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46 U.S.C. § 53406 — Payments
Federal law — U.S. Code and appendices · legal_authorities
**(a) Annual Payments.—**
(1) **In general.—** — Subject to the availability of appropriations and the other provisions of this section, the Secretary shall pay to a program participant for an operating agreement under this chapter, for each vessel that is covered by the operating agreement, an amount equal to—
(A) $8,160,000 for each of fiscal years 2025 and 2026;
(B) $8,380,000 for each of fiscal years 2027 and 2028;
(C) $8,606,000 for each of fiscal years 2029 and 2030;
(D) $8,839,000 for each of fiscal years 2031 and 2032;
(E) $9,078,000 for each of fiscal years 2033 and 2034;
(F) $9,323,000 for each of fiscal years 2035 and 2036;
(G) $9,574,000 for each of fiscal years 2037 and 2038; and
(H) $9,833,000 for each of fiscal years 2039 and 2040.
(2) **Timing.—** — The amount payable to a program participant under paragraph (1) for a fiscal year shall be paid in 12 equal monthly installments at the end of each month during that fiscal year. The amount payable for any fiscal year may 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 program participant shall certify, in accordance with regulations issued by the Secretary, that the vessel has been and will be operated in accordance with [section 53405(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title46-section53405/a&num=0&edition=prelim) for at least 320 days during 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 may not make any payment under this
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Source location: Title 46, Chapter 534, § 53406; chapter-534-tanker-security-fleet.md
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**(a) Annual Payments.—**
(1) **In general.—** — Subject to the availability of appropriations and the other provisions of this section, the Secretary shall pay to a program participant for an operating agreement under this chapter, for each vessel that is covered by the operating agreement, an amount equal to—
(A) $8,160,000 for each of fiscal years 2025 and 2026;
(B) $8,380,000 for each of fiscal years 2027 and 2028;
(C) $8,606,000 for each of fiscal years 2029 and 2030;
(D) $8,839,000 for each of fiscal years 2031 and 2032;
(E) $9,078,000 for each of fiscal years 2033 and 2034;
(F) $9,323,000 for each of fiscal years 2035 and 2036;
(G) $9,574,000 for each of fiscal years 2037 and 2038; and
(H) $9,833,000 for each of fiscal years 2039 and 2040.
(2) **Timing.—** — The amount payable to a program participant under paragraph (1) for a fiscal year shall be paid in 12 equal monthly installments at the end of each month during that fiscal year. The amount payable for any fiscal year may 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 program participant shall certify, in accordance with regulations issued by the Secretary, that the vessel has been and will be operated in accordance with [section 53405(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title46-section53405/a&num=0&edition=prelim) for at least 320 days during 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 may not make any payment under this chapter for a vessel with respect to any days for which the vessel is—
(1) not operated or maintained in accordance with an operating agreement under this chapter;
(2) more than 20 years of age; or
(3) simultaneously operating under an agreement pursuant to chapter 531 of this title.
**(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), may not reduce such a payment for—
(A) 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; or
(B) any days in which the vessel is operated under charter to the United States Government;
(2) may not make such a 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; and
(3) shall make a pro rata reduction for each day less than 320 in a fiscal year that the vessel is not operated in accordance with [section 53405 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title46-section53405&num=0&edition=prelim).
**(e) Limitations Regarding Noncontiguous Domestic Trade.—**
(1) **In general.—** — No program participant 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 a program participant 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 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
**(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
Source: Supplied U.S. Code snapshot — release unconfirmed · 10 U.S.C. § 2631
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Operation of Vessel.—** An operating agreement under this chapter shall require that, during the period the vessel covered by the agreement is operating under the agreement the vessel shall—
(1) be operated in the United States foreign commerce, mixed United States foreign commerce and domestic trade allowed under a registry endorsement issued under [section 12111 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title46-section12111&num=0&edition=prelim), in foreign-to-foreign commerce, or under a charter to the United States;
(2) not be operated in the coastwise trade except as described in paragraph (1); and
(3) be documented under chapter 121 of this title.
**(b) Annual Payments by the Secretary.—**
(1) **In general.—** — An operating agreement under this chapter shall require, subject to the availability of appropriations, that the Secretary make a payment to the program participant in accordance with section 53406.
(2) **Operating agreement is an obligation of the united states government.—** — An operating agreement under this chapter constitutes a contractual obligation of the United States Government to pay the amounts provided for in the agreement to the extent of actual appropriations.
**(c) Documentation Requirement.—** Each vessel covered by the operating agreement, including an agreement terminated under section 53404(c)(2), shall remain documented under chapter 121 of this title until the date the operating agreement would terminate according to its terms.
**(d) National Security Requirements.—**
(1) **In general.—** — A program participant with respect to an operating agreement, including an agreement terminated under section 53404(c)(2), shall continue to be bound by the provisions of section 53407 until the date
Source: Supplied U.S. Code snapshot — release unconfirmed · 46 U.S.C. § 53405
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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
Source: Supplied U.S. Code snapshot — release unconfirmed · 46 U.S.C. § 50501
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Federal law — U.S. Code and appendices · legal_authorities
**(a) In General.—** The Secretary of Transportation shall require, as a condition of including any vessel in the Fleet, that the program participant of the vessel enter into an operating agreement with the Secretary under this section.
