Shipyards

Small Shipyard Grant Applications Due April 16

For small shipyards—defined as those with fewer than 1,200 employees and involved primarily in the repair and construction of commercial vessels—time is fast running out for pursuing funds through the Maritime Administration’s Small Shipyard Grant Program. The deadline for submitting an application for this year’s round of grants is April 16—less than a month away.

Congress set aside $20 million in the fiscal year 2019 budget for the Small Shipyard Grant Program. On February 15, after a lengthy partial government shutdown to start the year and a three-week continuing resolution, Congress passed the omnibus appropriations bill and President Donald Trump signed it into law. The omnibus bill included $20 million for the Small Shipyard Grant Program. By law, the Maritime Administration (MarAd) had 15 days to announce the availability of grant funds, and the deadline to submit applications was set at April 16, 60 days after the budget became law.

Interested shipyards who have not already started or submitted an application still have time, but they need to act quickly, said David Matsuda, principal of Matsuda & Associates LLC, the company that spearheads the Small Shipyard Grant Coalition.

“They have to develop an application, identify the project they want to fund, what piece of equipment they want to purchase with the grant money, or what kind of training program they want to include,” Matsuda said. “There’s still plenty of time, but the deadline is about a month away, and these applications do take a bit of work to put together.”

The grant program funds up to 75 percent of the cost of a project, program or piece of equipment, so shipyards also have to identify at least 25 percent of the needed funding.

Matsuda said competitive projects are typically ones that help shipyards become more efficient.

“MarAd tends to like the ones where the training or the new equipment will lead to efficiencies and cost savings that ultimately benefit the customer,” he said.

Matsuda said equipment that helps speed up haul-out work, including drydocks and travelifts, are frequent recipients of grant funding.

“If you get a better or more efficient way to haul boats out of the water, that’s core to a lot of shipyards’ businesses, especially on the repair side,” he said.

Other types of projects that received funding in 2018 included plasma cutting systems, terrain and crawler cranes, water jet cutting machines, establishment of a lamination apprentice program, forklifts, and much more. In all, 29 shipyards received funding in 2018 ranging from just over $67,000 to more than $1.4 million.

State Of The Industry

The Small Shipyard Grant Program was a topic of discussion at a March 6 hearing in Washington, D.C., titled, “The State of the American Maritime Industry,” which focused on the maritime industry in the United States, especially as it relates to the fiscal year 2020 budget. The hearing featured testimony from a number of maritime industry leaders, including Matthew Paxton, president of the Shipbuilders Council of America.

Sen. Tammy Baldwin of Wisconsin highlighted the importance of the grant program to the maritime industry.

“The Small Shipyard Grant Program helps shipyards make needed upgrades and investments in workers,” Baldwin said. “The program helps ensure that America’s shipbuilding industry remains strong, all while supporting military shipbuilding.”

Baldwin went on to ask Paxton to discuss how the grant program benefits the country at large.

“I think the wisdom of the Small Shipyard Grant Program is the reality that smaller and mid-tier shipyards don’t have the funds to do capital investments, to do some of the expenditures it takes to make shipyards more efficient and more competitive,” Paxton said. “Through the Small Shipyard Grant Program, we’ve seen some of the smaller and mid-tier shipyards get more and more competitive.”

Those capital investments, then, mean more shipyards are able to compete for government contracts, which drives down prices, Paxton said.

“You have more competition because shipyards can all of a sudden bid on those government contracts they couldn’t bid on before, because they’ve learned how to build more and more complex commercial ships,” Paxton said. “As a direct result, there’s a cost savings that comes back to the taxpayer, because again, you have more shipyards bidding on more contracts, be it NOAA ships, be it Coast Guard ships, be it Army ships. All those grants went into those shipyards to allow them to get welding machines and heavy lifts, to allow them to be more competitive.”

Since the Small Shipyard Grant Program was established in 2006, funding each year has averaged between $10 million and $20 million, with a peak allocation of $100 million in 2009 as part of the American Recovery and Reinvestment Act.

For more information on the grant program, see the Maritime Administration website, www.maritime.dot.gov, and search for “Small Shipyard Grants” or visit the Small Shipyard Grant Coalition website, www.smallshipyards.com.

D.C. Fly-In Set for March 26

Despite the longtime success of the Small Shipyard Grant Program, the president’s fiscal year 2020 budget proposal includes zero dollars for it. However, Matsuda said that’s not entirely surprising.

“It’s never been in any president’s budget in the history of the program,” he said. “It’s not a surprise, but it’s a good reminder that it takes some work to keep this program going. Congress really does need to hear from industry if they want it to continue, or else Congress will discontinue it. That happened in the past, and we’ve got to work to keep it going.”

To that end, the Small Shipyard Grant Coalition is organizing a Washington, D.C., fly-in for March 26, named “Small Shipyard Day on Capitol Hill.” The event is a chance for representatives from small shipyards around the country to interact in person with congressional officials in order to communicate the vital role shipyards play in the economy.

“Our goals are to help promote awareness of the program and the importance of the program amongst the decision makers in Washington,” Matsuda said.

Participation is free, but space is limited. Registration details are available online at the Small Shipyard Grant Coalition website.

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