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Tag: Biden administration

Biden executive order on Chinese cranes affects Port of Va.

President Joe Biden issued an executive order Wednesday addressing cybersecurity and espionage concerns over Chinese-made cranes in use at U.S. ports, including the Port of Virginia. Additionally, the Biden administration announced a plan to invest $20 billion on infrastructure security at U.S. ports, including support for domestic manufacturing of ship-to-shore cranes.

National security concerns about espionage and other cyber crime risks associated with ship-to-shore cranes manufactured by Shanghai Zhenhua Heavy Industries Co., known as ZPMC, became public in March 2023 following a report from The Wall Street Journal. ZPMC is owned by the Chinese government, and its major shareholder is China Communications Construction Co.

In a press briefing on Tuesday, Rear Adm. John Vann, commander of the U.S. Coast Guard Cyber Command, said: “The People’s Republic of China-manufactured ship-to-shore cranes make up the largest share of the global market and account for nearly 80% of cranes at U.S. ports. By design, these cranes may be controlled, serviced and programmed from remote locations. These features potentially leave PRC-manufactured cranes vulnerable to exploitation.”

Federal officials would not disclose if there have been any known cybersecurity incidents associated with the ZPMC cranes.

The issue is so critical, Vann said on Tuesday, because “America’s system of ports and waterways accounts for over $5.4 trillion of our nation’s annual economic activity, and our ports serve as a gateway for over 90% of all overseas trade.”

All 27 of the Port of Virginia’s ship-to-shore cranes were manufactured by ZPMC, according to Cathie Vick, the Virginia Port Authority’s chief development and public affairs officer. The port also has four cranes on order from ZPMC that will be delivered to the Virginia International Gateway terminal in December 2024 and another four cranes that will be delivered to Norfolk International Terminals in August 2025, Vick said Wednesday.

Biden’s executive order expands the Coast Guard’s authority to address cybersecurity concerns. Additionally, the Coast Guard will issue a maritime security directive listing risk management steps for owners and operators of Chinese-made ship-to-shore cranes.

“Before any new cranes are put into service they are subject to a detailed forensic cyber analysis that is performed by one of the nation’s federal law enforcement agencies,” Vick said in a statement. “New cranes awaiting analysis are isolated with dedicated firewalls to ensure there is no contact with port networks or the internet.

“At the Port of Virginia, we take the issue of cybersecurity very seriously and work continuously to protect our operations against outside threats,” Vick continued in the statement. “As part of this effort, we undertake regular cybersecurity exercises that include close collaboration with several federal entities [and] partners in Hampton Roads to ensure readiness for multiple types of cyber events or threats. We are confident that our protocols will satisfy the requirements of the executive order.”

Biden’s executive order broadens the Coast Guard’s authority to address cyber threats, including granting the authority “to control the movement of vessels that present a known or suspected cyber threat to U.S. maritime infrastructure,” according to the White House.

Some of the cybersecurity regulations implemented in the executive order, including mandatory reporting of cybersecurity incidents or active cyber threats and inspections of relevant vessels and facilities, were already voluntarily included in the Port of Virginia’s protocols, Vick said.

The Biden administration will also direct more than $20 billion to port infrastructure investments over the next five years, including supporting domestic manufacturing of cranes, according to a White House news release. That will include funding to help Paceco, a U.S.-based subsidiary of Japanese company Mitsui E&S Co., to manufacture ship-to-shore cranes in the United States. Paceco previously manufactured cranes in the U.S. from 1958 until the late 1980s, according to the White House.

Currently, no cranes comparable to ZPMC’s are manufactured in the U.S., according to reporting from The Wall Street Journal, and an alternative crane used by some U.S. ports from Finnish company Konecranes costs about a third more.

Speaking to reporters Tuesday, Anne Neuberger, U.S. deputy national security advisor for cyber and emerging technologies, said that the administration is not looking at a “rip and replace” strategy for ship-to-shore cranes already in use, but instead was focused on setting cybersecurity requirements “to secure the existing infrastructure” and to also make sure that ports “can go [back] to buying trusted cranes and to bringing back [crane] manufacturing to the United States, given how important cranes are to port operations.”

At this time, the Virginia Port Authority does not have plans to replace its ZPMC-made cranes, and port officials have not had any discussions with the federal government about that, Vick said.

