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                                                     Calendar No. 182
115th Congress     }                                   {       Report
                                 SENATE
 1st Session       }                                   {      115-136
_____________________________________________________________________




 MARITIME ADMINISTRATION AUTHORIZATION AND ENHANCEMENT ACT FOR FISCAL 
                               YEAR 2018

                               __________

                              R E P O R T

                                 of the

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                S. 1096






[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]










                 July 24, 2017.--Ordered to be printed
                 
                                   ______

                         U.S. GOVERNMENT PUBLISHING OFFICE 

69-010                         WASHINGTON : 2017 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                     one hundred fifteenth congress
                             first session

                   JOHN THUNE, South Dakota, Chairman
 ROGER F. WICKER, Mississippi         BILL NELSON, Florida
 ROY BLUNT, Missouri                  MARIA CANTWELL, Washington
 TED CRUZ, Texas                      AMY KLOBUCHAR, Minnesota
 DEB FISCHER, Nebraska                RICHARD BLUMENTHAL, Connecticut
 JERRY MORAN, Kansas                  BRIAN SCHATZ, Hawaii
 DAN SULLIVAN, Alaska                 EDWARD J. MARKEY, Massachusetts
 DEAN HELLER, Nevada                  CORY A. BOOKER, New Jersey
 JAMES M. INHOFE, Oklahoma            TOM UDALL, New Mexico
 MIKE LEE, Utah                       GARY C. PETERS, Michigan
 RON JOHNSON, Wisconsin               TAMMY BALDWIN, Wisconsin
 SHELLEY MOORE CAPITO, West           TAMMY DUCKWORTH, Illinois
    Virginia
 CORY GARDNER, Colorado               MAGARET WOOD HASSAN, New 
                                         Hampshire
 TODD C. YOUNG, Indiana               CATHERINE CORTEZ MASTO, Nevada
                       Nick Rossi, Staff Director
                 Adrian Arnakis, Deputy Staff Director
                    Jason Van Beek, General Counsel
                 Kim Lipsky, Democratic Staff Director
           Christopher Day, Democratic Deputy Staff Director















                                                     Calendar No. 182
115th Congress     }                                   {       Report
                                 SENATE
 1st Session       }                                   {      115-136

======================================================================



 
 MARITIME ADMINISTRATION AUTHORIZATION AND ENHANCEMENT ACT FOR FISCAL 
                               YEAR 2018

                                _______
                                

                 July 24, 2017.--Ordered to be printed

                                _______
                                

Mr. Thune, from the Committee on Commerce, Science, and Transportation, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 1096]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 1096) to amend and enhance 
certain maritime programs of the Department of Transportation, 
and for other purposes, having considered the same, reports 
favorably thereon with an amendment (in the nature of a 
substitute) and recommends that the bill (as amended) do pass.

                          Purpose of the Bill

    The purpose of S. 1096 is to authorize appropriations for 
the Department of Transportation (DOT), including the following 
Maritime Administration (MARAD) activities: funding programs 
associated with maintaining the United States merchant marine 
industry; strengthening sexual assault and harassment 
prevention and response at the United States Merchant Marine 
Academy (USMMA); and providing the USMMA with tools to improve 
operational flexibility, faculty retention, and financial 
support.

                          Background and Needs

    MARAD was established in 1950 to foster, promote, and 
develop the merchant marine industry of the United States. 
MARAD, an operating administration within the DOT, is tasked 
with the following: administering the Maritime Security Program 
(MSP) to support 60 U.S.-flag vessels in the movement of cargo 
on international waters, thereby supporting military sealift 
capacity in times of war or national emergency; managing the 
Ready Reserve Force, funded by the Department of Defense; 
managing disposal of the National Defense Reserve Fleet (NDRF) 
when ships are no longer deemed useful for defense or missions; 
promoting U.S.-flag vessels by monitoring cargo preference 
requirements; overseeing the U.S. Merchant Marine Academy 
(USMMA) to educate future U.S. mariners; administering loan and 
grant programs, including the Maritime Loan Guarantee Program 
(Title XI Program) and Assistance to Small Shipyards Program; 
promoting port infrastructure development and congestion 
mitigation in the transportation system through education and 
coordination; informing the Department of Homeland Security on 
the availability of coastwise-qualified vessels supporting 
State maritime academies; and other functions.
    Overseen by MARAD, the USMMA is a Federal service academy 
that has been training merchant mariners for more than 70 
years, offering baccalaureate degrees specializing in 
engineering and maritime transportation. In exchange for 
tuition assistance, graduates incur certain service 
obligations. In June, 2016, the Middle States Commission on 
Higher Education (MSCHE) placed USMMA's accreditation under 
warning status due to the USMMA's failure to meet several of 
MSCHE's accreditation standards.\1\ One standard was related to 
sexual misconduct response provisions, and the remaining issues 
were related to independence in governance, budgeting, and 
administrative functions.
---------------------------------------------------------------------------
    \1\The Middle States Commission on Higher Education (MSCHE), 
``Statement of Accreditation Status,'' at http://www.msche.org/
Documents/SAS/494/Statement%20of%20Accreditation
%20Status.htm.
---------------------------------------------------------------------------

