DOD Leases of Foreign-Built Ships: Background for Congress [Updated October 20, 2006]   [open pdf - 38KB]

From the Summary: "The Department of Defense (DOD) in recent years has leased some foreign-built cargo ships for total periods, including options and renewals, of almost 10 years -- a length of time that some observers argue effectively circumvents a legal requirement that U.S. military ships be built in U.S. shipyards. These observers, particularly the American Shipbuilding Association (ASA), have proposed reducing the current 5-year legal limit on ship leases to 2 years for foreign-built ships. DOD argues that its ship leases are the most cost-effective way to meet its needs for the ships in question, and opposes the idea of reducing the leasing term from 5 years to 2 years for foreign-built ships. The House version of the FY2007 defense authorization bill (H.R. 5122) included a provision (Section 1016) that would limit the terms of future leases of foreign-built ships to no more than 2 years. The Senate version of the bill (S. 2766) did not contain a similar provision. The conference report on H.R. 5122 (H.Rept. 109-702 of September 29, 2006) does not contain a similar provision. This CRS report will be updated when events warrant."

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CRS Report for Congress, RS22454
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