of cargo destined for Portland. Should this happen, the Port of Portland would fold. The 40,000 jobs dependant upon trade would evaporate and there would be no guarantees that the country 

would be any more secure. The congestion at the ports of arrival, I suggest, would 

make the possible West Coast IWLU strike look like a picnic. 

I believe that the efforts to secure our borders are highly commendable and so 

very important, but in those efforts I it is my hope that you will take the input from 

all of the concerned parties to assure that the final legislation is effective, flexible 

enough for changing situations and technological develops and most of all balanced. 

We all want security but we also want and need strong and viable trade to assure 

a strong economy. For this we need a balance of security enforcement along side 

of trade facilitation. This is the mission set before us by the President and reiterated by Customs Commissioner Bonner and Director of Homeland Security, Tom 

Ridge. 

Thank you again for the opportunity to testify today. My colleagues and I are 

ready and willing to assist you in every way possible as you go forward in finalizing 

this legislation.

Senator WYDEN. Well said. As I say, we’re going to followup on 

the suggestions you’re making specifically and just sort of walk 

through this legislation in the eyes of what it would mean for 

somebody like yourself. Thank you. 

Senator WYDEN. Captain Townley. 

60

STATEMENT OF CAPTAIN JIM TOWNLEY, EXECUTIVE

DIRECTOR, COLUMBIA RIVER STEAMSHIP

OPERATORS ASSOCIATION 

Mr. TOWNLEY. Senator, good morning. I would like to repeat 

Patty’s sentence with respect to the support your staff has provided, and Rob as well. Just a super job on preparing for this. 

My name is Jim Townley. I’m the executive director of the Columbia River Steamship Operators, and that association is made 

up of owners, operators, agents, towing companies and barge interests on the Columbia River. I’m also executive director of the Columbia River Port Rejuvenation Coalition, which is an ever-growing 

number of shippers, forwarders, brokers, carriers, and business interests in Oregon and Washington who have concerns about the 

cost competitiveness of the Columbia River and its future. And I 

will serve in that capacity until such time as they find competent 

help. 

That having been said, I really want to thank you, Senator, and 

Senator Smith as well, for giving us the opportunity to testify on 

a matter of grave importance to our nation and the region, and 

particularly as those relate to trade in securing our ports, which is 

so vital to Oregon, Washington and national commerce. 

Many of the people in the room today are aware of the fact that 

our industry on the morning of September 11th, took immediate 

measures to tighten security on the river system. The Coast Guard 

later told us that the actions that we took, the procedures that we 

voluntarily imposed on ourselves later became the national standards that were adopted. 

We pride ourselves on being proactive and innovative and very 

practical when it comes to meeting national, regional and global 

challenges and opportunities. As an example the Protector Alpha 

fire with loss of life in 1982, the flood of the century in 1996, the 

already twice mentioned New Carissa grounding and break up in 

1999, and then two subsequent extremely low water situations 

which were very bad for commerce and the river reputation we had 

in fall of 2000 and fall of 2001. 

Each one of those situations have given our industry the increasing experience of what I’ll call the art and science of forging private/public partnerships, which we’ve done to good advantage. 

We’ve found ways of sharing those practices and in sharing lessons 

learned, and in finding innovative and cost effective solutions to 

the problems and challenges facing us. Unfortunately, the tragedy 

of September 11 has presented us with our greatest challenge thus 

far. 

Beginning on September 13, the Columbia River Steamship Operators Association initiated a series of meetings with other maritime industry members and Federal agencies to assess our own 

vulnerabilities, consider our threats and develop cost effective approaches to increased security, while minimizing adverse impact on 

commerce. We were looking for checkpoints not show points. These 

efforts led us to the concept establishing a regional maritime security coalition throughout our entire river system and along our 

coasts and ports. 

On Monday, June 17th, the Transportation Security Administra- tion confirmed a Federal grant award of $623,000 to the CRSOA, 

61

to conduct a proof of concept test and demonstration of a prototype 

‘‘Regional Maritime Security Coalition.’’ The grant will allow the 

establishment and testing of a public-private model that will serve 

as an umbrella seaport security organization. Under this concept, 

the technical and information resources from the ocean shipping 

and public seaport sectors will be combined with the resources of 

pertinent Federal agencies, such as Coast Guard, customs, immigration, agriculture, FBI and FEMA, and with regional, state, and 

local law enforcement, emergency management, and possibly with 

national guard and reserve military assets. 

We believe the coalition should be operated as a public-private 

partnership that aims at making maritime transportation security 

an integral part of daily trade and transportation operations, and 

that is financed—and this should probably be of great interest to 

you, Senator—from both public and private sector sources with regional generated moneys staying in the region. 

This coalition would integrate and coordinate government and industry information, intelligence, and operations to ensure appropriate and cost effective levels of security and that do not unnecessarily impede commerce. 

We believe that the proven wisdom of Congress as expressed in 

the Oil Pollution Act of 1990 presents a model for prevention of terrorist events and for first response to security incidents. We believe 

successful elements of OPA 90 can be integrated in the legislation 

currently under consideration and that that particular legislative 

model is generally adaptive to homeland security purposes. 

