Coast Guard Authorization Bill Passes House with Sec. 302 Intact

The Coast Guard Authorization bill, H.R. 2830, which includes language in Section 302 to re-establish tax and fee authority for local and state governments on navigable waterways, passed the House in late April in a surprise vote. The bill would authorize states and local governments to charge sales and similar taxes on river trips. In a dispute over a similar tax in Polk County, Tennessee, the County claims outfitters owe nearly $2 million in taxes and have threatened to confiscate their property. They argued in an appeal brief that Congress never intended this exemption, even though it has been law since 1884 to prevent multiple jurisdictions from levying taxes on federally navigable waters.

H.R. 2830 includes obscure language in Section 302 that amends the Rivers and Harbors Appropriations Act of 1884 that few would understand unless they had followed this bill. Representative Don Young (R-AK) asked for insertion of the language even though the bill's primary sponsor is Representative Oberstar, (D-MN). Under existing legislative authority, states and local governments may charge fees on navigable waterways if they provide safety or security enhancements. However, Section 302 language authorizes overlapping and new fees even if outfitters are paying high fees for government regulation. If it passes the Senate, river, coastal tour and fishing services will be subject to new or renewed taxes and fees at a time when many seasonal businesses are struggling to cope with high fuel and operating costs. Vessels involved in foreign commerce are exempt once again demonstrating why it is sometimes easier for some companies to operate overseas than in the U.S. In the U.S. every layer of government thinks they are entitled to taxes and fees on small business. The Senate version of the Coast Guard Authorization does not include this language. America Outdoors is working vigorously to keep Sec. 302 out of the Senate version of the Coast Guard Authorization bill, S. 1892, overseen by Senator Cantwell's subcommittee (D-WA) in the Senate.

In the Senate, the Committee on Commerce, Science and Transportation has jurisdiction over the Coast Guard Authorization bill. Members in Maine, Alaska, Oregon, West Virginia and Arizona have key Senators on the list.

Key Senators on that Committee are Chairman Senator Daniel Inoyue (D-HI), Ranking Republican Ted Stevens (R-AK), Chair of the Subcommittee on Oceans, Atmosphere, Fisheries, and Coast Guard Maria Cantwell (D-WA), and Ranking GOP member on the Subcommittee Olympia Snowe (R-ME).

The following is the complete full committee membership: Senators Inoyue, John Rockefeller (D-WV), John Kerry (D-MA), Byron Dorgan (D-ND), Barbara Boxer (D-CA), Bill Nelson (D-FL), Maria Cantwell (D-WA), Frank Lautenberg (D-NJ), Mark Pryor (D-AR), Thomas Carper (D-DE), Claire McCaskill (D-MO), Amy Klobuchar (D-MN), Ted Stevens (R-AK), John McCain (R-AZ), Trent Lott (R-MS), Kay Bailey Hutchison (R-TX), Olympia Snowe (R-ME), Gordon Smith (R_OR) John Ensign (R-NV), John Sununu (R-NH), Jim DeMint (R-SC), David Vitter (R-LA) and John Thune (R-SD).

Members should contact and write their Senators and Representative requesting that the following language be eliminated from the Coast Guard Reauthorization bill.

Section 4(b) of the Act of July 5, 1884, commonly known as the Rivers and Harbors Appropriation Act of 1884 (33 U.S.C. 5(b)), is amended-

(1) by striking `or' at the end of paragraph (2)I;
(2) by striking the period at the end of paragraph
(3) and inserting `; or'; and (3) by adding at the end the following: `
(4) sales taxes on goods and services provided to or by vessels or watercraft (other than vessels or watercraft primarily engaged in foreign commerce).'.

For letters to the Senate

The Honorable ______________
United States Senate
Washington, DC 20510

Dear Senator:
I am writing to ask you to support deletion of Section 302 Goods and Services from the Coast Guard Authorization Act, that was passed by the House of Representatives. This section of the bill overturns provisions of the Rivers and Harbors Appropriate Act of 1884 that prevented vessels operating on navigable waters from being taxed by every local and state government through which they transit. It is equally disturbing that the bill exempts vessels involved in foreign commerce from the tax, while allowing additional taxes on many small fishing operations and outfitters and guides. These small businesses often already pay fees to state licensing authorities and federal land managing agencies. Those fees are for state licenses and for other fees authorized under the Federal Lands Recreation Enhancement Act of 2004 and other authorities.

With rising fuel and operating costs these businesses are struggling to survive and cannot absorb more taxes.

Seasonal businesses simply cannot withstand the onslaught of fees, higher fuel costs and health care costs descending on their operations. Please stand up for small business and remove Section 302 from the Coast Guard Authorization Act of 2007.

Thank you for your earnest consideration.

Sincerely,

__________________________

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