Sexual Assault and Sexual Harassment Prevention

    The Committee included provisions in the National Defense 
Authorization Act (NDAA) for fiscal year (FY) 2009 provisions 
that required the Secretary of Transportation (Secretary) and 
the USMMA to implement policies that would address sexual 
assault and harassment at the USMMA.\2\ An October 2014, DOT 
Inspector General (IG) report noted deficiencies in the USMMA's 
effort.\3\ All nine of the report's recommendations have been 
resolved and closed, but recent student surveys, focus group 
results, and accreditation board findings have caused increased 
focus on these sexual assault and harassment issues at the 
USMMA.
---------------------------------------------------------------------------
    \2\P.L. 110-417
    \3\U.S. Department of Transportation, ``Better Program Management 
and Oversight are Required for USMMA's Efforts to Address Sexual 
Assault and Harassment,'' 2014, at https://www.oig.dot.gov/sites/
default/files/
USMMA%20Sexual%20Assualt%20and%20Sexual%20Harassment%20Audit%20Report%5E
10-23-14.pdf.
---------------------------------------------------------------------------
    In response, the Committee included provisions in the NDAA 
for FY 2017 requiring the USMMA to maintain at least one full-
time Sexual Assault Response Coordinator (SARC), who would 
reside on or near the USMMA, and to designate at least one 
permanent employee as a sexual assault victim advocate.\4\ The 
law also requires sexual assault victim advocates to receive 
training in the USMMA's comprehensive sexual assault and sexual 
harassment prevention policies. Victim advocate duties include 
identifying resources and informing victims of rights, while 
connecting with, or serving as, a companion in navigating 
investigative, medical, mental/emotional health, and recovery 
processes relating to sexual assault. In addition, the 
Committee included in the NDAA for FY 2017 a requirement for a 
24-hour hotline through which the victim of a sexual assault 
can receive confidential victim support services. The 
Committee's addition to the NDAA for FY 2017 also enhanced 
sexual assault and harassment prevention and response training 
among cadets. Following passage of the NDAA for FY 2017, the 
USMMA created the Sexual Assault Prevention and Response 
Office, expanding the staff by hiring a director and two victim 
advocate-educator positions.\5\
---------------------------------------------------------------------------
    \4\P.L. 114-328
    \5\U.S. Merchant Marine Academy, ``Sexual Assault Prevention and 
Response Program,'' at https://www.usmma.edu/academy-life/sexual-
assault-prevention/sexual-assault-prevention-and-response-program.
---------------------------------------------------------------------------
    To provide oversight of the USMMA's implementation of the 
new sexual assault and harassment prevention and response 
measures, and the USMMA's voluntary actions, the Committee 
included a provision in the NDAA for FY 2017 requiring the DOT 
IG to report on the effectiveness of the USMMA's prevention and 
response plan by March 31, 2018.\6\
---------------------------------------------------------------------------
    \6\P.L. 114-328
---------------------------------------------------------------------------

Sea Year Stand Down

    Sea Year is a collaborative effort between the USMMA, 
MARAD, and commercial carriers enabling midshipmen from the 
USMMA to sail aboard merchant vessels and gain real-world 
industry experience. Citing concerns of sexual assault aboard 
vessels participating in the program, former Secretary Foxx 
suspended Sea Year in June 2016 while MARAD examined ways to 
ensure that Sea Year training was conducted in a safe and 
respectful environment. During the suspension, MARAD - along 
with a consortium of industry and unions - brought forth a new 
proposal to address sexual assault and harassment prevention 
and response. This includes a zero tolerance policy, an 
electronic reporting system, vetted mentors, regular crew 
training, and a prohibition on fraternization between crew and 
midshipmen. Additionally, these requirements will be reviewed 
after 6 months and annually thereafter.\7\ Further, the NDAA 
for FY 2017 requires a working group to report to Congress in 
September 2017 on efforts to further address prevention and 
reporting.
---------------------------------------------------------------------------
    \7\Maritime Administration (MARAD), ``Summary of Sea Year 
Criteria,'' at https://www.marad.dot.gov/criteria.
---------------------------------------------------------------------------

Authorization

    This bill would authorize appropriations to the DOT for 
programs associated with maintaining the United States merchant 
marine industry. The authorized amounts are the following: 
$100,802,000 for the United States Merchant Marine Academy; 
$29,550,000 for State Maritime Academies; $36,000,000 for the 
National Security Multi-Mission Vessel Program; $58,694,000 for 
Maritime Administration Operations and Programs; $20,000,000 
for the disposal of vessels in the National Defense Reserve 
Fleet; $33,000,000 for the Title XI Loan Guarantee Program; and 
$35,000,000 for the Assistance to Small Shipyards Program.

                         Summary of Provisions

    S. 1096 would make improvements to the USMMA, largely 
modeled on authorities available to other Federal service 
academies. Major provisions include the following:
           Enhancing sexual assault prevention and 
        response by ensuring each student participating in the 
        Sea Year program has access to a functional satellite 
        communication device, and ensuring the academy has 
        sufficient resources.
           Creating more cost-effective options by 
        removing the limit on contracting adjunct professors in 
        one academic trimester at the USMMA.
           Boosting donations to the USMMA by allowing 
        for the acceptance of partial project funding with 
        qualified guarantees and authorizing expenditure.
           Improving USMMA faculty retention and 
        maritime research and education by allowing faculty 
        members to compete for grants that have scientific or 
        educational value.
           Preventing potential educational disruption 
        by allowing the USMMA to stay open in the event of a 
        lapse in appropriations.
    In addition, S. 1096 would reauthorize the assistance to 
small shipyards program on a 3-year basis, similar to the last 
authorization of the program, and allow for the reallocation of 
unused grant funds. It also would include provisions 
authorizing the Secretary to designate centers of excellence 
for domestic maritime workforce training and education. 
Finally, it would require a DOT IG study on certain aspects of 
the MSP.