Our experience tells us that best practices for homeland security 

prevention, detection, deterrence, the whole enchilada, could be 

used to augment whatever standards are put in place with additional nonregulatory standards of care. This is something we use 

routinely here and in the Puget Sound area, and it’s generally a 

self-policing system of inspections and audits which are augmented 

with Federal spot checks and oversight to assure compliance with 

these adopted standards. 

One important goal we hope to achieve also is one-stop shopping 

for information collection from domestic and international carriers 

who currently have to deal with many, many Federal agencies, but 

primarily Customs and INS. Each one of the agencies has its own 

requirements and it’s own format and so on and so forth, and it 

would be very nice if we could in fact in the interest of security 

consolidate all that into one location and make it a lot more user 

friendly. 

We believe risk analysis similar to what’s required by OPA 90 

should be required and conducted for homeland security with the 

following specific enhancements: Risk and vulnerability assessments should be conducted on a continuous and real time basis as 

cargoes move through regional maritime transportation networks. 

While there are many ways by which these assessments could be 

conducted, fundamentally they would occur on a computer platform 

where as a minimum, information about cargoes on vessels could 

be combined with information about vessel locations, which could 

be combined with information about cargoes staged at waterfront 

facilities to give our intelligence and law enforcement agencies 

62

more timely and valuable information than is currently available 

to them today. 

Point of origin inspections and certifications, as other people 

have testified, should be investigated for both imports and exports 

allowing chain of custody security to be maintained over maritime 

transportation system passengers and assets as they move through 

the system from origin to destination. 

And because the west coast is a high tech center for the country, 

computer and other high tech capabilities should be marshaled to 

enhance the goals of homeland security for everything from intelligence assessments to confirmation of successful cargo delivery. 

And finally, Senator, I’ll just mention a TSA grant once again 

has made even more critical a request we’ve made to your office for 

fiscal year 2003 Federal assistance that was made immediately following September 11th, to establish a vessel traffic information 

system here in the river. Since 1998, the ship operators and the 

Columbia River pilots have been working on a public-private partnership to establish a VTIS in this river. And in fiscal year 2000, 

the ship operators authorized a quarter million dollars in private 

sector money—which I have to add is a lot of money for an organization of our size—to do a proof of concept trial of the system. And 

the Department of Transportation Volpe Center is being retained 

under contract to do that. 

Once the system is in place, location, course, speed, and status 

of every vessel, its cargo and crew, can be made immediately 

known to appropriate authorities instantly. The events of September 11th, have obviously made such information even more critical. This VTIS system that I just mentioned, the Regional Maritime Security concept that I’ve outlined for the hearing today 

would substantially increase the public safety and security of the 

Columbia River region. Support of the VTIS funding on behalf of 

the region will allow us to significantly increase security for trade 

and seaports in fiscal year 2003, several years ahead of what we 

would be able to do otherwise on our own. 

Our industry is committed to establishing VTIS and building a 

Regional Maritime Security system and to providing needed support to any practical and cost effective idea that will improve the 

safety and security of our ports, waterways and commerce. 

That concludes my formal statement. I’d be happy to answer any 

questions you may have. 

[The prepared statement of Mr. Townley follows:]

PREPARED STATEMENT OF CAPTAIN JIM TOWNLEY, EXECUTIVE DIRECTOR, COLUMBIA

RIVER STEAMSHIP OPERATORS ASSOCIATION

Good morning. I’m Jim Townley, Executive Director to the Columbia River Steamship Operators Association, a not-for-profit association of ship owners, operators, 

agents, and towing and barge industry members. Thank you Senator Wyden and 

Senator Smith for holding these hearings. We are grateful for the opportunity to testify this morning on a subject of grave importance to our nation and region, particularly as our actions relate to protecting trade and securing ports that are vital to 

Oregon, Washington, and to National commerce. 

As many of the people in this room today are aware, the Columbia River Region’s 

maritime industry took immediate measures to tighten security beginning on the 

morning of September 11th. The U.S. Coast Guard told us later that the heightened 

security procedures we voluntarily imposed on ourselves starting September 12th 

were subsequently adopted as the National standard several weeks afterward. 

63

The Columbia River Region’s maritime industry has earned a reputation for being 

proactive, innovative, and practical when it comes to meeting regional, national, and 

global challenges and opportunities. The burning of the grain ship Protector Alpha, 

with loss of life in 1982, the 1996 ‘‘flood of the century,’’ the grounding and break 

up of the Motor Vessel New Carissa in 1999, and two successive very low water seasons in the Fall of 2000 and 2001 gave our industry increasing experience in the 

art and science of forging public private partnerships, sharing ‘‘best practices’’ and 

lessons learned, and implementing innovate and cost effective solutions. The tragic 

events of September 11 presented us with our greatest challenge thus far. 

Beginning on September 13, 2001, the Columbia River Steamship Operators Association initiated a series of meetings with other maritime industry members and 

with Federal agencies to assess our vulnerabilities, consider threats and alternatives, and develop cost-effective approaches to significantly increase security while 

minimizing adverse impacts to the movement of ships and cargos where-ever possible. We sought to identify and establish ‘‘check points’’ not ‘‘choke points.’’ We 

sought to combine our talents and resources into a single, unified regional security 

system. 

