The Positive Impact of the Jones Act for Florida Ports

April 03, 2019

Tampa Bay’s political and transportation leaders joined the Florida Maritime Partnership and the American Maritime Partnership at the Gulf Marine Shipyard on March 22, 2019 to rally in support of the Jones Act for the domestic maritime industry and its impact on local, state, and national economies. With a Crowley Maritime Corp. ship as their backdrop, lobbyists highlighted the job and revenue growth throughout Florida provided by the domestic maritime industry and the bylaws of the Jones Act.

However, despite the positive economic benefits of the Jones Act, some have argued in the past for a repeal of the law.

Why Do Some Oppose the Jones Act?

The Jones Act, also known as the Merchant Marine Act of 1920, is a federal law that regulates maritime commerce by stating all domestic shipping must occur with ships that are built, owned, and operated by U.S. companies. The law applies to all U.S. territories with the exception of the U.S. Virgin Islands, yet the Jones Act has repeatedly faced criticism for its shipping restrictions — particularly towards Puerto Rico.

Opponents of the Jones Act argue that it puts unfair restrictions on foreign countries who conduct trade with Puerto Rico — hurting the island’s economy. Another point is the increased shipping costs for Puerto Rico and other non-continental U.S. territories, like Hawaii and Alaska. One study from the New York Federal Reserve in 2012 found the cost of transporting a container to Puerto Rico from the mainland was double the cost for shipping that same container from a foreign port.

Puerto Rico’s governor, Ricardo Rosselló, has argued for a 10 year exemption on the Jones Act. The Cato Institute and other political figures, including former Director of Hispanic Media, Luis Miranda, have pushed for an exemption of the Jones Act. Former Sen. John McCain once called for a permanent repeal in 2017, referring to the law as an “antiquated, protectionist law that has driven up costs and crippled Puerto Rico’s economy.”

Benefits of the Jones Act for the U.S. Maritime Industry and Florida Ports

The U.S Senate is currently considering a bill that would exempt Puerto Rico from the Jones Act. However, U.S. shipbuilders and other supporters say the law’s shipping restrictions boost the U.S. economy. Fair Kim, policy director of the American Maritime Congress, a nonprofit lobbying group for the U.S. shipping industry, has argued repealing the law poses a threat to national security.

“You don’t want a foreign country to control the acquisition, design, and construction of a war ship,” Kim stated to the Intercept.

Lobbyists highlighted the job growth of 10,000 (a 25% increase) and the $3.73 billion in income generated in the Tampa region. Tampa Bay Mayor Bob Buckhorn commended the Jones Act and the domestic maritime industry, stating:

“The domestic maritime industry in Tampa is important not just for the stable and well-paying jobs it provides to Tampanians, but also the critical role it plays in our local, state and national economy. With nearly 10,000 jobs and over $2 billion in economic impact in the Tampa region, and over 65,000 jobs and a $14.6 billion in economic impact across the state, the domestic maritime industry is vital in keeping Tampa and Florida a leader in the industry. When our local shipbuilders and maritime workers are able to thrive, the entire city, state, and country benefits.”

The Jones Act’s Impact on Warehouse Facilities

The rally at the Gulf Marine Shipyard shows the positive impact the Jones Act and domestic maritime industry has on Florida ports and the economy, but what about warehouse facilities?

For a warehouse, the Jones Act helps bring in business for U.S. companies and encourages the production of American-made products. One point made by supporters at the rally is the lack of U.S. tanker ships that carry liquified natural gas to Puerto Rico — which is still recovering from the effects of Hurricane Maria in 2017.

“If demand increases, we will build ships,” said Crowley Senior Vice President Michael Roberts. “Right now, the market doesn’t exist.”

Warehouse facilities who market to and trade with Puerto Rican and other international companies gain a large advantage from the domestic maritime industry and the Jones Act, especially for warehouses located near a Florida port. Their loading docks remain consistently busy and act as a major location for delivering and receiving shipments across U.S. ports— broadening the potential business opportunities for companies wanting to supply warehouse equipment for industries across international waters.

Southern States Enterprises is one business that greatly benefits from the Jones Act and the maritime industry. Our mission to offer high-quality products to meet warehouse storage and equipment needs continues to help businesses in need of our services. From motive power equipment, to pallet racks, to equipment installations— there’s no limit to the products and services SSE can provide for the domestic maritime industry and businesses transporting goods into U.S. ports!

Political and transportation leaders have continued to make the push for state support of the act by rallying in Tallahassee the week of March 25th. ‘Local jobs, local economy’ is the approach for warehouse facilities and transportation businesses. It not only promotes U.S. made ships and domestic shipping, but it supports a large community and state through job growth and helping to sustain strong economies for Florida and the southern states

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