A second example

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involves

container freight stations.

Customs has decided that in many districts where there are multiple container freight stations, to select a limited number where Customs will station inspectors. Thus, merchandise

-- no

selected for examination which is being handled by a non-selected container station will need to be transported to a selected site. Although Customs has already began to implement this plan criteria have been established for either the procedure to be followed or the tests to be applied in making the determination as to which sites will be selected. Obviously, these decisions will have great practical importance both to Customs and the trade community. With no standards or criteria, it is difficult to ascertain how a rational decision process can function. Customs has indicated that it has begun to work on some guidelines, and while we plan to meet with Customs on this issue, there is no guarantee that input from the trade community will be solicited.

While

Finally, we are disheartened to note that even the administrative ruling process has suffered from this same type of problem. Many of our members, in addition to having a bonded warehouse, are also importers in their right. Even those members who only store a third parties' goods are interested in aiding

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their respective clients. Thus, many of the thousands of administrative rulings issued annually by Customs are of interest to our members. Indeed, some of these rulings directly effect bonded operations. In the Customs Simplification Act of 1978, this Congress recognized the importance of these rulings and the need of the public to be aware of them, and thus enacted 19 U.S.C. 1625. While Customs initially published a large number of rulings pursuant to that provision, the number has declined dramatically in recent years. To make matters worse, in addition to the 80 percent deadline between 1980 to 1985 in the number of rulings published, Customs has also ceased publishing a list of unpublished rulings.

Obviously, this makes it far more difficult for our members to know exactly what is required in many situations. This in turn increases the workload burden on Customs when documents are incorrectly completed, entry is made under the wrong item number, and so forth. In our opinion, the greater the degree of infor.mation dissemination, the smoother the system will function for both the trade community and the government.

I

Again, I would like to thank this Committee for the opportunity to discuss some of our goals, objectives and concerns. sincerely hope this testimony will be useful in your deliberations, and assure you that the N.B.W.A. is ready and willing to work with both Customs and this Committee on any and all issues.

If you have any questions either I or the members of our Association who are here today would be happy to address them.

Senator DANFORTH. All right. Next we have a panel consisting of the Honorable Pat Davis, who is a member of the Port of Seattle Commission, appearing on behalf of the Western States Coalition for Effective Customs Service; Patrick Gill, on behalf of the Northwest Apparel & Textile Association; Robert Tobias, who is the National President of the National Treasury Employees Union.

And, Senator Gorton is here with Commissioner Davis. Senator Gorton, do you have a comment?

Senator ĜORTON. I do.

STATEMENT OF HON. SLADE GORTON, U.S. SENATOR FROM THE STATE OF WASHINGTON

Senator GORTON. Thank you, Mr. Chairman and Senator Baucus. It is a real pleasure for me to introduce Commissioner Pat Davis. She is testifying on behalf of the Western States Coalition for Effective Customs Services. She was just elected to the Seattle Port Commission last November, but she is no stranger to the business of the Seattle waterfront or the complexities of the Seattle-Tacoma International Airport.

She spent the last 9 years scrutinizing projects, studying port budgets and operations and generally serving as the public's eye on the port before her election.

In this role, she became keenly aware of the critical relationship between the Customs Service and the ports that it serves, both at the waterfront and at the airport. Customs can make the difference between swift and efficient movement of cargo and passengers or bottlenecks which cause inconvenience, irritation, and ultimately a loss of business.

The depth of concern about this issue throughout the country is amply illustrated by the fact that all of the major ports on the West Coast, which are generally fiercely competitive, have banded together to try to find a common solution to their Customs problems.

I am sure that you will find Commissioner Davis' testimony enlightening and helpful.

I thank you for giving me this opportunity to introduce her, and even more importantly, for giving her the opportunity to share her views with you.

Senator DANFORTH. Senator Gorton, thank you very much.
Commissioner Davis, would you like to proceed?

STATEMENT OF HON. PAT DAVIS, MEMBER, PORT OF SEATTLE COMMISSION, SEATTLE, WA, ON BEHALF OF THE WESTERN STATES COALITION FOR EFFECTIVE CUSTOMS SERVICE

Commissioner DAVIS. Thank you, Mr. Chairman.