These efforts led to the concept of developing and establishing a regional maritime 

security coalition throughout our river system and along our coasts. On Monday, 

June 17th, the Transportation Security Administration confirmed a Federal Grant 

award of $623,000 to the CRSOA, to conduct a ‘‘proof of concept’’ test and demonstration of a prototype ‘‘Regional Maritime Security Coalition.’’ This Grant will 

allow the establishment and testing of a public-private model that will serve as an 

umbrella seaport security organization. Under this concept, the technical and information resources from the ocean shipping and public seaport sectors will be combined with the resources of pertinent Federal agencies such as the Coast Guard, 

Customs, Immigration, Agriculture, FEMA, and FBI, and with regional, state, and 

local law enforcement, emergency management, and possibly with National Guard 

and reserve military assets. 

The testimony I’m providing this morning outlines the concept we intend to prove 

with this Grant. 

The Columbia River maritime industry believes a regional maritime security coalition should be established that is operated as a public-private partnership, that 

aims at making maritime transportation security an integral part of daily public 

and private sector maritime trade and transportation operations, and that is financed with public and private sector funds where regionally generated monies remain in the region. 

The mission of the coalition would be to regionally integrate and coordinate government and industry information, intelligence, and operations that ensure appropriate and cost effective levels of security and that do not unnecessarily impede 

commerce. 

We further believe that the proven wisdom of Congress as expressed in the Oil 

Pollution Act of 1990 presents a model for prevention of terrorist events and for first 

response to security incidents. We believe successful elements of OPA 90 can be integrated with legislation currently under consideration and is generally adaptable 

to homeland security purposes. 

Our experience tells us that ‘‘Best Practices’’ for homeland security prevention, detection, deterrence, and response could be translated into non-regulatory ‘‘Standards 

of Care’’ clearly and explicitly expressing the consensus of local government and industry on what is going to be done to prevent, detect, deter, and/or respond to homeland security incidents. We believe a self-policing system of inspections and audits, 

augmented with Federal spot checks and oversight, will assure compliance with 

these adopted standards. 

One important goal we hope to achieve is the establishment of ‘‘one stop shopping’’ for information collection from domestic and international carriers who currently must deal with several Federal agencies when arriving or departing U.S. 

ports and waterways (most notably the U.S. Coast Guard, Customs, and INS). At 

a minimum the diverse requirements for providing similar ship, cargo, and crew information to different Federal agencies at different times and places, using different 

formats and reporting rules, should be consolidated into single, uniform reporting 

requirements that will facilitate knowledge of vessel operating status, emergent 

vulnerabilities and risks, and intelligence interest for those involved in the safe and 

secure movement of people and cargos through our maritime transportation system. 

Communications and coordination between CRSOA and Puget Sound Steamship 

Operators Association, and between Columbia River and Puget Sound Harbor Safety 

organizations are being expanded and improved. We are sharing our collective experience and resources, ideas, and ‘‘best practices.’’ We are investigating ways of expanding the scope of security work that could be facilitated by organizations such 

64

as the Pacific Northwest Waterways Association and the Pacific Northwest Economic Region. Plans for doing even more are under development. 

We believe Risk Analysis, similar to what is required by OPA 90, should be required and conducted for homeland security with the following specific enhancements:

Risk and vulnerability assessments should be conducted on a continuous and 

‘‘real time’’ basis as cargos move through regional maritime transportation networks. While there are many ways by which these assessments could be conducted, fundamentally they would occur on a computer platform where as a 

minimum, information about cargos on vessels could be combined with information about vessel locations, which could be combined with information about 

cargos staged at waterfront facilities to give our intelligence and law enforcement agencies more timely and valuable information than is currently available 

to them today.

‘‘Point of origin’’ inspections and certifications should be investigated for both 

imports and exports allowing ‘‘chain of custody’’ security to be maintained over 

maritime transportation system people and assets from origin to destination.

Because the West Coast is the high tech center for the country, computer and 

other high tech capabilities should be marshaled to enhance the goals of homeland 

security for everything from intelligence assessments to confirmation of successful 

cargo delivery.

Finally, the TSA Grant award has made even more critical a request for FY 2003 

Federal assistance made immediately following September 11th for establishing a 

Vessel Traffic Information System. Since 1998, the CRSOA and the Columbia River 

Pilots have been working on a public-private partnership to establish a VTIS in the 

Columbia River. In FY 2000, the CRSOA authorized the expenditure of $250,000 of 

private sector funds to conduct a proof of concept trial of the system. The Department of Transportation’s Volpe Center is being retained under contract to conduct 

this trial. Once in place, the location, course, speed, and status of every vessel, its 

cargo, and crew, can be made known to appropriate authorities instantly. The 

events of September 11 made the availability of such information even more crucial. 

This VTIS system, when integrated with the Regional Maritime Security concept, 

would substantially increase the public safety and security of the Columbia River 

region. Support of the VTIS funding on behalf of the Columbia River region will 

allow us to significantly increase the security of our trade and seaports in fiscal year 

2003, several years earlier than would be possible otherwise. Our industry is committed to establishing the VTIS, to building our regional maritime security system, 

and to providing needed support for any practical and cost-effective idea that will 

improve the safety and security of our ports, waterways, and commerce. 

