I 

111TH CONGRESS 

1ST SESSION H. R. 2651 

To amend title 46, United States Code, to direct the Secretary of Transportation to establish a maritime career training loan program, and for 

other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 2, 2009 

Mr. CUMMINGS (for himself, Mr. OBERSTAR, Mr. MICA, and Mr. LOBIONDO) 

introduced the following bill; which was referred to the Committee on 

Transportation and Infrastructure 

A BILL 

To amend title 46, United States Code, to direct the Secretary of Transportation to establish a maritime career 

training loan program, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Maritime Workforce 

5 Development Act’’. 

6 SEC. 2. MARITIME EDUCATION LOAN PROGRAM. 

7 (a) IN GENERAL.—Chapter 517 of title 46, United 

8 States Code, is amended by adding at the end the fol9 lowing: 


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1 ‘‘§ 51705. Maritime career training loan program 

2 ‘‘(a) ESTABLISHMENT.—The Secretary of Transpor3 tation shall establish a maritime career training loan pro4 gram (in this section referred to as the ‘program’) in ac5 cordance with the requirements of this section. 

6 ‘‘(b) PURPOSE.—The purpose of the program shall 

7 be to make maritime career training loans available to eli8 gible students to provide for the training of United States 

9 mariners. 

10 ‘‘(c) ADMINISTRATION.—The program shall be car11 ried out by the Secretary, acting through the Adminis12 trator of the Maritime Administration. 

13 ‘‘(d) DUTIES.—The Secretary shall— 

14 ‘‘(1) allocate, on an annual basis, the award of 

15 loans under the program based on the needs of stu16 dents; 

17 ‘‘(2) develop an application process and eligi18 bility criteria for the award of loans under the pro19 gram; 

20 ‘‘(3) approve applications for loans under the 

21 program based on the eligibility criteria and alloca22 tions made under paragraph (1); and 

23 ‘‘(4) designate maritime training institutions at 

24 which loans made under the program may be used. 

25 ‘‘(e) DESIGNATION OF MARITIME TRAINING INSTITU26 TIONS.— 


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1 ‘‘(1) IN GENERAL.—In designating maritime 

2 training institutions under subsection (d)(4), the 

3 Secretary— 

4 ‘‘(A) may include Federal, State, and com5 mercial training institutions and nonprofit 

6 training organizations, except that under7 graduate students at the United States Mer8 chant Marine Academy shall not be eligible for 

9 loans under the program; 

10 ‘‘(B) shall designate institutions based on 

11 geographic diversity and scope of classes of12 fered; 

13 ‘‘(C) shall ensure that designated institu14 tions have the ability to administer the pro15 gram; and 

16 ‘‘(D) shall ensure that designated institu17 tions meet requirements to provide training in18 struction for appropriate Coast Guard-approved 

19 training instruction. 

20 ‘‘(2) EXCLUSIONS.—The Secretary— 

21 ‘‘(A) may exclude from participation in the 

22 program a maritime training institution that 

23 has had severe performance deficiencies, includ24 ing deficiencies demonstrated by audits or proVerDate Nov 24 2008 01:34 Jun 03, 2009 Jkt 079200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2651.IH H2651

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1 gram reviews conducted during the 5 calendar 

2 years immediately preceding the present year; 

3 ‘‘(B) shall exclude from participation in 

4 the program a maritime training institution 

5 that has delinquent or outstanding debts to the 

6 United States, unless such debts are being re7 paid under or in accordance with a repayment 

8 arrangement satisfactory to the United States, 

9 or the Secretary in the Secretary’s discretion 

10 determines that the existence or amount of any 

11 such debts has not been finally determined by 

12 the appropriate Federal agency; 

13 ‘‘(C) may exclude from participation in the 

14 program a maritime training institution that 

15 has failed to comply with quality standards es16 tablished by the Department of Labor, the 

17 Coast Guard, or a State; and 

18 ‘‘(D) may establish such other criteria as 

19 the Secretary determines will protect the finan20 cial interest of the United States and promote 

21 the purposes of this section. 

