FMC down but not out

   In the days leading up to the June 30 expiration of Commissioner Daniel B. Maffei’s term with the U.S. Federal Maritime Commission, the National Industrial Transportation League sounded an alarm.
   “This creates a third vacancy and hamstrings the ability of the commission to run effectively and efficiently,” warned Mary Pileggi, chair of the trade group, in a June 21 letter to the White House.
   The NIT League hoped that President Trump would renominate Maffei to the position of FMC commissioner to “ensure that the commission remains in a position to do its work and carry out the regulatory reform goals of the administration.”
   The clock ran out and Maffei departed the agency following the expiration of his one-year holdover period from his term’s official expiration on June 30, 2017, leaving two sitting commissioners — Acting Chairman Michael A. Khouri and Commissioner Rebecca Dye, both Republicans.
   Maffei, a Democrat, joined the commission on July 18, 2016, after having served as senior fellow at the Center for the Study of the Presidency and a senior adviser at the Commerce Department. He also served as a U.S. congressman from New York from 2009 to 2011 and 2013 to 2015. 
   FMC commissioners must be nominated by the president and confirmed by the Senate for each five-year term they serve. The commissioners are permitted to stay in those positions for one year past their terms’ expirations, if their replacements have not yet been confirmed by the Senate.
   Maffei was nominated to the FMC on Nov. 19, 2015, confirmed by the Senate on June 29, 2016, and appointed to the commission by President Obama on July 18, 2016. He took over the seat of former FMC Chairman and Commissioner Richard A. Lidinsky Jr., who retired in the summer of 2016.
   Pileggi complimented Maffei, saying he was “a valuable member of the commission, demonstrating a deep commitment to the work and ideals of the commission since his initial appointment in July 2016.”
   Other trade groups expressed similar concerns with Maffei’s departure, such as the Green Coffee Association and the National Retail Federation (NRF). 
   “We are greatly concerned that the commission may not be able to continue to serve the American industries at the needed capacity without it being fully staffed,” said Jason Cortellini, chairman of the Green Coffee Association, in a letter to the FMC.
   Jon Gold, NRF’s vice president of supply chain and customs policy, noted there are several important industry matters before the FMC, including the detention and demurrage petition and the proposed changes to the PierPass program in Southern California. “We need a fully functioning FMC to address these and other issues, especially as the supply chain and maritime industry continue to evolve," he said.
   The FMC, an independent agency, has seats for five commissioners from both the Republican and Democratic parties when fully staffed. However, even with two commissioners and by statute, the FMC continues to perform its work at an undiminished pace, said Chairman Khouri. (At the time of writing this article, President Trump had not announced any nominations for FMC commissioner.)
   “We’re not out of business” because the FMC is down to two commissioners, Khouri said in an interview. “Our process is quite robust and moving forward.”
   Commissioner William P. Doyle left the FMC in early January, ahead of his June 30 term expiration, to become executive director and CEO of the Dredging Contractors of America, while Commissioner Mario Cordero departed the agency in the spring of 2017 to become executive director of the Port of Long Beach.
   Despite the fact that the FMC is now down to two commissioners, Khouri and Dye, as a quorum, are still able to vote on matters before the agency during public meetings or through circulated recommendations from staff. “That process would not be any different if we had five, four or three commissioners,” Khouri said. 
   In addition to the ongoing work on the detention/demurrage fact-finding and consideration of amendments to PierPass, as well as monitoring the competitiveness of container carrier and marine terminal operator agreements and alliances, the FMC recently completed publication of the final new regulations governing Negotiated Rate Arrangements and NVOCC Service Arrangements. 
   The FMC remains vigilant in ensuring that ocean transportation intermediaries — freight forwarders and non-vessel-operating common carriers — remain compliant with the Shipping Act, Khouri said.
   The agency’s Regulatory Reform Task Force also continues to review existing regulations under the commission’s authority and will determine which are burdensome and no longer necessary to meet the agency’s obligations under the Shipping Act. 
   In December, Dye released her final Supply Chain Innovation Teams report, which, among other things, calls for the creation of a national seaport information portal for the container shipping industry’s use.
   The FMC currently operates with a budget of just over $27 million and has about 111 staff with an authorization of up to 129. The commission remains focused on staying fully staffed with key personnel, such as transportation economists and lawyers. 
   “My sense is that the mood is positive across the commission,” Khouri said. “The staff is really dedicated and knows they’re doing important work.”