cial transportation resources (including services). The
basic terms of the Emergency Preparedness Agreement
shall be established pursuant to consultations among
the Secretary, the Secretary of Defense, and Maritime
Security Program contractors. In any Emergency
Preparedness Agreement, the Secretary and a contrac-
tor may agree to additional or modifying terms ap-
propriate to the contractor’s circumstances.
‘‘(b) RESOURCES MADE AVAILABLE.—The commercial
transportation resources to be made available under an
Emergency Preparedness Agreement shall include vessels or
capacity in vessels, intermodal systems and equipment, ter-
minal facilities, intermodal and management services, and
other related services, or any agreed portion of such
nonvessel resources for activation as the Secretary may de-
termine to be necessary, seeking to minimize disruption of
the contractor’s service to commercial shippers.
‘‘(c) COMPENSATION.—
‘‘(1) IN GENERAL.—The Secretary of Transpor-
tation shall provide in each Emergency Preparedness
Agreement for reasonable compensation for all com-
mercial transportation resources provided pursuant to
this section.
‘‘(2) SPECIFIC
REQUIREMENTS.—Compensation
under this subsection—
‘‘(A) shall not be less than the contractor’s
commercial market charges for like transpor-
tation resources;
‘‘(B) shall include all the contractor’s costs
associated with provision and use of the contrac-
tor’s commercial resources to meet emergency re-
quirements;
‘‘(C) in the case of a charter of an entire
vessel, shall be fair and reasonable;
‘‘(D) shall be in addition to and shall not
in any way reflect amounts payable under sec-
tion 652; and
‘‘(E) shall be provided from the time that a
vessel or resource is diverted from commercial
service until the time that reenters commercial
service.
‘‘(d) TEMPORARY REPLACEMENT VESSELS.—Notwith-
standing any other provision of this subtitle or of other law
to the contrary—
‘‘(1) a contractor may operate or employ in for-
eign commerce a foreign-flag vessel or foreign-flag ves-
sel capacity, as a temporary replacement for a United
States-documented vessel or United States-documented
vessel capacity that is activated under an Emergency
Preparedness Agreement; and
‘‘(2) such replacement vessel or vessel capacity
shall be eligible during the replacement period to
transport preference cargoes subject to section 2631 of
title 10, United States Code, the Act of March 26,
1934 (46 App. U.S.C. 1241–1), and sections 901(a),
901(b), and 901b of this Act to the same extent as the
eligibility of the vessel or vessel capacity replaced.
‘‘(e) REDELIVERY AND LIABILITY OF U.S. FOR DAM-
AGES.—
‘‘(1) IN
GENERAL.—All commercial transpor-
tation resources activated under an Emergency Pre-
paredness Agreement shall, upon termination of the
period of activation, be redelivered to the contractor
in the same good order and condition as when re-
ceived, less ordinary wear and tear, or the Govern-
ment shall fully compensate the contractor for any
necessary repair or replacement.
‘‘(2) LIMITATION ON LIABILITY OF U.S.—Except
as may be expressly agreed to in an Emergency Pre-
paredness Agreement, or as otherwise provided by
law, the Government shall not be liable for disruption
of a contractor’s commercial business or other con-
sequential damages to a contractor arising from acti-
vation of commercial transportation resources under
an Emergency Preparedness Agreement.
‘‘(3) LIMITATION ON APPLICATION OF OTHER RE-
QUIREMENTS.—Sections 902 and 909 of this Act shall
not apply to a vessel while it is covered by an Emer-
gency Preparedness Agreement under this subtitle.
Any Emergency Preparedness Agreement entered into
by a contractor shall supersede any other agreement
between that contractor and the Government for vessel
availability in time of war or national emergency.
‘‘DEFINITIONS
‘‘SEC. 654. In this subtitle:
‘‘(1) FLEET.—The term ‘Fleet’ means the Mari-
time Security Fleet established pursuant to section
651(a).
‘‘(2) LASH VESSEL.—The term ‘LASH vessel’
means a lighter aboard ship vessel.
‘‘(3) UNITED
STATES-DOCUMENTED
VESSEL.—
The term ‘United States-documented vessel’ means a
vessel documented under chapter 121 of title 46, Unit-
ed States Code.
‘‘AUTHORIZATION OF APPROPRIATIONS
‘‘SEC. 655. There are authorized to be appropriated
for operating agreements under this subtitle, to remain
available until expended, $100,000,000 for fiscal year 1996
and such sums as may be necessary, not to exceed
$100,000,000, for each fiscal year thereafter through fiscal
year 2005.’’.
SEC. 3. TERMINATION OF OPERATING-DIFFERENTIAL SUB-
SIDY PROGRAM.
(a) LIMITATION
ON PAYMENTS
FOR OLDER VES-
SELS.—Section 605(b) of the Merchant Marine Act, 1936
(46 App. U.S.C. 1175(b)), is amended to read as follows:
‘‘(b) No operating-differential subsidy shall be paid for
the operation of a vessel after the calendar year the vessel
becomes 25 years of age, unless the Secretary of Transpor-
tation has determined, before the date of enactment of the
Maritime Security Act of 1995, that it is in the public in-
terest to grant such financial aid for the operation of such
vessel.’’.
(b) WIND-UP OF PROGRAM.—Subtitle A of such Act
(46 App. U.S.C. 1171 et seq.), as designated by the amend-
ment made by section 2(1), is further amended by adding
at the end the following new section:
‘‘SEC. 616. (a) After the date of enactment of the Mari-
time Security Act of 1995, the Secretary of Transportation
shall not enter into any new contract for operating-differen-
tial subsidy under this subtitle.
‘‘(b) Notwithstanding any other provision of this Act,
any operating-differential subsidy contract in effect under
this title on the day before the date of enactment of the Mar-
itime Security Act of 1995 shall continue in effect and ter-
minate as set forth in the contract, unless voluntarily termi-
nated at an earlier date by the parties (other than the Unit-
ed States Government) to the contract.
‘‘(c) The essential service requirements of section
601(a) and 603(b), and the provisions of sections 605(c)
and 809(a), shall not apply to the operating-differential
subsidy program under this subtitle effective upon the ear-
lier of—
‘‘(1) the date that a payment is made, under the
Maritime Security Program established by subtitle B
to a contractor under that subtitle who is not party
to an operating-differential subsidy contract under
this subtitle, with the Secretary to cause notice of the
date of such payment to be published in the Federal
Register as soon as possible; or
‘‘(2) with respect to a particular contractor
under the operating-differential subsidy program, the
date that contractor enters into a contract with the
Secretary under the Maritime Security Program es-
tablished by subtitle B.
‘‘(d)(1) Notwithstanding any other provision of law,
a vessel may be transferred and registered under an effective
United States-controlled foreign flag if—
‘‘(A) the operator of the vessel receives an operat-
ing-differential subsidy pursuant to a contract under
this subtitle which is in force on October 1, 1994, and