22 ‘‘(f) STATE MARITIME ACADEMIES.— 

23 ‘‘(1) USE OF FUNDS FOR LOANS TO STUDENTS

24 ATTENDING STATE MARITIME ACADEMIES.—The 

25 Secretary may obligate not more than 50 percent of 


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1 the amounts appropriated to carry out this section 

2 for a fiscal year for loans to undergraduate students 

3 attending State maritime academies receiving assist4 ance under chapter 515 of this title. 

5 ‘‘(2) ACADEMIC STANDARDS FOR STUDENTS.— 

6 Students at State maritime academies receiving 

7 loans under the program shall maintain satisfactory 

8 progress toward the completion of their course of 

9 study as evidenced by the maintenance of a cumu10 lative C average, or its equivalent, or academic 

11 standing consistent with the requirements for grad12 uation, as determined by the institution. 

13 ‘‘(g) LOAN AMOUNTS AND USE.— 

14 ‘‘(1) MAXIMUM AMOUNTS.—The Secretary may 

15 not make loans to a student under the program in 

16 an amount that exceeds $15,000 in a calendar year 

17 or $60,000 in the aggregate. 

18 ‘‘(2) USE OF LOAN PROCEEDS.—A student who 

19 receives a loan under the program may use the pro20 ceeds of the loan only for postsecondary expenses in21 curred at an institution designated by the Secretary 

22 under subsection (d)(4) for books, tuition, required 

23 fees, travel to and from training facilities, and room 

24 and board. 


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1 ‘‘(h) STUDENT ELIGIBILITY.—To be eligible to re2 ceive a loan under the program, a student shall— 

3 ‘‘(1) be eligible to hold a license or merchant 

4 mariner document issued by the Coast Guard; 

5 ‘‘(2) provide to the Secretary such information 

6 as the Secretary may require, including all current 

7 Coast Guard documents, certifications, proof of 

8 United States citizenship or permanent legal status, 

9 and a statement of intent to enter a maritime ca10 reer; 

11 ‘‘(3) meet the enrollment requirements of a 

12 maritime training institution designated by the Sec13 retary under subsection (d)(4); and 

14 ‘‘(4) sign an agreement to— 

15 ‘‘(A) complete a course of instruction at 

16 such a maritime training institution; and 

17 ‘‘(B)(i) maintain a license and serve as an 

18 officer in the merchant marine on a docu19 mented vessel or a vessel owned and operated 

20 by the United States for at least 18 months of 

21 service at sea following the date of graduation 

22 from the maritime program for which the loan 

23 proceeds will be used; or 

24 ‘‘(ii) serve as an unlicensed merchant mar25 iner on a documented vessel or a vessel owned 


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1 and operated by the United States for at least 

2 18 months of service at sea following the date 

3 of graduation from the maritime program for 

4 which the loan proceeds will be used. 

5 ‘‘(i) ADMINISTRATION OF LOANS.— 

6 ‘‘(1) CONTENTS OF LOAN AGREEMENTS.—Any 

7 agreement between the Secretary and a student bor8 rower for a loan under the program shall— 

9 ‘‘(A) be evidenced by a note or other writ10 ten instrument that provides for the repayment 

11 of the principal amount of the loan and any 

12 origination fee, together with interest thereon, 

13 in equal installments (or, if the student bor14 rower so requests, in graduated periodic install15 ments determined in accordance with such 

16 schedules as may be approved by the Secretary) 

17 payable quarterly, bimonthly, or monthly, at the 

18 option of the student borrower, over a period 

19 beginning 9 months from the date on which the 

20 student borrower completes study or discon21 tinues attendance at the maritime program for 

22 which the loans are used at the institution ap23 proved by the Secretary and not exceeding 10 

24 years; 


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1 ‘‘(B) include provision for acceleration of 

2 repayment of the whole, or any part, of such 

3 loan, at the option of the student borrower; 

4 ‘‘(C) provide the loan without security and 

5 without endorsement; 

6 ‘‘(D) provide that the liability to repay the 

7 loan shall be canceled upon the death of the 

8 student borrower, or if the student borrower be9 comes permanently and totally disabled, as de10 termined in accordance with regulations to be 

11 issued by the Secretary; 

12 ‘‘(E) contain a notice of the system of dis13 closure of information concerning default on 

14 such loan to credit bureau organizations; and 

15 ‘‘(F) include provisions for deferral of re16 payment, as determined by the Secretary. 

