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46 U.S.C. § 53106 — Payments
Federal law — U.S. Code and appendices · legal_authorities
**(a) Annual Payment.—**
(1) **In general.—** — The Secretary, subject to the availability of appropriations and the other provisions of this section, shall pay to the contractor for an operating agreement, for each vessel that is covered by the operating agreement, an amount equal to—
(A) $5,000,000 for each of fiscal years 2018, 2019, and 2020;
(B) $8,233,463 for fiscal year 2021;
(C) $5,300,000 for each of fiscal years 2022, 2023,,11 So in original. Second comma probably should not appear. and 2024;
(D) $6,500,000 for each of fiscal years 2025 and 2026;
(E) $6,675,500 for each of fiscal years 2027 and 2028;
(F) $6,855,000 for each of fiscal years 2029and 2030;
(G) $7,040,000 for each of fiscal years 2031 and 2032;
(H) $7,230,000 for each of fiscal years 2033 and 2034;
(I) $7,426,000 for each of fiscal years 2035 and 2036;
(J) $7,626,000 for each of fiscal years 2037 and 2038; and
(K) $7,832,000 for each of fiscal years 2039 and 2040.
(2) **Timing.—** — The amount shall be paid in equal monthly installments at the end of each month. The amount shall not be reduced except as provided by this section or section 51307(b).
**(b) Certification Required for Payment.—** As a condition of receiving payment under this section for a fiscal year for a vessel, the contractor for the vessel shall certify, in accordance with regulations issued by the Secretary, that the vessel has been and will be operated in accordance with paragraph (1) and (2) of section 53105(a), as otherwise applicable with respect to such vessel, for at least 320 days in the fiscal year. Days during which the vessel is drydocked, surveyed, inspected, or repaired shall be considered days of operation for purposes of this subsection.
**(c) General Limitations.—** The Secreta
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Source file: Laws/federal/codes/united-states-code/title-46/section-53106-payments--1f4252899c.md
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Source location: Title 46, Chapter 531, § 53106; chapter-531-maritime-security-fleet.md
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**(a) Annual Payment.—**
(1) **In general.—** — The Secretary, subject to the availability of appropriations and the other provisions of this section, shall pay to the contractor for an operating agreement, for each vessel that is covered by the operating agreement, an amount equal to—
(A) $5,000,000 for each of fiscal years 2018, 2019, and 2020;
(B) $8,233,463 for fiscal year 2021;
(C) $5,300,000 for each of fiscal years 2022, 2023,,11 So in original. Second comma probably should not appear. and 2024;
(D) $6,500,000 for each of fiscal years 2025 and 2026;
(E) $6,675,500 for each of fiscal years 2027 and 2028;
(F) $6,855,000 for each of fiscal years 2029and 2030;
(G) $7,040,000 for each of fiscal years 2031 and 2032;
(H) $7,230,000 for each of fiscal years 2033 and 2034;
(I) $7,426,000 for each of fiscal years 2035 and 2036;
(J) $7,626,000 for each of fiscal years 2037 and 2038; and
(K) $7,832,000 for each of fiscal years 2039 and 2040.
(2) **Timing.—** — The amount shall be paid in equal monthly installments at the end of each month. The amount shall not be reduced except as provided by this section or section 51307(b).
**(b) Certification Required for Payment.—** As a condition of receiving payment under this section for a fiscal year for a vessel, the contractor for the vessel shall certify, in accordance with regulations issued by the Secretary, that the vessel has been and will be operated in accordance with paragraph (1) and (2) of section 53105(a), as otherwise applicable with respect to such vessel, for at least 320 days in the fiscal year. Days during which the vessel is drydocked, surveyed, inspected, or repaired shall be considered days of operation for purposes of this subsection.
**(c) General Limitations.—** The Secretary of Transportation shall not make any payment under this chapter for a vessel with respect to any days for which the vessel is—
(1) under a charter to the United States Government, other than a charter pursuant to an Emergency Preparedness Agreement under section 53107;
(2) not operated or maintained in accordance with an operating agreement under this chapter; or
(3) more than—
(A) 25 years of age, except as provided in subparagraph (B); or
(B) 20 years of age, in the case of a tank vessel.
