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1 Marine Engineers Beneficial Association (AFL-CIO) 444 N. Capitol Street, N.W., Suite 800 Washington, DC Hot Off The Press TEL: (202) FAX: (202) To: All Ports From: Audra Kincaid Total Pages Including Cover: 7 Date: 4/19/13 Telex Times #16 akincaid@mebaunion.orgw

2 MARINE ENGINEERS BENEFICIAL ASSOCIATION (AFL-CIO) On Watch in Peace and War Since 1875 M.E.B.A. TELEX TIMES April 19, 2013 The Official Union Newsletter NUMBER 16 In this issue House Holds T&I Hearing on Proposed FY 2014 Budget M.E.B.A. Wins Wage Dispute with AMHS M.E.B.A. President Receives Seafarers House Award M.E.B.A. Meets with Rep. Janice Hahn USCG Increases Port Security in Northeast after Boston Bombings; Affected Members can Utilize Good & Welfare Fund Fourth Anniversary of the MAERSK ALABAMA Hijacking The Suez Canal vs. The Panama Canal; A Shipping Battle Turkey to Build Kanal Istanbul M.E.B.A. Mourns the Passing of Jeff Jenkins Available Job Listings... HOUSE HOLDS T&I HEARING ON PROPOSED FY 2014 BUDGET On April 16th, the House Subcommittee on Coast Guard and Maritime Transportation held a hearing on President s Fiscal Year 2014 Budget Request for Coast Guard and Maritime Transportation Programs. While part of the hearing was spent examining the budgetary effects on the Coast Guard, much of the hearing focused on the U.S. Merchant Marine. Members of Congress touched upon the damaging effects of the proposed cuts to the Food for Peace program, the funding shortfall in MSP due to sequestration, as well as the Administration s continued implementation delay of the cargo preference authority granted under the Defense Authorization Act of The M.E.B.A. will continue to work with Members of Congress and Administration officials to remedy the issues associated with the budget shortfalls. The M.E.B.A. encourages all members to contact their congressional officials and speak with them about the vital importance of the USMM and the current structure of the Food Aid Program. Please contact M.E.B.A. Political Director Matt Dwyer by phone (202) or mdwyer@mebaunion.org for talking points. He will advise you on the best way to reach your officials, and will follow up with your concerns on the Hill. M.E.B.A. WINS WAGE DISPUTE WITH AMHS A long-running battle with the State of Alaska over wage-withholding and state income taxation has been resolved favorably for M.E.B.A. members. The Alaska Marine Highway System sometimes contracts with shipyards for major overhauls and vessel reconstruction in the State of Oregon. Vessels sent by the State of Alaska to Oregon frequently have M.E.B.A. members and other merchant mariners assigned work aboard the vessels while in the shipyard. Without consulting with the Union, the State of Alaska commenced withholding wages from M.E.B.A. members in order to pay Oregon income tax. This withholding was contrary to federal law protecting merchant mariners who do not reside in Oregon from a state income tax levy by the Beaver State. M.E.B.A., in cooperation with other maritime unions, filed grievances, and demanded that the State of Alaska indemnify M.E.B.A. members and stop improperly withholding funds from wages. The most outlandish aspect of this situation is that the State of Oregon did not demand - 1 -

3 that tax withholding take place from non-resident merchant mariners. The wage-withholding was about Alaska bureaucrats run amok. After much wrangling and without admitting any error, the State of Alaska finally agreed to stop withholding wages from M.E.B.A. members and to refund improperly withheld wages. Eric Downer, an AMHS First Assistant Engineer and other M.E.B.A. members provided timely and solid information the Union used to push back and prevail. M.E.B.A. Executive Vice-President Dave Nolan noted that it sometimes takes a while to turn any bureaucracy around but thanks to the effort of M.E.B.A.'s Alaska Representative, Ben Goldrich with aid from the Seattle Branch Agent, Dave Nashif, and a lot of hard work by the members, the Union finally prevailed. M.E.B.A. PRESIDENT RECEIVES SEAFARERS HOUSE AWARD M.E.B.A. President Mike Jewell, was honored by the Seafarers & International House as a 2013 Outstanding Friend of Seafarers at its thirteenth annual awards banquet, Setting the Course, on April 18. President Jewell