17 ‘‘(2) RATE OF INTEREST.—A student borrower 

18 who receives a loan under the program on or after 

19 January 1, 2010, and before October 1, 2015, shall 

20 be obligated to repay the loan amount to the Sec21 retary, together with interest beginning in the period 

22 referred to in paragraph (1)(A), at a rate to be de23 termined as follows: 

24 ‘‘(A) For a loan for which the first dis25 bursement is made on or after January 1, 


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1 2010, and before October 1, 2011, 5.6 percent 

2 on the unpaid principal balance of the loan. 

3 ‘‘(B) For a loan for which the first dis4 bursement is made on or after October 1, 2011, 

5 and before October 1, 2012, 4.5 percent on the 

6 unpaid principal balance of the loan. 

7 ‘‘(C) For a loan for which the first dis8 bursement is made on or after October 1, 2012, 

9 3.4 percent on the unpaid principal balance of 

10 the loan. 

11 ‘‘(3) DISCLOSURE REQUIRED PRIOR TO DIS12 BURSEMENT.— 

13 ‘‘(A) IN GENERAL.—The Secretary shall at 

14 or prior to the time the Secretary makes a loan 

15 to a student borrower under the program, pro16 vide thorough and adequate loan information on 

17 such loan to the student borrower. The disclo18 sures required by this paragraph may be made 

19 as part of the written application material pro20 vided to the student borrower, as part of the 

21 promissory note evidencing the loan, or on a 

22 separate written form provided to the student 

23 borrower. 

24 ‘‘(B) CONTENTS.—The disclosures shall 

25 include— 


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1 ‘‘(i) the address to which communica2 tions and payments should be sent; 

3 ‘‘(ii) the principal amount of the loan; 

4 ‘‘(iii) the amount of any charges col5 lected at or prior to the disbursal of the 

6 loan and whether such charges are to be 

7 deducted from the proceeds of the loan or 

8 paid separately by the student borrower; 

9 ‘‘(iv) the stated interest rate on the 

10 loan; 

11 ‘‘(v) the yearly and cumulative max12 imum amounts that may be borrowed; 

13 ‘‘(vi) an explanation of when repay14 ment of the loan will be required and when 

15 the student borrower will be obligated to 

16 pay interest that accrues on the loan; 

17 ‘‘(vii) a statement as to the minimum 

18 and maximum repayment term that the 

19 Secretary may impose, and the minimum 

20 monthly payment required by law and a 

21 description of any penalty imposed as a 

22 consequence of default, such as liability for 

23 expenses reasonably incurred in attempts 

24 by the Secretary to collect on a loan; 


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1 ‘‘(viii) a statement of the total cumu2 lative balance, including the loan applied 

3 for, owed by the student borrower to the 

4 Secretary, and an estimate of the projected 

5 monthly payment, given such cumulative 

6 balance; 

7 ‘‘(ix) an explanation of any special op8 tions the student borrower may have for 

9 loan consolidation or other refinancing of 

10 the loan; 

11 ‘‘(x) a statement that the student bor12 rower has the right to prepay all or part 

13 of the loan, at any time, without penalty; 

14 ‘‘(xi) a statement summarizing cir15 cumstances in which repayment of the loan 

16 or interest that accrues on the loan may be 

17 deferred, and a brief notice of the program 

18 for repayment of loans, on the basis of 

19 military service, pursuant to the Depart20 ment of Defense educational loan repay21 ment program (10 U.S.C. 16302); 

22 ‘‘(xii) a definition of default and the 

23 consequences to the student borrower if 

24 the student borrower defaults, together 

25 with a statement that the disbursement of, 


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1 and the default on, a loan under this part 

2 shall be reported to a credit bureau or 

3 credit reporting agency; 

4 ‘‘(xiii) to the extent practicable, the 

5 effect of accepting the loan on the eligi6 bility of the student borrower for other 

7 forms of student assistance; and 

8 ‘‘(xiv) an explanation of any cost the 

9 student borrower may incur in the making 

10 or collection of the loan. 

