Ports Get Capital Funds for Equipment Upgrades, But Automation and Chinese Cranes Face New Restrictions

This new legislation amends Title 46 of the U.S. Code to give U.S. marine terminal operators—that’s the folks who run our ports—access to special Capital Construction Funds (CCF). Until now, these funds were mainly for vessel owners to build or rebuild ships. The core purpose is to allow port operators to use pre-tax dollars to buy, build, or rebuild cargo handling equipment, which includes everything from cranes to vehicles used to move goods. This is a big deal for modernizing U.S. port infrastructure, but the money comes with some specific strings attached, particularly around where the equipment is made and how automated it is.

The Port Upgrade Fund: Who Gets to Save?

Section 2 is the game-changer here, officially allowing U.S. marine terminal operators to set up CCFs specifically for their terminals. Think of it as a tax-advantaged savings account for buying big, expensive port machinery. This means a port operator in Savannah or Long Beach can now put money aside pre-tax, provided they use that money for specific upgrades. The catch? The funds must be used for equipment used at U.S. terminals, and the bill prioritizes domestic manufacturing. Section 1 defines “Cargo Handling Equipment” and specifies that if a port operator wants to use these funds for foreign-made gear, they first have to determine that there isn’t enough “good quality equipment made in the U.S. available for the job.” This subjective requirement means the operator has a lot of wiggle room to decide if U.S. equipment meets their needs, which could be a point of friction down the line.

The Automation vs. Jobs Tightrope

One of the most interesting and potentially disruptive restrictions is found in Section 5, which addresses “Qualified Withdrawals.” While port operators can use the funds to buy new gear, they are explicitly prohibited from using CCF money to purchase fully automated cargo handling equipment if the Secretary determines that doing so would cause a “net loss of jobs at a marine terminal.” For port workers, this is a major protection, essentially ensuring that federal incentives won't be used to automate them out of a job. However, for terminal operators who want to invest in cutting-edge, fully automated systems—which often boost efficiency—this provision limits their options and could slow down modernization compared to global competitors. It forces a tough choice between capital access and technological advancement.

The China Ban on Cranes

Section 5 also contains a very specific trade restriction: you cannot use these Capital Construction Funds to buy any cranes manufactured in the People’s Republic of China. This is a direct measure aimed at supply chain security and reducing reliance on Chinese manufacturing for critical infrastructure. While the overall bill aims to boost domestic manufacturing, this clause singles out China, ensuring that federally incentivized port upgrades use equipment sourced elsewhere. This means terminal operators must look to other global suppliers or domestic manufacturers for their heavy lifting gear.

Reporting on American-Made Gear

To keep everyone honest about the domestic preference, Section 8 requires the Secretary to conduct an annual inquiry into the availability of U.S.-manufactured cargo handling equipment. The results of this domestic equipment census must then be shared with all CCF holders. This provides transparency and gives port operators the data they need to justify their purchasing decisions—especially if they decide to buy foreign equipment because they claim U.S. options aren't available or adequate.