I 
108TH CONGRESS 
1ST SESSION H. R. 2360
To provide for qualified withdrawals from the Capital Construction Fund 
for fishermen leaving the industry and for the rollover of Capital Con-
struction Funds to individual retirement plans, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 5, 2003
Mrs. CAPPS (for herself, Mr. THOMPSON of California, Mr. BLUMENAUER, Mr. 
WU, Mr. FARR, Mr. GEORGE MILLER of California, and Mr. DEFAZIO) 
introduced the following bill; which was referred to the Committee on 
Ways and Means, and in addition to the Committee on Armed Services, 
for a period to be subsequently determined by the Speaker, in each case 
for consideration of such provisions as fall within the jurisdiction of the 
committee concerned 
A BILL 
To provide for qualified withdrawals from the Capital Con-
struction Fund for fishermen leaving the industry and 
for the rollover of Capital Construction Funds to indi-
vidual retirement plans, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Capital Construction 
Fund Qualified Withdrawal Act of 2003’’.
SEC. 2. AMENDMENT OF THE MERCHANT MARINE ACT OF 
1936 TO ENCOURAGE RETIREMENT OF CER-
TAIN FISHING VESSELS AND PERMITS. 
(a) IN GENERAL.—Section 607(a) of the Merchant 
Marine Act, 1936 (46 U.S.C. App. 1177(a)) is amended 
by adding at the end the following: ‘‘Any agreement en-
tered into under this section may be modified for the pur-
pose of encouraging the sustainability of the fisheries of 
the United States by making the termination and with-
drawal of a capital construction fund a qualified with-
drawal if done in exchange for the retirement of the re-
lated commercial fishing vessels and related commercial 
fishing permits.’’. 
(b) NEW QUALIFIED WITHDRAWALS.—
(1) IN
GENERAL.—Section 607(f)(1) of the 
Merchant Marine Act, 1936 (46 U.S.C. App. 
1177(f)(1)) is amended—
(A) by striking ‘‘for:’’ and inserting
‘‘for—’’; 
(B) by striking ‘‘vessel’’ in subparagraph 
(A) and inserting ‘‘vessel;’’; 
(C) by striking ‘‘vessel, or’’ in subpara-
graph (B) and inserting ‘‘vessel;’’; 
(D) by striking ‘‘vessel.’’ in subparagraph 
(C) and inserting ‘‘vessel;’’; and
(E) by inserting after subparagraph (C) 
the following: 
‘‘(D) the payment of an industry fee au-
thorized by the fishing capacity reduction pro-
gram under section 312(b) of the Magnuson-
Stevens Fishery Conservation and Management 
Act (16 U.S.C. 1861a(b)); 
‘‘(E) in the case of any such person or 
shareholder for whose benefit such fund was es-
tablished with respect to any vessel operated in 
the fisheries of the United States, or any share-
holder of such person, a rollover contribution 
(within the meaning of section 408(d)(3) of the 
Internal Revenue Code of 1986) to such per-
son’s or shareholder’s individual retirement plan 
(as defined in section 7701(a)(37) of such 
Code); 
‘‘(F) the payment of the net proceeds de-
posited into the fund from a sale described in 
subsection (b)(1)(C)(ii) to a person retiring re-
lated commercial fishing vessels and permits; 
‘‘(G) the acquisition of a vessel monitoring 
system as a safety improvement for a fishing 
vessel; or
‘‘(H) the acquisition or construction of 
fishing gear designed to minimize or avoid by-
catch as required under section 301(a)(9) of the 
Magnuson-Stevens Fishery Conservation and 
Management Act (16 U.S.C. 1851(a)(9)).’’. 
(2) REDUCTION PROGRAM SALE PROCEEDS AL-
LOWED IN DETERMINING DEPOSIT CEILING.—Sec-
tion 607(b)(1)(C) of such Act (46 U.S.C. App. 
1177(b)(1)(C)) is amended by striking ‘‘or (ii)’’ and 
inserting ‘‘(ii) the sale of any agreement vessel or 
fishing permit retired through the fishing capacity 
reduction program under section 312(b) of the Mag-
nuson-Stevens Fishery Conservation and Manage-
ment Act (16 U.S.C. 1861a(b)), or (iii)’’. 
(3) CERTAIN QUALIFIED WITHDRAWALS TREAT-
ED AS WITHDRAWN FROM THE CAPITAL ACCOUNT.—
Section 607(e)(2)(B) of such Act (46 U.S.C. App. 
1177(e)(2)(B)) is amended by adding at the end 
‘‘unless such portion represents gain from a sale de-
scribed in subsection (b)(1)(C)(ii) and is withdrawn 
for any purpose provided under subparagraph (D), 
(E), or (F) of subsection (f)(1),’’. 
(4) SECRETARY TO ENSURE RETIREMENT OF 
VESSELS
AND
PERMITS.—The Secretary of Com-
merce by regulation shall establish procedures to en-
sure that any person making a qualified withdrawal 
authorized by section 607(f)(1)(F) of the Merchant 
Marine Act, 1936 (46 U.S.C. App. 1177(f)(1)(F)) 
retires the related commercial use of fishing vessels 
and commercial fishery permits. 
(c) CONFORMING AMENDMENTS.—
(1) IN
GENERAL.—Section 7518(e)(1) of the 
Internal Revenue Code of 1986 (relating to purposes 
of qualified withdrawals) is amended—
(A) by striking ‘‘for:’’ and inserting
‘‘for—’’; 
(B) by striking ‘‘vessel, or’’ in subpara-
graph (B) and inserting ‘‘vessel;’’; 
(C) by striking ‘‘vessel.’’ in subparagraph 
(C) and inserting ‘‘vessel;’’; 
(D) by inserting after subparagraph (C) 
the following: 
‘‘(D) the payment of an industry fee au-
thorized by the fishing capacity reduction pro-
gram under section 312 of the Magnuson-Ste-
vens Fishery Conservation and Management 
Act (16 U.S.C. 1861a); 
‘‘(E) in the case of any person or share-
holder for whose benefit such fund was estab-
lished with respect to any vessel operated in the