11 ‘‘(C) INFORMATION TO BE PROVIDED

12 WITHOUT COST.—The information provided 

13 under this paragraph shall be available to the 

14 Secretary without cost to the student borrower. 

15 ‘‘(4) REPAYMENT AFTER DEFAULT.—The Sec16 retary may require any student borrower who has 

17 defaulted on a loan made under the program to— 

18 ‘‘(A) pay all reasonable collection costs as19 sociated with such loan; and 

20 ‘‘(B) repay the loan pursuant to an income 

21 contingent repayment plan. 

22 ‘‘(5) AUTHORIZATION TO REDUCE RATES AND

23 FEES.—Notwithstanding any other provision of this 

24 section, the Secretary may prescribe by regulation 

25 any reductions in the interest rate or origination fee 


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1 paid by a student borrower of a loan made under the 

2 program as the Secretary determines appropriate to 

3 encourage ontime repayment of the loan. Such re4 ductions may be offered only if the Secretary deter5 mines the reductions are cost neutral and in the best 

6 financial interest of the United States. 

7 ‘‘(6) COLLECTION OF REPAYMENTS.—The Sec8 retary shall collect repayments made under the pro9 gram and exercise due diligence in such collection, 

10 including maintenance of all necessary records to en11 sure that maximum repayments are made. Collection 

12 and servicing of repayments under the program shall 

13 be pursued to the full extent of the law, including 

14 wage garnishment if necessary. The Secretary of the 

15 Department in which the Coast Guard is operating 

16 shall provide the Secretary of Transportation with 

17 any information regarding a mariner that may aid 

18 in the collection of repayments under this section. 

19 ‘‘(7) REPAYMENT SCHEDULE.—A student bor20 rower who receives a loan under the program shall 

21 repay the loan quarterly, bimonthly, or monthly, at 

22 the option of the student borrower, over a period be23 ginning 9 months from the date the student bor24 rower completes study or discontinues attendance at 

25 the maritime program for which the loan proceeds 


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1 are used and ending not more than 10 years after 

2 the date repayment begins. Provisions for deferral of 

3 repayment shall be determined by the Secretary. 

4 ‘‘(8) CONTRACTS FOR SERVICING AND COLLEC5 TION OF LOANS.—The Secretary may— 

6 ‘‘(A) enter into a contract or other ar7 rangement with State or nonprofit agencies 

8 and, on a competitive basis, with collection 

9 agencies for servicing and collection of loans 

10 under this section; and 

11 ‘‘(B) conduct litigation necessary to carry 

12 out this section. 

13 ‘‘(j) REVOLVING LOAN FUND.— 

14 ‘‘(1) ESTABLISHMENT.—The Secretary shall es15 tablish a revolving loan fund consisting of amounts 

16 deposited in the fund under paragraph (2). 

17 ‘‘(2) DEPOSITS.—The Secretary shall deposit in 

18 the fund— 

19 ‘‘(A) receipts from the payment of prin20 cipal and interest on loans made under the pro21 gram; and 

22 ‘‘(B) any other monies paid to the Sec23 retary by or on behalf of individuals under the 

24 program. 


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1 ‘‘(3) AVAILABILITY OF AMOUNTS.—Amounts in 

2 the fund shall be available to the Secretary, without 

3 further appropriation— 

4 ‘‘(A) to cover the administrative costs of 

5 the program, including the maintenance of 

6 records and making collections under this sec7 tion; and 

8 ‘‘(B) to the extent that amounts remain 

9 available after paying such administrative costs, 

10 to make loans under the program. 