**(d) Reductions in Payments.—** With respect to payments under this chapter for a vessel covered by an operating agreement, the Secretary—
(1) except as provided in paragraph (2), shall not reduce any payment for the operation of the vessel to carry military or other preference cargoes under section 55302(a), 55304, 55305, or 55314 of this title, [section 2631 of title 10](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title10-section2631&num=0&edition=prelim), or any other cargo preference law of the United States;
(2) shall not make any payment for any day that the vessel is engaged in transporting more than 7,500 tons of civilian bulk preference cargoes pursuant to section 55302(a), 55305, or 55314 of this title that is bulk cargo; and
(3) shall make a pro rata reduction in payment for each day less than 320 in a fiscal year that the vessel is not operated in accordance with paragraph (1) and (2) of section 53105(a), as otherwise applicable with respect to such vessel, with days during which the vessel is drydocked or undergoing survey, inspection, or repair considered to be days on which the vessel is operated.
**(e) Limitation Regarding Noncontiguous Domestic Trade.—**
(1) **In general.—** — No contractor shall receive payments pursuant to this chapter during a period in which it participates in noncontiguous domestic trade.
(2) **Limitation on application.—** — Paragraph (1) shall not apply to any person that is a citizen of the United States within the meaning of [section 50501 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title46-section50501&num=0&edition=prelim), applying the 75 percent ownership requirement of that section.
(3) **Participates in a noncontiguous domestic trade defined.—** — In this subsection the term “participates in a noncontiguous domestic trade” means directly or indirectly owns, charters, or operates a vessel engaged in transportation of cargo between a point in the contiguous 48 States and a point in Alaska, Hawaii, or Puerto Rico, other than a point in Alaska north of the Arctic Circle.
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Federal law — U.S. Code and appendices · legal_authorities
In this chapter:
(1) **Bulk cargo.—** — The term “bulk cargo” means cargo that is loaded and carried in bulk without mark or count.
(2) **Contractor.—** — The term “contractor” means an owner or operator of a vessel that enters into an operating agreement for the vessel with the Secretary under section 53103.
(3) **Fleet.—** — The term “Fleet” means the Maritime Security Fleet established under section 53102(a).
(4) **Foreign commerce.—** — The term “foreign commerce” means—
(A) commerce or trade between the United States, its territories or possessions, or the District of Columbia, and a foreign country; and
(B) commerce or trade between foreign countries.
(5) **Participating fleet vessel.—** — The term “participating fleet vessel” means any vessel that—
(A) on October 1, 2015—
(i) meets the requirements of paragraph (1), (2), (3), or (4) of section 53102(c); and
(ii) is less than 20 years of age if the vessel is a tank vessel, or is less than 25 years of age for all other vessel types; and
(B) on December 31, 2014, is covered by an operating agreement under this chapter.
(6) **Person.—** — The term “person” includes corporations, partnerships, and associations existing under or authorized by the laws of the United States, or any State, Territory, District, or possession thereof, or of any foreign country.
(7) **Product tank vessel.—** — The term “product tank vessel” means a double hulled tank vessel capable of carrying simultaneously more than 2 separated grades of refined petroleum products.
(8) **Secretary.—** — The term “Secretary” means the Secretary of Transportation.
(9) **Tank vessel.—** — The term “tank vessel” has the meaning that term has under [section 2101 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-
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Federal law — U.S. Code and appendices · legal_authorities
**(a) In General.—** Supplies bought for the Army, Navy, Air Force, Marine Corps, or Space Force, or for a Defense Agency, or otherwise transported by the Department of Defense, may only be transported by sea in—
(1) a vessel belonging to the United States; or
(2) a vessel of the United States (as such term is defined in [section 116 of title 46](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title46-section116&num=0&edition=prelim)).
**(b) Waiver and Notification.—**
(1) The Secretary of Defense may waive the requirement under subsection (a) if such a vessel is—
(A) not available at a fair and reasonable rate for commercial vessels of the United States; or
(B) otherwise not available.
(2) At least once each fiscal year, the Secretary of Defense shall submit, in writing, to the appropriate congressional committees a notice of any waiver granted under this subsection and the reasons for such waiver.
