46 U.S.C. § 53716 — Deposit fund

Page 452 TITLE 46—SHIPPING § 53716 (2) DOCUMENTED PROOF OF PROGRESS REQUIRE- MENT.—The Secretary or Administrator shall, by regulation, establish a transparent, inde- pendent, and risk-based process for verifying and documenting the progress of projects under construction before disbursing guaran- teed loan funds. At a minimum, the process shall require documented proof of progress in connection with the construction, reconstruc- tion, or reconditioning of a vessel or vessels before disbursements are made from the es- crow fund. The Secretary or Administrator may require that the obligor provide a certifi- cate from an independent party certifying that the requisite progress in construction, re- construction, or reconditioning has taken place. (e) DISBURSEMENT ON TERMINATION OF AGREE- MENT.— (1) IN GENERAL.—If a payment has not be- come due under the guarantee before the ter- mination of the escrow agreement, the balance of the escrow fund at the time of termination shall be disbursed to— (A) prepay the excess of— (i) the principal amount of all obliga- tions whose proceeds are to be used to fi- nance the construction, reconstruction, or reconditioning of the vessel used or to be used as security for the guarantee; over (ii) 75 percent or 87.5 percent, whichever is applicable under section 53709(b) of this title, of the actual cost of the vessel to the extent paid; and (B) pay interest on that prepaid amount of principal. (2) REMAINING BALANCE.—Any remaining bal- ance of the escrow fund shall be paid to the ob- ligor. (f) INVESTMENT.—The Secretary or Adminis- trator may invest and reinvest any part of an es- crow fund in obligations of the United States Government with maturities such that the es- crow fund will be available as required for pur- poses of the escrow agreement. Investment in- come shall be paid to the obligor when received. (g) TERMS TO PROTECT GOVERNMENT.—The es- crow agreement shall contain other terms the Secretary or Administrator considers necessary to protect fully the interests of the Government. (Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1614; Pub. L. 109–163, div. C, title XXXV, § 3507(a)(1)(H), (3), Jan. 6, 2006, 119 Stat. 3555; Pub. L. 110–181, div. C, title XXXV, § 3522(a)(10)(B), (11), (b), Jan. 28, 2008, 122 Stat. 598.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 53715(a) ...... 46 App.:1279a(a) (less proviso). June 29, 1936, ch. 858, title XI, § 1108, formerly § 1111, as added Pub. L. 86–127, § 1(2), July 31, 1959, 73 Stat. 272; renumbered Pub. L. 92–507, § 5, Oct. 19, 1972, 86 Stat. 916; Pub. L. 97–31, § 12(136), Aug. 6, 1981, 95 Stat. 166; Pub. L. 108–136, title XXXV, § 3521(a), Nov. 24, 2003, 117 Stat. 1799. HISTORICAL AND REVISION NOTES—CONTINUED Revised Section Source (U.S. Code) Source (Statutes at Large) 53715(b) ...... 46 App.:1279a(a) (proviso). 53715(c) ...... 46 App.:1279a(b). 53715(d) ...... 46 App.:1279a(g). 53715(e) ...... 46 App.:1279a(c). 53715(f) ....... 46 App.:1279a(d), (e). 53715(g) ...... 46 App.:1279a(f). Editorial Notes AMENDMENTS 2008—Pub. L. 110–181, § 3522(b), repealed Pub. L. 109–163, § 3507(a)(1)(H), (3). See 2006 Amendment note below. Pub. L. 110–181, § 3522(a)(10)(B), (11), incorporated the substance of the amendment by Pub. L. 109–163, § 3507(a)(1)(H), (3), into this section by inserting ‘‘or Ad- ministrator’’ after ‘‘Secretary’’ wherever appearing and ‘‘or Administrator’s’’ after ‘‘Secretary’s’’ in subsec. (d)(1). See 2006 Amendment note below and section 18(a) of Pub. L. 109–304, set out as a Legislative Purpose and Construction note preceding section 101 of this title. 