Grant Program Is Model Of Effective Government Help

Since it was inaugurated in 2008, MarAd’s Small Shipyard Grant Program has awarded more than $226 million in a total of 216 grants. These grants help fund upgrades and expansions that often lead to more competitive operations, higher-quality ship construction and improved employee skills. The grants support employee training and equipment improvements that foster increased efficiency and economic growth.

In 2009, its spending went from $10 million to $100 million in a one-time response to the 2008 financial meltdown as part of the American Recovery and Reinvestment Act.

In 2013, U.S. shipbuilders produced $37.3 billion in gross domestic product.

Often family-owned and employing fewer than 1,200 workers, small shipyards “play a critical role in contributing to our nation’s economy,” MarAd said in announcing this year’s recipients. Supporting more than 400,000 jobs, they create employment opportunities for working families and small communities.

“Small shipyards are an irreplaceable aspect of America’s shipbuilding industry,” said Maritime Administrator Mark Buzby. “They are a key component to national security and our economic viability as a whole; providing good jobs for hardworking Americans.”

The Small Shipyard Grant program is in many ways a model of effective federal support. That one-time stimulus deal aside, its small size is one of the keys. When it was founded, the program was budgeted at only $10 million; in 2018 the amount was increased to $20 million. This year’s version of the Small Shipyard Grant Program was authorized under Section 3501 of the John S. McCain National Defense Authorization Act for Fiscal Year 2019. The program requires almost no overhead, with almost all of its budget going to the grant recipients. That means every dollar has real impact. Those who apply for the grants must cover 25 percent of the cost of their proposed projects, with the grants covering the remaining 75 percent. The money goes toward equipment acquisitions and projects that help small shipyards grow and expand their business.

The program has proven popular enough among both parties that some version of it is regularly included in appropriations bills. It undoubtedly helps that small shipyards are located in most states, and grants can be distributed over much of the country.

Nevertheless, it is not an established, continued program with guaranteed funding. It is important enough to shipyards that a new group of maritime industry leaders, the Small Shipyard Grant Coalition, participated in the first-ever “fly-in” to Washington on March 26.  They met with the Maritime Administrator as well as leaders in the Senate and House of Representatives, including key congressional staff, to discuss the future of the grant program. It’s another front in our industry’s never-ending effort to tell the story of how inland maritime commerce benefits the American people.