                          Legislative History

    On May 9, 2017, the Committee's Subcommittee on Surface 
Transportation and Merchant Marine Infrastructure, Safety, and 
Security held a maritime transportation oversight hearing 
entitled, ``Opportunities and Challenges for the Maritime 
Administration and Federal Maritime Commission,'' that, among 
other topics, examined opportunities and challenges for MARAD 
and the USMMA. Joel Szabat, Executive Director of MARAD, and 
Rear Admiral James Helis, Superintendent of the USMMA, 
testified on the implementation of the NDAA for FY 2017 and 
efforts to improve sexual assault and harassment prevention and 
response at the USMMA.
    On May 18, 2017, the Committee met in open Executive 
Session and, by voice vote, ordered S. 1096 to be reported 
favorably with an amendment (in the nature of a substitute). 
Senator Fischer offered a substitute amendment. Additional 
amendments were offered by Senators Schatz and Baldwin. These 
amendments were accepted.

                            Estimated Costs

    In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

S. 1096--Maritime Administration Authorization and Enhancement Act for 
        Fiscal Year 2018

    Summary: S. 1096 would reauthorize programs administered by 
the Maritime Administration (MARAD), which operates the United 
States Merchant Marine Academy (USMMA) and oversees the 
Nation's merchant marine--the civilian mariners and fleet of 
U.S. vessels engaged primarily in waterborne commerce. The bill 
would provide mandatory funding for the USMMA to continue to 
operate in the event of a lapse of discretionary appropriations 
to MARAD. S. 1096 also would provide contract authority--a 
mandatory form of budget authority--for MARAD to pursue certain 
projects on the basis of agreements with nonfederal entities 
that commit to making future donations to the agency.
    CBO estimates that enacting S. 1096 would increase direct 
spending by $1.1 billion over the 2018-2027 period. We also 
estimate that implementing the bill would cost $272 million 
over the 2018-2022 period, assuming appropriation of authorized 
and estimated amounts.
    Pay-as-you-go procedures apply because enacting the 
legislation would affect direct spending. Enacting the bill 
would not affect revenues.
    CBO estimates that enacting S. 1096 would not increase net 
direct spending or on-budget deficits by more than $5 billion 
in any of the four consecutive 10-year periods beginning in 
2028.
    S. 1096 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would impose no costs on state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary effect of S. 1096 is shown in the following table. 
The costs of this legislation fall within budget function 400 
(transportation).

 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              By fiscal year, in millions of dollars--
                                           -------------------------------------------------------------------------------------------------------------
                                             2017    2018    2019    2020    2021    2022    2023    2024    2025    2026    2027   2017-2022  2017-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              INCREASES IN DIRECT SPENDING
 
USMMA Activities:
    Estimated Budget Authority............       0     101     104     106     109     112     114     117     121     124     127       532      1,135
    Estimated Outlays.....................       0      76      93     103     108     111     113     116     120     123     126       491      1,089
                                                     INCREASES IN SPENDING SUBJECT TO APPROPRIATION
MARAD Activities:
    Authorization Levela..................       0     212      35      35       0       0       0       0       0       0       0       282        282
    Estimated Outlays.....................       0     107      49      49      46      21      10       0       0       0       0       272        282
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note:USMMA = U.S. Merchant Marine Academy; MARAD = Maritime Administration.
aThe authorization level for MARAD does not include the $101 million authorized for USMMA activities because CBO considers that to be direct spending
  under the bill.

    Basis of estimate: For this estimate, CBO assumes that S. 
1096 will be enacted near the end of fiscal year 2017 and that 
appropriations will be provided for each fiscal year. Estimates 
of outlays are based on historical spending patterns for the 
affected programs.

Direct spending

    Under current law, funding for the USMMA, which trains 
officers for the country's marine transportation and defense 
needs, is provided in annual appropriation acts. S. 1096 would 
authorize the appropriation of $101 million for the USMMA in 
2018, but starting in 2018, S. 1096 would provide mandatory 
funding for the USMMA to continue to operate for any period of 
time during which discretionary funds are not available to the 
academy. Because the bill would make amounts automatically 
available without further legislation, it would increase direct 
spending. Scorekeeping guidelines adopted by the Congress and 
the Administration require CBO to prepare cost estimates for 
bills without taking into account any possible future 
legislation. Based on the authorized level of funding and 
accounting for anticipated inflation, CBO estimates that 
enacting this provision would increase directspending by $1.1 
billion over the 2018-2027 period because CBO does not assume that 
subsequent appropriation bills would provide this funding. The Congress 
appropriated $83 million for the USMMA in 2017.
    In addition, S. 1096 would provide contract authority--a 
mandatory form of budget authority--for MARAD to pursue certain 
projects on the basis of agreements with nonfederal donors that 
commit to making gifts to the agency. The bill would specify 
the types of agreements that would be considered ``qualified 
guarantees'' of donations, which would be paid over time, to 
support near-term spending for projects with costs of at least 
$1 million. Under S. 1096, such agreements would allow MARAD to 
incur obligations in advance of the gift being received (this 
type of spending authority is known as contract authority) and 
regardless of whether sufficient funds are available to 
complete the project.
    The magnitude of contract authority stemming from qualified 
guarantees under S. 1096 is uncertain, but CBO estimates that 
any net change in direct spending resulting from MARAD's use of 
such guarantees probably would be insignificant over the 2018-
2027 period. Under current law, the USMAA receives donations 
(which are recorded as reductions in direct spending) of 
between $1 million and $1.5 million annually and spends about 
the same amount. CBO expects that the new authority would not 
affect the timing, magnitude, or efforts supported by those 
routine donations and the subsequent spending.
    According to MARAD, allowing donors to support major 
projects with donations that could be paid over several years 
could help the agency attract larger donations in the future. 
Any such increase in donations would be fully offset by a 
corresponding increase in mandatory outlays resulting from 
contract authority created by the qualified guarantees, which 
would occur sooner and over a shorter period of time than the 
associated offsetting receipts from donations. As a result of 
those potential timing lags, CBO expects that authorizing MARAD 
to incur upfront obligations on the basis of qualified donation 
guarantees could increase net direct spending in early years, 
but any such near term increases would be fully offset by 
subsequent reductions in net direct spending when donations are 
received. However, based on information about the relatively 
limited use of similar authorities by military academies, CBO 
expects that that any net changes in direct spending 
attributable to extending such authority to MARAD would not 
exceed $500,000 over the 2018-2027 period.