addressed an audience of over 250 representatives from maritime labor and business. He spoke passionately about how the entire industry needs to stand together to protect the U.S. Merchant Marine. Make no mistake, the U.S. Merchant Marine is under attack daily, weekly, monthly and yearly, Jewell warned the crowd. He continued on to detail the support that our industry desperately needs in this hostile legislative environment. MSP, Cargo Preference and the Jones Act are all under siege. We need the whole industry to set a course, and we need our friends in Congress to pass a maritime strategic plan that commits to the U.S. Merchant Marine, our fourth arm of defense. Robert Bugbee, President and Director of Scorpio Tankers, Inc. was also honored at the dinner with the same award. He spoke about Scorpio s work in the industry and how grateful he is to support hardworking seafarers. The Seafarers & International House is a New York-based organization. Its mission is to provide support and care for international seafarers and sojourners. It runs an 84-room guesthouse in New York City and is associated with the Evangelical Lutheran Church in America. M.E.B.A. MEETS WITH REP. JANICE HAHN On Tuesday, the M.E.B.A. hosted a meet and greet event for Congresswoman Janice Hahn (D- CA) with the transportation labor industry. Hahn is a strong supporter of the maritime industry and friend of the M.E.B.A. She promised to continue to be an advocate for maritime labor jobs, to tackle issues concerning the correct spending of the Harbor Maintenance Tax Fund, and to help push for the current structure of the Food Aid program. Rep. Hahn was also very interested in learning how sequestration will affect maritime jobs, and expressed that she was hopeful that Congress could come to a solution to end sequestration. She also said that the Transportation and Infrastructure Committee seemed open to working in a bipartisan manner to tackle issues such as the Water Resources Development Act (WRDA), funding for a Surface Transportation bill, and other legislation that supports maritime - 2 -

4 infrastructure. The Congresswoman also spoke about the Congressional Port Caucus, which she helped to create, and how she hoped to tackle dredging issues in a bi-partisan manner. Rep. Hahn sits on the House committees on Transportation and Infrastructure, and Small Business. She also serves on the Coast Guard and Maritime Transportation, the Highways and Transit, and Water Resources and Environment subcommittees. She is also the Ranking Member of the subcommittee on Health and Technology. USCG INCREASES PORT SECURITY IN NORTHEAST AFTER BOSTON BOMBINGS; AFFECTED MEMBERS CAN UTILIZE GOOD & WELFARE FUND Coast Guard units throughout the Northeast have increased their presence to ensure safety and security of the ports and waterways, after Monday s bombings at the Boston Marathon. As a result of the increased patrols, the Coast Guard is able to keep the Ports of Boston, New York and New Jersey open to commercial shipping, passenger ferry transportation and recreational boating. Boston station crews, cutters, aircraft and Maritime Safety and Security Teams (MSST) from Boston and New York, along with local stations and patrol boats are operating throughout the port with a heightened awareness alongside partners and fellow first responders. MSST Boston and New York s response boatcrews, MSST New York s K-9 units and maritime emergency response units randomly conduct searches aboard passenger ferries and commercial vessels as well as conducting pierside sweeps utilizing a remote operated vehicle. The Coast Guard is asking the maritime community to remain vigilant and report concerns to law enforcement officials. The message continues to apply: If you see something, say something. M.E.B.A. member William Bill Kenneweg ran the marathon, finishing shortly before the first bomb was detonated. Brother Kenneweg painted a positive picture of extreme kindness, pride, and helpfulness on the part of all Boston residents and law enforcement during the aftermath of the bombings. The Union is happy to hear that Brother Kenneweg remained safe during the incident and joins him in personally extending heartfelt condolences to the family and friends of the people lost and injured in this tragedy, and (my) deepest sympathy to