That concludes my formal statement. I’d be happy to answer any questions you 

may have as well as provide additional written comments as necessary.

Senator WYDEN. Very good, Captain. Mr. Holte. 

STATEMENT OF BRUCE HOLTE, PRESIDENT, LOCAL 8, 

INTERNATIONAL LONGSHORE AND WAREHOUSE UNION 

Mr. HOLTE. Senator Wyden, my name is Bruce Holte. I’m the 

president of the International Longshoreman Warehouse Union, 

ILW 8, representing 600 working men and women in the Port of 

Portland. I’m pleased to submit comments regarding the security of 

our nation’s ports. 

Within the lower Columbia River there are approximately 1350 

ILW representing longshoremen, marine clerks, and foremen working in the ports of Astoria, Oregon, Vancouver, Washington, and 

Long View, Washington. The members of the ILW are committed 

to making our ports and surrounding areas safe, secure and free 

of criminal or terrorism activities. Just as important, we are absolutely committed to the security of our work force as well as the 

surrounding communities where we all live and interact. 

This is especially so since ILW members face direct risk to their 

personal safety and livelihood from such criminal and terrorism 

65

acts simply by virtue of the jobs we do and the areas where we 

work. Following the horrendous terrorist attack on September 11, 

ports throughout the country went on immediate security alerts. In 

Portland meetings have been held between the Coast Guard and 

local interests to discuss the threats we now face and the actions 

we must take. 

Familiarities have been established between key Coast Guard 

personnel and key local aid officers so that regular and constructive 

dialog can take place around security issues. The Port Marine Security Act S. 1214 initially focuses on criminal activities rather 

than national security and terrorism. The present need to secure 

our ports from the threats of international terrorism now overrides 

all other issues. 

There are substantial areas of omission in S. 1214 that need to 

be retracted to truly enhance our nation’s seaport security. The 

U.S. Coast Guard has basically been a waterside enforcement agency within the Federal Government. For purposes of clarity, understanding that landside enforcement is a different matter altogether 

and major American ports, including areas of ILW jurisdiction, 

landside security enforcement has been a function of local port and 

terminal operators. 

The Port Marine Security Act S. 1214 focuses heavily on 

longshore workers as a significant security risk. It is absolutely 

contrary to the fact and to the goal of maintaining secure seaports 

to treat longshore workers as security risks. Longshore workers are 

not the problem, but rather a critical part of the solution to keeping our ports safe and secure. 

It is the well-established longshore work force that knows how 

things work best at ports, and perhaps most importantly it is ILW 

members who are best able to detect and report suspicious and unusual activities in the ports. The government should therefore enlist these dedicated workers as partners rather than as suspects in 

efforts to secure our nation’s ports. 

In times of shrinking tax receipts, the most cost effective first 

line security available is the very workers who toil on the docks 

daily. The longshore worker must be embraced as part of the solution not part of the problem. In that the superstructure activity 

levels and operating procedures at ports vary substantially, it is 

imperative that local communities, investors, government and 

stakeholders work together to develop and maintain security procedures that meet the certain standards at a given port. 

As a significant stakeholder ILW must be actively included as a 

general matter of policy. ILW opposes background checks on any of 

our workers. During investigation of the Integrity Commission on 

Seaport Security, Gram Commission, ILW challenged the commission to prove their assertion that internal conspiracies are a problem at many of our nation’s ports. We asked them for an example 

of an internal conspiracy where the committed crime involved ILW 

longshore workers. They could not produce one example of ILW 

workers at our nation’s ports involving criminal conspiracies. Not 

one. Not one. 

In fact the only involvement our members have with serious 

criminal activities is reporting to the authorities suspicious activities and cargo. In previous testimony before the Senate Congress, 

66

Science and Transportation Committee we pointed out that the action of one longshore worker at the port of Tacoma led to the largest cocaine seizure in the port’s history. 

In times of war the ILW members have delivered on their promise to load military cargo in the safest most efficient way possible. 

It is equally agreeable that the government not respond to new terrorisms against our country in ways that harm the productivity of 

our commercial seaports. Excessive or imprudent regulations that 

fail to account for the true realities of port operations will only result in further damage to the national and world economics at a 

time when they are in perilous circumstances. 

We must not through rash government regulations accomplish 

the very result our enemies seek, and we are trying to avoid the—

I’d like to for a second, if you don’t mind, I’d like to go off my written statement and hit on a point you talked about earlier. We have 

a major concern, longshoremen in general, in the ports of what you 

talked about seals and cans not being inspected. The Port of Portland, and this is just a scenario, a can can be taken off a ship, put 

on a truck and brought right out to the rail system, loaded on a 

rail and shipped out without anybody checking the seal, looking at 

the seal. Who knows what could be in there? 

For an example, you could have these al Qaeda or whatever you 

want to call them guys on that ship, they could unlash that can, 

they could load those guys in there, lash that back up, load that 

on a rail and off they go. You just don’t know. Another example is 

they could make that a hot can, where it comes on the dock, as an 

example the topside operator might grab that can off a truck, put 

it on the ground and a yard guy will load that on a commercial 

truck and off they go. 

