Posted on: Friday, February 14, 2003
Bill lets cruise line sail in Hawai'i
By Janis L. Magin
Associated Press
The new federal spending bill approved by Congress last night includes a provision that allows Norwegian Cruise Line to sail foreign-built ships under a U.S. flag in Hawai'i waters.
The ships, the first of which may begin cruising the Islands next year, could potentially create thousands of jobs and inject millions of dollars into the state's tourism industry.
"This will be a major economic boost to the Hawai'i tourism industry and the economy in general, especially to the Neighbor Islands," said U.S. Rep. Ed Case, whose district encompasses rural O'ahu and the Neighbor Islands.
The U.S. House yesterday overwhelmingly approved the vast $397.4 billion fiscal 2003 appropriations bill, which finances every federal agency but the Pentagon for the rest of this federal budget year, which began Oct. 1. Hawai'i Democrats Case and Neil Abercrombie both voted yes on the measure, which passed on a 228-83 vote.
The Senate passed the bill by a vote of 76-20 last night. President Bush would sign the bill into law, said White House spokeswoman Claire Buchan.
"I hope that this initiative will help our economy and provide much needed jobs for our people," said Sen. Dan Inouye, D-Hawai'i, who inserted the language into the Senate version of the bill last month. Inouye and Sen. Daniel Akaka, also a Hawai'i Democrat, both voted to pass the bill.
The provision allows Norwegian to finish building overseas two partly built cruise ships destined for Hawai'i under a failed American ship building project, and then sail them exclusively in Hawai'i. It also allows the cruise line to reflag an additional cruise ship already in operation.
The provision exempts Norwegian's ships from federal law that prohibits foreign-built ships from operating between U.S. ports. It also requires the Miami-based cruise line to employ American crews and abide by all U.S. laws.
The exemption will authorize Norwegian to be the only company to provide interisland cruise service exclusively in Hawai'i.
A joint House-Senate conference this week amended the language to say, "... any ship documented under the authority of this section shall operate in regular service transporting passengers between or among the islands of Hawai'i and shall not transport passengers in revenue service to ports in Alaska, the Gulf of Mexico or the Caribbean Sea ..."
Case said the language was amended to satisfy some opponents of the provision.
"Members of Congress from those locations representing shipping interests did not want these ships to come into competition in those areas," he said.
Inouye's office has said the first ship would begin service next year and create as many as 700 jobs. By the time the second ship is completed and the third existing ship is reflagged, the number of jobs created in Hawai'i could be as many as 3,000, the senator has said.
The provision does not call for any federal money to be used. The Maritime Administration was stuck with $185 million in guaranteed debt on the vessels when construction ended last year.
The two 1,900-passenger ships were being constructed in Mississippi as part of the failed Project America program to build cruise ships in the United States for the first time in more than 40 years.
The uncompleted ships and materials were bought by Norwegian last year and sent to Europe after Northrop Grumman Corp. canceled the project. The defense contractor had been building the two vessels for American Classic Voyages, which filed for bankruptcy protection Oct. 19, 2001, citing losses after the Sept. 11, 2001, attacks. The collapse of the Miami-based cruise company eliminated 2,150 jobs, including 1,100 in Hawai'i.
Norwegian, whose Norwegian Star began sailing interisland cruises in December 2001, has sought the exemption from the federal ban on foreign-built ships operating between U.S. ports.
To get around that law, the Norwegian Star now makes a trip to Fanning Island in the Republic of Kiribati on each of its interisland cruises.
