The legal requirements of CPFA, particularly the required level of CPFA shipped on U.S.-flag vessels, have changed over time. Figure 1 shows key legislation related to CPFA. USAID, USDA, and MARAD are the primary agencies involved in CPFA. USAID administers Title II of the Food for Peace Act, which responds to emergency needs such as disasters and crises, and targets the underlying causes of hunger and malnutrition through development food assistance programs. In fiscal year 2014, USAID provided an estimated 1 million metric tons of food aid valued at more than $1.3 billion. USDA’s Foreign Agricultural Service (FAS) administers other food aid programs. In particular, the Food for Progress program responds to non-emergency food aid situations by supporting agricultural value chain development, expanding revenue and production capacity, and increasing incomes in food-insecure countries. The McGovern-Dole International Food for Education and Child Nutrition program responds to nonemergency food aid needs by supporting education and nutrition for schoolchildren, particularly girls, expectant mothers, and infants. In fiscal year 2014, USDA provided nearly 192,000 metric tons of food aid, valued at more than $127 million, for Food for Progress; and more than 70,000 metric tons of food aid, valued at more than $164 million, for McGovern-Dole. USDA’s Farm Service Agency serves as the buying agent for all U.S. food aid programs and extends invitations for bids to prospective food commodities sellers and providers of freight services for commodity delivery to overseas ports. The Farm Service Agency’s Kansas City Commodity Office (KCCO) is responsible for procuring food commodities. MARAD is responsible for monitoring federal agencies’ implementation of cargo preference laws, including CPFA. In addition to monitoring compliance, MARAD establishes guideline rates to determine whether U.S.-flag shipping rates are fair and reasonable. See appendix III for details on MARAD’s “fair and reasonable” determinations. DOD and the USCG also have some involvement in CPFA, through various activities detailed below. DOD has programs that involve U.S.-flag vessels that compete to ship food aid under CPFA. For example, the Voluntary Intermodal Sealift Agreement (VISA) is a partnership between the U.S. government and the maritime industry to provide DOD with “assured access” to commercial sealift and intermodal capacity to support the emergency deployment and sustainment of U.S. military forces. During times of war or national emergency, DOD will use commercial sealift capacity, to the extent it is available, to meet ocean transportation requirements. This commercial sealift capacity includes U.S.- and foreign-flag vessels or intermodal capacity to support DOD’s needs. In the event voluntary capacity does not meet DOD contingency requirements, DOD will activate VISA as necessary. VISA participants have committed vessels or intermodal capacity to support DOD contingency requirements during the various activation stages of VISA and in return are afforded priority to meet DOD peacetime and contingency sealift requirements. Vessels participating in the Maritime Security Program (MSP) are required to be enrolled in VISA. MSP is intended to guarantee that certain kinds of militarily useful ships and their crews will be available to DOD in a military contingency. Vessels in MSP will be activated through the VISA program. Currently, MSP provides direct payment of up to $3.1 million per year for up to 60 militarily useful U.S.-flag vessels participating in international trade to support DOD. DOT determines the commercial viability and DOD determines the military usefulness of vessels that seek participation in MSP. Guidance on military usefulness is being updated and is expected to be issued by September 2015. According to DOD officials, the criteria for military usefulness include ship speed, deck strength, and container cargo carriage capacity. DOD, through the United States Transportation Command, and DOT, through MARAD, maintain and operate a fleet of vessels owned by the federal government to meet the logistic needs of the military services that cannot be met by existing commercial service. As of July 2015, the reserve sealift fleet is composed of 61 vessels, 46 of which are MARAD- owned and form part of the Ready Reserve Force, and 15 are DOD- owned vessels in the Military Sealift Command’s Surge Sealift program. DOD notifies the Military Sealift Command and MARAD when it directs activation of vessels in the reserve sealift fleet for contingency operations, exercises, training and testing, and other defense purposes for when commercial sealift is not available or suitable. Such vessels must be fully operational with a complete crew within their assigned readiness status, which varies from 5 to 10 days. Commercial U.S. ship managers provide systems maintenance, equipment repairs, logistics support, activation, manning, and operations management by contract. U.S. mariners are necessary to crew U.S.