11 ‘‘(4) MAINTENANCE OF RECORDS.—The Sec12 retary shall maintain accurate records of the admin13 istrative costs referred to in paragraph (3)(A). 

14 ‘‘(k) ANNUAL REPORT.—The Secretary, on an an15 nual basis, shall submit to the Committee on Transpor16 tation and Infrastructure of the House of Representatives 

17 and the Committee on Commerce, Science, and Transpor18 tation of the Senate a report on the program, including— 

19 ‘‘(1) the total amount of loans made under the 

20 program in the preceding year; 

21 ‘‘(2) the number of students receiving loans 

22 under the program in the preceding year; and 

23 ‘‘(3) the total amount of loans made under pro24 gram that are in default as of the date of the report. 


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1 ‘‘(l) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are authorized to be appropriated for each of fiscal years 

3 2010 through 2015— 

4 ‘‘(1) $10,000,000 for making loans under the 

5 program; and 

6 ‘‘(2) $1,000,000 for administrative expenses of 

7 the Secretary in carrying out the program. 

8 ‘‘§ 51706. Maritime recruitment, training, and reten9 tion grant program 

10 ‘‘(a) STRATEGIC PLAN.— 

11 ‘‘(1) IN GENERAL.—Not later than one year 

12 after the date of enactment of this section, and at 

13 least once every 3 years thereafter, the Secretary of 

14 Transportation, acting through the Administrator of 

15 the Maritime Administration, shall publish in the 

16 Federal Register a plan that describes the dem17 onstration, research, and multistate project priorities 

18 of the Department of Transportation concerning 

19 merchant mariner recruitment, training, and reten20 tion for the 3-year period following the date of publi21 cation of the plan. 

22 ‘‘(2) CONTENTS.—A plan published under para23 graph (1) shall contain strategies and identify poten24 tial projects to address merchant mariner recruitVerDate Nov 24 2008 01:34 Jun 03, 2009 Jkt 079200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\H2651.IH H2651

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1 ment, training, and retention issues in the United 

2 States. 

3 ‘‘(3) FACTORS.—In developing a plan under 

4 paragraph (1), the Secretary shall take into account, 

5 at a minimum— 

6 ‘‘(A) the availability of existing research 

7 (as of the date of publication of the plan); 

8 ‘‘(B) the need to ensure results that have 

9 broad applicability; 

10 ‘‘(C) the benefits of economies of scale and 

11 the efficiency of potential projects; and 

12 ‘‘(D) the likelihood that the results of po13 tential projects will be useful to policymakers 

14 and stakeholders in addressing merchant mar15 iner recruitment, training, and retention issues. 

16 ‘‘(4) CONSULTATION.—In developing a plan 

17 under paragraph (1), the Secretary shall consult 

18 with representatives of the maritime industry, labor 

19 organizations, and other governmental entities and 

20 parties with an interest in the maritime industry. 

21 ‘‘(5) TRANSMITTAL TO CONGRESS.—The Sec22 retary shall transmit copies of a plan published 

23 under paragraph (1) to the Committee on Transpor24 tation and Infrastructure of the House of RepresentVerDate Nov 24 2008 01:34 Jun 03, 2009 Jkt 079200 PO 00000 Frm 00017 Fmt 6652 Sfmt 6201 E:\BILLS\H2651.IH H2651

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1 atives and the Committee on Commerce, Science, 

2 and Transportation of the Senate. 

3 ‘‘(b) DEMONSTRATION PROJECTS.— 

4 ‘‘(1) IN GENERAL.—The Secretary may award 

5 grants to a maritime training institution to carry 

6 out demonstration projects that implement the prior7 ities identified in the plan prepared under subsection 

8 (a)(1), for the purpose of developing and imple9 menting methods to address merchant mariner re10 cruitment, training, and retention issues. 