Spending subject to appropriation

    S. 1096 would authorize appropriations for MARAD totaling 
$383 million, including $313 million for 2018 and $35 million 
in both 2019 and 2020. The agency received an appropriation of 
$223 million for those activities in 2017. The amount 
authorized for 2018 includes $101 million for the USMMA; 
however, as previously discussed, S. 1096 also would provide 
mandatory funding for the academy's operations. After 
accounting for that mandatory funding, CBO estimates that S. 
1096 would authorize appropriations totaling $282 million over 
the 2018-2020 period for MARAD. The authorization includes:
           $59 million for operations and program 
        support provided by MARAD's headquarters;
           $36 million for a program to build new 
        vessels that could perform multiple missions related to 
        national security;
           $35 million annually over the 2018-2020 
        period for assistance to support capital improvements 
        and worker training programs at small shipyards and 
        maritime communities;
           $33 million to guarantee loans to construct 
        or modernize U.S. vessels or shipyards;
           $30 million to provide financial and other 
        support to state maritime academies; and
           $20 million for disposal of vessels in the 
        National Defense Reserve Fleet.
    Based on historical spending patterns for activities 
administered by MARAD, CBO estimates that outlays would total 
$107 million in 2018 and $272 million over the 2018-2022 
period.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays that are subject to those 
pay-as-you-go procedures are shown in the following table.

 CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR S. 1096, AS ORDERED REPORTED BY THE SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION ON MAY 18, 2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              By fiscal year, in millions of dollars--
                                           -------------------------------------------------------------------------------------------------------------
                                             2017    2018    2019    2020    2021    2022    2023    2024    2025    2026    2027   2017-2022  2017-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               NET INCREASE IN THE DEFICIT
 
Statutory Pay-As-You-Go Impact............       0      76      93     103     108     111     113     116     120     123     126       491      1,089
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Increase in long-term direct spending and deficits: CBO 
estimates that enacting the legislation would not increase net 
direct spending or on-budget deficits by more than $5 billion 
in any of the four consecutive 10-year periods beginning in 
2028.
    Intergovernmental and private-sector impact: S. 1096 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would benefit state maritime academies and 
other public institutions by authorizing federal financial and 
technical assistance for maritime education. Any costs incurred 
by those entities would result from voluntary commitments.
    Estimate prepared by: Federal costs: Megan Carroll and 
Janani Shankaran; Impact on state, local, and tribal 
governments: Jon Sperl; Impact on the private sector: Amy Petz.
    Estimate approved by: H. Samuel Papenfuss, Deputy Assistant 
Director for Budget Analysis.

                           Regulatory Impact

    In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported:

                       number of persons covered

    This measure, as reported, would not create any new 
programs or impose any new significant regulatory requirements, 
and, therefore, would not subject any individuals or businesses 
to new significant regulations.
    This measure would require MARAD to ensure each student 
participating in the Sea Year program at the USMMA is provided 
or has access to a functional satellite communication device. 
Currently, there are nine companies participating in the Sea 
Year program.
    This measure would set new Buy America requirements for the 
Assistance to Small Shipyards Program, though MARAD has 
included Buy America requirements in grant requirements prior 
to this statutory change. The program funds grants for an 
estimated 10 to 15 shipyards per year.

                            economic impact

    Enactment of this legislation is not expected to have any 
significant adverse impacts on the Nation's economy.

                                privacy

    This measure would not impact the personal privacy of 
individuals.

                               paperwork

    This measure would not impose substantial paperwork burden 
on individuals or businesses.

                   Congressionally Directed Spending

    In compliance with paragraph 4(b) of rule XLIV of the 
Standing Rules of the Senate, the Committee provides that no 
provisions contained in the bill, as reported, meet the 
definition of congressionally directed spending items under the 
rule.

                      Section-by-Section Analysis


Section 1. Short title; table of contents.

    This section would provide a short title for the bill and 
list a table of contents.

Section 2. Authorization of the Maritime Administration.

    This section would authorize appropriations for FY 2018 to 
the DOT for programs associated with maintaining the United 
States merchant marine, including the following: the USMMA; 
State maritime academies; National Security Multi-Mission 
Vessel Program; MARAD operations and programs; the ship 
disposal program; and the Title XI Program. This section also 
would authorize appropriations for FY 2018 to FY 2020 for the 
Assistance to Small Shipyards Program.
    This section would authorize an increase in funding for the 
USMMA to ensure access to satellite communication devices and 
on-campus sexual assault and harassment prevention activities.

Section 3. Removal adjunct professor limit at United States Merchant 
        Marine Academy.

    This section would remove the limit on contracting adjunct 
professors in one academic trimester at the USMMA. Other 
Federal service academies do not have a limit on adjunct 
professors in one academic trimester. This change is intended 
to provide a cost-effective way to provide students with 
additional elective courses beyond the core curricula; some 
electives may be necessary to satisfy certain commissioning 
requirements.

Section 4. Acceptance of guarantees in conjunction with partial 
        donations for major projects of the States Merchant Marine 
        Academy.