-flag commercial vessels providing sealift capabilities for DOD needs, as well as the reserve sealift fleet. Crewing of such vessels is a voluntary system for mariners with the necessary qualifications. Mariner qualifications for crewing the reserve sealift fleet include having a USCG merchant mariner credential with the necessary national and international endorsements to crew these vessels, which include Standards of Training, Certification and Watchkeeping (STCW) and endorsement for unlimited tonnage for deck officer positions that include master, chief mate and officer in charge of a navigational watch, and unlimited horsepower for engineer positions. In addition, mariners sailing onboard such vessels, among other things, are required to take specific DOD-approved training matching their types of vessels, cargo, mission requirements, and areas of operation, according to MARAD. The specialized training includes topics such as physical security, antiterrorism, ship survivability, Navy communication systems, naval operations, engineering, and logistics. This training is typically provided by Navy trainers, as well as by union and private trainers. Currently, U.S. maritime labor unions have collective bargaining agreements with vessel operators under contract to the government to crew the reserve sealift fleet, as needed. USCG is responsible for the credentialing of mariners and maintains records on all mariners who hold valid merchant mariner credentials, including data on mariners who may serve on U.S.-flag vessels that support DOD during times of war or national emergencies, among which are vessels that compete to ship food aid under CPFA. The Navy’s Strategic Sealift Officer Program maintains within the Reserve Component of the U.S. Navy a cadre of strategic sealift officers to support national defense sealift requirements and capabilities. Strategic sealift officers can be recalled to active military duty to fill officer positions aboard the reserve sealift fleet if a shortage of qualified civilian mariners exists. However, many of the Strategic Sealift Officers may already be employed as civilian mariners onboard commercial vessels. The Navy and MARAD have agreed that Strategic Sealift Officers may be used to fill officer positions aboard the reserve sealift fleet after all reasonable means to obtain other qualified civilian mariners have been exhausted. USAID and USDA rely on implementing partners to deliver food aid to beneficiaries for emergency and nonemergency purposes. Implementing partners submit a food order proposal designed to meet program objectives of USAID’s and USDA’s food aid programs. USAID and USDA officials review the order to ensure its suitability for the program and country area with regard to the quantity and type of commodity requested. Once approved, the commodity request for food aid is forwarded to KCCO, which collects commodity orders with similar delivery dates for placement on a solicitation. KCCO then issues a solicitation for commodity vendors to offer their products for sale to USDA. Concurrently, administering agencies, working with implementing partners, issue a solicitation with specific freight tender terms and conditions for ocean freight services to deliver these commodities to overseas destinations. For all U.S. in-kind food commodities except USAID’s bulk food aid, ocean carriers and commodity vendors submit offers electronically through the Web Based Supply Chain Management system (WBSCM). KCCO evaluates commodity bids and freight offers according to lowest landed cost (the cost of the commodity plus transportation charges), through WBSCM. USAID and USDA review the ocean freight offers to identify programmatic issues, such as ensuring ocean freight offers meet the tenders’ terms and conditions, ensuring rates are consistent with fair market prices, as well as assessing the offers’ relation with CPFA requirements. USAID and USDA coordinate with KCCO to recommend award of commodity and transportation contracts, and advise the implementing partners to enter into such contracts. U.S.-flag vessels charge higher shipping rates than foreign-flag vessels largely because of their higher operating cost. According to a MARAD study, U.S.-flag vessels face significantly higher cost, including crew cost, maintenance and repair cost, insurance cost, and overhead cost. For 2010, MARAD found that the average U.S.-flag vessel operating cost is roughly 2.7 times higher than its foreign-flag counterpart. MARAD also found that crew cost, the largest component of U.S.-flag vessels’ operating cost, was about 5.3 times higher than that of foreign-flag vessels. While crew cost accounted for about 70 percent of U.S.-flag vessel operating cost, it accounted for about 35 percent for the foreign- flag vessels. National Security Directive 28 directs DOD to determine the requirements for sealift, among other things, and DOT to determine whether adequate manpower is available to meet such requirements. According to DOD officials, DOD has determined the number of vessels, including those in the reserve sealift fleet that would be required to meet its needs under different contingency scenarios and communicated that to MARAD.