On April 20th, a bipartisan, bicameral group of lawmakers, including Senator Mark Kelly (D-Ariz.) and Senator Todd Young (R-Ind.) in the Senate and Representative John Garamendi (D-Calif.) and Representative Trent Kelly (R-Miss.) in the House, reintroduced the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 (the “SHIPS Act” or the “Act”). The SHIPS Act’s sponsors describe the bill as a “comprehensive approach to revitalizing the U.S. Merchant Marine.” It aims to: (1) establish national oversight and consistent funding for U.S. maritime policy; (2) make U.S.-flagged vessels more commercially competitive through de-regulation; (3) rebuild the U.S. shipyard industrial base; and (4) expand and strengthen the maritime labor force. It also sets a goal for establishing a fleet of 250 U.S.-flagged vessels in international commerce.
A predecessor bill, the SHIPS for America Act of 2024, garnered bipartisan support last year after its initial introduction in Congress, and the current iteration of the legislation may find similar support from industry, labor, and lawmakers. Additionally, given the parallels between the Act and President Trump’s recent Executive Order 14269, which we addressed in this post, the new SHIPS Act could attract backers in the Trump administration as well. We describe several of the Act’s key features below.
Maritime Security Board and Maritime Security Trust Fund
The SHIPS Act’s sponsors identify increasing oversight and funding for the U.S. maritime sector as a critical component of revitalizing the domestic maritime industry. If enacted, the Act would require the President to establish the position of Maritime Security Advisor within the White House to lead an interagency Maritime Security Board. The Act would task the Maritime Security Board with making whole-of-government strategic decisions to implement a National Maritime Strategy coordinating the domestic marine transportation system.
The Act also would establish a Maritime Security Trust Fund as a dedicated source of funding for critical maritime security programs. Financing for the fund would come from the reinvestment of duties and fees paid by the maritime industry, including taxes and penalties collected by U.S. Customs and Border Protection. These fees would include a new penalty on vessels that are owned or operated by a foreign entity of concern or registered to a foreign country of concern (defined as Russia, China, Iran, and North Korea), as well as vessel owners who conduct significant amounts of business with the CCP-owned China State Shipbuilding Corporation (CSSC).
Rulemaking Committee on Commercial Maritime Regulations
The Act would establish a Rulemaking Committee on Commercial Maritime Regulations and Standards within the Coast Guard. This body would be tasked with evaluating opportunities to better align priorities and limit redundancies between the regulatory standards of the U.S. Coast Guard and the International Maritime Organization (IMO), “while protecting United States mariners and the United States maritime industry from foreign regulations that undermine the maritime industrial competitiveness of the United States.” Committee responsibilities would also include adjusting duties to enhance the competitiveness of cargo on U.S.-flagged ships, ensuring that cargo financed by the U.S. government is transported on U.S.-flagged vessels, and requiring a portion of commercial goods imported from China to move aboard U.S.-flagged vessels starting in 2030.
Expansion of Cargo Preferences
The Act also would expand cargo preference requirements across both governmental and private shipping. For instance, the Act would raise the percentage of U.S. government cargo that must sail on U.S.- flagged vessels from 50% to 100%, and establish a commercial cargo preference, requiring that within 15 years, 10% of all cargo imported into the United States from the People’s Republic of China be imported on U.S.-flagged vessels. To aid in compliance efforts for cargo preference requirements, the Act would establish a Ship America Office within the Maritime Administration, including the establishment of a “Ship America” verification program, to help identify goods and services that were shipped on U.S.-flagged and crewed vessels.
Tax Credits and Financial Assistance for the U.S. Shipyard Industrial Base
The Act also includes several provisions to expand the U.S. shipyard industrial base, for both miliary and commercial vessels. These initiatives include a 25% tax credit for investment in qualifying domestic shipyard facilities, and a 33% tax credit for investment made by a taxpayer to construct, repower, or reconstruct an eligible oceangoing vessel in the United States. Qualifying facilities for the 25% investment credit would include both civil and military shipyards and manufacturing facilities dedicated to making critical components for those vessels. The Act also would convert the Title XI Federal Ship Financing Program into a revolving fund, establish a Shipbuilding Financial Incentives program to support new approaches to domestic ship building and ship repair, and expand eligibility under the Department of Energy’s loan guarantee program to support investments in U.S.-flag vessels, shipyards, marine terminals, and port facilities.
Additional Funding and Support for the Maritime Labor Force
The Act promises significant investment in the maritime workforce by, among other things, establishing a Maritime Workforce Promotion and Recruitment Campaign through an amendment to the FY 2025 NDAA and allocating additional funding to the U.S. Merchant Marine Academy and supporting State Maritime Academies. The Act also aims to streamline and modernize the U.S. Coast Guard’s Merchant Mariner Credentialing system.
Department of Defense Programs
Finally, several of the Act’s provisions are directed at the U.S. Navy and Coast Guard. For example, one initiative would require the Navy and Coast Guard to assess and integrate commercial best practices into the design, construction, and repair of Navy and Coast Guard vessels to help shipbuilders efficiently serve both military and commercial customers. Another section of the Act requires a plan for using the Defense Production Act and related authorities to enhance shipyard infrastructure and support the industrial base. Further, the Act establishes additional authorities (and reporting obligations) for the Secretary of the Navy related to recruitment and retention efforts at Military Sealift Command.
Next Steps . . .
Once the SHIPS Act is introduced formally and assigned a bill number in each chamber, it will be referred to the relevant committees—likely the Finance Committee in the Senate and the House Committees on Armed Services, Transportation and Infrastructure, Ways and Means, and Education and the Workforce, among others—for further consideration and markup. That process will determine whether the bill advances as standalone legislation or is absorbed into a broader legislative package—such as the FY 2025 NDAA. Still, the path ahead is uncertain. Competing legislative priorities, unresolved funding questions, and jurisdictional complexities could all slow or stall the Act’s progress.