PVA’s Gaspardo Applauds Tax Cuts, Raises Concerns About Illegal Chartering

Gus Gaspardo is president of the Padelford Packet Boat Company, St. Paul, Minn., and 2018 president of the Passenger Vessel Association. Gaspardo has been chairman of PVA’s Regulatory Committee and Rivers Region chair, and regularly participates in the PVA/Coast Guard Quality Partnership meetings and in PVA-sponsored Congressional Fly-Ins.

WJ: What is the single most important issue facing PVA members right now?

Gaspardo: The Passenger Vessel Association represents companies that operate U.S.-flagged passenger vessels in nearly every port in the United States.  These members operate a variety of different types of vessels from large public ferries to small private ferries, from dinner boats to excursion vessels, from sailing vessels to whale watch boats.

As a result, the issues on which PVA works are as diverse as the industry it represents. The association interacts regularly with Congress and many of the federal regulatory agencies, including the U.S. Coast Guard.

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But some issues are more consequential than others for passenger vessel operators.  Over the last several years, the association has been focusing its attention on combating illegal charter operations.  These illegal operators are cropping up in every major port, and they skirt the law by offering charters to the public aboard uninspected vessels, which have in many cases unlicensed and inexperienced crew.

We feel strongly that this illegal practice is a growing threat to the traveling public’s safety.  Illegal charter operators also reflect poorly on domestic passenger vessel operators who comply with stringent regulations and have stellar safety records.

PVA is strongly encouraging the Coast Guard to increase enforcement against illegal charter operators nationwide.  Last summer, the Coast Guard in Chicago boarded 39 vessels suspected of operating illegal charters.  This enforcement effort resulted in the issuance of 22 notices of violations. We are now seeing more Coast Guard enforcement efforts in other ports as well.

PVA also advocates for sufficient resources to be allocated to the Coast Guard’s marine safety mission, especially its vessel inspection services.  Putting dollars into vessel inspection functions to prevent accidents is far more economical than responding to vessel casualties after they occur.

The Maritime Safety Act of 2018, developed by the House of Representatives, has several positive features that will enhance the Coast Guard’s prevention mission.

PVA is part of a broad coalition of maritime interests supporting efforts in Congress to clarify and simplify the regulatory regime for vessel water discharges that are produced incidentally during normal operations.  We hope the Vessel Incidental Discharges Act will be finalized and signed into law this fall.

WJ: How have the Trump tax cuts and the booming economy affected the passenger cruise industry?

Gaspardo: A strong U.S. economy is good for everyone, and the passenger vessel industry has been experiencing improving business conditions for the last several years as a result. A strong domestic travel and tourism market coupled with available consumer discretionary funds underpins these conditions and signals continued optimism for the future.

New vessel purchases, along with new vessel construction across many passenger vessel market segments, are occurring; as a result of this optimism and industry growth, expansion and innovation will follow.

WJ: Do you see any lasting effects on the passenger vessel industry from the widely publicized Duck Boat casualties in Missouri?

Gaspardo: The National Transportation Safety Board and the Coast Guard have both independently initiated investigations relating the accident involving Stretch Duck 07 in Branson, Mo.  It is unclear when these reports will be finalized, but they could take anywhere from six months to a year to wrap up.

At the same time, Sen. Claire McCaskill (D-Mo.) has introduced legislation in the Senate that would require amphibious vehicle operators operating on federal waters to adopt additional safety measures during waterborne operations.

PVA has worked closely over the years with the Coast Guard and the National Transportation Safety Board to promote safe practices for amphibious vehicle operators, and we will continue to do so.

PVA will, of course, monitor this situation as it unfolds and continue to promote the advancement of safety practices among PVA member amphibious vehicle operators.

Amphibious vehicle operators, such as DUKWs, make up only  a small segment of the U.S. passenger vessel industry as a whole.   Consequently, PVA does not anticipate that the DUKW tragedy in Missouri will have policy or business impacts on other passenger vessel operators.

WJ: How have the Trump administration’s steel and aluminum tariffs affected passenger vessel orders?

Gaspardo: Over the past two years, construction of ferries and other passenger vessels in U.S. shipyards has boomed.  It’s too early to determine how much impact steel and aluminum tariffs will have, but one PVA member constructing a ferry with Canadian steel has reported a cost increase of several hundred thousand dollars.

WJ: Talk a bit about the efforts to reduce emissions by ferries and cruise vessels, including North America’s first LNG-powered ferry in Quebec.

Gaspardo: U.S. ferries have looked at possible conversions to LNG and other alternate fuels but have thus far not chosen to go down that route.  Washington State Ferries is likely going to convert several large ferries to hybrid diesel/electric propulsion.

Another PVA operator is constructing a sightseeing vessel that will employ lithium-ion batteries and has announced its participation in a project for the nation’s first hydrogen fuel cell boat.  That said, most PVA members construct vessels powered by diesel engines that conform to the most recent EPA emission standards, and that have significantly reduced carbon emissions.