Coast Guard: Most Training Providers Expect to Implement Revised International Maritime Standards by the Deadline Despite Challenges
Published: 2017-01-31T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Merchant mariners operate U.S. commercial ships and support national defense in emergency and war. Coast Guard issues regulations and policies to ensure merchant mariners are credentialed and meet minimum international standards. To incorporate changes made to the international STCW Convention in 2010, Coast Guard issued regulations in December 2013 that training providers must implement by January 1, 2017, to ensure mariners meet the revised requirements. These changes are intended to help reduce the risk of accidents in U.S. and international waters.
GAO was asked to review Coast Guard and training providers' implementation of the revised STCW requirements. This report addresses (1) the extent to which Coast Guard provided sufficient guidance to training providers about the revised STCW requirements; (2) the progress training providers report in implementing the revised STCW requirements; and challenges reported in doing so; and, (3) the extent to which Coast Guard evaluated costs and benefits of the revised STCW requirements, and impacts training providers report about the costs and benefits of implementing the revised requirements. GAO conducted a web-based survey from March 2016 to June 2016 of all 167 Coast Guard-approved STCW training providers. Eighty-one percent responded, although response rates varied for individual questions. GAO also reviewed Coast Guard's guidance and reports and interviewed officials.
GAO is not making recommendations.
section_title: What GAO Found
paragraphs: Most training providers (80 percent) who responded to GAO's survey reported that they were satisfied with guidance the U.S. Coast Guard (Coast Guard) provided to assist them in implementing the revised International Convention on Standards of Training, Certification and Watchkeeping for Seafarers (STCW) requirements. However, 58 percent of respondents, including state maritime academies, private for-profit colleges, and others, reported that the lack of timely Coast Guard guidance for developing a quality assurance process—Quality Standards System (QSS)—affected their ability to implement the revised STCW requirements. A QSS is intended to ensure that training providers have a documented quality system in place to monitor training activities. Coast Guard officials said the agency plans to meet with industry stakeholders in March 2017 to discuss whether additional QSS guidance is necessary.
Most of the training providers (81 percent) who responded to GAO's survey reported that they plan to meet the January 1, 2017, deadline to implement the revised STCW requirements, but also reported some challenges in doing so. For example, over half of the respondents (54 percent) reported that interpreting the revised STCW requirements was a challenge. To address this issue, Coast Guard has ongoing outreach efforts to obtain feedback from training providers, help them interpret Coast Guard's regulations, and determine what additional guidance is needed. Almost half of the respondents (46 percent) reported that recruiting qualified course instructors was a challenge. However, Coast Guard stated that the revised requirements related to instructor's qualifications have not changed substantially; therefore, the challenge experienced with recruiting instructors may be related to specific training providers, rather than to the revised STCW requirements. Training providers not expecting to meet the deadline for implementing the revised STCW requirements (19 percent) provided various reasons, such as a lack of funding to address the requirements, needing additional Coast Guard guidance, or lacking the time to complete the required documentation.
Coast Guard evaluated the costs and benefits of the revised STCW requirements, and training providers who responded to GAO's survey reported related impacts of implementing the revised requirements. For example, Coast Guard evaluated the average costs to training providers for developing a QSS and the costs for conducting STCW audits. About half of the surveyed training providers expected their costs would be similar to Coast Guard's estimates. About one third anticipated incurring costs higher than the Coast Guard's average estimate due to needing more time for administrative tasks than Coast Guard allowed or purchasing additional training equipment. Coast Guard officials said they estimated average costs, and therefore did not consider specific items that particular training providers may need. Over half of training providers agreed with Coast Guard's assessment of potential benefits from the revised STCW requirements, such as increased vessel safety, with most of the remaining providers expecting no effect from the STCW changes.

section_title: Letter
paragraphs: The U.S. merchant marine—the commercial ships of the United States  and the mariners who operate them—is a critical component of the U.S.  freight transportation sector and contributes billions of dollars to the  country’s national output. The merchant marine also supports national  defense by providing ships and mariners to the U.S. military in times of  national emergency and war. Proper education and training of mariners is  important to the success of the merchant marine.
The U.S. Coast Guard (Coast Guard) within the Department of Homeland  Security (DHS) is charged with issuing regulations and policies related to  merchant mariner credentialing and licensing—including ensuring those  who are credentialed meet the minimum international standards  established by International Maritime Organization’s (IMO) conventions.  To incorporate the 2010 amendments to the IMO’s Standards of Training,  Certification and Watchkeeping for Seafarers (STCW) Convention, Coast  Guard issued a final rule on December 24, 2013 (referred to as the  STCW final rule). To be consistent with the international standards, the  revised STCW requirements must be fully implemented by January 1,  2017. In general, the revised STCW implementation process consists of  activities such as ensuring that instructors obtain additional training,  providers update the training curriculum to reflect the revised STCW  requirements, and providers develop a quality assurance policy, among  other things. About 60,000 U.S. mariners, 316 owners and operators of  1,044 U.S. flag vessels, and 167 STCW maritime training providers will  be affected by the revised STCW requirements. The maritime training  providers affected include one federal academy, six state maritime  academies, and 160 non-academy training providers that offer Coast  Guard-approved maritime courses.
Implementation and enforcement of the STCW requirements is intended  to reduce the risk of human errors onboard ships that could potentially  lead to accidents in U.S. and international waters. Over 90 percent of  ships visiting U.S. waters are foreign-flag vessels carrying multinational  crews that are subject to STCW. The STCW final rule is intended to  strengthen U.S. authority to enforce the STCW convention and code  against foreign-flag vessels in U.S. waters. Similarly, Coast Guard  officials noted that it is important that all U.S. flagged seagoing vessels  visiting foreign ports employ only mariners who are fully compliant with  the STCW requirements because doing so prevents U.S. flagged vessels  from being detained while docked in foreign ports.