anyone effected by this event. Our thoughts are with the City of Boston, especially now with the ongoing lockdown and search. In this time of need, M.E.B.A. members are encouraged to support the Good & Welfare Fund. The Fund is used to help active and retired M.E.B.A. members and their families in case of crisis. Members affected by the Boston Marathon bombings can apply for aid from the fund. Strengthening the fund will allow additional assistance to members and retirees in their time of hardship. Each M.E.B.A. hall has Good & Welfare receipt books. The Internal Revenue Service has ruled that the Good & Welfare Fund is exempt from Federal Income tax. Your contributions to the - 3 -

5 fund are tax deductible so please give liberally in order to help a Union brother or sister in need. Seek out your local Union hall for further details. FOURTH ANNIVERSARY OF THE MAERSK ALABAMA HIJACKING Last week, on the fourth anniversary of the pirate hijacking of the MAERSK ALABAMA M.E.B.A Retiree Mike Perry, former ALABAMA Chief Engineer, sent the following to his shipmates: To all of the Alabama Shipmates, On this anniversary of the navy freeing Richard, I have just received a phone call from Special Agent Steve Sorrells of the FBI. Steve is the agent that came to Mombasa to perform the investigation and collect our statements. Two years ago, he went out of his way to personally return to me the knife that I used to take down Abduwali with. They came right to my house to present it to me. Any way he called because he wanted us all to know that we have not been forgotten. They remember what we went through and what we did. He is a nice guy, and truly has reached out in respect to all of you. We all did good, we all came home. A job well done, thank you. In April 2009, the MAERSK ALABAMA was attacked and hijacked off the coast of Somalia. During the incident the ship s captain, Richard Phillips, was captured on a lifeboat and held prisoner for days. The Somali pirate, Abduwali Abdukhadir Muse, was identified as the ringleader of the pirates that boarded the ALABAMA. The pirates took hostage the Captain and other crewmembers on deck and made a series of demands for their return. However, Chief Perry and the rest of the crew refused to surrender and instead took control of the ship away from the bridge. They blacked the vessel out and powered it down while securing themselves in an area near the engine room. The pirates, unable to locate the crew or control the ship could not execute the rest of their plan. While Muse searched the engine room for the missing crewmembers, Perry popped out of the dark with a knife and turned the tables on him. Later, Muse temporarily was able to depart the ship onto the vessel s lifeboat via a botched hostage exchange. He and the other three pirates brought the ship s captain with them but Muse later surrendered to Navy officers aboard the USS BAINBRIDGE shortly before Navy Seal sharpshooters took down the final three pirates. Muse was sentenced to over 33 years in prison. The M.E.B.A. is extremely proud of the Officers and crew who were aboard the ALABAMA they proved how skilled and professional our U.S. merchant mariners are, and how they expertly handled the complexities and dangers of going to sea. THE SUEZ CANAL VS. THE PANAMA CANAL; A SHIPPING BATTLE - 4 -

6 The Suez Canal and the Panama Canal are competing heavily for shipping traffic. Currently, more fuel-efficient ships that can afford to take a slower route are sailing the Suez Canal rather than the Panama Canal. Despite the longer transit time, these vessels are winning the cargo race because they have higher container capacities and can transport more cargo at a lower cost. However, with the completion of the Panama Canal expansion, shippers transiting the faster South American waterway will eventually have the opportunity to catch up to the slower shippers utilizing the Suez, according to a recent Journal of Commerce (JOC) article. In the meantime, U.S. importers and exporters have not flocked to carriers using the Suez Canal, but are waiting to see if the cost benefit of shipping more cargo on bigger vessels is worth the time delays they would have to take in exchange. Many companies, such as Maersk, are implementing new routes through the Suez to fully take advantage of the cargo