Future of United States Maritime Part 1: Review of Fiscal Year 2026 Federal Maritime Commission Budget Request

Coast Guard and Maritime PolicyHouse · 2025-07-22 · 119th Congress
The Subcommittee on Coast Guard and Maritime Transportation held this hearing to review the Federal Maritime Commission's (FMC) proposed $40 million fiscal year 2026 budget, its implementation of the Ocean Shipping Reform Act (OSRA) of 2022, and its recently launched investigation into "flags of convenience" among foreign-flagged vessels. Begins at 0:19:18
Transcript
Highlights

Title

FMC Fiscal Year 2026 Budget and Ocean Shipping Reform Act Implementation

Purpose

The Subcommittee on Coast Guard and Maritime Transportation held this hearing to review the Federal Maritime Commission's (FMC) proposed $40 million fiscal year 2026 budget, its implementation of the Ocean Shipping Reform Act (OSRA) of 2022, and its recently launched investigation into "flags of convenience" among foreign-flagged vessels. Commissioner Rebecca Dye, the sole witness, testified about staffing losses, rulemaking progress, and enforcement efforts, while members from both parties raised concerns about flat funding and vacant commissioner seats. Begins at0:19:18

Who spoke

Chairman (Subcommittee on Coast Guard and Maritime Transportation)0:19:18: Opened the hearing on the FMC's FY2026 budget request0:20:07, citing the agency's investigation into flags-of-convenience shipping practices0:20:56 and framing the hearing around restoring US maritime dominance0:21:42.

Ranking Member Salud Carbajal (D-CA)0:22:12: Yielded his opening statement time to Ranking Member Larson0:22:12.

Rep. John Larson (D-CT)0:22:12: Said FMC has lost nearly 20% of its workforce to the deferred resignation program and hiring freeze0:24:00, noted the agency lacks two commissioners and a chair0:24:28, and later questioned Dye on rulemaking timelines and OPM hiring exemptions0:39:540:41:15.

Mr. Carbal (subcommittee member)0:25:15: Delivered a statement citing that over 80% of world trade volume moves by ocean0:26:06 and that FMC has waived or refunded more than $5.8 million in undue port fees since OSRA's enactment0:27:17.

Commissioner Rebecca Dye, Federal Maritime Commission0:29:43: Testified in support of the $40 million FY26 budget, level with FY250:30:08; said $25.8 million is budgeted for salaries after 13 employees departed under deferred resignation0:30:51; described completed OSRA rulemakings on detention/demurrage and unreasonable refusal to deal0:32:26; addressed the flags-of-convenience investigation into open registries like Panama, the Marshall Islands, and Liberia0:38:16; and said five of six foreign-controlled ocean carriers are Chinese-controlled, with one Korean0:57:190:59:47.

Mr. McDow0:45:34: Asked why the budget shifts more funding to rent, security, and IT systems0:45:52, and pressed on how OSRA changed FMC operations0:47:32.

Mr. Carbour Hall0:50:25: Focused questions on the flags-of-convenience investigation, asking what risks it poses to Americans and what remedies FMC could pursue, including barring vessels from US ports0:50:300:53:33.

Mr. Petronis0:55:47: Asked Dye to elaborate on unfair Chinese shipping practices and confirmed five of six foreign-controlled carriers are Chinese-controlled0:58:32.

Mr. Shelton (subcommittee member, Michigan)1:00:33: Raised concerns about Canadian ballast water regulations affecting Great Lakes shippers ($36 billion industry)1:00:57, and pressed on whether flat funding and 20% staff cuts would hinder complaint response1:03:33.

Mr. Bandrew (subcommittee member, New Jersey)1:06:16: Raised concerns about the Coast Guard's rapid removal of 350 navigational buoys under its "e-Aton" modernization plan, citing groundings and near-misses in his coastal district1:06:261:07:21, and asked whether FMC has coordinated with the Coast Guard on the issue1:08:20.

Rep. Garamendi1:09:12: Yielded his time to Mr. Johnson, then praised Commissioner Dye's tenure across multiple administrations1:10:05 and discussed the pending FMC reauthorization act raising authorized funding from $40 million toward $49 million and eventually $57 million over four years1:12:46.

Rep. Johnson1:15:50: Lead sponsor of the FMC reauthorization bill; asked Dye for her general assessment of the bill1:15:54, discussed lessons from the OSRA charge-complaint process1:17:47, and noted the hearing was "the least sexy hearing" but reflected responsible bipartisan oversight1:20:24.

Key moments

Dye testified FMC's FY26 budget request is $40 million, flat from FY25, with $25.8 million for salaries — a $2 million reduction after 13 employees left under the deferred resignation program0:30:360:30:51.

Larson noted the FMC has lost about 20% of its workforce and is seeking OPM approval for six exemptions to hire attorneys and economists to replace departed staff0:24:000:41:15.

Carbal said more than $5.8 million in undue port fees have been waived or refunded since OSRA's 2022 enactment, and Dye separately cited "a little over $5 million" returned through the charge-complaint process0:27:170:43:38.

Dye disclosed that five of six foreign government-controlled ocean carriers are Chinese-controlled and one is Korean-controlled, and said FMC monitors their pricing for below-cost subsidization0:57:360:59:47.

Shelton pressed Dye on whether flat funding and 20% staff reductions would hinder FMC's ability to respond to ballast-water and invasive-species complaints from Great Lakes shippers; Dye maintained the agency "still has a quorum" and is "in good shape"1:03:481:04:12.

Bandrew raised alarm over the Coast Guard's plan to remove 350 navigational buoys in the Northeast under an "e-Aton" modernization effort, citing groundings and near-misses; Dye said FMC has not yet coordinated with the Coast Guard on this specific initiative1:06:371:08:20.

Garamendi outlined the pending FMC reauthorization act's proposed funding increase from $40 million to $49 million initially, ramping to $57 million over four years1:12:461:13:17.

Carbajal/Larson's opening statement noted US-flag vessels comprise less than 2% of total US imports and exports0:22:38.

Chairman's opening statement said the FMC's FY2026 budget request totals $40 million to fund salaries, operations, and capital needs0:20:07.

Dye repeatedly declined to detail internal staffing reorganizations, saying only "we are in good shape today" when asked what rehiring 26 lost positions would mean for agency effectiveness0:54:470:55:15.

Metadata

Committee
Chamber / CongressHouse · 119th Congress
Date2025-07-22
TypeHearing
Witnesses
The Honorable Rebecca Dye — Commissioner, Federal Maritime Commission
Videoyoutube
Transcript228 caption blocks · 8,577 words · 1:21:38 runtime
EventCongress.gov 118486