In 2014, we reviewed the availability of maritime training, the availability  of financial assistance for maritime training, and Maritime Administration  (MARAD) actions to ensure mariners meet commerce and defense needs  and industry stakeholder views on those actions. We found that the costs  associated with required maritime training—whether borne by the  mariners or by entities such as federal agencies—vary depending on the  type of training and the training provider. For example, at that time  several stakeholders estimated that the cost of Coast Guard-required  entry-level mariner training—including basic safety training and other up- front costs for required physical exams and drug tests—ranged from  about $1,500 to $3,000. In another example, a large private-training  provider reported that one week of training—mostly designed for current  mariners seeking to advance their careers or keep up with training  requirements—cost about $1,300 per mariner. Based on our 2014  analysis, we found that for prospective mariners enrolled in their first year  at state maritime academies, tuition, fees, and room and board costs for  an in-state mariner could be as high as $29,000 or as low as $19,000 per  year, depending on the academy.
Maritime training providers have raised questions in testimony to  Congress and in comments to the proposed STCW rule regarding the  guidance Coast Guard has provided to them and the cost of implementing  the new STCW requirements. You asked us to review the guidance  Coast Guard issued that is intended to assist training providers with  addressing the revised STCW requirements as well as the providers’  progress in implementing the revised requirements. In this report, we  address the following questions:  1.  To what extent has Coast Guard provided sufficient guidance to  training providers about addressing the revised STCW requirements?  2.  What progress do training providers report in implementing the  revised STCW requirements, and what challenges, if any, have they  reported in doing so?  3.  To what extent has Coast Guard evaluated the costs and benefits of  the revised STCW requirements, and what impact, if any, do training  providers report regarding the costs and benefits of implementing the  requirements?
To address our three objectives, we conducted a web-based survey— from March 21, 2016, to June 10, 2016—of the universe of 167 Coast  Guard-approved maritime training providers to obtain their perspectives  on Coast Guard’s guidance, their progress implementing the revised  STCW requirements, and any costs and benefits of the new  requirements. Our survey response rate was 81 percent, with 136  respondents answering the survey. Of the 136 who responded, 10  indicated that they did not teach any STCW-related courses; as a result,  these providers were excluded from our analysis leaving 126 respondents  for consideration. Not every survey respondent answered every  question, so the survey response rate varies by question.
We interviewed selected STCW training providers, specifically the federal  and six state maritime academies, two private providers, and Coast  Guard officials responsible for maritime training. We visited two of the  state academies Coast Guard recently audited for insight on Coast  Guard’s assessment of their progress in implementing STCW revisions.  We also visited the two private training providers, selected based on  proximity to the maritime academies we visited. While our survey  represents the entire population of STCW training providers who  responded, our interviews with training providers are not generalizable,  but are used to elaborate on some of the areas discussed in the survey.
To determine the extent to which Coast Guard has provided sufficient  guidance to the training providers about addressing the revised STCW  requirements, we analyzed the training providers’ assessments of  sufficiency in their survey responses regarding Coast Guard guidance.  We also analyzed Coast Guard and MARAD documents, including  applicable Coast Guard training and audit guidance and reports,  correspondence with training providers, and Coast Guard’s STCW final  rule. Additionally, we reviewed Coast Guard’s applicable Navigation and  Vessel Inspection Circulars (NVIC), which Coast Guard provided as  guidance to assist training providers with implementing the STCW  requirements. During our interviews with selected training providers we  discussed their experiences with Coast Guard guidance for implementing  the revised STCW requirements. We also discussed Coast Guard’s audit  recommendations to the maritime academies with Coast Guard officials to  confirm our understanding of the recommendations as well as the survey  responses from training providers regarding STCW guidance and  obtained Coast Guard’s plans for any future guidance.
To describe what progress training providers have reported and any  challenges in implementing Coast Guard’s regulations for addressing the  revised STCW requirements, we analyzed related survey responses  regarding progress and challenges. We also analyzed Coast Guard’s  findings from its recent audits of the federal and state maritime  academies to determine the Coast Guard’s assessment of maritime  academies’ progress in implementing the revised STCW requirements.  We also interviewed Coast Guard officials to obtain their perspectives on  training providers’ progress and challenges—including the extent to which  the agencies are addressing any challenges reported by the training  providers in our survey. We also discussed STCW implementation  progress and challenges during our interviews with selected training  providers.
To determine the extent to which Coast Guard has evaluated the costs  and benefits of implementing its regulations for addressing the revised  STCW requirements, we analyzed relevant documentation such as Coast  Guard’s regulatory impact analysis and comments from training providers  and other stakeholders on the proposed rule and reviewed the STCW  final rule. We also interviewed Coast Guard officials to determine whether  the STCW final rule includes key elements for assessing costs and  benefits in federal rulemaking. We analyzed cost and benefit results  from our survey and discussed those issues and their impact in our  interviews with selected training providers. For a more detailed discussion  on our scope and methodology, see appendix I.
We conducted this performance audit from September 2015 to January  2017, in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: Coast Guard is the federal agency responsible for oversight of U.S.  merchant marine credentialing and licensing. As part of these  responsibilities, Coast Guard develops credentialing regulations based on  statutory requirements and international treaties developed under the  auspices of the IMO, to which the United States is a party. Coast Guard  also drafts policies to clarify implementation of its regulations for training  providers and mariners. Coast Guard issues guidance for complying with  its regulations, including STCW requirements, through the publication of  NVICs. Coast Guard implements the requirements for the issuance of  merchant mariner credentials. Finally, Coast Guard also is to coordinate  with its maritime training stakeholders to monitor U.S. efforts to implement  the STCW convention.
