To amend title 46, United States Code, to include the replacement or purchase of additional cargo handling equipment as an eligible purpose for Capital Construction Funds, and for other purposes.
- Bill Number
- H.R. 3842
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Transportation and Public Works
- Status
- Introduced
- Latest Action
- 2025-06-10: Referred to the Subcommittee on Coast Guard and Maritime Transportation.
- Last Updated
- 2025-09-27T08:05:43Z
AI-Generated Summary
Purpose
This bill (H.R. 3842) aims to expand the Capital Construction Fund (CCF) program under U.S. maritime law. The CCF allows certain taxpayers to defer taxes on income deposited into a fund, which can then be used for qualified investments in vessels or related assets. The legislation broadens the program to include investments in cargo handling equipment and marine terminals, promoting U.S.-made equipment, port infrastructure, and job protection while restricting certain foreign imports.
Key Provisions
- Definitions (Section 1): Introduces terms for "cargo handling equipment" (vehicles or land-based tools used at marine terminals to lift or move cargo, prioritizing U.S.-manufactured items unless unavailable in sufficient quantity or quality) and "marine terminal" (facilities like docks, piers, and adjacent areas for loading/unloading ships).
- Establishing a CCF (Section 2): Allows U.S. citizens owning/leasing eligible vessels and operators of U.S. marine terminals to enter agreements with the Secretary (of the Department of Homeland Security, overseeing the U.S. Coast Guard) to create a CCF. Funds can support replacement, additional, or reconstructed vessels or cargo handling equipment at U.S. marine terminals.
- Deposits and Withdrawals (Sections 3–4): Extends deposit and withdrawal rules to include marine terminal operations. Limits deposits based on taxable income from terminal activities or equipment operations.
- Qualified Withdrawals (Section 5): Permits tax-deferred withdrawals for acquiring, building, or reconstructing vessels, barges, containers, or cargo handling equipment, including paying off related debts. Prohibits withdrawals for:
- Fully automated equipment (remotely operated or monitored) if it results in a net job loss at the terminal, as determined by the Secretary.
- Cranes made in the People's Republic of China (PRC).
- Treatment of Withdrawals and Accounting (Sections 6–7): Adjusts tax basis rules and withdrawal ordering (first-in, first-out or last-in, first-out methods) to include cargo handling equipment alongside vessels.
- Equipment Availability Reporting (Section 8): Requires the Secretary to annually publish a Federal Register notice seeking information on U.S.-manufactured cargo handling equipment availability and share results with CCF participants.
Significant Changes to Existing Law
- Expands CCF eligibility beyond vessel owners to include marine terminal operators, a new category.
- Adds cargo handling equipment as a qualified use for CCF funds, previously limited to vessels, barges, and containers.
- Introduces restrictions on automation (to protect jobs) and PRC-manufactured cranes, which were not previously addressed in the CCF statute (title 46, U.S. Code, chapter 535).
- Requires annual transparency on domestic equipment availability to guide investments.
Potential Impacts
- Government Agencies: The Department of Homeland Security (via the U.S. Coast Guard or Maritime Administration) gains administrative duties, including determining job impacts from automation and publishing annual reports, potentially increasing workload and oversight costs.
- Citizens and Businesses: U.S. port operators and shipping companies can access tax incentives for modernizing equipment, potentially lowering costs and improving efficiency. Workers at marine terminals may benefit from job protections against excessive automation. Domestic equipment manufacturers could see increased demand.
- International Relations: The ban on PRC cranes may strain trade ties with China and encourage sourcing from allies, aligning with broader U.S. efforts to reduce reliance on Chinese infrastructure (e.g., due to security concerns like potential surveillance). It could indirectly boost exports of U.S.-made equipment to global ports.
Main Stakeholders Affected
- Marine Terminal Operators and Port Authorities: Gain access to CCF for equipment upgrades but must comply with job and sourcing rules.
- Vessel Owners and Shipping Companies: Existing CCF users unaffected directly but may collaborate with terminals; the program now supports integrated supply chain investments.
- Cargo Handling Equipment Manufacturers: U.S. firms benefit from preferences; foreign (non-PRC) producers may fill gaps if U.S. supply is insufficient.
- Port Workers and Unions: Protected from job losses due to automation, potentially stabilizing employment in the maritime sector.
- Taxpayers and the U.S. Treasury: Deferred taxes from CCF could reduce short-term revenue but aim for long-term economic growth in domestic maritime industries.
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens enforcement of "Buy American" preferences in maritime investments by tying tax benefits to domestic sourcing, potentially inviting challenges if availability determinations are disputed. The job-loss prohibition introduces subjective Secretary discretion, which could lead to administrative reviews or litigation over "net loss" calculations.
- Constitutional: No direct conflicts; aligns with Congress's commerce clause authority over interstate and foreign trade. The PRC crane ban raises no ex post facto or due process issues as it applies prospectively to new purchases.
- Political: Reflects priorities in U.S. maritime policy, such as enhancing supply chain resilience, countering Chinese economic influence (e.g., amid port security debates), and supporting blue-collar jobs. It could influence broader infrastructure bills or trade negotiations without partisan overtones in the bill text.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (3)
Rep. Carter, Troy A. [D-LA-2], Rep. Carson, André [D-IN-7], Rep. Malliotakis, Nicole [R-NY-11]
Recent Actions
- 2025-06-10: Referred to the Subcommittee on Coast Guard and Maritime Transportation.
- 2025-06-09: Referred to the House Committee on Transportation and Infrastructure.
- 2025-06-09: Introduced in House
- 2025-06-09: Introduced in House
Bill Versions
- To amend title 46, United States Code, to include the replacement or purchase of additional cargo handling equipment as an eligible purpose for Capital Construction Funds, and for other purposes. — issued 2025-06-09 — PDF (7 pages)