**(b) Procedure for Applications.—**
(1) **Eligible vessels.—** — The Secretary of Transportation shall accept an application for an operating agreement for an eligible product tank vessel under the priority under paragraph (2) only from a person that has authority to enter into an operating agreement under this chapter.
(2) **Establishment of priority.—** — The Secretary of Transportation may enter into a new operating agreement with an applicant that meets the requirements of section 53402(c) for a vessel that meets the qualifications of section 53402(b), and shall give priority to applications based on—
(A) vessel capabilities, as established by the Secretary of Defense; then
(B) after consideration of vessel type, according to an applicant’s record of owning and operating vessels; then
(C) after consideration of ownership and operation, according to such additional priorities as the Secretary of Transportation may consider appropriate.
(3) **Concurrence of award.—** — The Secretary of Transportation may not approve an application for an operating agreement without the concurrence of the Secretary of Defense.
**(c) Limitation.—** The Secretary of Transportation may not award operating agreements under this chapter that require payments under [section 53406 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title46-section53406&num=0&edition=prelim) for more than—.11 So in original. The period probably should not appear.
(1) for each of fiscal years 2022 and 2023, 10 vessels; and
(2) for any sub
Source: Supplied U.S. Code snapshot — release unconfirmed · 46 U.S.C. § 53403
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Emergency Preparedness Agreement Required.—** The Secretary of Transportation, in coordination with the Secretary of Defense, shall establish an emergency preparedness program under this section under which the program participant for an operating agreement under this chapter shall agree, as a condition of the operating agreement, to enter into an emergency preparedness agreement with the Secretary. The Secretary shall negotiate and enter into an Emergency Preparedness Agreement with each program participant as promptly as practicable after the program participant has entered into the operating agreement.
**(b) Terms of Agreement.—** The terms of an agreement under this section—
(1) shall provide that upon request by the Secretary of Defense during time of war or national emergency, or whenever determined by the Secretary of Defense to be necessary for national security or contingency operation (as that term is defined in [section 101 of title 10](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title10-section101&num=0&edition=prelim)), the program participant shall make available commercial transportation resources (including services) described in subsection (d) to the Secretary of Defense;
(2) shall include such additional terms as may be established by the Secretary of Transportation and the Secretary of Defense; and
(3) shall allow for the modification or addition of terms upon agreement by the Secretary of Transportation and the program participant and the approval by the Secretary of Defense.
**(c) Participation After Expiration of Operating Agreement.—** Except as provided by section 53406, the Secretary of Transportation may not require, through an emergency preparedness agreement or an operating agreement, that a program participant cov
Source: Supplied U.S. Code snapshot — release unconfirmed · 46 U.S.C. § 53407
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Federal law — U.S. Code and appendices · legal_authorities
Page 422
TITLE 46—SHIPPING
§ 53405
provided by this chapter for that fiscal year,
then the Secretary shall notify the Committee
on Armed Services and the Committee on Com-
merce, Science, and Transportation of the Sen-
ate and the Committee on Armed Services and
the Committee on Transportation and Infra-
structure of the House of Representatives that
operating agreements authorized under this
chapter for which sufficient funds are not avail-
able will not be renewed for that fiscal year if
sufficient funds are not appropriated by the 60th
day of that fiscal year.
(e) RELEASE OF VESSELS FROM OBLIGATIONS.—
If funds are not appropriated for payments under
an operating agreement under this chapter for
any fiscal year by the 60th day of that fiscal
year, then—
(1) each vessel covered by the operating
agreement is thereby released from any fur-
ther obligation under the operating agree-
ment;
(2) the program participant for the vessel
may transfer and register such vessel under a
foreign registry that is acceptable to the Sec-
retary of Transportation and the Secretary of
Defense, notwithstanding section 56101 of this
title; and
(3) if chapter 563 of this title is applicable to
the vessel after registration, then the vessel is
available to be requisitioned by the Secretary
pursuant to chapter 563 of this title.
(Added Pub. L. 116–283, div. C, title XXXV,
§ 3511(a), Jan. 1, 2021, 134 Stat. 4413; amended
Pub. L. 117–81, div. C, title XXXV, § 3515(b), Dec.
27, 2021, 135 Stat. 2243; Pub. L. 118–159, div. C,
title XXXV, § 3531(a), Dec. 23, 2024, 138 Stat. 2312.)
Editorial Notes
AMENDMENTS
2024—Subsec. (a). Pub. L. 118–159 substituted ‘‘2040’’
for ‘‘2035’’.
2021—Subsec. (b). Pub. L. 117–81 substituted ‘‘Any’’ for
‘‘The program participant of a’’, inse
Source: Supplied 2024 U.S. Code historical extraction · 46 U.S.C. § 53406
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