    This section would allow a donor of a gift to the USMMA to 
fund a substantial portion of a major project, if such donor 
provides a qualified guarantee he or she would make an 
additional gift sufficient to complete the project if other 
donors do not contribute the necessary additional funds. The 
United States Military Academy, United States Naval Academy, 
and United States Air Force Academy (USAFA) all have nearly 
identical authority.

Section 5. Authority to pay conveyance or transfer expenses in 
        connection with acceptance of a gift to the United States 
        Merchant Marine Academy.

    This section would permit the USMMA to accept a gift, such 
as tangible property, that may require additional expenditures 
necessary for shipping or conveyance of the gift. This change 
is intended to prevent delays or denials in the acceptance of 
tangible property that has value to the USMMA.

Section 6. Authority to participate in Federal, State or other research 
        grants.

    This section would allow USMMA faculty members to 
participate in competitions for grants that have scientific or 
educational value to the USMMA. The USMMA currently does not 
have authority to comply with many terms and conditions of 
grants or to expend appropriated funds to submit applications. 
This section is modeled on the authority provided to the USAFA. 
This change is intended to improve faculty retention and 
benefit maritime scientific and educational research.

Section 7. Continuing funding for the United States Merchant Marine 
        Academy.

    This section would provide continuing funding for the USMMA 
in the event of a lapse in appropriations. The section is 
modeled on the authority provided to other Federal service 
academies.

Section 8. Access to satellite communication devices during Sea Year 
        program.

    This section would require MARAD to ensure each student 
participating in the Sea Year program is provided or has access 
to a functional satellite communication device. The section 
would prohibit the denial of the use of such device whenever 
the student determines that use is necessary to prevent or 
report sexual harassment or assault.

Section 9. Assistance for small shipyards and maritime communities.

    This section would make changes to the Assistance to Small 
Shipyards Program. This section would provide for the 
reallocation of unused small shipyard grants to fund other 
qualifying grants. This section would establish certain Buy 
America requirements. MARAD has included a Buy America 
provision in recent grant agreements for this program.

Section 10. Domestic maritime centers of excellence.

    This section would authorize the Secretary to designate 
certain community and technical colleges with a maritime 
training program or training center as a center of excellence 
for domestic maritime working force training and education. 
This section would authorize the Secretary to provide a 
designated center of excellence with technical assistance and 
surplus Federal equipment and assets.

Section 11. Determinations on the viability of vessels.

    This section would require the DOT IG to audit the criteria 
used by the Secretary for determining the commercial viability 
of any MSP vessel that operates in competition with a domestic 
trade vessel documented under the laws of the United States. 
This section would apply to the criteria used for vessels with 
MSP operating agreements beginning after September 30, 2016.

                        Changes in Existing Law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
material is printed in italic, existing law in which no change 
is proposed is shown in roman):

                           TITLE 46. SHIPPING


                      SUBTITLE V. MERCHANT MARINE

                    PART B. MERCHANT MARINE SERVICE

           CHAPTER 513. UNITED STATES MERCHANT MARINE ACADEMY

Sec. 51301. Maintenance of the Academy

  (a) In General.--The Secretary of Transportation shall 
maintain the United States Merchant Marine Academy as an 
institute of higher education to provide instruction to 
individuals to prepare them for service in the merchant marine 
of the United States, to conduct research with respect to 
maritime-related matters, and to provide such other appropriate 
academic support, assistance, training, and activities in 
accordance with the provisions of this chapter as the Secretary 
may authorize.
  (b) Recruitment.--The Secretary of Transportation may, 
subject to the availability of appropriations, expend funds 
available for United States Merchant Marine Academy operating 
expenses for recruiting activities, including advertising, in 
order to obtain recruits for the Academy and cadet applicants.
  (c) Superintendent.--
          (1) In general.--The immediate command of the United 
        States Merchant Marine Academy shall be in the 
        Superintendent of the Academy, subject to the direction 
        of the Maritime Administrator under the general 
        supervision of the Secretary of Transportation.
          (2) Appointment.--The Secretary of Transportation 
        shall appoint as the Superintendent--
                  (A) an individual who has--
                          (i) attained a general or flag 
                        officer rank in the Navy, Army, Air 
                        Force, Marine Corps, Coast Guard, or 
                        National Oceanic and Atmospheric 
                        Administration; and
                          (ii) served at sea in any rank;
                  (B) an individual who has--
                          (i)(I) served at sea in the Navy, 
                        Army, Air Force, Marine Corps, Coast 
                        Guard, or National Oceanic and 
                        Atmospheric Administration; or
                                  (II) held a valid Coast Guard 
                                merchant mariner credential; 
                                and
                          (ii) demonstrated exemplary 
                        leadership in the education of 
                        individuals in the Armed Forces or 
                        United States merchant marine; or
                  (C) if a qualified individual described in 
                subparagraph (A) or (B) does not apply for the 
                position, an individual who has--
                          (i) attained the grade of captain or 
                        above in the Navy, Coast Guard, or 
                        National Oceanic and Atmospheric 
                        Administration or colonel or above in 
                        the Army, Air Force, or Marine Corps; 
                        and
                          (ii) served at sea in any grade.
          (3) Rule of construction.--Notwithstanding paragraph 
        (2), the Secretary of Transportation may appoint an 
        individual who is the best qualified candidate, even if 
        such individual does not fully meet the criteria 
        described in paragraph (2).
  (d) Continuing Funding.--
          (1) In general.--Out of any funds in the general fund 
        of the Treasury not otherwise appropriated, there are 
        hereby appropriated such sums as may be necessary for 
        operations of the United States Merchant Marine Academy 
        for any period during which interim or full-year 
        appropriations are not in effect for the United States 
        Merchant Marine Academy, for fiscal year 2018, and for 
        each fiscal year thereafter.
          (2) Termination.--Amounts made available for a fiscal 
        year under this subsection shall remain available until 
        the earlier of--
                  (A) the enactment into law of an 
                appropriation for such fiscal year (including a 
                continuing appropriation) for such operations); 
                or
                  (B) the enactment into law for the Maritime 
                Administration of the applicable regular 
                appropriation for such fiscal year, or 
                continuing appropriations resolution for such 
                fiscal year, without any appropriation for such 
                operations.