11 ‘‘(2) GRANT AWARDS.—Grants shall be awarded 

12 under this subsection on a competitive basis under 

13 guidelines and requirements to be established by the 

14 Secretary. 

15 ‘‘(3) APPLICATIONS.—To be eligible to receive a 

16 grant for a project under this subsection, a maritime 

17 training institution shall submit to the Secretary a 

18 grant proposal that includes, at a minimum— 

19 ‘‘(A) information demonstrating the esti20 mated effectiveness of the project; and 

21 ‘‘(B) a method for evaluating the effective22 ness of the project. 

23 ‘‘(4) ELIGIBLE PROJECTS.—Projects eligible for 

24 grants under this subsection may include— 


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1 ‘‘(A) the establishment of maritime tech2 nology skill centers developed through local 

3 partnerships of industry, labor, education, com4 munity-based organizations, economic develop5 ment organizations, or Federal, State, and local 

6 government agencies to meet unmet skills needs 

7 of the maritime industry; 

8 ‘‘(B) projects that provide training to up9 grade the skills of workers who are employed in 

10 the maritime industry; 

11 ‘‘(C) projects that promote the use of dis12 tance learning, enabling students to take 

13 courses through the use of media technology, 

14 such as videos, teleconferencing, and the Inter15 net; 

16 ‘‘(D) projects that assist in providing serv17 ices to address maritime recruitment and train18 ing of youth residing in targeted high poverty 

19 areas within empowerment zones and enterprise 

20 communities; 

21 ‘‘(E) the establishment of partnerships 

22 with national and regional organizations with 

23 special expertise in developing, organizing, and 

24 administering merchant mariner recruitment 

25 and training services; and 


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1 ‘‘(F) the establishment of maritime train2 ing programs that foster technical skills and 

3 operational productivity in communities in 

4 which economies are related to or dependent 

5 upon the maritime industry. 

6 ‘‘(c) PROJECTS AUTHORIZED.— 

7 ‘‘(1) PROJECTS.—The Secretary may award 

8 grants to carry out projects identified in a plan pub9 lished under subsection (a)(1) under which the 

10 project sponsor will— 

11 ‘‘(A) design, develop, and test an array of 

12 approaches to providing recruitment, training, 

13 or retention services to one or more targeted 

14 populations; 

15 ‘‘(B) in conjunction with employers, orga16 nized labor, other groups (such as community 

17 coalitions), and Federal, State, or local agen18 cies, design, develop, and test various training 

19 approaches in order to determine effective prac20 tices; or 

21 ‘‘(C) assist in the development and replica22 tion of effective service delivery strategies for 

23 the national maritime industry as a whole. 

24 ‘‘(2) RESEARCH PROJECTS.—The Secretary 

25 may award grants to carry out research projects 


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1 identified in a plan published under subsection 

2 (a)(1) that will contribute to the solution of mari3 time industry recruitment, training, and retention 

4 issues in the United States. 

5 ‘‘(3) MULTISTATE OR REGIONAL PROJECTS.— 

6 The Secretary may award grants to carry out 

7 multistate or regional projects identified in a plan 

8 published under subsection (a)(1) to effectively dis9 seminate best practices and models for implementing 

10 maritime recruitment, training, and retention serv11 ices designed to address industry-wide skill short12 ages. 

13 ‘‘(4) GRANT AWARDS.—Grants shall be awarded 

14 under this subsection on a competitive basis under 

15 guidelines and requirements to be established by the 

16 Secretary. 

17 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

18 are authorized to be appropriated for each of fiscal years 

19 2010 through 2015— 

20 ‘‘(1) $10,000,000 for making grants under this 

21 section; and 

22 ‘‘(2) $1,000,000 for administrative expenses of 

23 the Secretary in carrying out this section.’’. 


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1 (b) CONFORMING AMENDMENT.—The analysis for 

2 such chapter is amended by adding at the end the fol3 lowing: 

‘‘51705. Maritime career training loan program. 

‘‘51706. Maritime recruitment, training, and retention grant program.’’. 

Æ 


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