Senator WYDEN. Just 1 second. Do any of you in the business 

community disagree with what Mr. Holte just said? Let the record 

show Mr. Holte talked about the threat of unsealed containers, containers that again have essentially no verification process, and his 

point, a point made by the labor union that deal with this, have 

been echoed by all the business witnesses on the panel. Go ahead, 

Mr. Holte. 

Mr. HOLTE. Thank you. With that I’ll just go back to my written 

statement. 

Senator WYDEN. I’ll tell you what, can we put the rest of that in 

the record so I can get to a couple questions? 

Mr. HOLTE. Sure. It was thanking you for being here. 

[The prepared statement of Mr. Holte follows:]

PREPARED STATEMENT OF BRUCE HOLTE, PRESIDENT, LOCAL 8, INTERNATIONAL

LONGSHORE AND WAREHOUSE UNION

As President of the International Longshore and Warehouse Union (ILWU) Local 

8 representing 600 working men and women in the Port of Portland I am pleased 

to submit comments regarding the security of our nation’s ports. Within the lower 

Columbia River there are approximately 1350 ILWU represented longshoremen, marine clerks and foremen working in the ports of Portland Oregon, Astoria Oregon, 

Vancouver Washington and Longview Washington. The members of the ILWU are 

committed to making our ports and surrounding areas safe, secure, and free of 

criminal or terrorist activities. Just as important, we are absolutely committed to 

insulating the security of our workforce as well as the surrounding communities 

where we all live and interact. This is especially so since ILWU members face direct 

67

risk to their personal safety and livelihood from such criminal and terrorist acts 

simply by virtue of the jobs we do and the areas where we work. 

Following the horrendous terrorist attacks of September 11, ports throughout the 

country went on immediate security alert. In Portland meetings have been held between the Coast Guard and Local 8 representatives to discuss the threats we now 

face and the actions we must take. Familiarity has been established between key 

Coast Guard personnel and key Local 8 officers so that regular and constructive dialogue can take place around security issues. 

The Port and Maritime Security Act (S.1214) initially focused on criminal activities rather than national security and terrorism. The present need to secure our 

ports from the threats of international terrorism now overrides all other issues. 

There are substantial areas of omission in S. 1214 that need to be rectified to truly 

enhance our nation’s seaport security. The U.S. Coast Guard has basically been a 

waterside enforcement agency within the federal government. For purposes of clarity, understand that landside enforcement is a different matter altogether. In major 

American ports, including areas of ILWU jurisdictions, landside security enforcement has been a function of the local port and terminal operators. 

The Port and Maritime Security Act (S.1214) focuses heavily on the Longshore 

worker as the significant security risk. It is absolutely contrary to the facts and to 

the goal of maintaining secure seaports to treat longshore workers as security risks. 

Longshore workers are not the problem but rather are a critical part of the solution 

for keeping our ports safe and secure from crime and terrorism. It is the well-established longshore workforce that knows how things work best in the ports and, perhaps most importantly, knows who belongs where in the marine terminals. It is 

ILWU members who are best able to detect and report suspicious and unusual activity in the ports. The government should, therefore, enlist these dedicated workers 

as partners rather than as suspects in the efforts to secure our nations ports. In 

times of shrinking tax receipts the most cost effective first line of security available 

is the very workers who toil on the docks daily. The Longshore worker must be embraced as part of the solution, not part of the problem. 

In that the superstructure, activity levels and operating procedures of ports varies 

substantially it is imperative that local committees of industry and government 

stakeholders work formally together to develop and maintain security procedures 

that meet the circumstances of a given port. As a significant stakeholder the ILWU 

must be actively included. 

As a general matter of policy, the ILWU opposes background checks on any of our 

workers. During the investigation of the Interagency Commission on Seaport Security (the Graham Commission) the ILWU challenged the Commission to prove their 

assertion that internal conspiracies are a problem at many of our nation’s ports. We 

asked them for an example of an internal conspiracy to commit crimes involving 

ILWU Longshore workers. They could not produce one example of ILWU workers 

at our nation’s ports involved in criminal conspiracies. Not one. In fact, the only involvement our members have with serious criminal activity is reporting to authorities suspicious activities and cargo. In previous testimony before the Senate Commerce, Science and Transportation Committee, we pointed out that the actions of 

one longshore worker at the Port of Tacoma led to the largest cocaine seizure in 

the Port’s history. In times of war, the ILWU members have delivered on their 

promise to load military cargo in the safest, most efficient way possible. 

It is equally critical that the government not respond to the new terrorism against 

our country in ways that harm the productivity of our commercial seaports. Excessive or imprudent regulations that fail to account for the true realities of port operations will only result in further damage to the national and world economies, at 

a time when they are in perilous circumstances. We must not, through rash government regulation, accomplish the very result our enemies seek and we are trying to 

avoid—the disabling of waterfront commerce. 

Accompanying this statement is a detailed proposal designed to pinpoint critical 

security-sensitive areas with specific delineations between landside and waterside 

operations. The proposals are designed to increase and improve port security protections in an economically feasible way. 

