Complying With Subchapter M

Subchapter M - US Perspective

Published Feb 26, 2017 1:16 AM by Kevin Gilheany

(Article originally published in Nov/Dec 2016 edition.)

Some operators still don’t realize that a safety management system is not required under Subchapter M.

By Kevin P. Gilheany

Since proposing a rule-making for the Inspection of Towing Vessels in 2011, it has taken the Coast Guard five years to publish the long-awaited final rule on Subchapter M. Officially issued on June 20, 2016 and weighing in at 798 pages in the long format, it takes a good week to read through. Yet despite its size and length, the final rule appears to have been well worth the wait.

The Coast Guard has done a fine job of simplifying and reorganizing the regulation, making it much easier to understand and implement than the original proposal. The big news is that (1) operators now have a choice of compliance options (third-party Towing Safety Management System or standard Coast Guard inspections) and (2) the “grandfathering” clause has been greatly expanded to cover much of the existing towboat fleet. Many of the costly equipment requirements have been relegated to new towing vessels only.


Don’t skip the Preamble. The actual regulation begins on page 537 of the 798-page document. The first 536 pages are the Preamble. We were taught, as Coast Guard marine inspectors trying to decipher the intent of a regulation, to go back to the Federal Register where the regulation in question was originally published. It has always been an invaluable source of information, and this Preamble is no exception.

Following the publication of the proposed rule in 2011, the Coast Guard held four public meetings in different cities across the country and received over 3,000 comments on the proposed rule. The long-awaited answers to those comments are found in the Preamble.

A few brought forth unexpected results, reminding us to be careful what we wish for. For example, a commenter requested that the requirement for a self-priming portable pump be removed, and another noted that crews have problems with the self-priming feature. The Coast Guard not only declined to remove the requirement but instead added another requirement to require regular training for crews on the self-priming feature!

But the real headline for this Final Rule is the Coast Guard’s response to what it refers to as a “very large number of comments” suggesting that a Towing Safety Management System (TSMS) be required for all towing companies and not be optional. The Coast Guard’s response is found in several places in the Preamble. Here are two:

• “The Coast Guard disagrees that the TSMS should be mandatory.”

• “Regarding the TSMS requirement, it is optional. In this Final Rule, the only vessels required to maintain a TSMS are those that choose the TSMS option.”

Unfortunately, there are still some in the industry who do not understand that a safety management system is not required under Subchapter M.

Existing Safety Management Systems

The Coast Guard estimates that 51 percent of the 5,509 towing vessels in operation are covered by an existing safety management system (SMS). But this does not mean that they must choose the TSMS option or that their SMS will become part of the compliance for Subchapter M. The Coast Guard is clear on this: “These regulations do not preclude any towing vessel company from adopting a safety management system. However, the structure of Subchapter M provides towing vessel companies with flexibility in how to comply with this subchapter.”

• Coast Guard Option vs. Third-Party TSMS Option

As a former Coast Guard marine inspector and industry consultant for the past 12 years, I do not see a substantial benefit to choosing the third-party TSMS option over traditional Coast Guard inspections. Sure, there will be lots of benefits to companies like mine and even the Coast Guard itself, but not for the towing companies. Beware of sales pitches. One recent article mentioned that choosing the Coast Guard option would incur a Coast Guard user fee of $1,030 per vessel, when in fact the user fee applies to all towing vessels regardless of the compliance option.

Some of those intent on using the TSMS option rely on the reasoning that the Coast Guard will not have enough personnel to do the inspections required. The Coast Guard provides the following reassurance in the Preamble: “The Coast Guard is prepared for the estimated demand for annual inspection from owners and managing operators selecting the Coast Guard annual-inspection option. The Coast Guard will closely monitor the demand for inspections and make resource adjustments as necessary.” The Preamble goes on to explain that demand was estimated by assuming that companies with five or fewer vessels would use the Coast Guard option.

Choosing the compliance option will be the single biggest decision companies make regarding Subchapter M.