capacity on post- Panamax vessels. However, shippers are waiting for companies to release their new pricing lists, which will factor in fuel costs and the new hike in Suez Canal tolls, before they make the decision to switch shipping routes. Even in the cases where some cost savings many occur, there are shippers who will still utilize the faster Panama Canal route, especially for just-in-time inventories. The canal war will also cause carriers to eliminate smaller, less fuel-efficient ships and replace them with the new and large post-panamax vessels. This will give carriers more pricing power and control. Maersk will be upgrading its TP-7 service of 10, 4,900 TEUs, vessels that sail from North Asia to the U.S. East Coast via the Panama Canal to 12, 8,000 TEUs, vessels. The new TP-7 service will replace the company s suspended AE9 Asia-Europe route. The last of the Panamax vessels on Maersk s old TP-7 service route transited the Panama Canal in early April. According to the JOC, 16 services had connected the Far East and the U.S. East Coast via the Panama Canal until earlier this month. The services were made up of 4,500 to 5,500 TEU Panamax ships, which is the maximum size the Panama Canal can accommodate at this point in time. The recent changed by Maersk and other companies mean that eight strings of vessels will be transiting the Suez Canal, operating ships of 6,500 to 9,000 TEUs. The Panama Canal Authority expected such changes, but is not worried, as it believes profits and business can be regained once the Canal expansion is completed. TURKEY TO BUILD KANAL ISTANBUL Turkey will move forward with plans to build a 30-mile long shipping canal to link the Black Sea and the Sea of Marmara. The goal is to reduce congestion in the Bosphorus Strait, according to a government official. The Strait is currently the only maritime waterway leading to the ocean from the Black Sea and serves as an important trade route for Russian and Ukrainian grains and exports. Prime Minister Tayyip Erdogan introduced the idea of the Kanal Istanbul project in 2011 before he won the general election. It was considered a notable but impractical proposal. However, the Prime Minister and Deputy Prime Minister, and Turkey s Higher Planning Council believe the canal can be built and are moving forward with the project

7 The canal would turn Istanbul s European side into part of an island that would lie parallel to the north-west of the Bosphorus, according to the Journal of Commerce (JOC). There is no projected cost for the canal s construction at this time. According to Turkish officials, about 150 million tonnes of oil and petroleum products pass through the Bosphorus Strait every year. M.E.B.A. MOURNS THE PASSING OF JEFF JENKINS Jeff Jenkins, longtime member and former M.E.B.A. Representative in the Portland hall passed away last weekend at the age of 60. Jeff first turned wrenches as a member beginning in 1977 and had a long and productive career sailing with the Union until his retirement from the sea in As his retirement became effective, he took over our Portland Union hall as Representative in January Jeff proved able and effective in the job and kept the hall humming until the office closed down for cost-cutting reasons in April Once he retired from the daily grind, it freed him up to pursue some of his passions such as traveling with his Airstream trailer all over the great Northwest and beyond and being part of the rabid Airstreamer community. He leaves behind three children: Jeffrey Jr., Katherine and Laura Jenkins as well as ex-wife Mary. HORIZON LINES: LOOKING TO EXPAND CRANE/PE POSITIONS Looking for a good shore side job? Horizon Lines has expressed interest in increasing their M.E.B.A. staffed crane/port engineer department in Puerto Rico. Any member interested in this opportunity please contact Atlantic Coast VP Chris Guerra at cguerra@mebaunion.org or (201) TO SEE MORE JOB LISTINGS PLEASE VISIT: REGULAR MONTHLY MEETINGS Monday, May 6 Boston@1200; Jacksonville@1300; Seattle@1300; Tuesday, May 7 Baltimore/Calhoon School at CMES@1430; Charleston@1400; Houston@1315; San Francisco (Oakland)@1230; Wednesday, May 8 New Orleans@1315; Thursday, May 9 L.A. (Wilmington)@1230; New York (New Jersey)@1300; Norfolk@1230; Tampa@1300; Friday, May 10 Honolulu@1100; FINISHED WITH ENGINES