Waterside Security Issues 

Match Personnel with Provided Documents 

Legislation should require crew and passenger lists including names, addresses, 

passports, and mariner documents be matched up in person with the documents 

submitted. Currently, when the Immigration and Naturalization Service (INS) is 

given the documentation, they merely go through the documents without requiring 

the individuals presence to insure he or she is who the documents say they are. 

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Implementation of Integrated Systems 

Implementation of integrated systems allowing Customs to inspect and/or review 

manifests containing identification of shipper, port of origin, and cargo shipped prior 

to vessel entering American waters. 

Advance Security Clearances of Vessels 

The legislation should require advance security clearance requirements for all vessels, their owners, operators and crew before entering a U.S. port. Presently, these 

vessels operate wider secrecy and without regulations by the scheme of flying the 

flag of a country (flag of convenience) that lacks any meaningful regulations and 

scrutiny. The London Times reported that the terrorist group Al Queda presently 

operates flags convenience vessels. 

Landside Security Issues 

Container Security Seals 

Like luggage on airplanes, the containers on vessel and in port facilities need to 

be subjected to security screening to protect U.S. seaports and international maritime commerce. Obviously, it is both impractical and cost-prohibitive to inspect 

every one of the tens of thousands of containers that flow in and out of our ports 

each day. Proposed legislation should at least mandate that port workers who receive containers inspect the integrity of the outside seal on each container. Seal inspection must he done to insure that the seal number matches up with the consignee who was the last person who sealed that container up and is responsible for 

the cargo therein. To insure port security, this is one of the ‘‘primary’’ actions that 

must be undertaken. This act must mandate that the integrity of the seals be checked 

and rechecked against terminal documentation to insure the origins of that cargo. 

A broken seal would alert the port facility that the container has been tampered 

with and that it needs to be carefully inspected before entering a facility or being 

placed on a vessel, and should be immediately earmarked to Customs for inspection 

A systematic check of container seals provides authorities with a record as to the 

parties responsible for placing the seal on any container that may be the means of 

a terrorist act. 

Documentation 

The industry trend is that we are seeing less descriptive documentation of a container’s contents. Where not too many years ago, every container entering a terminal was accompanied by a load plan describing in detail its contents from head 

to door, that practice is being replaced to the point that the contents of many containers entering the terminal are completely unknown or the description is so vague 

as to be useless. Requiring full disclosure of a container’s contents is only prudent 

before allowing access to a terminal. 

Empty Containers 

One of the most overlooked of potential security risks to terminals, ships, and port 

infrastructure is the proper handling of empty containers. On any given day as 

much as forty percent of cargo delivered into any facility is comprised of empty containers. A physical inspection of these containers is vital for a number of reasons: 

(1) Terminal safety- knowing that in almost all port facilities empty containers are 

very rarely inspected, the potential for placement of some kind of explosive device 

is something that must he considered and planned for; (2) Vessel Safety or remote 

site endangerment—the concept where an uninspected empty container containing 

an explosive device would be loaded onto a vessel for detonation. In many ports 

throughout the world the inspection of empty containers is a requirement, for exactly many of the reasons that were outlined! What would happen if a terrorist cell 

in a foreign country for example were to take an empty container, place an explosive 

device inside, then load it up and ship it for detonation elsewhere? In the Port of 

Portland ILWU marine clerks inspect many of the empty containers, but the practice is mixed from terminal to terminal and from operation to operation within terminals. For years, inspection of empty containers was regularly done in America’s 

largest seaports; however this procedure was abandoned some years ago. Once 

again, if we truly are desirous of creating safe and secure seaports then the full return to these inspections is a must. 

Non Inspection of Truckers 

The primary threat to American seaports is the ability of truckers to gain access 

to dockside marine container terminals with ‘‘carte blanche’’ accessibility. THE MAJORITY OF ALL TRUCKERS ENTERING MARINE FACILITIES IN AMERICA’S 

LARGEST PORTS DO SO WITHOUT HAVING TO EXHIBIT ANY KIND OF 

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IDENTIFICATION WHATSOEVER. Prior to the terrorist attacks in New York and 

Washington. DC, there was no requirement for truckers to produce any identification upon entrance to marine terminal facilities. However, even following the attack, 

only two marine container facilities in California now demand ID. upon entrance 

through marine terminal gates, but there still is no match-up of photo ID with the 

truckers themselves because they only have to produce the California drivers license 

number for entrance. Truckers entering docks in Portland are not required 

to produce any form of identification. The truckers entering these marine facilities have virtually unobstructed access to the entire facility, enabling them to place 

anything, anywhere, at anytime. They regularly leave their trucks to use restroom 

facilities, to visit with other truck drivers, to open empty containers for personal inspection, to unlock chassis, etc. Truck drivers entering the terminal should be confined to the truck. 

The Failure to Provide Secure Cargo Holding Areas 

In many ports throughout the world, the local workforces take the cargo (now in 

steel cargo shipping containers almost all the time) and place them in secured ‘‘holding areas, many times located next to marine facility entrance gates, awaiting truckers who are allowed only in these secured areas to pick up containers, usually on 

an appointment basis. This is an excellent concept that has resulted from years of 

experience realizing that the best way to secure your facility is to only allow those 

on the terminal that have immediate business needs. They then realized that to 

allow trucker’s unlimited carte blanche’’ access to all areas of the facilities was a 

dramatic error as it compounded the problems of security and congestion. What followed was the establishment of secure ‘holding’’ for cargo retrieval. 

