K

- Sea Transportation Inc.

One Tower Center Boulevard

, 17th Floor

East Brunswick, NJ 08816

- 1145 ISM CERTIFIED

732

- 339

- 6100 ∙ fax 732

- 339

- 6140 December 4 , 2009

Docket Management Facility (M

- 30)
U.S. Department of Transportation
West Building Ground Floor

Room W12

- 140 1200 New Jersey Ave. SE
Washington, DC 20590

- 0001

Docket Number: USCG 200 1

- 10 486

Subject: Regulated Standards for Living Organisms Discharged in Ship’s Ballast Water Discharged

in U.S. Waters

Gentlemen:

K

- Sea Transportation Inc

. , headquartered in East Brunswick, New Jersey, is a leading provider of

marin e transportation, distribution and logistics services in the U.S. From locations in New York, Philadelphia, Norfolk, Seattle and Honolulu, K

- Sea operates a large fleet of tugs and tank barges that serves a wide range of customers, including major oil compa nies, oil traders and refiners in both domestic

and international service

. Our operations include nearly 100 vessels that carry and manage some form of ballast water discharge

.

General Comments

K

- Sea Transportation recognizes the efforts of the U.S. Coast Guard to implement the intent of the NISA. Although we support the effort to stop invasive species from entering our waters, we believe this rule has numerous significantly flawed requirements which will be impossible to imp lement on our tugs and barges , and lead to severe impacts within our domestic waterborne transportation system

. The current framework and rules for ballast water management in U.S. waters has been allowed to become a virtual maze of State and Federal requi rements that are nearly impossible for the average tug and barge company, as well as its vessel s and officers, to comply with. Without imposing preemption for Federal rules, regulation of ballast water has created the potential, if not the reality, to r es trict trade and severely impact the economies of nearly every State which relies on waterborne com merce.

We believe that it is critical that the U.S. Coast Guard demonstrate strong leadership and exercise its authority by establishing national ballast wate r regulations that preempt State regulation.

NPRM Assumptions and Conclusions

We do not believe that you have accounted for all the vessels which may be impacted by this regulation. Nearly all towing vessels of any size and configuration utilize ballast water to maintain towing trim and stability as fuel is consumed. As it is comm on knowledge that the MISLE database used by the USCG to collect this data contains numerous errors, and is missing much information about individual uninspected towing vessels, the USCG may be better served to utilize another source, such as the EPA VGP

d atabase, to acquire this information. This database would include every U.S. flag vessel that carries more than 2,115 gallons of ballast. The regulatory analysis also assumes that the proposed requirements would only affect vessels with the capacity to ca rry large volumes of ballast water (450,000 gallons and up) and flow rates of 1,100 gallons per minute or more. In fact, the proposed rule would affect vessels with much smaller capacity and much lower flow rates. A typical inland towboat has 20,000

- 40,0 00 gallons of ballast water capacity; a typical coastal tug has 20,000

- 70,000 gallons. A small harbor tug might have a capacity of 2,000

- 3,000 gallons. While barges, especially oceangoing barges, have larger ballast capacities, the ballast capacity of man y barges is still a fraction of that assumed in the regulatoryK

- Sea Transportation Inc.

Subject: Regulated Standards for Living Organisms Discharged in Ship’s Ballast Water Discharged

in U.S. Waters Page 2

analysis. Flow rates for barges and towing vessels discharging ballast water are also considerably less than those of other commercial vessels, ranging from 20 to 250 gallons per minute.

The NP RM concludes that the only substantial cost associated with a ballast water treatment system that a company will incur is procurement and installation. This is a n erroneous assumption based on the fact that ballast water treatment is still a virtually unk nown technology and there are no systems even commercially available that are suitable for installation in a typical towing vessel. The most common

similar devices onboard towing vessels that we utilize are water makers. We utilize these devices to

make fresh potable water from sea water for vessels operating away from sources of potable water. We commonly see operating costs of at least 10% of the acquisition cost per year after installation. And this

is for a water treatment device that handles a tiny fraction of what would be expected of a ballast water treatment system over the same period of time.

The NPRM cost assumptions , based on the number of vessels and cost data you have provided, appear to make the assumption that the average cost of procuring and installing a ballast water treatment system will be approximately $ 450,000 with an average annual maintenance cost of $ 203

. This is an inherently flawed assumption.

First, since treatme nt systems are not commercially available, there is no idea what these systems will cost. During the initial stages of introducing these devices to the market, the manufacturers, in order to recover their research and development costs, can expect to incr ease the wholesale cost of the system by a factor of at least 200%.