**(c) Requirements for Reflagging or Repair Work.—**
(1) In each request for proposals to enter into a time-charter contract for the use of a vessel for the transportation of supplies under this section, the Secretary of Defense shall require that—
(A) any reflagging or repair work on a vessel for which a proposal is submitted in response to the request for proposals be performed in the United States (including any territory of the United States); and
(B) any corrective and preventive maintenance or repair work on a vessel under contract pursuant to this section relevant to the purpose of such contract be performed in the United States (including any territory of the United States) for the duration of the contract, to the greatest extent practicable.
(2) The Secretary of Defense may waive a requirement under paragraph (1) if the Secretary det
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Federal law — U.S. Code and appendices · legal_authorities
**(a) In General.—** In this subtitle, a corporation, partnership, or association is deemed to be a citizen of the United States only if the controlling interest is owned by citizens of the United States. However, if the corporation, partnership, or association is operating a vessel in the coastwise trade, at least 75 percent of the interest must be owned by citizens of the United States.
**(b) Additional Requirements for Corporations.—** In this subtitle, a corporation is deemed to be a citizen of the United States only if, in addition to satisfying the requirements in subsection (a)—
(1) it is incorporated under the laws of the United States or a State;
(2) its chief executive officer, by whatever title, and the chairman of its board of directors are citizens of the United States; and
(3) no more of its directors are noncitizens than a minority of the number necessary to constitute a quorum.
**(c) Determination of Controlling Corporate Interest.—** The controlling interest in a corporation is owned by citizens of the United States under subsection (a) only if—
(1) title to the majority of the stock in the corporation is vested in citizens of the United States free from any trust or fiduciary obligation in favor of a person not a citizen of the United States;
(2) the majority of the voting power in the corporation is vested in citizens of the United States;
(3) there is no contract or understanding by which the majority of the voting power in the corporation may be exercised, directly or indirectly, in behalf of a person not a citizen of the United States; and
(4) there is no other means by which control of the corporation is given to or permitted to be exercised by a person not a citizen of the United States.
**(d) Determination of 75 Percent Corporate Inter
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Federal law — U.S. Code and appendices · legal_authorities
Page 405
TITLE 46—SHIPPING
§ 53106
1 So in original. Second comma probably should not appear.
ered a transfer of an operating agreement if the
same legal entity with the same vessels remains
the contracting party under the operating
agreement.
(f) REPLACEMENT VESSELS.—A contractor may
replace a vessel under an operating agreement
with another vessel that is eligible to be in-
cluded in the Fleet under section 53102(b), if the
Secretary, in conjunction with the Secretary of
Defense, approves the replacement of the vessel.
(Added Pub. L. 108–136, div. C, title XXXV,
§ 3531(a), Nov. 24, 2003, 117 Stat. 1812; amended
Pub. L. 109–304, § 13(a)(4), Oct. 6, 2006, 120 Stat.
1701; Pub. L. 109–364, div. C, title XXXV, § 3502(a),
Oct. 17, 2006, 120 Stat. 2514; Pub. L. 110–181, div.
C, title XXXV, § 3526(f), Jan. 28, 2008, 122 Stat.
602; Pub. L. 112–239, div. C, title XXXV, § 3508(e),
Jan. 2, 2013, 126 Stat. 2225; Pub. L. 115–91, div. C,
title XXXV, § 3503(a), Dec. 12, 2017, 131 Stat. 1911.)
Editorial Notes
REFERENCES IN TEXT
The date of the enactment of the National Defense
Authorization Act for Fiscal Year 2018, referred to in
subsec. (a)(2), is the date of enactment of Pub. L. 115–91,
which was approved Dec. 12, 2017.
AMENDMENTS
2017—Subsec. (a)(1)(A). Pub. L. 115–91, § 3503(a)(1), in-
serted ‘‘, except as provided in paragraph (2),’’ after ‘‘in
the foreign commerce or’’.
Subsec. (a)(2), (3). Pub. L. 115–91, § 3503(a)(2)–(4), added
par. (2) and redesignated former par. (2) as (3).
2013—Subsec. (e). Pub. L. 112–239, § 3508(e)(1), amended
subsec. (e) generally. Prior to amendment, subsec. (e)
related to transfer of operating agreements, with limi-
tation based on citizenship of recipient.
Subsec. (f). Pub. L. 112–239, § 3508(e)(2), amended sub-
sec.
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