Federal Budget Cuts May Cause Shipping Delays

March 12, 2013 | With federal budget cuts across all departments in effect as of March 1, 2013, government agencies are varying widely in how they are dealing with the automatic cuts. Sequestration will impact government agencies that work in collaboration with the toy industry in the following ways:

1.
U.S. Customs and Border Protection (CBP) has announced that it will reduce operational expenditures for the remainder of 2013 as follows:

  • There will be reduced hours of service at seaports and land ports of entry. New hours will be port-specific and determined locally.
  • Cargo operations will have decreased levels of service, increasing delays for container examinations up to five days at major seaports.
  • CBP will be unable to be flexible in maintaining or extending operating hours at ports.
  • There will be no conveyance diversions, since all ports of entry will be operating below capacity. Therefore, diverting to a different port will have no realistic gain.
NOTE: all trusted trader programs including Global Entry, SENTRI, NEXUS, C-TPAT, and FAST will continue to operate normally.

The CBP has stated that it will communicate with its stakeholders concerning changes in port operations and procedures, shipment inquiries, and changes of hours.  The Office of Field Operations (OFO) and Office of International Trade (OT) will participate in weekly conference calls to discuss the impact of sequestration with stakeholders.

2. The Consumer Product Safety Commission (CPSC) has stated that it will remain laser-focused on priority projects and that the budget cuts should have no noticeable effect on projects that are critical to consumers or industry. Despite reports that half of the nation’s 2.1 million federal workers are potentially being furloughed over the next six months, the CPSC will not furlough any employees. Instead, the agency plans to take steps internally (e.g., cutting some non-critical IT projects) to help absorb costs.

The Toy Industry Association (TIA) has determined that CBP’s cuts will impact toy industry trade and stakeholders in several ways. For more detail and to see TIA’s advice for importers, members are advised to consult the Legislative Bulletin sent earlier today.

TIA will provide members with updates as additional impacts become known.