Utilization of Existing Security Personnel 

Minimum manning standards and uniform, training procedures must he adopted 

for the existing professional security personnel to meet the growing security needs 

of our ports. 

The above outlined points are a collection of the most critical procedures that 

must take place if we are to safeguard our American seaports. We have worked 

within these ports every day for many years and our experience enables us the opportunity to share with you, the Committee, some of the protocols and procedures 

in a marine environment. 

I appreciate the opportunity to submit comments for the record on behalf of the 

International Longshore and Warehouse Union and I am prepared to answer any 

questions from Committee members. I look forward to the opportunity to work with 

you as we solve the problems of reviewing security issues so that commerce within 

our nation’s seaports may continue uninterrupted in a manner prosperous, safe, and 

secure for many years to come.

Senator WYDEN. That’s just the story of my life. Gets right to the 

point. Let me ask you what really just leaps out at me. All of you 

have suggestions and that was why I wanted to followup on Mr. 

Holte’s point on unsealed containers. Mr. Townley has some proposals with respect to how we get additional resources. Our business community has made a number of very good suggestions in 

my view from Nike and the trade community and the various 

broker groups to streamline the bill. And I just wonder what’s 

being done here to have more of a working partnership between all 

of you that are at this table? 

I know, I’m not going to put anybody on the spot here. I know 

there are not a lot of ongoing meetings between business and labor 

on these kinds of discussions. I think that’s got to change. I think 

we’ve got to have more of a partnership, a day-to-day ongoing partnership with respect to the people at this table. PNITA does terrific 

work. I’ve worked with PNITA all through my years in Congress. 

I think you’ve got to have labor people more involved in these kinds 

of discussions, because if we’re going to get it right—we have security provisions that are important, people in the community and 

we’re not putting business through bureaucratic water torture, and 

needless red tape—we’ve got to have you all talking. We’ve got to 

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have people like yourselves leading discussions like this, walking 

out there and saying, Let’s get together for coffee next Tuesday at 

nine o’clock. Let’s followup on the things that Gordon Smith and 

Ron Wyden talked about and let’s give them some suggestions. 

They’re on a conference committee that’s dealing with these 

kinds of issues. As far as I can tell the point that Mr. Holte is talking about that I got you all to agree on, is that everybody agrees 

we’ve got to do something about seals. The debate is over how you 

do it. And it seems to me that the labor people are volunteering 

to play a bigger role. I mean they’re showing that they want to be 

constructive and work with business in this area, and I think we 

need business people to pick up on this. 

So tell me, if you would, what can we do to have a better partnership between all of you at this table to better attack some of 

these concerns that all of you here quite acknowledge are out there. 

Mr. Holte. 

Mr. HOLTE. I just want to say one thing about what you just 

said. We already have people on the docks. We have marine clerks 

and longshoremen that are willing, they’re already there, to check 

the seals and to look at the cans. This is on the record. I want you 

to know that. We have got people already on the dock ready to do 

it. 

Ms. IVERSON-SUMMER. Senator, we have been in dialog. We have 

been in dialog with PNITA people, with Customs. After 9/11 we 

met and said what can we do to help this situation? We have been 

more than willing to invite you, to engage you in conversation as 

well as with the port. The Portland community, the international 

trade community, is a tight knit group. They’re very willing to 

work together. Federal agencies and people in our industry are 

open with ideas and very willing to listen to us. We’ve got the 

forum so we can do it right here. 

Senator WYDEN. I want to hear a report of those kinds of discussions, OK? I feel very strongly about this subject. I mean I think 

you know so much is coming up with home grown solutions, and 

we need to have people having these discussions, for example, 

about who can do what with respect to the problem of unsealed 

containers. I think it’s clear it’s serious and none of you suggests 

otherwise; but it means people are going to have to start working 

with some folks that probably over the years they have said, ‘‘Oh, 

those people are just on the other side; there’s no possible way we 

can find common ground.’’

And I just don’t buy that. The times are too serious to just say 

we’re going to stick with our position paper and you can read it at 

committee and Congress. And in the last 5 years we’ve got some 

people to set aside their position paper and try some new things. 

Other ideas? 

Mr. ISBELL. Senator, there’s a lot of containers that move, and 

when you talk about unsealed containers, we also talked about 

sealed containers and a seal can be jeopardized on that container. 

Nike has invested over $50,000 a year in Jakarta alone to put different types of locking seals on containers. One of those things that 

is of a major concern for us is this 24-hour pre-notification. It does 

leave containers on docks in countries that are less sophisticated 

than the U.S. in terms of the security of those containers. 

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In fact I was in Jakarta a week ago, and the day I left, one of 

our containers, even though it was supposedly double stacked with 

doors facing end-to-end the container was broken into. Did thieves 

use container information provided to port officials? Fortunately 

our container seal type lock on that container identified that that 

container had been opened and a couple of cartons of Nike shoes 

had been taken out. Staging containers at foreign ports is the other 

problem with the 24-hour pre-notification process. 

