What you need to know about the Jones Act, which Trump just waived for Puerto Rico

The Trump administration authorized lifting the act on Thursday.

ByABC News
September 28, 2017, 5:25 PM

— -- After public pressure mounted, the Trump administration on Thursday authorized that the almost century-old Jones Act be waived following Hurricane Maria to ease shipping rules for Puerto Rico.

As the situation in Puerto Rico worsened in the days after the hurricane slammed the island, some members of Congress asked the Department of Homeland Security (DHS) to issue a waiver, as it had for previous hurricanes.

On Wednesday, Puerto Rico Gov. Ricardo Rossello, also called on the Trump administration to issue a waiver.

Homeland Security Adviser Tom Bossert, who said he spoke with Rossello, said that the waiver has not come too late and is merely a proactive measure.

The controversy before the waiver

The president was asked Wednesday why his administration lifted the act to get aid to Texas and Florida but hadn’t done so in the wake of Maria.

“We're thinking about that,” Trump said before boarding Air Force One Wednesday on his way to Indiana. “We have a lot of shippers and a lot of people that work in the shipping industry that don't want the Jones Act lifted. We have a lot of ships out there right now.”

This was the first time that a governor from a U.S. territory has made a Jones Act waiver request. Generally, the requests come from another federal agency or shippers themselves.

Democrats and Republicans alike began pushing earlier this week for DHS to lift the Jones Act restrictions.

Sen. John McCain, R-Ariz., who’s been fighting to repeal the law for years, said it’s “unacceptable to force” Puerto Rico to pay “twice as much for food, clean drinking water, supplies and infrastructure” as they recover from Maria.

“Now, more than ever, it is time to realize the devastating effect of this policy and implement a full repeal of this archaic and burdensome Act,” McCain wrote in a statement Tuesday.

“Mr. President, please waive the Jones Act so that Puerto Rico can receive the relief it needs!” Rep. Ron DeSantis, a Republican from Florida, wrote on Twitter.

During a congressional hearing with the secretary of homeland security Wednesday, Sen. James Lankford, R-Okla., said that “Puerto Rico, in good times, thinks that the Jones Act cost them about a billion-and-a-half dollars in economic activity a year, but they especially need it now in just getting vessels in.”

Eight members of Congress led by Rep. Nydia Velazquez, D-N.Y., sent a written request Monday to DHS acting Secretary Elaine Duke.

By Wednesday, DHS said it was reviewing the request.

For Harvey and Irma, which hit Florida, Texas and parts of Louisiana, the Departments of Defense and Energy requested a week-long waiver and a week extension, which was granted by DHS on the basis of national defense. (link: https://www.dhs.gov/news/2017/09/08/dhs-signs-jones-act-waiver)

As of Wednesday morning, neither department had made a request related to Maria.

On Thursday, DHS said that the Secretary of Defense Jim Mattis had determined that a waiver is in the interest of national defense. The Department of Defense referred ABC News’ questions about the reasoning to the DHS letter.

“This waiver will ensure that over the next 10 days, all options are available to move and distribute goods to the people of Puerto Rico,” said Duke in a statement.

What is the Jones Act?

The Jones Act, which was passed as part of the Merchant Marine Act of 1920, prohibits any vessel not built, owned and partly crewed by the U.S. and its citizens and permanent residents to transport cargo between points in the United States.

It was named for its sponsor Sen. Wesley R. Jones, a Republican from Washington State.

The act's preamble lays out its purpose, which is to maintain a strong merchant marine comprised of U.S. citizens:

"It is necessary for the national defense and for the proper growth of its foreign and domestic commerce that the United States shall have a merchant marine of the best equipped and most suitable types of vessels sufficient to carry the greater portion of its commerce and serve as a naval or military auxiliary in time of war or national emergency, ultimately to be owned and operated privately by citizens of the United States."

A 2013 report from the U.S. Government Accountability Office (GAO) was inconclusive but noted that the results of removing the Jones Act might not be all positive for Puerto Rico’s economy.

"The effects of modifying the application of the Jones Act for Puerto Rico are highly uncertain, and various trade-offs could materialize depending on how the Act is modified,” the report found. “Because of cost advantages, unrestricted competition from foreign-flag vessels could result in the disappearance of most U.S.-flag vessels in this trade, having a negative impact on the U.S. merchant marine and the shipyard industrial base that the Act was meant to protect."

The most recent time the Jones Act was waived prior to hurricanes Harvey and Irma was in December 2012 to help in the aftermath of Hurricane Sandy.

Why it wasn’t waived sooner

According to Bossert, the Jones Act was finally waived for Puerto Rico not out of necessity, but as a proactive measure at the request of Rossello.

"We had enough capacity of U.S.-flagged vessels to take more than, or to exceed the requirement in need of diesel fuel and other commodities into Puerto Rico," Bossert said. After his conversation with the governor, Bossert said he talked to Trump about the matter.

"He thought that was absolutely the right thing to do and waived it right away," Bossert said at a press briefing Thursday. "So that was not too late, it was not even too early -- it was just the right thing to do proactively."

According to DHS, the issue with transporting goods to Puerto Rico has had more to do with moving around on the island than getting to the island.

"It was a little bit misunderstood and misreported that we had a capacity problem and had to waive the Jones Act," Bossert said. "Not the case."

According to Bossert, plenty of supplies were provided to the island. "The challenge became then land-based distribution," he said. "That remains the challenge, that remains the priority today."

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