• Operating Under a Certificate of Inspection (COI)

Nothing is left to chance with a COI. Everything is spelled out including the service of the vessel, the authorized routes, what the vessel is restricted from doing, and whether it operates in salt or fresh water. In order to understand what will go on a vessel’s COI, companies should make sure they understand the definitions of terms contained in Subchapter M as it will introduce a whole new lexicon to the towing industry.

Some of the terms whose definitions are especially important to know include “audit,” “coastwise,” “conflict of interest,” “existing towing vessel,” “galley,” “new towing vessel,” “workboat” and “worksite.” Don’t assume you know what something means. Look up the definition and save yourself lots of headaches.

For example, the crew of lunch-bucket boat brings an electric fryer on board to cook some shrimp in the forward crew area. Based on the definition of “galley,” the space is now a galley and subject to all galley-related regulations.

Cultural Shift

Subchapter M will bring about a cultural shift in the towing industry. While the company plays a role, Coast Guard inspections mostly consist of interactions between the marine inspector and the master of the vessel. It will soon become clear to the marine inspector which captains serve as master in name only and are still functioning as “operator of (un)inspected towing vessels,” solely there to drive the boat.

Captains are expected to assume command of their inspected vessels. The Preamble offers some insight into how the Coast Guard perceives the authority of the master:

• “During flood or low water conditions, for example, the master may specify that additional crew members are needed.”

• “For vessels choosing the Coast Guard option the corresponding ‘designated person’ is the vessel’s master.”

Captains must be comfortable making demands upon the company without fear of repercussions of any kind. The evolution of captains who have still not accepted, or who have not been granted, the full responsibilities of a master will be a leadership challenge for the industry going forward.

What to Do Now

The good news is the industry has time, but maybe not as much time as some think. In general, the Coast Guard gave the industry two years to comply – by July 20, 2018. The Coast Guard gave itself much more time to inspect all the towboats. By July 22, 2019, 25 percent of a company’s vessels must have a Certificate of Inspection (COI) on board. Each subsequent year the percentage increases by 25 percent regardless of the compliance option chosen.

The inspection must be scheduled with the Coast Guard three months in advance. A Coast Guard application for inspection form will be used in which you will mark down the compliance option chosen for each vessel. For those choosing the third-party TSMS option, a Towing Safety Management Certificate (TSMC) must also be provided at least six months prior to obtaining the COI. The frequently asked questions state that a third-party organization only needs to conduct a plan review and management audit in order to issue the TSMC. However, before the COI is issued by the Coast Guard a survey and external audit must be completed.

The bad news is also that the industry has time. People procrastinate, and there’s a lot to do. Prudent operators will get started early to avoid any problems. Regardless of the compliance option chosen, the following course of action is recommended:

Require all captains to read the regulation

• Survey your vessels and produce a comprehensive worklist

• Develop a Health & Safety plan

• Develop a comprehensive system of record-keeping

• Produce a training matrix.

For those choosing the third-party TSMS option, add the following:

• Conduct a gap analysis on your SMS and add what is required to make it a TSMS

• Determine which third-party organization you will use for TSMS plan-approval and external audits

• Determine if you will use an internal or external survey program.

This is going to be a major change for the towing industry. No matter how long a company has been under a voluntary safety management system or how proud it may be of its safety record, this regulation must not be taken lightly. The good old days are officially over.

The greatest challenge for companies choosing the TSMS option will be getting captains and crews to conform to a system of written policies and procedures. There will be some difficult years ahead. But as difficult as they will be, the task at hand will not be impossible with the right leadership and management. – MarEx

Kevin Gilheany is a maritime consultant and retired U.S. Coast Guard marine inspector. He is also a frequent speaker on compliance issues. His firm, Maritime Compliance International, LLC, assists companies with their training and compliance programs, including Subchapter M. 

The opinions expressed herein are the author's and not necessarily those of The Maritime Executive.