Sec. 51315. Gifts to the Merchant Marine Academy

  (a) In General.--The Maritime Administrator may accept and 
use conditional or unconditional gifts of money or property for 
the benefit of the United States Merchant Marine Academy, 
including acceptance and use for non-appropriated fund 
instrumentalities of the Merchant Marine Academy. The Maritime 
Administrator may accept a gift of services in carrying out the 
Administrator's duties and powers. Property accepted under this 
section and proceeds from that property must be used, as nearly 
as possible, in accordance with the terms of the gift.
  (b) Establishment of Academy Gift Fund.--There is established 
in the Treasury a fund, to be known as the ``Academy Gift 
Fund''. Disbursements from the Fund shall be made on order of 
the Maritime Administrator. Unless otherwise specified by the 
terms of the gift, the Maritime Administrator may use monies in 
the Fund for appropriated or non-appropriated purposes at the 
Academy. The Fund consists of--
          (1) gifts of money;
          (2) income from donated property accepted under this 
        section;
          (3) proceeds from the sale of donated property; and
          (4) income from securities under subsection (c) of 
        this section.
  (c) Investment of Fund Balances.--On request of the Maritime 
Administrator, the Secretary of the Treasury may invest and 
reinvest amounts in the Fund in securities of, or in securities 
the principal and interest of which is guaranteed by, the 
United States Government.
  (d) Disbursement Authority.--There are hereby authorized to 
be disbursed from the Fund such sums as may be on deposit, to 
remain available until expended.
  (e) Deductibility of Gifts.--Gifts accepted under this 
section are a gift to or for the use of the Government under 
the Internal Revenue Code of 1986.

Sec. 51317. Adjunct professors

  (a) In General.--The Maritime Administrator may establish a 
program for the purpose of contracting with individuals as 
personal services contractors to provide services as adjunct 
professors at the Academy, if the Maritime Administrator 
determines that there is a need for adjunct professors and the 
need is not of permanent duration.
  (b) Contract Requirements.--Each contract under the program--
          (1) must be approved by the Maritime Administrator; 
        [and]
          (2) shall be for a duration, including options, of 
        not to exceed one year unless the Maritime 
        Administrator finds that exceptional circumstances 
        justify an extension of up to one additional year[.]; 
        and
          (3) shall be subject to the availability of 
        appropriations.
  [(c) Limitation on Number of Contractors.--In awarding 
contacts under this section, the Maritime Administrator shall 
ensure that not more than 25 individuals actively provide 
services in any one academic trimester, or equivalent, as 
contractors under subsection (a).
  [(d) Reporting Requirements.--When the authority granted by 
subsection (a) is used to hire an adjunct professor at the 
Academy in fiscal year 2010 or fiscal year 2011, the 
Administrator shall notify the Committee on Armed Services of 
the House of Representatives, the Committee on Armed Services 
of the Senate, and the Committee on Commerce, Science, and 
Transportation of the Senate, including the need for and the 
term of employment for the adjunct professor.]