The United States, through Coast Guard, implements provisions of the  STCW convention through regulations. A timeline of IMO’s major  amendments to the STCW requirements since 1978 and Coast Guard’s  actions to implement the changes are presented in figure 1.
subsections: section_title: Composition of STCW Training Provider Survey Respondents
paragraphs: As of March 2016, approximately 167 training providers were approved  by Coast Guard to administer courses related to implementation of the  revised STCW requirements. Out of the 81 percent of survey respondents  (136 responses), 10 indicated they were not teaching STCW courses  resulting in a survey sample of 126 STCW training providers. Not every  survey respondent answered every question. As a result, response rate  varied by question. Figure 2 shows the number of respondents and the  types of organizations that participated in our survey.
section_title: Training and Certification Requirements for U.S. Mariners
paragraphs: Training requirements for U.S. mariners vary depending on  circumstances—such as the mariner’s role on the vessel, the area of  operation, and the size of the vessel—but mariners are primarily subject  to three types of training requirements:  training required for commercial operations in both oceangoing and  domestic waterways (see figure 3 for a map of these waterways); military-specific training required of civilian mariners who sail aboard  government-owned vessels or vessels on charter to the Department  of Defense; and maritime company-specific training requirements.
Mariners may be certified for service in domestic waters only, but a  STCW certification is required for international or oceangoing service.  Under Coast Guard’s regulations, mariners can meet the training  requirements for certification through a combination of experience,  training with evaluation through professional examination, or a practical  demonstration of skills. Figure 3 identifies the areas of operation for  domestic and international certification.
The STCW certification process is intended to ensure that the training a  mariner receives, and the assessment of a mariner’s skills after the  training is completed, supports the goal of placing qualified mariners on- board merchant vessels.
section_title: Training Provider Course and Program Approval and Audit Requirements
paragraphs: The Coast Guard’s National Maritime Center (NMC) approves all training  providers that offer mariner training courses and programs, including  programs at the federal and state maritime academies. NMC is also  responsible for oversight of Coast Guard approved maritime training  programs to ensure that maritime training providers offering Coast Guard  approved training are performing their duties in a manner that meets all  regulatory and policy standards. Figure 4 provides an overview of Coast  Guard’s maritime training course approval request process—application  to issuance.
Coast Guard approves maritime training courses and is to audit training  provider compliance with STCW requirements every 5 years. Coast  Guard also requires providers to conduct an internal audit in the interim  every 2 and a half years. According to Coast Guard officials, in 2013, the  federal and state maritime academies received approval of their training  programs for compliance with the 2010 STCW amendments. The officials  added that Coast Guard is currently in the process of the first audit cycle  subsequent to those approvals—the federal and five state maritime  academies had been audited by Coast Guard as of November 2016.
section_title: STCW Training Providers We Surveyed Reported Satisfaction with Coast Guard Guidance, but Reported Delay in Quality Assurance Guidance May Affect STCW Implementation
subsections: section_title: Coast Guard Has Provided Guidance to Training Providers Through Outreach Activities and Guidance Documents
paragraphs: Coast Guard has provided guidance to training providers to implement  the revised STCW requirements generally in two ways. First, Coast  Guard conducted various outreach activities, including:
Publishing online resources such as webinars and a frequently asked  questions page. For example, prior to issuing the STCW final rule,  Coast Guard convened an STCW Policy Advisory Council to solicit  questions from the maritime industry regarding the revised STCW  requirements, and Coast Guard used this feedback to develop the  frequently asked questions page.
Managing a call center that is available to training providers and  mariners to answer questions about the revised STCW requirements,  among other things.
Holding advisory committee and maritime stakeholder meetings. For  example, the Merchant Marine Personnel Advisory Committee  (MERPAC) consists of about 19 members with expertise across the  maritime industry and advises the Secretary of Homeland Security  regarding merchant mariner credentialing issues, among other  things. MERPAC is required to hold public meetings at least twice  per year, and Coast Guard has used MERPAC meetings as a forum  for discussing the revised STCW requirements. The Maritime  Academy Council (MAC) consists of senior administrators from state  maritime academies, and Coast Guard has used MAC meetings to  discuss the revised STCW requirements, among other things. Coast  Guard officials said that MERPAC and MAC are collaborative  mechanisms used to provide stakeholders with an opportunity to  provide recommendations to Coast Guard. The officials also reported  that Coast Guard invited all of the STCW training providers to two  public meetings in 2011 to provide details and answer questions on  the revised STCW requirements.
Second, Coast Guard has issued guidance documents intended to aid  training providers as they implement the revised STCW requirements.  Guidance documents include material on how to prepare for Coast Guard  audits, a bridging plan for maritime academies to update their curriculum  based on the revised STCW requirements, and 24 NVICs that provide  clarification on the compliance with and enforcement of regulations.  Coast Guard also provided guidance on qualifying for specific training- related STCW endorsements. For example, one NVIC provides  guidance for the approval of training courses and programs. According  to Coast Guard officials, the NVICs were generally prepared in  consultation with the maritime stakeholders through MERPAC.
section_title: Most Survey Respondents Were Satisfied With Coast Guard Guidance, but Over Half Reported that Delay in Quality Assurance Guidance May Affect STCW Implementation
paragraphs: Most training providers who responded to our survey reported that they  were satisfied with Coast Guard’s coordination and guidance efforts  overall (91 of 114 respondents or 80 percent). For example,
21 of the 26 survey respondents that reported participating in Coast  Guard’s webinars were satisfied (81 percent).
57 of the 65 survey respondents that reported contacting Coast  Guard’s call center to obtain information or clarification of the revised  STCW requirements were satisfied (88 percent).
29 of the 32 survey respondents that reported attending MERPAC or  other advisory committee meetings to obtain information on the  revised STCW requirements were satisfied (91 percent).