2006—Pub. L. 109–163, § 3507(a)(1)(H), (3), which di- rected the amendment of section 1279a of the former Appendix to this title from which this section was de- rived, was repealed by Pub. L. 110–181, § 3522(b). See 2008 Amendment notes and Historical and Revision notes above. § 53716. Deposit fund (a) IN GENERAL.—There is a deposit fund in the Treasury for purposes of this section. The Sec- retary or Administrator, in accordance with an agreement under subsection (b), may deposit into and hold in the fund cash belonging to an obligor to serve as collateral for a guarantee made under this chapter with respect to the ob- ligor. (b) AGREEMENT.—The Secretary or Adminis- trator and an obligor shall make a reserve fund or other collateral account agreement to govern the deposit, withdrawal, retention, use, and re- investment of cash of the obligor held in the fund. The agreement shall contain— (1) terms and conditions required by this section; (2) terms that grant to the United States Government a security interest in all amounts deposited into the fund; and (3) any additional terms considered by the Secretary or Administrator to be necessary to protect fully the interests of the Government. (c) INVESTMENT.—The Secretary or Adminis- trator may invest and reinvest any part of the amounts in the fund in obligations of the Gov- ernment with maturities such that amounts in the fund will be available as required for pur- poses of the agreement under subsection (b). Cash balances in the fund in excess of current requirements shall be maintained in a form of uninvested funds, and the Secretary of the Treasury shall pay interest on these funds. (d) WITHDRAWALS.— (1) IN GENERAL.—Cash deposited into the fund may not be withdrawn without the con- sent of the Secretary or Administrator. (2) USE OF INCOME.—Subject to paragraph (3), the Secretary or Administrator may pay any income earned on cash of an obligor deposited into the fund in accordance with the agree- ment with the obligor under subsection (b). Page 453 TITLE 46—SHIPPING § 53717 (3) RETENTION AGAINST DEFAULT.—The Sec- retary or Administrator may retain and offset any or all of the cash of an obligor in the fund, and any income realized thereon, as part of the Secretary’s or Administrator’s recovery against the obligor in case of a default by the obligor on an obligation. (Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1616; Pub. L. 109–163, div. C, title XXXV, § 3507(a)(1)(H), (3), Jan. 6, 2006, 119 Stat. 3555; Pub. L. 110–181, div. C, title XXXV, § 3522(a)(10)(B), (11), (b), Jan. 28, 2008, 122 Stat. 598.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 53716 .......... 46 App.:1279b. June 29, 1936, ch. 858, title XI, § 1109, as added Pub. L. 107–107, title XXXV, § 3503, Dec. 28, 2001, 115 Stat. 1392. In subsection (a), the word ‘‘established’’ is omitted for consistency with other codified titles of the United States Code. Editorial Notes AMENDMENTS 2008—Pub. L. 110–181, § 3522(b), repealed Pub. L. 109–163, § 3507(a)(1)(H), (3). See 2006 Amendment note below. Pub. L. 110–181, § 3522(a)(10)(B), (11), incorporated the substance of the amendment by Pub. L. 109–163, § 3507(a)(1)(H), (3), into this section by inserting ‘‘or Ad- ministrator’’ after ‘‘Secretary’’ wherever appearing, ex- cept the second place appearing in subsec. (c), and in- serting ‘‘or Administrator’s’’ after ‘‘Secretary’s’’ in subsec. (d)(3). See 2006 Amendment note below and sec- tion 18(a) of Pub. L. 109–304, set out as a Legislative Purpose and Construction note preceding section 101 of this title. 2006—Pub. L. 109–163, § 3507(a)(1)(H), (3), which di- rected the amendment of section 1279b of the former Appendix to this title from which this section was de- rived, was repealed by Pub. L. 110–181, § 3522(b). See 2008 Amendment notes and Historical and Revision notes above. § 53717. Management of funds in the Treasury (a) DEFINITION.