Red Hill crisis another example of Jones Act getting in the way

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By Keli‘i Akina

Oahu residents are keenly aware of the yearslong saga in which leakage from the U.S. Navy’s Red Hill Bulk Fuel Storage Facility in Moanalua has been contaminating the island’s water supply, sickening residents and forcing thousands of people out of their homes.


The situation became so bad that the Pentagon last year committed the Navy to decommissioning the Red Hill site and moving all its fuel to other locations, including Kalaeloa on the western tip of Oahu and elsewhere throughout the Pacific.

Keli’i Akina

But who knew the protectionist federal maritime law known as the Jones Act would become part of the Red Hill discussion?

U.S. Rep. Ed Case of Hawaii, that’s who, and I’m glad he brought it up.

The 1920 Jones Act limits the shipment of goods between U.S. ports to only ships that are U.S. flagged and built and mostly owned and crewed by Americans — which means the Navy is supposed to use Jones Act vessels if it is going to move fuel from Red Hill to other points within the U.S.

So what’s the problem? Two things. First, Jones Act ships cost significantly more to use than internationally flagged vessels. And second, there really aren’t any Jones Act vessels available to use anyway.

Recognizing this, Case this week urged U.S. Secretary of Homeland Security Alejandro Mayorkas to grant a waiver of the Jones Act.

He said “as a practical matter, Jones Act ships are functionally unavailable for this timeframe and prohibitively expensive due to the very limited number of fuel tankers in the Jones Act fleet, which are fully committed elsewhere.” 

Case also requested a waiver of the federal government’s “military cargo preference” mandate because any fuel moved  from Hawaii to overseas bases would be “government-impelled” cargo and must be moved on U.S.-flagged vessels, though not necessarily U.S.-built Jones Act ships. 

He said complying with this law would be “administratively complicated and similarly prohibitively expensive.” 

In his letter to Mayorkas, Case explained that the current defueling plan will require one Jones Act tanker — assuming any are available — and nine cargo preference tankers to ship the fuel from a pier at Joint Base Pearl Harbor-Hickam to the other locations.

He said that without the two waivers, it would cost $66 million, whereas with the waivers about only $36 million at current international charter rates. 

In addition, lining up the tankers will take time, he said, so obtaining the waivers now would give the U.S. Department of Defense “the fullest possible range of options to contract internationally available fuel tanker transport on a predictable and cost-effective basis.”

Case didn’t mention this in his letter to Mayorkas, but all Jones Act waivers requested must be considered necessary in the interest of national defense and require final approval by the president.

Waivers requested directly by the U.S. Secretary of Defense have a high priority. So considering this is an issue involving the U.S. Navy, perhaps Case should have called on Secretary of Defense Lloyd Austin as well to recommend the waivers to the president.

In cases involving non-DOD requests, the Secretary of Homeland Security has the authority to grant such waivers, also subject to presidential approval, but, again, only if it considered to be in the interest of national defense. However, since resolution of the Red Hill crisis involves moving 100 million gallons of U.S. Navy bulk fuel, that sounds like a national security issue to me.

Either way, I am optimistic we will see a Jones Act waiver issued, and I commend Rep. Case for pushing this cause.

However, I am also left with a question: Why should we need a waiver of the Jones Act at all? 

Whether it’s a natural disaster, a fuel shortage or some other crisis, the Jones Act always turns out to be a barrier to our safety and security, not a help. 

We know that it hurts Hawaii and other parts of the U.S economically, has failed to ensure a strong shipbuilding industry and merchant marine, and has put our national security at risk. 

Today it is hindering reasonable and cost-effective efforts to resolve the Red Hill crisis. What will be the next disaster that requires a Jones Act waiver?

It’s time we update the Jones Act for the 21st century.


Keli‘i Akina is president and CEO of the Grassroot Institute of Hawaii.



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Grassroot Institute of Hawaii is a nonprofit, nonpartisan research institute dedicated to the principles of individual liberty, the free market and accountable government. Through research papers, policy briefings, commentaries and conferences, the Institute seeks to educate and inform Hawaii's policy makers, news media and general public. Committed to its independence, the Grassroot Institute of Hawaii neither seeks nor accepts government funding. The institute is a 501(c)(3) organization supported by all those who share a concern for Hawaii's future and an appreciation of the role of sound ideas and more informed choices.

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