We think the current system works today. Yes, we can invite the 

longshoremen as a vehicle today until the technology can arrive to 

maybe suggest that they take the electronic information from the 

data that is provided to them on the manifest with the seal number 

and develop maybe a good effective game plan that increases—

doesn’t jeopardize productivity on the port, but yet allows that seal 

number to be validated against the documentation. Because a container can be opened at a foreign port, a new seal can be put on 

that container but that seal number doesn’t register. The technology that we need, Senator, is intelligent seals that can be passively read with technology as the container moves via a truck, via 

a rail car at 40 miles an hour, 50 miles an hour. Whatever the 

speed it could be read and could be validated that that container 

seal has not been tampered with. 

Senator WYDEN. Mr. Isbell, not only do I agree with your point, 

I’m going to followup and our staff is going to talk to the marine 

people and see if there’s somebody already working on this. Because, again, this is how we’re going to, you know, build this, the 

value added part of that last answer, because part as you know—

it’s something you talked about in your testimony and it is something I agree with—the value added part of that last answer is you 

want to reach out to the longshore people and everybody else that 

you can find to work on an issue that we know is indisputably critical; and that’s technology. 

And to be on this side of the dais, constructing the partnership, 

we’re going to try to get you together with some of the people at 

RAINS, which is taking a leading role in cybersecurity, and see if 

you can find someone who’s working on these intelligent seals as 

you call them and make sure that we’ve got all hands on deck in 

terms of providing a working solution. 

Mr. ISBELL. We would be very welcome to do that. Protection of 

our cargo is just as important as, you know, protection against 

harmful acts to the container. 

Senator WYDEN. Mr. Townley, who are you talking to in terms 

of this idea you have for trying to get extra revenue? Something 

your group likes? Are you out talking to labor or PNITA or somebody else to show that you’re building a coalition? 

Mr. TOWNLEY. Yes, Senator. The discussions so far have involved 

the federal agencies I mentioned in my talk, the presentation this 

morning, as well as most of the ports up and down the river and 

including Coos Bay. 

Senator WYDEN. Ever talk to Mr. Holte about it? 

Mr. TOWNLEY. I haven’t talked to Mr. Holte yet, and there’s a 

couple reasons for that mostly to do with negotiations with BMA 

and the ILWU. I want to make two points that I think are important for all of us in the room to be aware of, Senator. One is that 

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CPR, the Columbia River Port Rejuvenation, one of its top goals is 

to find, and has been from the day they were formed, is to find new 

channels with the ILWU and ways of sustaining continuous communication with them. That’s No. 1. 

Point No. 2, sir, the Regional Maritime Security Coalition that 

we’re talking about, the concept itself involves getting everyone involved in the system thinking in terms of security with respect to 

every single task they perform in moving cargo. That means more 

than just making pilots on the ship or stevedores on the docks additional eyes and ears for our Federal agencies. It involves keeping 

them intimately involved in planning and procedures and all the 

processes that we put together as equal partners. And it’s employing their talents, their knowledge and their skills on a continuous 

basis. That’s the challenge of the concept that we’re trying to improve. 

Senator WYDEN. Anything you’d like to add, Ms. Isbell? 

Ms. ISBELL. I’d like to just say that I think PNITA might be a 

very good vehicle to start this kind of dialog because we’re neutral, 

we’re non-partisan. We have a lot of different kinds of members. 

We’re already talking to the brokers association here in Portland 

as well as in Los Angeles, and it might be a real good way to be 

the host organization. We have a transportation committee that is 

active in many different issues right now. So I would invite that 

as a vehicle. 

Senator WYDEN. I’d love to see you do that. I think, you know, 

I’ve talked with you all on the channel deepening project over the 

years about getting the environmental people, the downriver ports 

and the labor people into it, and I think you’re ideally positioned 

to play a bigger role in terms of trying to address some of these 

regional issues. And certainly today we’re working on Port Security. But much of what you can build in these partnerships would 

be useful on other issues as well in terms of deepening the channel 

and other kinds of concerns. 

In a sense you’re the ideal panel to wrap up with. I think we 

have prided ourselves in the Pacific Northwest. We’re a long way 

from Washington, DC and much of what we have been able to contribute is that we get people like yourselves together and we come 

up with home grown creative ideas that work for us. And then people around the country say, Look what they’re doing in Oregon 

again. Here they are leading the country. And I think there’s a 

chance to do this on Port Security kinds of questions. 

You’ve been terrific to stay with us here I guess well over 3 

hours, and I’m going to followup on this. The business people 

please note I feel very strongly about the points that you have 

made, and I’m committed to making sure that we see that through 

the prism of what it’s like for somebody who is a small business 

person and the cargo comes in from Los Angeles or somewhere and 

then makes its way, you know, to Oregon. And we’ve got to make 

these procedures and processes work to use our labor folks. A special thanks to you for being willing to be out front on security 

issues. Your people talked about it yesterday. You obviously were 

well briefed on it. 

Mr. Holte, we thank you. Mr. Townley, you always represent 

your people well. Many creative kinds of ideas. 

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Is there anything that you all would like to add further? If not, 

the Subcommittee is adjourned. 

[Whereupon, the hearing adjourned at 1:20 p.m.]

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