Second, as the U.S. shipyard industry is being driven into extinction by various regulatory and

environmental forces

, there are fewer and fewer vendors and location s in which to perform th is work

which

, not surprising ly, drives the cost higher and higher. This does not even take into account the fact

that most of the U.S. towing vessel fleet will not be able to accommodate an y installation of a ballast treatment system without major struct ura l modifications, if it can be accomplished at all. Your comment in the NPRM that owners, in order to deal with a lack of available shipyard space, will simply have to

“ schedule the installations well in advance of the compliance dates ” , is a staggering demonstration of how disconnected from the marine industry the USCG is on this subject

. Aside from the fact that the treatment systems do not even yet exist, this comment has no basis in understanding the variables of our economy

and the customers that o ur industry serves. You need only look at the precarious state of our economic situation today to see that there is no one in government or industry able to predict the future, and know what our service requirements might be more than a few months to a ye ar into the future.

And third, the average annual operating cost has no basis in fact, as there is no machinery system on a typical vessel that can b e operated for $200 per year. Just b uying filters for a typical potable water system will cost you at leas t $750 per year.

As our vessels are on a 2 1⁄2 year drydocking schedule as required by Class and USCG, t he implementation schedule proposed in the NPRM would require that we install a system on approximately

100 vessel s in our fleet over a period of 2 1⁄2 years from 2016 through 2019. Even using your owned

flawed estimate that we can procure and install a system for $450,000 per vessel , this means that our capital expenditures, not including interest or maintenance over a 2 1⁄2 year period would be approximately $45,000,000 . I think it is reasonable to conclude that implementation of a rule that looks anything like this NPRM will effectively bankrupt most of the U.S. towing vessel fleet.

Of particular concern is the NPRM’s suggestion that a two

- tiered approach will be used, and implement a second, higher standard for ballast water discharge within 5 years after implementation of the initial standard. So even if the vessel owner is able to make the investment in a system, within 5 years it will be obsolete and require retrofitting to meet another higher standard for w hich no suitable technology even

exists.

Without an accurate understanding of the affected vessel population and its characteristics, the Coast Guard cannot make a defensible assessment of the scientific basis for, cost and cost

- benefit of, and

technical a nd operational feasibility of requiring ballast water treatment systems on a particular class of vessels. In fact, there is considerable evidence, or in some cases lack of evidence, to argue against theK

- Sea Transportation Inc.

Subject: Regulated Standards for Living Organisms Discharged in Ship’s Ballast Water Discharged

in U.S. Waters Page 3

application of ballast water treatment requirements to towing vessels and barges in the U.S. domestic

trade.

First, the DPEIS provides no evidence to suggest that ballast water discharged by towing vessels or barges operating exclusively on the inland river system, or within the same coastal ecosystem, has contributed to the introduction or spread of invasive species in U.S. waters. When the Coast Guard instituted nationwide ballast water reporting requirements in 2004, the agency told industry that one of the principal purposes of collecting this data was to map vessel movements and ballast water discharge patterns against invasive species flows. Industry was told that the Coast Guard would use this

information to determine where ballast water discharges had contributed to the introduction or spread of invasive species and thus, where and on which classes of vessels ballast water treatment requirements would be justified. While the National Ballast Water Information Clearinghouse (NBIC) contai ns a wealth of data submitted by vessel owners over the past five years, we are aware of no effort by the Coast Guard to analyze the data to see what it suggests about the role of vessels, and particularly domestic towing vessels, in the introduction and s pread of invasive species. We note, as well, that the National Invasive Species Act exempts from ballast water management requirements crude oil tankers in the U.S. coastwise trade, presumably because they pose no risk of introducing invasive species into U.S. waters. It would be patently unfair to subject domestic towing vessels and barges with much smaller volumes of ballast water capacity to a different standard.

Recommendations

Exempt from these regulations all towing vessels and barges in the U.S. do mestic

trade;

Within the crude oil tanker exemption, include barges engaged in the coastwise transport of petroleum products;

Eliminate the two

- tier standard or, alternatively, provide that a vessel installing a treatment system that complies with the Phas e I standard will not be required to replace that system if and when a Phase II standard is implemented; and,

Conduct a robust and comprehensive practicability review prior to requiring ballast water treatment systems on any class of vessels.

If the Coast Guard is still intent on imposing these regulations on commercial vessels, then to get a real flavor for their impacts, they should be imposed on ALL vessels in service, including public vessels and warships. It is untenable and completely unreasonable th at the Coast Guard should be concerned about imposing these onerous regulations on small towing vessels and barges , while exempting TAPS trade crude oil tankers and large ferries, aircraft carriers, and MSC containerships.

Sincerely,

Capt. Dan Nutt Director, Regulatory Affairs

K

- Sea Transportation Inc.

Cc: Jennifer Carpenter , American Waterways Operators