Streams

Explainer: The Jones Act

Friday, November 02, 2012 - 03:52 PM

Waiting on line to pay cash for gas to fill gas cans at the Hess station on Union St. and 4th Ave. in Brooklyn (photo by Amy Pearl)

To ease widespread gas shortages in the Northeast, the federal government has temporarily lifted a restriction on foreign fuel tankers.

The Jones Act (pdf) -- formerly known as the Merchant Marine Act of 1920 -- was originally intended to ensure that the U.S. has a strong merchant marine during times of war. It also prohibits foreign ships from touching two U.S. ports consecutively -- meaning all goods that move between two domestic ports must do so on ships that are U.S. flagged and staffed.

The waiver means tankers that would otherwise be barred can immediately begin shipping petroleum products from the Gulf of Mexico to the Northeast.

According to a recent Wall Street Journal article, "it is either essential for national security or a vast barnacle on the hull of U.S. growth, depending on your point of view." Bob Parrish, the president of the Maritime Law Association of the United States, told TN the Jones Act is "really a deep subject that's been debated."

At a press conference Friday morning, New York Governor Andrew Cuomo said the waiver was necessary to speed delivery of fuel to area ports. Soon after, the Department of Homeland Security released a statement that read, in part: "As a result of impacts caused by Hurricane Sandy, today Secretary of Homeland Security Janet Napolitano issued a temporary, blanket waiver of the Jones Act to immediately allow additional oil tankers coming from the Gulf of Mexico to enter Northeastern ports, to provide additional fuel resources to the region...Secretary Napolitano's action immediately allows additional ships, that would otherwise be barred, to begin shipping petroleum products from the Gulf of Mexico to Northeastern ports, increasing the access to fuel in the storm damaged region."

Also on Friday, Cuomo signed an executive order allowing distributors and transporters to bring gasoline, diesel, and kerosene into New York without having to meet the usual registration requirements. "I don’t like to waive the tax, I don’t want to lose the money," he said, "but we do want to accelerate the flow of gasoline."

The waiver of the Jones Act lasts through November 13.

 

 

 

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