Neuberger said that while the executive order “certainly ties to particular concerns about Chinese cyber activity, we also have concerns regarding criminal activity.” She cited a criminal ransomware attack that disrupted the Port of Nagoya in Japan for more than two days in July 2023.

There have been no reports of cybersecurity breaches affecting Port of Virginia cranes, according to Vick. The federal government has not alerted the port to any instances of cranes in Virginia being used for espionage.

“We are confident that all of the cranes owned and operated by the Port of Virginia are safe and secure and will already comply with the parameters set forth in the executive order,” Vick said in a statement. “We employ best practices and will continue to collaborate with multiple federal law enforcement agencies to ensure the equipment we purchase, own and operate is here for its intended use, which is to move cargo.”

Va. bankers say they’re not worried by SVB collapse

Last weekend was pretty tense for bankers, even for those leading institutions quite distant and different from Silicon Valley Bank, which Friday became the second largest bank to fail in U.S. history. Federal regulators shut down SVB after a run on the bank. By Sunday, regulators also shut down New York’s Signature Bank, which became the third biggest bank ever to fail in the United States.

As word spread about SVB customers pulling out their money due to fears the FDIC would back only $250,000 per account, stocks dropped for banks everywhere, including in Virginia. “Friday, all banks got painted with the brush of fear,” Rex Smith, United Bank’s Central Virginia regional president, said Monday. “It was a lot of fear and misinformation and lack of information.”

United Bank’s stock rebounded a bit on Monday, as people learned more about what happened at SVB, which had $209 billion in total assets in December and was a major backer of venture capital-backed tech startups. According to NPR, 90% of SVB’s deposits were above the federal insurance cap of $250,000, and VC investor Peter Thiel’s Founders Fund members withdrew millions from the bank, leading to what Judy Gavant, chief financial officer of Blue Ridge Bankshares Inc., called “just one of those old-fashioned runs on the bank.” SVB investors and depositors attempted to remove $42 billion from the bank on Thursday alone, said a California state regulator.

On Sunday and Monday, the White House and federal regulators took emergency steps to ensure that SVB and Signature Bank customers will have access to their deposits, which helped calm fears among startup entrepreneurs and their funders. U.S. Treasury Secretary Janet Yellen and President Joe Biden both emphasized that taxpayers would not be on the hook for reimbursing SVB and Signature account holders, with the money coming from the FDIC’s Deposit Insurance Fund, which banks pay into.

Biden also said that the bank executives responsible would be fired and that the banks’ investors would not be bailed out. “They knowingly took a risk and when the risk didn’t pay off, the investors lose their money. That’s how capitalism works,” Biden said during a Monday morning address from the White House.

Furthermore, in a move designed to prevent more bank runs, the federal government announced it had also initiated backstop measures to protect the entire nation’s banking deposits, safeguarding banks from $300 billion in securities losses.

Banks everywhere still suffered some financial fallout from the banking crisis, however, as investors sold off banking shares and sought safety in gold and Treasurys, kicking off the largest drop in regional bank stocks in three years.

And Virginia was no exception. Blue Ridge Bank, based in Charlottesville, saw its stock drop 8.97% Monday, and Fairfax-based FVCbank’s stock fell 11%. Share prices for Richmond’s Atlantic Union Bank, the largest regional bank headquartered in Virginia, with 2022 deposits of $15.7 billion, fell by 6.69% to $33.74 Monday.

However, the “unique risk factors” that affected SVB are not issues likely to impact the community and midsize banks here in Virginia, said Andy Farmer, spokesman for the Virginia State Corporation Commission, which regulates the commonwealth’s 47 state-chartered banks. “Virginia’s banking industry remains strong and well-capitalized.”

Atlantic Union CEO John Asbury noted the difference between his bank and the two that were shut down last week: “These are nontraditional banks engaged in nontraditional activities that grew rapidly. We are a full-service traditional banking facility.” Silicon Valley Bank, he said, was started to serve tech startups backed by venture capital firms. However, venture capital funding and loans for tech startups started to dry up in the past year, leading the startups to seek more withdrawals from the bank, Asbury said. SVB was invested heavily in long-term securities that weren’t liquid, though, and when the bank couldn’t find a buyer, SVB sold $21 billion in fixed-rate securities last week at a $1.8 billion loss in an unsuccessful attempt to hold off the bank run.

