Small Shipyards Win A Funding Boost — But The Fight Isn’t Over

By Dave Matsuda, Small Shipyard Grant Coalition

Congress delivered big for the Small Shipyard Grant Program in its Fiscal Year 2026 appropriations, with $35 million available — the most since 2009. It’s a long-overdue boost for small, often family-owned shipyards that quietly power America’s maritime sector.

As of this writing, the U.S. Department of Transportation’s Maritime Administration has not yet released the notice of funding opportunity for this round of Small Shipyard Grants, but that could come any day. Regardless of when the announcement is made or the deadline is to apply, small shipyards need to be ready to move fast with applications for grants to support capital improvement projects or maritime training programs.

Note: the Small Shipyard Grant Program defined small shipyards as those with 1,200 production employees or fewer that are engaged in the construction and repair of commercial vessels at least 40 feet long or non-commercial vessels 100-feet-long or more.

Even as this year’s grant process is unfolding, we’re looking toward fiscal year 2027 appropriations. We’re asking members of Congress to fund the Maritime Administration’s 2027 Small Shipyard Grant Program at $105 million. That level is consistent with President Trump’s previous requests and funds the program robustly enough to keep chipping away at the capital backlog in America’s maritime and shipbuilding sector.

The administration has made clear its maritime and shipbuilding goals, most recently in the Maritime Action Plan (MAP). The well-established success of the Small Shipyard Grant Program is also evident in the MAP, which contains a preliminary proposal to expand eligibility to large shipyards, though further details are forthcoming.

The MAP proposal to expand this program to include large shipyards raises serious concerns. Small shipyards are typically family-owned small businesses. They do not have access to Wall Street capital or the substantial, ongoing Department of War funding streams that are available to large shipyards. They face many of the same challenges, though, including maintaining aging waterfront infrastructure, investing in modern equipment and technology and competing in an increasingly tight labor market for skilled workers.

When a trained employee leaves a small shipyard for higher wages at a federally supported large shipyard, the small business absorbs the cost of training within this shared and highly constrained labor pool. Federal programs, like the Small Shipyard Grant Program, are designed to help level this uneven playing field and not further tilt it.

In addition, a new shipyard capacity expansion grant program proposed in the MAP could work, as long as it has appropriate safeguards to protect small shipyards. We look forward to learning more details of this idea.

Small shipyards may not drydock aircraft carriers, but they are part of the essential supply chains for large military vessels, as well as constructing and repairing other government vessels.

They are essential to America’s working waterfront and indispensable to the functioning of the American economy. Small shipyards build and maintain the bulk of America’s working fleet. These are the workboats that move commerce on our rivers and coasts, support export markets from the nation’s interior, ferry vehicles and passengers in remote and island communities, harvest seafood, perform critical marine construction and infrastructure projects and carry out safety, firefighting, law enforcement, research and environmental protection missions every day.

The Small Shipyard Grant Coalition stands ready to work with Congress and the administration to achieve national objectives through the strengthening of America’s hundreds of small shipyards. We are planning a national fly-in to Washington DC in mid-April to make sure our voice is heard on these important decisions ahead. America’s strong maritime future depends on a broad, competitive and resilient industrial base, and small shipyards are a cornerstone of that foundation.