IB 

Union Calendar No. 134 

111TH CONGRESS 

1ST SESSION H. R. 2651 

[Report No. 111–243] 

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 

JULY 31, 2009 

Additional sponsor: Mr. LARSEN of Washington 

JULY 31, 2009 

Committed to the Committee of the Whole House on the State of the Union 

and ordered to be printed 

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, 


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1 SECTION 1. SHORT TITLE. 

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

3 Development Act’’. 

4 SEC. 2. MARITIME EDUCATION LOAN PROGRAM. 

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

6 States Code, is amended by adding at the end the fol7 lowing: 

8 ‘‘§ 51705. Maritime career training loan program 

9 ‘‘(a) ESTABLISHMENT.—The Secretary of Transpor10 tation shall establish a maritime career training loan pro11 gram (in this section referred to as the ‘program’) in ac12 cordance with the requirements of this section. 

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

14 be to make maritime career training loans available to eli15 gible students to provide for the training of United States 

16 mariners. 

17 ‘‘(c) ADMINISTRATION.—The program shall be car18 ried out by the Secretary, acting through the Adminis19 trator of the Maritime Administration. 

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

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

22 loans under the program based on the needs of stu23 dents; 

24 ‘‘(2) develop an application process and eligi25 bility criteria for the award of loans under the pro26 gram; 


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

2 program based on the eligibility criteria and alloca3 tions made under paragraph (1); and 

4 ‘‘(4) designate maritime training institutions at 

5 which loans made under the program may be used. 

6 ‘‘(e) DESIGNATION OF MARITIME TRAINING INSTITU7 TIONS.— 

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

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

10 Secretary— 

11 ‘‘(A) may include Federal, State, and com12 mercial training institutions and nonprofit 

13 training organizations, except that under14 graduate students at the United States Mer15 chant Marine Academy shall not be eligible for 

16 loans under the program; 

17 ‘‘(B) shall designate institutions based on 

18 geographic diversity and scope of classes of19 fered; 

20 ‘‘(C) shall ensure that designated institu21 tions have the ability to administer the pro22 gram; and 

23 ‘‘(D) shall ensure that designated institu24 tions meet requirements to provide training inVerDate Nov 24 2008 21:50 Jul 31, 2009 Jkt 079200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2651.RH H2651

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1 struction for appropriate Coast Guard-approved 

2 training instruction. 

3 ‘‘(2) EXCLUSIONS.—The Secretary— 

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

5 program a maritime training institution that 

6 has had severe performance deficiencies, includ7 ing deficiencies demonstrated by audits or pro8 gram reviews conducted during the 5 calendar 

9 years immediately preceding the present year; 

10 ‘‘(B) shall exclude from participation in 

11 the program a maritime training institution 

12 that has delinquent or outstanding debts to the 

13 United States, unless such debts are being re14 paid under or in accordance with a repayment 

15 arrangement satisfactory to the United States, 

16 or the Secretary in the Secretary’s discretion 

17 determines that the existence or amount of any 

18 such debts has not been finally determined by 

19 the appropriate Federal agency; 

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

21 program a maritime training institution that 

22 has failed to comply with quality standards es23 tablished by the Department of Labor, the 

24 Coast Guard, or a State; and 


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

2 the Secretary determines will protect the finan3 cial interest of the United States and promote 

4 the purposes of this section. 

5 ‘‘(f) STATE MARITIME ACADEMIES.— 

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

7 ATTENDING STATE MARITIME ACADEMIES.—The 

8 Secretary may obligate not more than 50 percent of 

9 the amounts appropriated to carry out this section 

10 for a fiscal year for loans to undergraduate students 

11 attending State maritime academies receiving assist12 ance under chapter 515 of this title. 

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

14 Students at State maritime academies receiving 

15 loans under the program shall maintain satisfactory 

16 progress toward the completion of their course of 

17 study as evidenced by the maintenance of a cumu18 lative C average, or its equivalent, or academic 

19 standing consistent with the requirements for grad20 uation, as determined by the institution. 