“All of this frightened their customers,” Asbury said. By contrast, his bank and others in Virginia have little to do with the tech startup industry, at least compared to SVB, and Atlantic Union has never had a losing financial quarter since its founding in 1902, Asbury added. Meanwhile, New York-based Signature Bank was a major lender to the cryptocurrency industry, which, Asbury said, is “very unstable” and largely unregulated.

The federal government’s actions are meant to “avoid a crisis in confidence in banks,” Asbury said, but he and others in the industry said Monday they haven’t fielded many calls from customers about the situation.

“The banking system is safe, sound, well-capitalized, so this is very different from the fall of 2008,” when the collapse of Lehman Brothers, the fourth-largest U.S. investment bank, amid the Great Recession kicked off an international banking crisis, Virginia Bankers Association President and CEO Bruce Whitehurst remarked Monday. “That was a very different situation from the one we have today.”

Some Virginia banks have emailed or called their customers to reassure them that their funds are safe, and that the situation at the two shutdown banks was quite different from a typical community bank.

Reston-based John Marshall Bancorp Inc. put out a news release Monday affirming that the bank’s “financial condition remains strong.” The bank issued the release, it said, to “inform our shareholders as well as the customers and employees of the Bank that we are of sound financial condition, [and] our business model differs materially from that of SVB’s.”

For any individual or corporate customer who has less than $250,000 in savings at a bank, Whitehurst said, the current banking situation is not a big deal, but for any company “trying to make payroll, it is. If they have any questions or concerns, they should talk to their banks. It’s always a good idea for business owners to have an ongoing dialogue with their bankers.”

Steve Yeakel, president and CEO of the Virginia Association of Community Banks, dismissed the dips in bank stocks Friday and Monday as “nothing more than noise,” adding that he expects it all to be a footnote “in two or three weeks.”

One longer-lasting outcome of the situation, though, could be more banking regulations, though that could also include raising the federal insurance cap of $250,000 for business banking customers, which would be welcome news, Virginia bankers said. “I think it’s good that regulators are taking a second look at FDIC limits,” Smith said.

Farmer Focus to create 300 jobs with $17.8M expansion

Harrisonburg-based Farmer Focus is planning a $17.8 million expansion that will create 300 jobs and double its processing capacity, the organic poultry producer announced this week. 

Part of that expansion will be paid for with a $3.6 million grant from the United States Department of Agriculture’s Meat and Poultry Processing Expansion Program (MPPEP). U.S. Secretary of Agriculture Tom Vilsack announced the grant at a visit to Farmer Focus’ headquarters on Tuesday. 

The expansion will “enable Farmer Focus to welcome more family farmers into its farming family” and create 300 jobs over the next two years, according to a news release. Farmer Focus plans to expand its organic chicken processing facility in Harrisonburg. Operating since 2014, the plant processes 335,000 chickens per week, but demand has grown and the expansion will allow the company to process 630,000 chickens per week.  

The creation of the new jobs will coincide with the completion of the expansion project and will be a mix of production, maintenance and supervisory roles, according to Liz Fuchs, Farmer Focus’ chief people officer. A completion date for the expansion has not been set, and the expansion won’t physically change the size of the facility.

“The programs and money the Biden-Harris administration is committing can make a huge difference in providing opportunities to independent processors like Farmer Focus so we can build a more competitive meat industry and strong generational family farms while providing our consumers with the highest quality organic and humane certified chicken,” Farmer Focus Founding Farmer and CEO Corwin Heatwole said in a statement.

 “Just a little over a year ago, I was invited to a White House Round Table where I had the unique opportunity to share my thoughts directly with President [Joe] Biden and Secretary Vilsack on ways to increase competition within the meat industry,” Heatwole added. “The MPPEP proves that our leaders in Washington are listening closely to the farming community, and are following through on their commitment to improve the lives and livelihood of America’s farmers and the resiliency of our food system.”

The program provides grants to help eligible processors expand their capacity, according to the USDA. 

In a statement, Vilsack said, “The Biden-Harris Administration and USDA are taking action to advance a sustainable vision of agriculture that prioritizes the needs of our resilient producers and small businesses, strengthens our food supply chain and brings value back to rural people and places.”

