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by GARY COHN, Baltimore Sun

"The goal is to use our expertise and initiative to create a system that will scrap ships and offer opportunities for employment," said Rep. Wayne T. Gilchrest, chairman of the House Subcommittee on Coast Guard and Maritime Transportation. Some of the proposed reforms are helpful, he said, but he worries that they still would not adequately ensure that scrapping is performed safely.

Gilchrest, a Maryland Republican, also said that he supports the concept of a pilot program intended to provide information about the true costs of scrapping government ships in the United States -- and whether the job can be done safely and profitably.

The hearing was the subcommittee's second this year focusing on the scrapping industry, which has compiled a record of deaths, accidents, mishandling of asbestos and environmental violations while dismantling Navy ships at ports around the country.

In April, a Defense Department panel called for more rigorous management of the ship-scrapping program, including stepped-up inspections and clearer guidance to shipbreaking firms. Yesterday's hearing was held to determine whether the reform recommendations are adequate.

Meanwhile, the Senate Appropriations Committee approved $7.5 million yesterday for a new ship disposal initiative. The initiative does not describe how the funds should be spent, but they could be used for a pilot program or to test new ways of dismantling government ships. The ship-scrapping measure, included in the yearly Defense Department spending bill, will be voted on soon by the full Senate.

Sen. Barbara A. Mikulski, who urged the committee to adopt the funding measure, said it could lead to more efficient ways of scrapping obsolete government ships. "We've learned the hard way that shipbreaking can't be done on the cheap," the Maryland Democrat said.

Mikulski and other critics have questioned whether government ships can be scrapped both safely and profitably, and urged that the government's ship-scrapping program be overhauled. Under the current system, private contractors buy old ships from the government and hope to make a profit by selling the salvaged metal. In the 1990s, though, many contractors cut corners, leading to safety and environmental violations at U.S. ports, including Baltimore, The Sun reported in a series of articles in December.

Patricia A. Rivers, who headed the Defense Department panel, told the House subcommittee that ship-scrapping can be a safe and profitable enterprise. "We have no reason to believe, at this time, that we cannot continue with ship-scrapping as a sales program," she said.

Officials of maritime firms, meanwhile, provided conflicting testimony about whether ship-scrapping can be profitable. "If you comply with all the rules and regulations we don't think you can make sufficient money," David Watson, president and chief executive of Baltimore Marine Industries Inc., the Sparrows Point shipyard formerly owned by Bethlehem Steel Corp., told the subcommittee.

Kevin J. McCabe, chairman of International Shipbreaking Ltd., a Brownsville, Texas, company, disagreed. Asked whether a scrapper could buy old ships from the government, follow existing regulations and still make a profit, he said: "Unequivocally."

The Navy and the Maritime Administration together have about 180 old ships awaiting scrapping. Gilchrest stressed that it was important to continue searching for ways to accelerate the government's scrapping program while protecting workers and the environment.