As an elected member of the Commission of the Port of Seattle I am pleased to have the opportunity to appear before you today on behalf of the port, which operates one of the world's premiere container ports and Seattle-Takoma International Airport.

For both cargos and passengers, Seattle is a major gateway to the Far East, and serves international trade and travelers from all around the world.

I am also here today, as Senator Gorton mentioned, on behalf of the Western States Coalition for Effective Customs Service. The coalition was formed just last year in response to a growing perception among the international trading community that more needs to be done to assure that effective Customs Service must be available at all west coast gateways, and that the adequacy of Customs Service's must not serve to the competitive advantage or disadvantage of any particular gateway or region.

The current membership of the coalition consists of the major west coast ports, steamship lines, airlines, customs housebrokers, airports, railroads, and freight forwarders. A statement of the coalition's goals and objectives is attached to my prepared statement, as is its current membership.

The message I bring to you today is simple and straightforward. The volume of trade via West Coast ports such as Seattle has skyrocketed during the last decade. This dramatic increase in cargo and passenger arrivals is reflected in the Port of Seattle figures for the years 1980 to 1984, a 24-percent increase in international air cargo, a 71-percent increase in containerized marine cargo, and a 107-percent increase in international air passengers.

Now Congress, as you know, has recognized the need for increased Customs resources to accommodate the growing Pacific trade. Both the Senate and the House have over the last several Congresses directed that additional Customs personnel be made available. Until recently, however, Customs has not provided the much-needed additional manpower. In some cases, there has been a decline. Using Seattle as an example again, the Seattle district in 1982 had 189 inspectors. In 1986, it has 164.

I would like to stress, however, that the West Coast Coalition of Ports and Industries is not just concerned about staffing levels. A key concern for us all and the impetus for forming the coalition and the primary thrust of what I am here to say today is to assure that the allocation of Customs resources does not have any competitive impact among ports or areas of the country.

Senator Gorton mentioned that we are a very competitive bunch. We compete aggressively. We compete on the basis of factors such as location, transportation services, speed, labor productivity, distribution systems, cost, and many other factors. We feel that it is fair that shippers make decisions based on those factors; not on the basis of which port has the least cargo inspected or the shortest Customs delays. The same is true for tourists. The Port of Seattle has had an aggressive program in Japan to lure tourists to the Northwest. But a tourist from Japan should not decide which gateway to enter or avoid based on delays in clearing Customs.

To restate, then, implementation of Customs regulations, levels of staffing and Customs services should be applied equitably at all ports of entry.

This is not an abstract concern. Shippers presently give considerable weight to differences when they are making routing decisions. The ease of movement allowed by intermodal transportation means that Washington State, Oregon, and California ports compete not only among themselves but also with ports from all over the country and in Canada. Much of the cargo moving across west coast docks is not local cargo. Its port of origin or destination is most

likely in a State such as Illinois, Michigan, or Missouri, and that cargo can probably be served by any one of a number of ports located on the west, east or gulf coasts. The smallest difference in Customs procedures or in processing time can shift traffic from one port to another.

Let me give you a graphic and a painful example. In March of this year, the Port of Seattle received a letter from one of its steamship tenants. It is attachment K to my testimony.

It clearly shows that this company lost an important customer because Customs policies were different in Los Angeles from Seattle. All west coast ports want to remedy this. Next time this situation could happen to any other port. No port should lose business and jobs because of Customs services and policies.

The fact that we have united to confront this real problem is evidence of its importance. The coalition has now engaged a nationally recognized consultant to prepare an indepth analysis of Customs services to identify problem areas and to suggest remedies. We would like to share the results of this study with you, Mr. Chairman, and your committee when it is complete.

In addition to the problems of staffing levels and Customs services acting as competitive factors among ports, the coalition is concerned about implementation of automation procedures and the timely notification by Customs of new or changed procedures. We endorse the views of the previous panel in this regard.

We believe that automation is and will be more and more important.

Senator DANFORTH. Commissioner Davis, I regret to say that you are well over your time. I want to assure you that your entire record will be included in the record, the entire statement will be included in the record as it will be read.

Commissioner DAVIS. Thank you very much, Senator.

Senator DANFORTH. Thank you.

[The prepared written statement of Commissioner Davis follows:]