Sec. 51320. Acceptance of guarantees with gifts for major projects

  (a) Definitions.--In this section:
          (1) Major project.--The term ``major project'' means 
        a project estimated to cost at least $1,000,000 for--
                  (A) the purchase or other procurement of real 
                or personal property; or
                  (B) the construction, renovation, or repair 
                of real or personal property.
          (2) Major united states commercial bank.--The term 
        ``major United States commercial bank'' means a 
        commercial bank that--
                  (A) is an insured bank (as defined in section 
                3(h) of the Federal Deposit Insurance Act (12 
                U.S.C. 1813(h)));
                  (B) is headquartered in the United States; 
                and
                  (C) has total net assets of an amount 
                considered by the Maritime Administrator to 
                qualify the bank as a major bank.
          (3) Major united states investment management firm.--
        The term ``major United States investment management 
        firm'' means--
                  (A) any broker or dealer (as such terms are 
                defined in section 3 of the Securities Exchange 
                Act of 1934 (15 U.S.C. 78c));
                  (B) any investment adviser or provider of 
                investment supervisory services (as such terms 
                are defined in section 202 of the Investment 
                Advisers Act of 1940 (15 U.S.C. 80b-2)); or
                  (C) a major United States commercial bank 
                that--
                          (i) is headquartered in the United 
                        States; and
                          (ii) holds for the account of others 
                        investment assets in a total amount 
                        considered by the Maritime 
                        Administrator to qualify the bank as a 
                        major investment management firm.
          (4) Qualified guarantee.--The term ``qualified 
        guarantee'', with respect to a major project, means a 
        guarantee that--
                  (A) is made by 1 or more persons in 
                connection with a donation for the project of a 
                total amount in cash or securities that the 
                Maritime Administrator determines is sufficient 
                to defray a substantial portion of the total 
                cost of the project;
                  (B) is made to facilitate or expedite the 
                completion of the project in reasonable 
                anticipation that other donors will contribute 
                sufficient funds or other resources in amounts 
                sufficient to pay for completion of the 
                project;
                  (C) is set forth as a written agreement 
                providing that the donor will furnish in cash 
                or securities, in addition to the donor's other 
                gift or gifts for the project, any additional 
                amount that may become necessary for paying the 
                cost of completing the project by reason of a 
                failure to obtain from other donors or sources 
                funds or other resources in amounts sufficient 
                to pay the cost of completing the project; and
                  (D) is accompanied by--
                          (i) an irrevocable and unconditional 
                        standby letter of credit for the 
                        benefit of the United States Merchant 
                        Marine Academy that is in the amount of 
                        the guarantee and is issued by a major 
                        United States commercial bank; or
                          (ii) a qualified account control 
                        agreement.
          (5) Qualified account control agreement.--The term 
        ``qualified account control agreement'', with respect 
        to a guarantee of a donor, means an agreement among the 
        donor, the Maritime Administrator, and a major United 
        States investment management firm that--
                  (A) ensures the availability of sufficient 
                funds or other financial resources to pay the 
                amount guaranteed during the period of the 
                guarantee;
                  (B) provides for the perfection of a security 
                interest in the assets of the account for the 
                United States for the benefit of the United 
                States Merchant Marine Academy with the highest 
                priority available for liens and security 
                interests under applicable law;
                  (C) requires the donor to maintain in an 
                account with the investment management firm 
                assets having a total value that is not less 
                than 130 percent of the amount guaranteed; and
                  (D) requires the investment management firm, 
                whenever the value of the account is less than 
                the value required to be maintained under 
                subparagraph (C), to liquidate any noncash 
                assets in the account and reinvest the proceeds 
                in Treasury bills issued under section 3104 of 
                title 31.
  (b) Acceptance Authority.--Subject to subsection (d), the 
Maritime Administrator may accept a qualified guarantee from a 
donor or donors for the completion of a major project for the 
benefit of the United States Merchant Marine Academy.
  (c) Obligation Authority.--The amount of a qualified 
guarantee accepted under this section shall be considered as 
contract authority to provide obligation authority for purposes 
of Federal fiscal and contractual requirements. Funds available 
for a project for which such a guarantee has been accepted may 
be obligated and expended for the project without regard to 
whether the total amount of funds and other resources available 
for the project (not taking into account the amount of the 
guarantee) is sufficient to pay for completion of the project.
  (d) Notice.--The Maritime Administrator may not accept a 
qualified guarantee under this section for the completion of a 
major project until 30 days after the date on which a report of 
the facts concerning the proposed guarantee is submitted to 
Congress.
  (e) Prohibition on Commingling Funds.--The Maritime 
Administrator may not enter into any contract or other 
transaction involving the use of a qualified guarantee and 
appropriated funds in the same contract or transaction.

Sec. 51321. Grants for scientific and educational research

  (a) Defined Term.--In this section, the term ``qualifying 
research grant'' is a grant that--
          (1) is awarded on a competitive basis by the Federal 
        Government (except for the Department of 
        Transportation), a State, a corporation, a fund, a 
        foundation, an educational institution, or a similar 
        entity that is organized and operated primarily for 
        scientific or educational purposes; and
          (2) is to be used to carry out a research project 
        with a scientific or educational purpose.
  (b) Acceptance of Qualifying Research Grants.--
Notwithstanding any other provision of law, the United States 
Merchant Marine Academy may compete for and accept qualifying 
research grants if the work under the grant is to be carried 
out by a professor or instructor of the United States Merchant 
Marine Academy.
  (c) Administration of Grant Funds.--
          (1) Establishment of account.--The Maritime 
        Administrator shall establish a separate account for 
        administering funds received from research grants under 
        this section.
          (2) Use of grant funds.--The Superintendent shall use 
        grant funds deposited into the account established 
        pursuant to paragraph (1) in accordance with applicable 
        regulations and the terms and conditions of the 
        respective grants.
  (d) Related Expenses.--Subject to such limitations as may be 
provided in appropriations Acts, appropriations available for 
the United States Merchant Marine Academy may be used to pay 
expenses incurred by the Academy in applying for, and otherwise 
pursuing, a qualifying research grant.