In addition, most survey respondents reported that the Coast Guard’s 24  NVICs pertaining to the revised STCW requirements provided sufficient  guidance and were issued in a timely manner. However, three of the six  state maritime academy cadet programs (50 percent) reported being “not  at all satisfied” with Coast Guard’s coordination on the implementation of  the revised STCW requirements. Officials from the three state maritime  academies generally attributed their dissatisfaction to the unique  challenges they face as 4-year degree granting institutions, and reported  that they would benefit from additional guidance regarding approval of  their 4-year curriculum. Coast Guard officials stated that coordination with  maritime academies has been extensive and that they have consulted  with and sought input from both the maritime academies and industry,  including during the negotiation of the 2010 amendments to the STCW  Convention and through MERPAC meetings. In addition, Coast Guard  officials said they met with the training institutions, including the maritime  academies, to help implement the revised requirements and that they  continue to provide assistance to all training institutions. Coast Guard  officials also reported plans to issue additional guidance to state maritime  academies.
For more details regarding survey respondents’ perspectives on the  sufficiency of guidance and timeliness of the NVICs issued, see  appendixes II and III.
Although most survey respondents reported that they were satisfied with  Coast Guard’s coordination efforts overall, most training providers also  reported that they would have benefited from a more timely update of  guidance on developing the required Quality Standards System (QSS).  For example, most of the training providers who responded to our survey  (58 percent) reported that their ability to implement the revised STCW  requirements was affected by a lack of timely guidance from Coast Guard  on developing the QSS. The STCW final rule requires organizations  offering training required by the STCW to be monitored by a QSS.
In 2014, Coast Guard reported plans to issue or update 26 NVICs  pertaining to the revised STCW requirements. These plans included a  QSS NVIC to clarify and guide training providers on how to appropriately  develop a QSS. However, since Coast Guard has not developed its QSS  guidance, the agency has directed training providers to the STCW final  rule, which lists essential elements to be included in a comprehensive  QSS. Because Coast Guard has not developed QSS guidance, training  providers reported delays in updating their training programs to meet the  revised STCW requirements. For example, training providers submitted  comments to Coast Guard during the proposed rulemaking noting  concerns that the QSS requirements were vague and duplicated other  quality assurance practices that training providers currently had in place.  One training provider who responded to our survey reported that  additional guidance was needed to ensure compliance with significant  changes to QSS record keeping requirements. Other training providers  reported that they would have benefited from seeing an example of a  completed QSS, as well as clarification of specific aspects of the QSS  requirements.
Coast Guard audits also indicate a need for additional QSS guidance. As  of November 2016, four of the five audit reports for federal and state  maritime academies, conducted from March 2015 to April 2016,  contained recommendations or deficiencies related to QSS  implementation—further highlighting the need for guidance to help  training providers develop and implement a QSS. Coast Guard also  acknowledged in these audit reports that it needed to issue updated QSS  guidance as soon as possible to ensure that training providers can  implement their QSS by the deadline.
However, in November 2016, Coast Guard officials said that the situation  may have changed since the time of our June 2016 survey, as the Coast  Guard learned during the September MERPAC meeting that many  training providers have successfully implemented QSS or expect to do so  by the January 1, 2017 deadline. As a result, the Coast Guard plans to  meet with MERPAC representatives in March 2017 to discuss whether  guidance on developing the required QSS is necessary.
section_title: Training Providers We Surveyed Generally Reported They Will Meet the STCW Implementation Deadline Despite Implementation Challenges Most Survey Respondents Reported They Will Meet the STCW Implementation Deadline
paragraphs: Most of the training providers who responded to our survey reported that  as of June 2016, they expect to meet the overall January 1, 2017,  deadline for implementing the revised STCW requirements (81 percent).  In general, the revised STCW implementation process consists of  activities such as ensuring that instructors obtain additional training,  providers update the training curriculum to reflect the revised STCW  requirements, and providers develop a QSS, among other things. In all  three categories, over half of the respondents reported that they will meet  the implementation deadline for these activities. For example,
66 percent of respondents reported their instructors were fully trained  as of June 2016, while 92 percent reported they will ensure that  current instructors obtain the additional training required by the  implementation deadline.
49 percent of respondents reported they have met the deadline for  updating their curriculum to incorporate the revised STCW  requirements as of June 2016, while 86 percent reported that they will  have their curriculum revised by the implementation deadline.
41 percent of respondents reported they have implemented the QSS  requirement as of June 2016, while 83 percent reported that they will  meet this requirement by the implementation deadline.
Those training providers not expecting to meet the requirements reported  various reasons, including a lack of time, lack of knowledge about the  new requirements, a desire to retire, or cost. For instance, two training  providers stated that they were unaware of the revised requirements  while one respondent reported plans to retire because the requirements  are getting burdensome for the small training school.
Among the federal and state maritime academies, six of the seven  academies reported that as of June 2016, they expect to meet the overall  January 1, 2017, STCW implementation deadline. More specifically,  four of five academies who responded to our question regarding  instructor training reported that as of June 2016, the current  instructors at their institutions will obtain the additional training  required to be STCW-compliant by the deadline;  six of seven academies reported that as of June 2016, their  curriculum will be updated by the deadline; and,  six of seven academies reported that as of June 2016, their QSS will  be implemented by the deadline.
The one state academy that did not anticipate meeting the overall STCW  implementation deadline indicated that the grandfathering guidelines for  graduating cadets who may need to take additional classes to comply  with the latest changes to the STCW requirements were insufficient.  Regarding the lack of grandfathering guidelines, Coast Guard officials  said that they assisted the academies with a bridging strategy to ensure  that current and future students meet the new requirements and continue  to work closely with all maritime academies to ensure compliance.
subsections: section_title: Training Providers Cited Challenges in Addressing the Revised STCW Requirements
paragraphs: While training providers reported progress in implementing the revised  STCW requirements, they also noted various challenges in implementing  these requirements. Based on survey responses in which training  providers were asked to note—from a list of 14 possible implementation  challenges—which challenges they faced, the most frequently reported  challenges were interpreting the revised STCW requirements, recruiting  qualified instructors, developing the organization’s QSS, developing the  program’s curriculum, and mariners’ willingness to remain in the  industry. With regard to developing a QSS, Coast Guard officials noted  that since we concluded our survey in June 2016, when some training  providers reported developing a QSS as a challenge, many of the training  providers have succeeded in implementing QSS or expect to do so by the  January 1, 2017, deadline. See figure 5 for the list of 14 possible  implementation challenges and the training provider’s views on the extent  to which they considered each to be a challenge. For additional details  regarding the extent to which the respondents reported experiencing  challenges in implementing the revised STCW requirements, see  appendix IV.
