WASHINGTON — Retail and wholesale apparel importers are mobilizing lobbying efforts on Capitol Hill as they become increasingly concerned over the Senate’s inaction on a port security bill.
More than two dozen retail executives, including representatives from Neiman Marcus, Liz Claiborne Inc. and J.C. Penney Co., as well as National Retail Federation officials, met last week with Sen. Susan Collins (R., Maine), who is a co-sponsor of the bill in the Senate, to discuss provisions in her bill and its timing. Other trade associations, such as the American Apparel & Footwear Association and the Retail Industry Leaders Association, are also gearing up efforts to build momentum for passage of a bill this year.
Retailers and wholesalers imported $89.2 billion worth of apparel and textiles to the U.S. last year and are supportive of port, cargo and supply chain security programs. However, they are wary of potentially burdensome legislation, such as a push by Democrats for 100 percent inspection of all U.S.-bound cargo.
Although the pending port security bills are “not perfect,” the business community is largely behind many of the provisions in the bills and wants to see Congress pass something this year.
“You don’t want this to be a political football,” said Frank Kelly, vice president of international trade compliance and government affairs at Liz Claiborne. “But you also want this thing to be somewhat logical…and take facilitating trade and combine it with more security. You need a combination of both.”
The House passed a port security bill in early May, and a companion bill is pending in the Senate. The bipartisan bill in the House — the SAFE Ports Act — authorizes more than $5 billion for port security over five years and requires the government to finish installing radiation screening equipment at 22 U.S. ports by the end of the 2007 fiscal year, which lawmakers maintain will cover 98 percent of incoming containers.
Executives from Gap, Limited, Nike and Wal-Mart met with Senate Majority Whip Mitch McConnell (R., Ky.) and Rep. Dan Lungren (R, Calif.), co-sponsor of the House bill, last week as part of the RILA’s government affairs committee meeting to discuss the legislative agenda for the remainder of the year, including the status of port security legislation.
A Senate panel has approved a bill that would take security one step further, requiring U.S.-bound cargo to be screened at foreign ports or be turned away from entering the U.S., but does not set a deadline for enforcement. It would also create a pilot program at three foreign ports to test and establish a 100 percent integrated screening system within one year.
“We want to see legislation move and get wrapped up this year,” said Erik Autor, vice president and international trade counsel at the NRF. “We don’t want to think a good Congress will leave the issue hanging out there for the next Dubai Ports World issue [the United Arab Emirates-owned company that sparked the political debate over port security when it attempted to acquire terminal operations at six key U.S. ports] or a security incident that revives the whole debate, because what could emerge is something a lot more draconian and problematic to deal with than what is on the table right now.”
The snag on the Senate side appears to be a jurisdictional dispute between two key committees. Autor said unless that dispute is resolved and a compromise reached, legislation will not move this year.
Collins and Sen. Patty Murray (D., Wash.) are co-sponsors of the GreenLane Maritime Cargo Security Act, which passed out of committee at the beginning of May and would authorize $835 million for port security each fiscal year through 2012.
It would also provide for a pilot program at three foreign ports to test and establish 100 percent integrated screening systems within one year. In addition, the bill would require 22 U.S. ports to establish procedures and technology to examine 100 percent of all U.S. containers for radiation by the end of 2007.
Retail executives, in their meeting with Collins, expressed their concern over the impasse and asked for clarifications on provisions in her bill, such as where the scanning in the three test foreign ports had to take place — at feeder ports, or at consolidation ports such as Hong Kong. The answer was the final port before cargo is shipped to the U.S.
The retail and importing sector will also closely watch for a revival of the lightning-rod issue in the Congressional debate over proposed measures for 100 percent inspection of all U.S.-bound cargo, which they have thus far successfully lobbied against.
Democrats in Congress are seeking to make port security an election year issue and have, to date, unsuccessfully pressed for 100 percent inspection of all U.S.-bound cargo.
“I don’t think we are out of the woods yet on that, but the vote on that issue has been somewhat along partisan lines,” said Autor.
He said legislation moving through the Senate is “always a risk” because of amendments, such as the 100 percent inspection requirement, that could go through if attached to other legislation.
“We want to make sure that what finally comes out of this process is something the business community can still work under,” said Stephen Lamar, senior vice president at the AAFA, noting 100 percent inspection of all U.S.-bound cargo is “problematic” and commercially unfeasible.
Lamar said better policy comes out of Congress when it is in a “planning mode” as opposed to a “reactive mode.”
“The concept we are looking at here is putting in place a process and framework that will govern this issue moving forward,” said Lamar. “If instead something happened [such as a security breach or terrorist attack], then Congress would go into a reactive mode.”
Claiborne’s Kelly said, “I’m waiting to see what the final bill will be. It’s a tough nut to crack. You want something that provides meaningful cargo and port security, but does not hinder trade.”