                           TITLE 46. SHIPPING


                      SUBTITLE V. MERCHANT MARINE

                 PART C. FINANCIAL ASSISTANCE PROGRAMS

                       CHAPTER 541. MISCELLANEOUS

Sec. 54101. Assistance for small shipyards and maritime communities

  (a) Establishment of Program.--Subject to the availability of 
appropriations, the Administrator of the Maritime 
Administration shall execute agreements with shipyards to 
provide assistance--
          (1) in the form of grants, loans, and loan guarantees 
        to small shipyards for capital improvements; and
          (2) for maritime training programs to foster 
        technical skills and operational productivity in 
        communities whose economies are related to or dependent 
        upon the maritime industry.
  [(b) Awards.--In providing assistance under the program, the 
Administrator shall--
          [(1) take into account--
                  [(A) the economic circumstances and 
                conditions of maritime communities;
                  [(B) projects that would be effective in 
                fostering efficiency, competitive operations, 
                and quality ship construction, repair, and 
                reconfiguration; and
                  [(C) projects that would be effective in 
                fostering employee skills and enhancing 
                productivity; and
          [(2) make grants within 120 days after the date of 
        enactment of the appropriations Act for the fiscal year 
        concerned.]
  (b) Awards.--
          (1) In general.--In providing assistance under the 
        program, the Administrator shall take into account--
                  (A) the economic circumstances and conditions 
                of maritime communities;
                  (B) projects that would be effective in 
                fostering efficiency, competitive operations, 
                and quality ship construction, repair, and 
                reconfiguration; and
                  (C) projects that would be effective in 
                fostering employee skills and enhancing 
                productivity.
          (2) Timing of award.--
                  (A) In general.--Except as provided in 
                subparagraph (B), the Administrator shall award 
                grants under this section not later than 120 
                days after the date of the enactment of the 
                appropriations Act for the fiscal year 
                concerned.
                  (B) Reallocation of unused funds.--If a grant 
                is awarded under this section and, for any 
                reason, the grant funds are not used by the 
                grantee--
                          (i) such funds shall remain available 
                        until expended; and
                          (ii) the Administrator may--
                                  (I) use such unused funds to 
                                award another grant under this 
                                section in the fiscal year 
                                concerned; or
                                  (II) reallocate such unused 
                                funds for grants in a 
                                subsequent fiscal year.
  (c) Use of Funds.--
          (1) In general.--Assistance provided under this 
        section may be used--
                  (A) to make capital and related improvements 
                in small shipyards located in or near maritime 
                communities;
                  (B) to provide training for workers in 
                communities whose economies are related to the 
                maritime industry; and
                  (C) for such other purposes as the 
                Administrator determines to be consistent with 
                and supplemental to such activities.
          (2) Administrative costs.--Not more than 2 percent of 
        amounts made available to carry out the program may be 
        used for the necessary costs of grant administration.
          (3) Buy america.--
                  (A) In general.--Notwithstanding any other 
                provision of law, the Secretary of 
                Transportation shall not obligate any funds 
                authorized to be appropriated to carry out this 
                chapter unless the steel, iron, and 
                manufactured products used in such project are 
                produced in the United States.
                  (B) Exceptions.--The provisions of 
                subparagraph (A) shall not apply if the 
                Secretary finds that--
                          (i) their application would be 
                        inconsistent with the public interest;
                          (ii) such materials and products are 
                        not produced in the United States in 
                        sufficient and reasonably available 
                        quantities and of a satisfactory 
                        quality; or
                          (iii) inclusion of domestic material 
                        will increase the cost of the overall 
                        project by more than 25 percent.
  (d) Prohibited Uses.--Grants awarded under this section may 
not be used to construct buildings or other physical facilities 
or to acquire land unless such use is specifically approved by 
the Administrator in support of subsection (c)(1)(C).
  (e) Matching Requirements; Allocation.--
          (1) Federal funding.--Except as provided in paragraph 
        (2), Federal funds for any eligible project under this 
        section shall not exceed 75 percent of the total cost 
        of such project.
          (2) Exception.--If the Administrator determines that 
        a proposed project merits support and cannot be 
        undertaken without a higher percentage of Federal 
        financial assistance, the Administrator may award a 
        grant for such project with a lesser matching 
        requirement than is described in paragraph (1).
          (3) Allocation of funds.--The Administrator may not 
        award more than 25 percent of the funds appropriated to 
        carry out this section for any fiscal year to any small 
        shipyard in one geographic location that has more than 
        600 employees.
  (f) Applications.--
          (1) In general.--To be eligible for assistance under 
        this section, an applicant shall submit an application, 
        in such form, and containing such information and 
        assurances as the Administrator may require, within 60 
        days after the date of enactment of the appropriations 
        Act for the fiscal year concerned.
          (2) Minimum standards for payment or reimbursement.--
        Each application submitted under paragraph (1) shall 
        include--
                  (A) a comprehensive description of--
                          (i) the need for the project;
                          (ii) the methodology for implementing 
                        the project; and
                          (iii) any existing programs or 
                        arrangements that can be used to 
                        supplement or leverage assistance under 
                        the program.\1\
---------------------------------------------------------------------------
    \1\So in original. There is no subparagraph (B).
---------------------------------------------------------------------------
          (3) Procedural safeguards.--The Administrator, in 
        consultation with the Office of the Inspector General, 
        shall issue guidelines to establish appropriate 
        accounting, reporting, and review procedures to ensure 
        that--
                  (A) grant funds are used for the purposes for 
                which they were made available;
                  (B) grantees have properly accounted for all 
                expenditures of grant funds; and
                  (C) grant funds not used for such purposes 
                and amounts not obligated or expended are 
                returned.
          (4) Project approval required.--The Administrator may 
        not award a grant under this section unless the 
        Administrator determines that--
                  (A) sufficient funding is available to meet 
                the matching requirements of subsection (e);
                  (B) the project will be completed without 
                unreasonable delay; and
                  (C) the recipient has authority to carry out 
                the proposed project.
  (g) Audits and Examinations.--All grantees under this section 
shall maintain such records as the Administrator may require 
and make such records available for review and audit by the 
Administrator.
  (h) Small Shipyard Defined.--In this section, the term 
``small shipyard'' means a shipyard facility in one geographic 
location that does not have more than 1,200 employees.
  (i) Authorization of Appropriations.--There are authorized to 
be appropriated to the Administrator of the Maritime 
Administration for each of fiscal years [2015 through 2017] 
2018 through 2020 to carry out this section--
          (1) [$5,000,000] $7,500,000 for training grants; and
          (2) [$25,000,000] $27,500,000 for capital and related 
        improvements.

        NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2017


                  [Public Law 114-328; 130 Stat. 2000]

SEC. 3514. SEA YEAR COMPLIANCE.

  [Not later than]
   (a) Vessel Operator Requirements.--Not later than 90 days 
after the date of the enactment of this Act, the Maritime 
Administrator, in consultation with operators of commercial 
vessels of the United States, shall establish--
          (1) criteria that vessel operators must meet in order 
        to participate in the Sea Year program of the United 
        States Merchant Marine Academy that addresses sexual 
        harassment, sexual assault, and other inappropriate 
        conduct; and
          (2) a process for verifying compliance with the 
        criteria.
  (b) Satellite Phone Access.--The Maritime Administrator shall 
ensure that each student participating in the Sea Year program 
is provided or has access to a functional satellite 
communication device. A student may not be denied from using 
such device whenever the student determines that such use is 
necessary to prevent or report sexual harassment or assault.

                                  [all]