With this second round of MPPEP grants, the USDA doled out $59 million to five U.S. companies, including Farmer Focus, the only Virginia-based grant recipient. Farmer Focus will make improvements to alleviate bottlenecks in processing and offset costs associated with equipment purchases, new conveyor lines, building and site modifications and a new wastewater treatment system, according to the USDA. 

Farmer Focus has recently undergone multiple leadership changes. In December 2022, Farmer Focus tapped Stephen J. Shepard as its new president and chief operating officer, a promotion from his role as executive vice president of operations.

Founded in 2014 and formerly known as Shenandoah Valley Organic, Farmer Focus sells organic poultry raised as free-ranging on humane-certified farms. In February 2022, Farmer Focus opened a 78,000-square-foot packaging facility in Harrisonburg,  increasing production capacity and expanding Farmer Focus’ workforce.

Farmer Focus’ products are now distributed in more than 4,000 stores, including the East Coast and the Midwest, in retail grocery chains such as Publix Super Markets Inc., Harris Teeter and Safeway Inc.

Va. to receive $6.22M to expand broadband

Virginia is receiving $6.22 million in “Internet for All” federal grants funded by the Bipartisan Infrastructure Law, the U.S. Department of Commerce’s National Telecommunications and Information Administration (NTIA) announced Thursday.

“As we continue to compete in the 21st century, it is crucial that we close the digital divide in Virginia,” U.S. Sen. Mark Warner said in a statement. “I’m glad to see this funding, courtesy of the bipartisan Infrastructure Investments and Jobs Act I was proud to negotiate, go towards ensuring that every corner of the commonwealth has access to affordable and reliable broadband.”

In 2021, former Gov. Ralph Northam pledged to provide broadband access across Virginia by 2024, moving up the deadline on his original pledge to achieve universal broadband access by 2028 due to federal COVID-19 relief funding that Virginia received in 2020 and 2021.

Virginia is currently the 27th most connected state in the country, but only 91.2% of Virginians have access to broadband internet with speeds of 100 mbps or faster, according to BroadbandNow, a trade site that publishes independent research on broadband and also provides data from the Federal Communications Commission. Thirteen percent of Virginia households don’t have internet access of any type, according to BroadbandNow.

In June 2022, Virginia received $219.8 million from the U.S. Treasury Department’s Coronavirus Capital Projects Fund, all of which the state planned to invest in broadband infrastructure projects. As reported by Virginia, estimates showed that investments made using the Capital Projects Fund would serve 28% of locations still lacking high-speed internet access in the state, according to a Treasury Department fact sheet.

Through the $42.45 billion Broadband Equity, Access and Deployment (BEAD) Program, Virginia will receive almost $5 million to fund planning, infrastructure deployment and adoption programs to expand high-speed internet access.

The BEAD program grant will fund activities including:

  • Supporting Virginia’s Commonwealth Connect plan, including creating a five-year action plan identifying Virginia’s broadband needs;
  • Increasing the broadband office’s capacity;
  • Establishing a Virginia Digital Opportunity Initiative Planning Grant Program to provide funding at the local and regional levels;
  • And awarding funding to 128 local government units.

Virginia will receive $1.22 million through the $2.75 billion Digital Equity Act, which Virginia will use to help develop the Commonwealth’s Digital Opportunity Plan, including hiring a digital opportunity coordinator, fund sub-awards for planning and mini-grant programs at the regional level and other initiatives.

This $1.22 million in funding is the first of three grant programs established in the Digital Equity Act.

“We are committed to providing affordable, reliable, universal, high-speed internet access across the commonwealth and this announcement helps further our efforts to bridge Virginia’s digital divide,” Gov. Glenn Youngkin said in a statement. “Federal planning grant funding will allow us to ensure [that] every Virginia home, business and community anchor institution has a funded solution for broadband access by 2024.”

Passed in November 2021, the $1.2 trillion Bipartisan Infrastructure Law, also known as the 2021 Infrastructure Investment and Jobs Act, included a $65 billion investment to expand high-speed internet access across the U.S.

All U.S. states and six territories applied for grant funding from the Internet for All initiative, and grant awards will be announced on a rolling basis, according to a news release.