Interpreting the revised STCW requirements: The most frequently  reported challenge by survey respondents was interpreting Coast Guard’s  revision of the STCW requirements with 54 percent of survey  respondents reporting this as a challenge. Six survey respondents  reported that Coast Guard’s STCW guidance intended to help training  providers interpret the revised requirements is hard to understand and  according to one provider, puts undue burden on providers to remain  compliant. Another training provider stated that the lack of “plain- language” guidance creates a challenge, especially for small schools that  might not have the resources or sophistication to understand the  language in the IMO convention or the regulation. Furthermore, of the  training providers who reported that they sought clarification on the  requirements from resources such as the Coast Guard’s call center, five  respondents reported receiving ambiguous or conflicting information, one  stated that representatives would read the guidance documents rather  than provide explanations, and another stated that the representatives  are more proficient in credentialing requirements rather than STCW  requirements. When we asked Coast Guard about these challenges,  officials responded that in addition to revising the NVICs based on  training provider feedback, they also prepared responses for individual  questions and have outreach activities planned as Coast Guard seeks to  provide clarification to the providers.
State maritime academies also reported challenges interpreting the  revised STCW requirements. For example, officials from one state  maritime academy stated that some of the revised STCW requirements  became clear after they were subjected to a Coast Guard audit.  Furthermore, other state maritime academy officials we interviewed  stated that Coast Guard’s guidance does not offer much assistance to  academies; as a result, the academies should be given separate STCW  guidance that takes into consideration the academic system in which they  operate. When asked about these challenges noted by the state maritime  academies, Coast Guard officials stated that they are determining the  type of guidance necessary to assist the state maritime academies and  plan to develop guidance for the maritime academies in the future.
Recruiting qualified instructors: Recruiting qualified instructors to teach  STCW-related courses was the next most frequently reported challenge  with 46 percent of respondents reporting it as a challenge. According to  Coast Guard guidance, requesting approval of new instructors as of  March 2014 should include documentation of the proposed instructor’s  experience, training, or evidence of the ability to use effective instructional  techniques that could include train-the-trainer certification. In their survey  responses, five training providers reported that these requirements have  decreased the supply of qualified instructors to teach STCW courses and  three reported that instructors will require higher compensation. In  addition, several of the training providers reported that qualified  instructors may be unaffordable to some providers or the increased costs  may be passed on to the mariners seeking STCW-related training.  Additionally, the supply of qualified instructors is declining, especially for  engineering instructors, according to 11 training providers. Seven  providers reported that the cost or time commitment required for potential  instructors to acquire the additional qualifications is a challenge. In  addition, one provider reported that some qualified mariners who could  potentially serve as faculty may not be interested in meeting the rigorous  STCW faculty requirements. Two other providers reported that some  qualified mariners may opt to take more competitive salaries at sea rather  than working as instructors. The Coast Guard acknowledged the effort  required for instructors to be compliant, but stated that the revised  guidance has not changed substantially regarding instructor qualification  and that instructors have always been expected to hold appropriate  credentials to teach maritime courses. In addition, the Coast Guard  officials stated that they are unable to speak to the challenge of recruiting  qualified instructors for any specific training providers.
Developing QSS: Almost half of the training providers–46 percent– reported that developing the organizations’ QSS was a challenge to  meeting the deadline. One provider reported that due to the QSS  development cost, it will not develop such a system and therefore may  lose its STCW training status. Six providers reported that they believe the  QSS requirement is an unnecessary administrative burden and expense  to the providers, especially for small providers that may stop offering  STCW courses because of the cost that may be associated with  developing a QSS, according to a maritime professional. Two survey  respondents also stated that they were reluctant to dedicate resources to  developing a QSS because it was unclear at the time of our survey what  would be required to be fully compliant. In addition, most state maritime  academy officials we interviewed reported that a QSS is redundant since  the academy’s accreditation status already ensures the quality of the  maritime training programs. With regards to cost, Coast Guard officials  stated that any cost incurred from developing a QSS is dependent on the  provider since the process requires documenting what providers do to  ensure program quality and compliance. According to Coast Guard  officials, regarding the redundancy of a QSS, the maritime academies  provided this comment during the development of the STCW final rule  and in response text was added to the regulation to enable the Coast  Guard to take accreditation body requirements into account when  assessing compliance with applicable QSS requirements. As of  November 2016, the Coast Guard is developing the policy to implement  this regulatory flexibility for the maritime academies. In addition, Coast  Guard officials stated that potential guidance may result after Coast  Guard explores how the accreditation process could be used to fulfill the  QSS requirements.
Developing curriculum: Based on our survey, 44 percent of  respondents reported that developing curriculum to meet the revised  STCW requirements is an implementation challenge. For example, three  providers reported that the curriculum development process related to  STCW requirements is arduous, vague, or expensive. Two providers  reported that having a sample curriculum related to STCW requirements  would be helpful. In addition, one provider reported that academies  needed more time to implement the STCW requirement changes within  their academic systems to accommodate the needs of the cadet. When  asked about this challenge, Coast Guard officials acknowledged there  can be costs associated with curriculum development, but noted that the  Coast Guard STCW regulation and policy guidance issued in January  2014 match the standards set by the IMO.
