E8-23189. Maritime Security Program

AGENCY:

Maritime Administration, Department of Transportation.

ACTION:

Applications are now being received for one Maritime Security Program (MSP) Operating Agreement.

SUMMARY:

The Maritime Administration (MARAD) is issuing this request for applications for one eligible vessel to fill one MSP Operating Agreement in accordance with the provisions of Subtitle C, Title XXXV of the National Defense Authorization Act for Fiscal Year 2004, the Maritime Security Act of 2003 (MSA 2003). The MSA 2003 authorizes the creation of a Maritime Security Program (MSP) that establishes a fleet of active, commercially viable, privately owned vessels to meet national defense and other security requirements and to maintain a United States presence in international commercial shipping. This request for applications provides, among other things, application criteria and a deadline for submitting applications for enrollment of one vessel in the MSP.

Applications

Applications are available by electronic mail. Please send requests for applications to [e-mail].

DATES:

Application Due Date: Applications for enrollment of one vessel in the MSP are November 3, 2008. Applications should be submitted to the address listed in the ADDRESSES section below.

ADDRESSES:

Application Submission: Submit applications for enrollment of vessels in the MSP to Peter E. Petrelis, Acting Deputy Director, Office of Sealift Support, W25-324, Maritime Administration, U.S. Department of Transportation, 1200 New Jersey Avenue, SE., Washington, DC 20590.

FOR FURTHER INFORMATION CONTACT:

Peter E. Petrelis, Acting Deputy Director, Office of Sealift Support, Maritime Administration, Telephone [phone]. For legal questions, call Murray Bloom, Chief, Division of Maritime Programs, Maritime Administration, 202-366-5320. For military utility questions, call LTC Tony Moritz, United States Transportation Command, 618-229-1451/1529.

SUPPLEMENTARY INFORMATION:

Background

On November 24, 2003, the President signed the National Defense Authorization Act for Fiscal Year 2004, which contained the MSA 2003 creating a new MSP from FY 2006 through FY 2015. This program also provides financial assistance to operators of U.S.-flag vessels that meet certain qualifications. The MSA 2003 requires that the Secretary of Transportation (Secretary), in consultation with the Secretary of Defense (Sec Def), establish a fleet of active, commercially viable, militarily useful, privately-owned vessels to meet national defense and other security requirements. Section 53111 of the MSA 2003 authorizes $156 million annually for FYs 2006, 2007, and 2008; $174 million annually for FYs 2009, 2010, and 2011; and $186 million annually for FYs 2012, 2013, 2014, and 2015 to support the operation of up to 60 U.S.-flag vessels in the foreign commerce of the United States. Payments to participating operators are limited to $2.6 million per ship per year for FYs 2006 through 2008, $2.9 million per ship per year for FYs 2009 through 2011, and $3.1 million per ship per year for FYs 2012 through 2015. Payments are subject to annual appropriations. Participating operators are required to make their commercial transportation resources available upon request by the SecDef during times of war or national emergency.

Application Criteria

The implementing MSP Regulations at 46 CFR 296.24(b)(2) provide that awards made subsequent to October 1, 2005, including the re-award of temporary agreements, must meet the ownership and operational requirements of 46 U.S.C. 53103(c) (i.e., priority of awards), and 46 CFR 296.24(b)(3) further stipulates that priority of subsequent awards will be assigned in accordance with requirements specified by the SecDef. Any re-award of an MSP Operating Agreement, or replacement of a vessel under an Agreement, is subject to approval by the SecDef, by and through the United States Transportation Command (USTRANSCOM).

The recipient of an Agreement is required to meet the citizenship eligibility requirements specified in 46 U.S.C. Chapter 531 and the implementing regulations at 46 CFR Part 296. Applicants with a vessel that meets program requirements, and who are citizens of the United States within the meaning of 46 U.S.C. 50501 will be given first consideration. In the event that no applicants meet this citizenship requirement, the Maritime Administration and USTRANSCOM will consider other citizenship categories.

Vessel Requirements

Acceptable vessels for this MSP Operating Agreement must meet the requirements of 46 U.S.C. 53102(b) and 46 CFR § 296.11. The Commander, USTRANSCOM, established general evaluation criteria for operational requirements for eligible MSP vessels.

Payments

The applicant chosen for this MSP Operating Agreement will be eligible for payments in accordance with 46 U.S.C. 53106 and 46 CFR 296.41.

Maintenance and Repair (M&R) Work Agreement Requirement

Subtitle A, section 3517 of the MSA 2003 provides for a pilot program under which the Secretary of Transportation shall, subject to the availability of appropriations, require one or more persons to enter into an agreement under this section as a condition of awarding an operating agreement to the person under chapter 531 of title 46, United States Code, for one or more vessels that normally make port calls in the United States. All qualified maintenance and repair on the vessel shall be performed in the United States. The MSP contractor shall be reimbursed for the costs of qualified maintenance or repair performed in the United States versus the difference in cost of performing this work in a geographic region in which the MSP vessel generally operates. The recipient of this Agreement is required to sign an MSP M&R agreement which stipulates that in the event that sufficient M&R funding is available, the MSP contractor will commit to perform M&R work in a U.S. shipyard.

National Security Requirements

The applicant chosen to receive the MSP Operating Agreement will be required to enter into an Emergency Preparedness Agreement (EPA) pursuant to section 53107 of the MSA 2003. The EPA shall be a document incorporating the terms of the Voluntary Intermodal Sealift Agreement (VISA), as approved by the Secretary and the SecDef, or other agreement approved by the Secretaries.

Documentation

The vessel chosen to receive the MSP Operating Agreement, if a foreign-flag vessel, must be documented as a U.S.-flag vessel under 46 U.S.C. chapter 121 prior to being eligible for MSP payments. Further, proof of U.S. Coast Guard vessel documentation and all relevant charter and management agreements for the chosen vessel must be approved by the Maritime Administration before the vessel is eligible to receive MSP payments.

Vessel Operation

The vessel chosen to receive the MSP Operating Agreement must be operated exclusively in the U.S.-foreign trade or in mixed foreign and domestic trade allowed under a registry endorsement issued under 46 U.S.C. 12105, except for tankers, which may be operated in foreign-to-foreign commerce, and shall not otherwise be operated in the coastwise trade of the United States.

Obligation of the U.S. Government

The amounts payable as MSP payments under an MSP Operating Agreement shall constitute a contractual obligation of the United States Government to the extent of available appropriations.

Merchant Marine Academy Cadets

The MSP Operator shall agree to carry two Merchant Marine Academy cadets, if available, on each voyage.

Approval

The Secretary in conjunction with the SecDef may approve applications to enter into an MSP Operating Agreement and make MSP Payments with respect to vessels that are determined by the Secretary to be the most commercially viable and those that are deemed by the SecDef to be most militarily useful for meeting the sealift needs of the United States in time of war or national emergencies.

By Order of the Maritime Administrator.

Dated: September 26, 2008.

Murray A. Bloom,

Acting Secretary, Maritime Administration.