Manchin hits gas on Mountain Valley Pipeline

First proposed in 2014, the 303-mile, $6.6 billion Mountain Valley Pipeline has seen its construction progress delayed time and time again by federal courts, regulators and environmentalists.

Indeed, MVP has faced so many setbacks that NextEra Energy Inc. said in February it was reevaluating its investment in the natural gas pipeline, citing “a very low probability of pipeline completion.”

The math on that calculation changed, since in late July, U.S. Sen. Joe Manchin, D-West Virginia, reached an agreement with Democratic leaders to support the Inflation Reduction Act, a $430 billion climate, tax and health care bill. The party cut a deal with Manchin that included having lawmakers and the Biden administration “take all necessary actions to permit the construction and operation of the Mountain Valley Pipeline.”

The pipeline would transport natural gas from West Virginia through the Roanoke and New River valleys, ultimately connecting to a pipeline near the North Carolina border. The 4th U.S. Circuit Court of Appeals sided with environmentalists, preventing the pipeline from passing through the Jefferson National Forest and crossing streams. In the initial deal, Democratic leaders agreed to move future pipeline challenges to the U.S. Court of Appeals for the District of Columbia, but that would need to be worked into a bill.

Mountain Valley supporters received more good news on Aug. 23 when the Federal Energy Regulatory Commission granted a four-year extension. The previous deadline was Oct. 13.

“With total project work roughly 94% complete, Mountain Valley remains committed to working diligently with federal and state regulators to secure the necessary permits to safely and responsibly finish construction,” says Natalie Cox, a spokesperson for Equitrans Midstream Corp., which will operate the pipeline and has a 48.1% ownership stake.

Equitrans remains committed to seeing the pipeline operational by the second half of 2023, according to Cox.

While several environmental organizations have praised the Inflation Reduction Act, conservation director of Charlottesville-based nonprofit Wild Virginia, says money isn’t worth setting a precedent of lawmakers telling regulating agencies to ignore provisions of the Clean Water Act or the Endangered Species Act to push through a fossil-fuel energy project.

“That just violates the whole principle of the laws, which is you go through a decision-making process, you weigh the facts [and] you make a decision based on those laws,” he says.

This story has been updated to reflect updated information.

White House taps Va. HBCU presidents for advisory board

The presidents of Virginia State University and Norfolk State University are on the list of intended appointees to the President’s Board of Advisors on Historically Black Colleges and Universities, the Biden administration announced on March 31.

Virginia State University President Makola M. Abdullah, Norfolk State University President Javaune Adams-Gaston and Janeen Uzzell, CEO of the Alexandria-based National Society of Black Engineers made the list from the commonwealth. Other board members from outside Virginia include Academy Award-nominated actress Taraji P. Henson, United Airlines President Brett Hart, TIAA President and CEO Thasunda Brown Duckett and NBA star Chris Paul of the Phoenix Suns.

The board will work to advance the HBCU Initiative, which President Jimmy Carter’s administration originally established to increase the participation of HBCUs in federally sponsored programs and reduce and eliminate barriers to participating in those programs. President Joe Biden signed an executive order in September 2021 reestablishing the initiative.

In February, Biden appointed Dietra Trent as executive director of the White House HBCU Initiative. Trent served as state secretary of education under former Gov. Terry McAuliffe and then as chief of staff to former state Secretary of Education Anne Holton, U.S. Sen. Tim Kaine’s wife, when Holton served as George Mason University’s interim president.

Abdullah became Virginia State University’s 14th president in 2016. Before that, he served as provost and senior vice president at Bethune-Cookman University. He previously was the provost and vice president for academic affairs at Florida Memorial University, and prior to that, dean and director of 1890 land grant programs at Florida Agricultural and Mechanical University.

“This initiative gives me an opportunity, in my capacity as VSU president, to also work closely with the Executive Office of the U.S. President on key administration priorities related to advancing educational equity, excellence and economic opportunities for HBCUs,” Abdullah said in a statement. “I am proud to serve on this board which allows me to continue to advocate for the transformative work of HBCUs.”