Willingness to stay in the industry: According to some survey  respondents, the effort required by mariners to comply with the revised  STCW requirements may result in some mariners leaving the industry.  Forty-one percent of the survey respondents reported that the willingness  of STCW-certified merchant mariners to remain employed in the industry  following the revised STCW requirements poses a challenge. In the  narrative responses, ten training providers reported that more mariners  may leave the industry or are looking for other employment options  because it is too difficult to maintain a merchant mariner credential under  the revised requirements. Training providers we interviewed also stated  that some mariners are opting to retire rather than meeting the new  requirements. Three narrative responses also noted that maintaining the  credential is expensive because of the cost of training, cost of travel to  attend training including lodging expenses, as well as the corresponding  loss of wages experienced when mariners are not at sea while they  attend training. Two survey respondents indicated that sometimes  mariners pay these costs out of pocket or some costs may be covered by  unions. When we asked about the challenge of mariner’s willingness to  stay in the industry, Coast Guard officials stated that the guidance  provides the minimum standards required of mariners and they have the  flexibility to choose the courses or programs they wish to take. Coast  Guard also acknowledged that some mariners may gravitate towards  professions that give greater flexibility to their schedule and work-life  balance.
In addition to the challenges listed in the survey, survey respondents  identified other challenges in their narrative responses, including the need  for better harmonization of the Coast Guard’s training for domestic  waterways and the STCW requirements. One provider reported that it has  to use resources to cross-check both requirements to ensure that its  program is accurate and in agreement. Academy officials we interviewed  also reported that the overlapping of the domestic and STCW  requirements is a strain on the time and resources of the academies.  Coast Guard officials responded that in cases where a specific topic  meets both a domestic and STCW requirement, it is only required to be  done once and documented as meeting the STCW requirement.
section_title: Coast Guard Assessed Costs and Benefits of STCW Implementation, and Training Providers We Surveyed Reported Varying Perspectives on STCW Costs and Benefits
subsections: section_title: Coast Guard Assessed Costs and Benefits in Accordance with Key Practices for Federal Rulemaking
paragraphs: Coast Guard estimated the costs and benefits of implementing the  revised STCW requirements in its regulatory analysis of the STCW final  rule. Costs and benefits are two of the four elements that the Office of  Management and Budget and GAO have identified as important to any  regulatory assessment for federal rulemaking, and based on our analysis,  Coast Guard’s rulemaking for implementing STCW regulatory revisions  addressed all four elements. Coast Guard estimated the total present  value cost of implementing the revised STCW requirements over 10 years  to be $228.9 million, or about $32.6 million annually. Coast Guard estimates included implementation costs associated with four general  areas—mariner training, medical examination, sea service, and training  providers. As shown in figure 6, Coast Guard estimated the majority of  costs were to meet mariner training requirements.
Coast Guard also identified qualitative benefits expected from  implementing the revised STCW requirements that would result from  increased and consistent training and enhanced medical evaluation.  Expected benefits included, for example, an increase in vessel safety and  a decrease in the risk of accidents. Coast Guard officials told us that they  did not quantify the benefits of implementing the revised STCW  requirements because of uncertainty about the relationship between  training and human factors involved in accidents. Officials stated that to  estimate benefits, Coast Guard reviewed studies on the effectiveness of  training in other industrial settings, but because of the difference in  contexts and the range of measures of effectiveness, they concluded that  the benefits transfer was not robust enough to quantify benefits for  STCW. Instead, Coast Guard conducted a “break-even” analysis of the  expected benefits, noting that break-even analyses are used for situations  where benefits from a regulatory action cannot be quantified. Such  analyses are intended to answer the question: “How small could the non- quantified benefits be before the rule would yield zero net benefits?” We  describe the Coast Guard’s benefits estimates in more detail below.
Executive Order 13563 directs agencies to periodically review significant  regulations to identify those that may be outmoded, ineffective,  insufficient or excessively burdensome, and to modify the regulations  according to what has been learned. Coast Guard officials said they  would consider conducting a retrospective analysis of its estimated costs  and benefits of implementing the revised STCW requirements after  sufficient time has passed for the costs and benefits to be realized, and if  funds are available.
section_title: Survey Respondents Reported Varying Perspectives on STCW Costs and Benefits
subsections: section_title: Perspectives on Costs to Training Providers
paragraphs: Most training providers who responded to our survey (68 percent)  reported that they anticipated that implementing the revised STCW  requirements would increase their organization’s costs. About half of all  survey respondents (49 percent) expected to increase their organization’s  training prices in 2017 while 37 percent expected no change in prices.
Training providers generally reported that they expected their costs of  implementing STCW requirements to be equal to or higher than the Coast  Guard’s estimates in its regulatory analysis of the STCW final rule.  Specifically, in estimating the costs of implementing the revised STCW  requirements, Coast Guard estimated average dollar costs for small and  non-small training providers across five cost categories. For example,  using Coast Guard estimates, the average cost for initial auditor  training—one of the five cost categories—for small providers was $3,499  and for non-small providers was $16,023. Across these five cost  categories, about half of responding training providers (46 to 50 percent)  indicated that their costs would be similar to Coast Guard’s cost  estimates, as shown in figure 7 below. About a third of respondents (28 to  39 percent) expect costs to be higher than Coast Guard estimated and 2  to 14 percent anticipated costs lower than Coast Guard’s estimates. In  addition, a small number of providers (between 10 and 13) responded  “other” to these questions. For example, one provider who indicated  “other” when comparing anticipated costs to Coast Guard estimates said  “our training system is much more complex than any other commercial  provider” while another stated “my training school consists of a single all- in-one manager/owner/instructor.”