21 ‘‘(g) LOAN AMOUNTS AND USE.— 

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

23 not make loans to a student under the program in 

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

25 or $60,000 in the aggregate. 


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

2 receives a loan under the program may use the pro3 ceeds of the loan only for postsecondary expenses in4 curred at an institution designated by the Secretary 

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

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

7 and board. 

8 ‘‘(h) STUDENT ELIGIBILITY.—To be eligible to re9 ceive a loan under the program, a student shall— 

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

11 mariner document issued by the Coast Guard; 

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

13 as the Secretary may require, including all current 

14 Coast Guard documents, certifications, proof of 

15 United States citizenship or permanent legal status, 

16 and a statement of intent to enter a maritime ca17 reer; 

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

19 maritime training institution designated by the Sec20 retary under subsection (d)(4); and 

21 ‘‘(4) sign an agreement to— 

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

23 such a maritime training institution; and 

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

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1 mented vessel or a vessel owned and operated 

2 by the United States for at least 18 months of 

3 service at sea following the date of graduation 

4 from the maritime program for which the loan 

5 proceeds will be used; or 

6 ‘‘(ii) serve as an unlicensed merchant mar7 iner on a documented vessel or a vessel owned 

8 and operated by the United States for at least 

9 18 months of service at sea following the date 

10 of graduation from the maritime program for 

11 which the loan proceeds will be used. 

12 ‘‘(i) ADMINISTRATION OF LOANS.— 

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

14 agreement between the Secretary and a student bor15 rower for a loan under the program shall— 

16 ‘‘(A) be evidenced by a note or other writ17 ten instrument that provides for the repayment 

18 of the principal amount of the loan and any 

19 origination fee, together with interest thereon, 

20 in equal installments (or, if the student bor21 rower so requests, in graduated periodic install22 ments determined in accordance with such 

23 schedules as may be approved by the Secretary) 

24 payable quarterly, bimonthly, or monthly, at the 

25 option of the student borrower, over a period 


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1 beginning 9 months from the date on which the 

2 student borrower completes study or discon3 tinues attendance at the maritime program for 

4 which the loans are used at the institution ap5 proved by the Secretary and not exceeding 10 

6 years; 

7 ‘‘(B) include provision for acceleration of 

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

9 loan, at the option of the student borrower; 

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

11 without endorsement; 

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

13 loan shall be canceled upon the death of the 

14 student borrower, or if the student borrower be15 comes permanently and totally disabled, as de16 termined in accordance with regulations to be 

17 issued by the Secretary; 

18 ‘‘(E) contain a notice of the system of dis19 closure of information concerning default on 

20 such loan to credit bureau organizations; and 

21 ‘‘(F) include provisions for deferral of re22 payment, as determined by the Secretary. 

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

24 who receives a loan under the program on or after 

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


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1 be obligated to repay the loan amount to the Sec2 retary, together with interest beginning in the period 

3 referred to in paragraph (1)(A), at a rate to be de4 termined as follows: 

5 ‘‘(A) For a loan for which the first dis6 bursement is made on or after January 1, 

7 2010, and before October 1, 2011, 5.6 percent 

8 on the unpaid principal balance of the loan. 

9 ‘‘(B) For a loan for which the first dis10 bursement is made on or after October 1, 2011, 

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

12 unpaid principal balance of the loan. 

13 ‘‘(C) For a loan for which the first dis14 bursement is made on or after October 1, 2012, 

15 3.4 percent on the unpaid principal balance of 

16 the loan. 

17 ‘‘(3) DISCLOSURE REQUIRED PRIOR TO DIS18 BURSEMENT.— 

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

20 or prior to the time the Secretary makes a loan 

21 to a student borrower under the program, pro22 vide thorough and adequate loan information on 

23 such loan to the student borrower. The disclo24 sures required by this paragraph may be made 

25 as part of the written application material proVerDate Nov 24 2008 21:50 Jul 31, 2009 Jkt 079200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H2651.RH H2651

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1 vided to the student borrower, as part of the 

2 promissory note evidencing the loan, or on a 

3 separate written form provided to the student 

4 borrower. 