Abdullah holds bachelor’s, master’s and doctorate degrees in civil engineering. He received his undergraduate degree from Howard University and his master’s and doctorate degrees from Northwestern University. He is a member of Alpha Phi Alpha Fraternity Inc. and a member of multiple boards and committees, including the Board of Trustees for the Southern Association of Colleges and Schools Commission on College and the Council of Presidents for Virginia Institutions of Higher Education.

Adams-Gaston became the seventh president of NSU in June 2019. Since then, the school has secured more than $7 million in public and private partnerships with corporations including Apple Inc., Netflix Inc., Amazon.com Inc., Bank of America Corp. and Dominion Energy Inc.

Adams-Gaston

“I am honored to serve on President Biden’s Board of Advisors on Historically Black Colleges and Universities,” Adams-Gaston said in a statement. “I appreciate the confidence the administration has in appointing me to serve on such a distinguished board. I look forward to collaborating with my fellow board members as we work to improve the outcomes for students who attend our historic institutions.”

Prior to becoming NSU’s president, Adams-Gaston served as senior vice president for student life at The Ohio State University. Before that, she had held several roles at the University of Maryland, including associate dean in academic affairs, assistant athletic director and graduate faculty member. She had a practice as a licensed psychologist for 25 years.

Uzzell is CEO of the Alexandria-based National Society of Black Engineers, a student-governed organization. She was previously the chief operating officer of Wikimedia Foundation Inc., which operates Wikipedia, where she helped launch the Wikimedia Knowledge Equity Fund to address racial inequities in free knowledge.

She previously held several roles in General Electric Co.’s health care technologies sector, including as head of women in technology. Uzzell also served as global director of external affairs and technology programs, director of health care programs at GE Africa and director of global health care programs.

Uzzell received her bachelor’s degree in mechanical engineering from North Carolina Agricultural and Technical State University and an MBA from Fairleigh Dickinson University. She has been recognized with a United Nations Global Leadership Award.

Va. restaurant, hospitality industry seeks $270M+ in relief funding

Hard hit by the pandemic, Virginia’s restaurant and hospitality industry is asking the General Assembly to dedicate more than $270 million from the state’s share of federal American Rescue Plan dollars to assist hotels, restaurants and other hospitality-related industries.

In a letter sent Tuesday to members of the state legislature’s money committees, the Virginia Restaurant, Lodging & Travel Association requested that the General Assembly allocate $273.35 million from the Virginia state government’s $3.76 billion share of the Biden administration’s $1.9 trillion American Rescue Plan.

Eric Terry

“Supporting these organizations with additional funding will ensure that more businesses survive, that workers stay employed, and that tourism across the commonwealth rebounds more quickly,” VRLTA President Eric Terry said in the April 6 letter addressed to House Appropriations Committee Chair Del. Luke Torian and Senate Finance and Appropriations Committee Chair Sen. Janet Howell.

Signed into law by Biden on March 11, the federal plan stipulates that 25% of American Rescue Plan funding should be allocated to assist states and communities “that have suffered economic injury as a result of job and gross domestic product losses in the travel, tourism, or outdoor recreation sectors.”

Virginia and its localities are receiving about $6.9 billion from the American Rescue Plan, which includes extending expanded unemployment benefits through Labor Day, $1,400 relief checks to individuals, and grants for small businesses.

“This is a once-in-a-lifetime opportunity for Virginia and its localities to alleviate the economic losses sustained through the pandemic in the hospitality and tourism industries,” reads a statement from the association.

Tourism accounts for $27 billion in annual revenue in the commonwealth. Restaurants brought in more than $18 billion in revenue for 2018 and lodging accounted for roughly $6 billion in the state in 2019. The state association estimates that collectively the industries lost $14.8 billion in 2020 due to the pandemic, with tourism alone losing $10 billion.

In the April 6 letter, the association is requesting the following relief funding:

  • $184.7 million for hotels and other lodging establishments
  • $36.7 million for restaurants
  • $20 million for the Virginia Tourism Corp.
  • $10 million for tourist attractions
  • $12.25 million for tourism entities
  • $2 million for campgrounds
  • $4.7 million for wedding venues
  • $1.5 million for convention centers
  • $1.5 million for job training for restaurant and lodging employees seeking jobs or improve skills

“You got a $27 billion industry that needs help, and we would do that for any other industry, I think,” Terry said in an interview with Virginia Business.

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