Some survey respondents identified costs that they did not believe were  included in Coast Guard’s average estimates for training providers. For  example, while Coast Guard included estimates for developing QSS  procedures, several training providers indicated that new QSS  requirements could involve more administrative time than estimated by  Coast Guard. Officials at one maritime academy indicated that they  allocated 9 hours per week to maintain the STCW system and believed  that the Coast Guard’s average estimates “did not come close to the true  costs” incurred by a large training provider. Officials at another maritime  academy indicated that implementing the requirements would require  “more courses, more assessments, more record keeping, more  simulation.” Coast Guard officials told us that they plan to consult with  state academies about the perceived impacts related to implementing the  requirements. A recently purchased simulator used for STCW training at  a maritime academy is displayed in figure 8.
In addition to administrative costs, academy officials stated that the extra  days of sea time required under the revised STCW requirements cost an  additional $7,000 a week to operate and staff the ship. Coast Guard  stated that it developed its cost estimates for a typical or average entity,  and therefore the costs used for estimating national effects did not include  costs that a specific entity might incur. When asked for their perspectives  on the training providers’ view of the cost of the revised STCW  requirements, Coast Guard officials stated that providers had the  opportunity to comment on the Coast Guard cost estimates during the  supplemental notice period and those comments were adjudicated and  applicable text amended before the final rule was issued.
section_title: Perspectives on Benefits of the Revised STCW Requirements
paragraphs: In estimating the benefits of implementing the revised STCW  requirements, Coast Guard identified nine categories of potential benefits.  Across these nine categories, survey respondents were mixed in their  expectation of whether there would be either a positive effect (i.e.,  benefits would be realized) or no effect (i.e., no benefits) from  implementing the revised STCW requirements. For example, as shown in  figure 9 below, 70 percent of training providers indicated that increased  mariner situational awareness was a benefit of the STCW regulatory  revisions. Also, between zero and nine providers across categories  reported the effects might be negative, rather than provide benefits, with  one state maritime academy noting that the documentation required to  demonstrate compliance with STCW—much of which has to be  completed at sea—is cumbersome.
Training providers varied by type of organization in their perspectives of  the benefits of implementing the revised STCW requirements. For  example, the U.S. Merchant Maritime Academy and most of state  maritime academies’ cadet programs (4 of 6) and union training providers  (3 of 5) expected that implementing the revised STCW requirements  would have no effect on the potential benefit of decreasing the risk of  property loss, whereas with other types of providers, such as colleges  and universities, most (10 of 15) expected a positive effect from the  benefit.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to DHS and the Department of  Transportation (DOT) for review and comment. DHS provided technical  comments, which we incorporated as appropriate. DOT had no comments  on the report.
We are sending copies of this report to the appropriate congressional  committees, the Secretary of Homeland Security, and the Office of the  Assistant Secretary for Administration, DOT. In addition, the report will be  available at no charge on the GAO website at http://www.gao.gov.
If you or your staff have any questions about this report, please contact  me at (202) 512-7141 or groverj@gao.gov. Contact points for our Offices  of Congressional Relations and Public Affairs may be found on the last  page of this report. GAO staff who made key contributions to this report  are listed in appendix V.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: This report focuses on the maritime training providers’ perspectives on  the U.S. Coast Guard’s (Coast Guard) guidance available to implement  the revised Standards of Training, Certification and Watchkeeping for  Seafarers (STCW) requirements, their progress implementing the revised  requirements, and any costs and benefits associated with implementing  the new requirements. Specifically, we addressed the following questions.  1.  To what extent has Coast Guard provided sufficient guidance to  training providers about addressing the revised STCW requirements?  2.  What progress do training providers report in implementing the  revised STCW requirements, and what challenges, if any, have they  reported in doing so?  3.  To what extent has Coast Guard evaluated the costs and benefits of  the revised STCW requirements, and what impact, if any, do training  providers report regarding the costs and benefits of implementing the  requirements?
To address all three objectives, we conducted a web-based survey of the  universe of 167 training providers approved by the Coast Guard to teach  STCW courses to obtain their perspective on each of our objectives.  Coast Guard provided GAO with a list of all training providers approved to  teach STCW courses, including contact information. We worked with  Coast Guard and independently verified contact information, particularly  e-mails (as the survey was web-based) to confirm the universe of 167  STCW training providers. We determined that this information was  reliable for our purposes.
To develop our survey questions, we reviewed the STCW final rule  (including comments and STCW implementation cost estimates), relevant  congressional testimony, Coast Guard’s guidance related to STCW  implementation, and other STCW-related documents. We also discussed  the survey topics with representatives from the Coast Guard, Maritime  Administration (MARAD), and a maritime union. We pretested our survey  with selected STCW training providers who were purposefully selected to  represent a broad range of providers, including the Coast Guard  Academy, a state maritime academy, a private training provider, a union  training provider, and with Coast Guard officials, and made changes for  clarity as needed.
The survey was available for completion from March 21, 2016, through  June 10, 2016, and we followed up by e-mailing or calling all participants  who had not yet responded after 8 days and again every few weeks to  encourage participation. Out of the universe of 167 STCW training  providers, 136 responded for a response rate of 81 percent. Of those  responding, 10 indicated they were not currently teaching STCW courses.  As such, we removed these respondents from our sample resulting in a  total population of 126 training providers teaching at least one STCW  course, and subject to STCW regulatory requirements. Not all  respondents answered every question so the response rate varied by  question. We analyzed the numeric data with statistical software and the  testimonial data with qualitative analysis software.
Also, for all three objectives, we interviewed officials from the Coast  Guard, selected training providers (including the federal and state  maritime academies) and other stakeholders, including MARAD— primarily for their perspectives as we developed our survey. We also  conducted interviews with Coast Guard officials responsible for maritime  training to obtain their views on each of our objectives. In addition, to  supplement training provider information gathered by the survey, we  interviewed officials at the federal maritime academy and the state  maritime academies to understand their unique perspective on  implementing the revised STCW requirements. Four of the six state  maritime academies and the federal maritime academy were interviewed  by phone, and we conducted site visits at two state academies—Texas  A&M at Galveston Maritime Academy and the Great Lakes Maritime  Academy. These academies were selected because both academies had  been recently audited by the Coast Guard for STCW compliance and  could share what was learned from the audits. We also interviewed two  private providers that were selected based on geographic proximity to the  academy site visits. While our survey represents the perspectives of the  of STCW training providers who responded, our interviews with training  providers are not generalizable and are used to provide illustrative  examples and context about the survey responses.