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

6 include— 

7 ‘‘(i) the address to which communica8 tions and payments should be sent; 

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

10 ‘‘(iii) the amount of any charges col11 lected at or prior to the disbursal of the 

12 loan and whether such charges are to be 

13 deducted from the proceeds of the loan or 

14 paid separately by the student borrower; 

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

16 loan; 

17 ‘‘(v) the yearly and cumulative max18 imum amounts that may be borrowed; 

19 ‘‘(vi) an explanation of when repay20 ment of the loan will be required and when 

21 the student borrower will be obligated to 

22 pay interest that accrues on the loan; 

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

24 and maximum repayment term that the 

25 Secretary may impose, and the minimum 


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1 monthly payment required by law and a 

2 description of any penalty imposed as a 

3 consequence of default, such as liability for 

4 expenses reasonably incurred in attempts 

5 by the Secretary to collect on a loan; 

6 ‘‘(viii) a statement of the total cumu7 lative balance, including the loan applied 

8 for, owed by the student borrower to the 

9 Secretary, and an estimate of the projected 

10 monthly payment, given such cumulative 

11 balance; 

12 ‘‘(ix) an explanation of any special op13 tions the student borrower may have for 

14 loan consolidation or other refinancing of 

15 the loan; 

16 ‘‘(x) a statement that the student bor17 rower has the right to prepay all or part 

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

19 ‘‘(xi) a statement summarizing cir20 cumstances in which repayment of the loan 

21 or interest that accrues on the loan may be 

22 deferred, and a brief notice of the program 

23 for repayment of loans, on the basis of 

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1 ment of Defense educational loan repay2 ment program (10 U.S.C. 16302); 

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

4 consequences to the student borrower if 

5 the student borrower defaults, together 

6 with a statement that the disbursement of, 

7 and the default on, a loan under this part 

8 shall be reported to a credit bureau or 

9 credit reporting agency; 

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

11 effect of accepting the loan on the eligi12 bility of the student borrower for other 

13 forms of student assistance; and 

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

15 student borrower may incur in the making 

16 or collection of the loan. 

17 ‘‘(C) INFORMATION TO BE PROVIDED

18 WITHOUT COST.—The information provided 

19 under this paragraph shall be available to the 

20 Secretary without cost to the student borrower. 

21 ‘‘(4) REPAYMENT AFTER DEFAULT.—The Sec22 retary may require any student borrower who has 

23 defaulted on a loan made under the program to— 

24 ‘‘(A) pay all reasonable collection costs as25 sociated with such loan; and 


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

2 contingent repayment plan. 

3 ‘‘(5) AUTHORIZATION TO REDUCE RATES AND

4 FEES.—Notwithstanding any other provision of this 

5 section, the Secretary may prescribe by regulation 

6 any reductions in the interest rate or origination fee 

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

8 program as the Secretary determines appropriate to 

9 encourage ontime repayment of the loan. Such re10 ductions may be offered only if the Secretary deter11 mines the reductions are cost neutral and in the best 

12 financial interest of the United States. 

13 ‘‘(6) COLLECTION OF REPAYMENTS.—The Sec14 retary shall collect repayments made under the pro15 gram and exercise due diligence in such collection, 

16 including maintenance of all necessary records to en17 sure that maximum repayments are made. Collection 

18 and servicing of repayments under the program shall 

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

20 wage garnishment if necessary. The Secretary of the 

21 Department in which the Coast Guard is operating 

22 shall provide the Secretary of Transportation with 

23 any information regarding a mariner that may aid 

24 in the collection of repayments under this section. 