—In this section, the term ‘‘FCRA’’ means the Federal Credit Reform Act of 1990 (2 U.S.C. 661 et seq.). (b) LOAN GUARANTEES BY ADMINISTRATOR.— (1) WHEN NOT SUBJECT TO FCRA.—The Admin- istrator shall account for payments and dis- bursements involving obligations guaranteed under this chapter and not subject to FCRA in an account in the Treasury entitled the Fed- eral Ship Financing Fund Liquidating Ac- count (a liquidating account as defined in FCRA). (2) WHEN SUBJECT TO FCRA.—The Adminis- trator shall account for payments and dis- bursements involving obligations guaranteed under this chapter and subject to FCRA in a separate account in the Treasury entitled the Federal Ship Financing Guaranteed Loan Fi- nancing Account (a financing account as de- fined in FCRA). (c) LOAN GUARANTEES BY SECRETARY.— (1) WHEN NOT SUBJECT TO FCRA.—The Sec- retary shall account for payments and dis- bursements involving obligations guaranteed under this chapter and not subject to FCRA in a separate account in the Treasury established for this purpose. (2) WHEN SUBJECT TO FCRA.—The Secretary shall account for payments and disbursements involving obligations guaranteed under this chapter and subject to FCRA in a separate ac- count in the Treasury established for this pur- pose. (d) DIRECT LOANS BY SECRETARY.—The Sec- retary shall account for payments and disburse- ments involving direct loans made under this chapter in a separate account in the Treasury established for this purpose. (Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1616; Pub. L. 109–163, div. C, title XXXV, § 3507(a)(1)(B), (D), (c)(2), Jan. 6, 2006, 119 Stat. 3555, 3556; Pub. L. 110–181, div. C, title XXXV, § 3522(a)(7), (9)(B), (b), Jan. 28, 2008, 122 Stat. 598.) HISTORICAL AND REVISION NOTES Revised Section Source (U.S. Code) Source (Statutes at Large) 53717 .......... 46 App.:1272. June 29, 1936, ch. 858, title XI, § 1102, as added June 23, 1938, ch. 600, § 46, 52 Stat. 969; Sept. 3, 1954, ch. 1265, § 2, 68 Stat. 1268; Pub. L. 86–123, § 1(2), July 31, 1959, 73 Stat. 269; Pub. L. 92–507, § 2, Oct. 19, 1972, 86 Stat. 910; Pub. L. 97–31, § 12(136), Aug. 6, 1981, 95 Stat. 166. 46 App.:1274(g). June 29, 1936, ch. 858, title XI, § 1104A(g) [§ 1104A for- merly § 1104], as added June 23, 1938, ch. 600, § 46, 52 Stat. 970; Aug. 4, 1939, ch. 417, § 14, 53 Stat. 1187; Sept. 28, 1950, ch. 1093, § 4, 64 Stat. 1078; Aug. 15, 1953, ch. 513, § 2, 67 Stat. 626; Sept. 3, 1954, ch. 1265, § 4, 68 Stat. 1269; Pub. L. 86–123, §§ 1(3), 2, July 31, 1959, 73 Stat. 269, 271; Pub. L. 86–127, § 1(3), (4), July 31, 1959, 73 Stat. 273; Pub. L. 86–518, § 1, June 12, 1960, 74 Stat. 216; Pub. L. 86–685, §§ 2, 3, Sept. 2, 1960, 74 Stat. 733; Pub. L. 90–341, June 15, 1968, 82 Stat. 180; Pub. L. 91–469, §§ 31, 32, Oct. 21, 1970, 84 Stat. 1035; restated Pub. L. 92–507, § 3, Oct. 19, 1972, 86 Stat. 914; Pub. L. 96–561, title II, § 220(3)(D), Dec. 22, 1980, 94 Stat. 3294; Pub. L. 97–31, § 12(136), Aug. 6, 1981, 95 Stat. 166; Pub. L. 97–35, title XVI, § 1606(d), Aug. 13, 1981, 95 Stat. 752; § 1104 renumbered as § 1104A, Pub. L. 101–380, title IV, § 4115(f)(1), Aug. 18, 1990, 104 Stat. 521. 46 App.:1280. Pub. L. 85–469, title I, § 101 (par. under heading ‘‘Fed- eral Ship Mortgage Insur- ance Fund’’), June 25, 1958, 72 Stat. 231; Pub. L. 97–31, § 12(137), Aug. 6, 1981, 95 Stat. 166. The Federal Ship Financing Fund which had been created by 46 App. U.S.C. 1272 is obsolete as a result of the Federal Credit Reform Act of 1990 (2 U.S.C. 661 et seq.). This section codifies the current requirements and practices for the management of funds under this chapter, based on the requirements of that Act.