[Views on S. 2511]

B-207825: Published: Jul 26, 1982. Publicly Released: Jul 26, 1982.

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GAO was asked to comment on proposed bill S. 2511, which would amend the Merchant Marine Act to provide that Government-generated cargoes transported on U.S. flag or foreign vessels shall be shipped at the lowest landed cost. GAO stated that, in managing cargoes, there are other considerations such as service which may take precedence over cost. Lowest landed transportation cost may not be the best measure of overall cost to the Government, and the requirement to ship at the lowest landed cost may inhibit a traffic manager's ability to choose service which will result in the lowest overall cost. GAO also noted that the wording of the bill should be changed to reflect the fact that the Maritime Administration was recently transferred from the Department of Commerce to the Department of Transportation.

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