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1 ‘‘(7) REPAYMENT SCHEDULE.—A student bor2 rower who receives a loan under the program shall 

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

4 the option of the student borrower, over a period be5 ginning 9 months from the date the student bor6 rower completes study or discontinues attendance at 

7 the maritime program for which the loan proceeds 

8 are used and ending not more than 10 years after 

9 the date repayment begins. Provisions for deferral of 

10 repayment shall be determined by the Secretary. 

11 ‘‘(8) CONTRACTS FOR SERVICING AND COLLEC12 TION OF LOANS.—The Secretary may— 

13 ‘‘(A) enter into a contract or other ar14 rangement with State or nonprofit agencies 

15 and, on a competitive basis, with collection 

16 agencies for servicing and collection of loans 

17 under this section; and 

18 ‘‘(B) conduct litigation necessary to carry 

19 out this section. 

20 ‘‘(j) REVOLVING LOAN FUND.— 

21 ‘‘(1) ESTABLISHMENT.—The Secretary shall es22 tablish a revolving loan fund consisting of amounts 

23 deposited in the fund under paragraph (2). 

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

25 the fund— 


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1 ‘‘(A) receipts from the payment of prin2 cipal and interest on loans made under the pro3 gram; and 

4 ‘‘(B) any other monies paid to the Sec5 retary by or on behalf of individuals under the 

6 program. 

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

8 the fund shall be available to the Secretary, without 

9 further appropriation— 

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

11 the program, including the maintenance of 

12 records and making collections under this sec13 tion; and 

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

15 available after paying such administrative costs, 

16 to make loans under the program. 

17 ‘‘(4) MAINTENANCE OF RECORDS.—The Sec18 retary shall maintain accurate records of the admin19 istrative costs referred to in paragraph (3)(A). 

20 ‘‘(k) ANNUAL REPORT.—The Secretary, on an an21 nual basis, shall submit to the Committee on Transpor22 tation and Infrastructure of the House of Representatives 

23 and the Committee on Commerce, Science, and Transpor24 tation of the Senate a report on the program, including— 


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

2 program in the preceding year; 

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

4 under the program in the preceding year; and 

5 ‘‘(3) the total amount of loans made under pro6 gram that are in default as of the date of the report. 

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

8 are authorized to be appropriated for each of fiscal years 

9 2010 through 2015— 

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

11 program; and 

12 ‘‘(2) $1,000,000 for administrative expenses of 

13 the Secretary in carrying out the program. 

14 ‘‘§ 51706. Maritime recruitment, training, and reten15 tion grant program 

16 ‘‘(a) STRATEGIC PLAN.— 

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

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

19 least once every 3 years thereafter, the Secretary of 

20 Transportation, acting through the Administrator of 

21 the Maritime Administration, shall publish in the 

22 Federal Register a plan that describes the dem23 onstration, research, and multistate project priorities 

24 of the Department of Transportation concerning 

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1 tion for the 3-year period following the date of publi2 cation of the plan. 

3 ‘‘(2) CONTENTS.—A plan published under para4 graph (1) shall contain strategies and identify poten5 tial projects to address merchant mariner recruit6 ment, training, and retention issues in the United 

7 States. 

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

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

10 at a minimum— 

11 ‘‘(A) the availability of existing research 

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

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

14 broad applicability; 

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

16 the efficiency of potential projects; and 

17 ‘‘(D) the likelihood that the results of po18 tential projects will be useful to policymakers 

19 and stakeholders in addressing merchant mar20 iner recruitment, training, and retention issues. 

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

22 under paragraph (1), the Secretary shall consult 

23 with representatives of the maritime industry, labor 

24 organizations, and other governmental entities and 

25 parties with an interest in the maritime industry. 


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1 ‘‘(5) TRANSMITTAL TO CONGRESS.—The Sec2 retary shall transmit copies of a plan published 

3 under paragraph (1) to the Committee on Transpor4 tation and Infrastructure of the House of Represent5 atives and the Committee on Commerce, Science, 

6 and Transportation of the Senate. 