To determine the extent to which Coast Guard provided sufficient  guidance to training providers to implement the revised STCW  requirements, we analyzed data from our survey and included relevant  questions in our interviews with Coast Guard, stakeholders, and selected  training providers. We reviewed and analyzed Coast Guard and MARAD  documents including applicable Coast Guard training and audit guidance  and reports, correspondence with training providers, STCW training  workshop materials, the STCW final rule, and prior GAO reports. We  reviewed Coast Guard’s updated Navigation and Vessel Inspection  Circulars (NVIC), which Coast Guard provided to training providers as  guidance to assist with implementing the revised STCW requirements. In  our meetings with selected STCW training providers and stakeholders we  discussed their experiences implementing the revised STCW  requirements and coordinating with Coast Guard and MARAD to do so.  With Coast Guard, we confirmed our understanding of their audit  recommendations to the respective federal and state maritime  academies.
To describe the progress of training providers in implementing the revised  STCW requirement and any challenges in doing so, we analyzed data  from our survey and included relevant questions in our interviews with  Coast Guard, stakeholders, and selected training providers. We reviewed  the STCW final rule, applicable deadlines, and Coast Guard’s plan for  training providers to transition between the existing and revised STCW  requirements. For familiarity with the process at state maritime  academies, we reviewed the maritime academy handbook. To describe  Coast Guard’s assessment of progress made by the providers in  implementing STCW revisions, we reviewed Coast Guard’s internal audit guidance, the audit reports conducted to date for the federal and state  maritime academies.
For our third objective regarding Coast Guard’s assessment of STCW  costs and benefits, we analyzed data from our survey and included  relevant questions in our interviews with Coast Guard and selected  training providers. We reviewed congressional testimony, comments  submitted for the Supplemental Notice of Proposed Rulemaking, and the  STCW final rule to identify cost and benefit issues. We reviewed the  STCW final rule and Final Rule Regulatory Analysis and Final Regulatory  Flexibility Analysis prepared by the Coast Guard to document the  agency’s estimated costs and benefits of revising STCW regulations. We  compared the STCW final rule to Office of Management and Budget  (OMB) criteria identifying key elements for effective rulemaking, and prior  GAO work. We reviewed OMB regulatory requirements, including  Circulars A-4 and A-94, and prior GAO work to identify key elements in  conducting a regulatory cost-benefit analysis.
We conducted this performance audit from September 2015 to January  2017 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
section_title: Appendix II: Survey Responses on Coast Guard Guidance
subsections: section_title: Survey Respondents’ Perspectives on the Sufficiency of Coast Guard’s Guidance to Implement the Standards of Training, Certification and Watchkeeping for Seafarers (STCW) Requirements
paragraphs: The U.S. Coast Guard (Coast Guard) issues guidance for complying with  its regulations, including STCW requirements, through the publication of  Navigation and Vessel Inspection Circulars (NVIC). In 2014, Coast  Guard reported plans to issue 26 NVICs pertaining to the revised STCW  requirements. As of March 2016, Coast Guard had published 24 NVICs  and reported plans to publish the additional NVICs pertaining to the  revised STCW requirements. According to Coast Guard officials, the  decision to publish a NVIC is based on a need to clarify a regulation and  provide implementation guidance. Table 1 provides details regarding the  survey respondents’ perspectives on the sufficiency of Coast Guard’s  guidance (24 NVICs), as of June 2016 to implement the STCW  requirements.
section_title: Appendix III: Survey Respondents’ Perspectives on Timeliness of Coast Guard Guidance
subsections: section_title: Survey Respondents’ Perspectives on Coast Guard’s Timeliness in Issuing Guidance to Implement the Standards of Training, Certification and Watchkeeping for Seafarers (STCW) Requirements
paragraphs: The Coast Guard issues guidance for complying with its regulations,  including STCW requirements, through the publication of Navigation and  Vessel Inspection Circulars (NVIC). In 2014, Coast Guard reported plans  to issue 26 NVICs pertaining to the revised STCW requirements. As of  March 2016, Coast Guard had published 24 NVICs and reported plans to  publish the additional NVICs pertaining to the revised STCW  requirements. According to Coast Guard officials, the decision to publish  a NVIC is based on a need to clarify a regulation and provide  implementation guidance. Table 2 provides details regarding the survey  respondents’ perspectives on Coast Guard’s timeliness in issuing  guidance (24 NVICs), as of June 2016 to implement the STCW  requirements.
section_title: Appendix IV: Standards of Training, Certification and Watchkeeping for Seafarers (STCW) Implementation Challenges
subsections: section_title: Standards of Training, Certification and Watchkeeping for Seafarers (STCW) Implementation Challenges as Reported by Training Providers, June 2016
paragraphs: Based on GAO’s interviews with officials from Coast Guard, Maritime  Administration, and other selected maritime training providers and  stakeholders (including unions and associations), we identified the 14  most frequently cited possible challenges that providers may face when  implementing the revised STCW requirements. Table 3 presents a  summary of the extent to which GAO’s survey respondents reported  experiencing challenges in implementing the revised STCW requirements  in each of the 14 challenge categories.
section_title: Appendix V: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact above, Ellen Wolfe (Assistant Director);  Frederick Lyles, Jr. (Analyst-in-Charge); David Bieler; Chuck Bausell; Eric  Hauswirth; Susan Hsu; Monica Kelly; Tracey King; Dainia Lawes; Carl  Ramirez; Cynthia Saunders; and Christine San all made key contributions  to this report.