7 ‘‘(b) DEMONSTRATION PROJECTS.— 

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

9 grants to a maritime training institution to carry 

10 out demonstration projects that implement the prior11 ities identified in the plan prepared under subsection 

12 (a)(1), for the purpose of developing and imple13 menting methods to address merchant mariner re14 cruitment, training, and retention issues. 

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

16 under this subsection on a competitive basis under 

17 guidelines and requirements to be established by the 

18 Secretary. 

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

20 grant for a project under this subsection, a maritime 

21 training institution shall submit to the Secretary a 

22 grant proposal that includes, at a minimum— 

23 ‘‘(A) information demonstrating the esti24 mated effectiveness of the project; and 


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1 ‘‘(B) a method for evaluating the effective2 ness of the project. 

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

4 grants under this subsection may include— 

5 ‘‘(A) the establishment of maritime tech6 nology skill centers developed through local 

7 partnerships of industry, labor, education, com8 munity-based organizations, economic develop9 ment organizations, or Federal, State, and local 

10 government agencies to meet unmet skills needs 

11 of the maritime industry; 

12 ‘‘(B) projects that provide training to up13 grade the skills of workers who are employed in 

14 the maritime industry; 

15 ‘‘(C) projects that promote the use of dis16 tance learning, enabling students to take 

17 courses through the use of media technology, 

18 such as videos, teleconferencing, and the Inter19 net; 

20 ‘‘(D) projects that assist in providing serv21 ices to address maritime recruitment and train22 ing of youth residing in targeted high poverty 

23 areas within empowerment zones and enterprise 

24 communities; 


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1 ‘‘(E) the establishment of partnerships 

2 with national and regional organizations with 

3 special expertise in developing, organizing, and 

4 administering merchant mariner recruitment 

5 and training services; and 

6 ‘‘(F) the establishment of maritime train7 ing programs that foster technical skills and 

8 operational productivity in communities in 

9 which economies are related to or dependent 

10 upon the maritime industry. 

11 ‘‘(c) PROJECTS AUTHORIZED.— 

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

13 grants to carry out projects identified in a plan pub14 lished under subsection (a)(1) under which the 

15 project sponsor will— 

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

17 approaches to providing recruitment, training, 

18 or retention services to one or more targeted 

19 populations; 

20 ‘‘(B) in conjunction with employers, orga21 nized labor, other groups (such as community 

22 coalitions), and Federal, State, or local agen23 cies, design, develop, and test various training 

24 approaches in order to determine effective prac25 tices; or 


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1 ‘‘(C) assist in the development and replica2 tion of effective service delivery strategies for 

3 the national maritime industry as a whole. 

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

5 may award grants to carry out research projects 

6 identified in a plan published under subsection 

7 (a)(1) that will contribute to the solution of mari8 time industry recruitment, training, and retention 

9 issues in the United States. 

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

11 The Secretary may award grants to carry out 

12 multistate or regional projects identified in a plan 

13 published under subsection (a)(1) to effectively dis14 seminate best practices and models for implementing 

15 maritime recruitment, training, and retention serv16 ices designed to address industry-wide skill short17 ages. 

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

19 under this subsection on a competitive basis under 

20 guidelines and requirements to be established by the 

21 Secretary. 

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

23 are authorized to be appropriated for each of fiscal years 

24 2010 through 2015— 


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

2 section; and 

3 ‘‘(2) $1,000,000 for administrative expenses of 

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

5 (b) CONFORMING AMENDMENT.—The analysis for 

6 such chapter is amended by adding at the end the fol7 lowing: 

‘‘51705. Maritime career training loan program. 

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


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Union Calendar No. 134 

111TH CONGRESS 

1ST SESSION H. R. 2651 

[Report No. 111–243] 

A BILL 

To amend title 46, United States Code, to direct 

other purposes. maritime career training loan program, and for the Secretary of Transportation to establish a 

JULY 31, 2009 

Committed to the Committee of the Whole House on the 

State of the Union and ordered to be printed 


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