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(D) research, recording (through drawings, photographs, or oth-
erwise), planning (through feasibility studies, architectural and en-
gineering services, or otherwise), and other services carried out as 
part of a preservation program for historic maritime resources. 
(d) CRITERIA FOR DIRECT GRANT AND SUBGRANT ELIGIBILITY.—To 
qualify for a subgrant from the National Trust under subsection (b), or a 
direct grant to or a subgrant from a State Historic Preservation Officer 
under subsection (c), a person shall— 
(1) demonstrate that the project for which the direct grant or 
subgrant will be used has the potential for reaching a broad audience 
with an effective educational program based on American maritime his-
tory, technology, or the role of maritime endeavors in American culture; 
(2) match the amount of the direct grant or subgrant, on a 1-to- 
1 basis, with non-Federal assets from non-Federal sources, which may 
include cash or donated services fairly valued as determined by the Sec-
retary; 
(3) maintain records as may be reasonably necessary to fully dis-
close— 
(A) the amount and the disposition of the proceeds of the direct 
grant or subgrant; 
(B) the total cost of the project for which the direct grant or 
subgrant is made; and 
(C) other records as may be required by the Secretary, including 
such records as will facilitate an effective accounting for project 
funds; 
(4) provide access to the Secretary for the purposes of any required 
audit and examination of any records of the person; and 
(5) be a unit of State or local government, or a private nonprofit 
organization. 
(e) PROCEDURES, TERMS, AND CONDITIONS.— 
(1) APPLICATION
PROCEDURES.—An application for a subgrant 
under subsection (b), or a direct grant or subgrant under subsection 
(c), shall be submitted under procedures prescribed by the Secretary. 
(2) TERMS AND CONDITIONS.—A person may not receive a subgrant 
under subsection (b), or a direct grant or subgrant under subsection 
(c), unless the person agrees to assume, after completion of the project 
for which the direct grant or subgrant is awarded, the total cost of the 
continued maintenance, repair, and administration of any property for 
which the subgrant will be used in a manner satisfactory to the Sec-
retary. 
(f) ALLOCATION OF, AND LIMITATION ON, GRANT FUNDING.— 
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(1) ALLOCATION.—To the extent feasible, the Secretary shall ensure 
that the amount made available under subsection (b) for maritime her-
itage education projects is equal to the amount made available under 
subsection (c) for maritime heritage preservation projects. 
(2) LIMITATION.—The amount provided by the Secretary in a fiscal 
year as grants under this section for projects relating to historic mari-
time resources owned or operated by the Federal Government shall not 
exceed 40 percent of the total amount available for the fiscal year for 
grants under this section. 
(g) PUBLICATION OF DIRECT GRANT AND SUBGRANT INFORMATION.— 
The Secretary shall publish annually in the Federal Register and otherwise 
as the Secretary considers appropriate— 
(1) a solicitation of applications for direct grants and subgrants 
under this section; 
(2) a list of priorities for the making of those direct grants and sub-
grants; 
(3) a single deadline for the submission of applications for those di-
rect grants and subgrants; and 
(4) other relevant information. 
(h) DIRECT GRANT AND SUBGRANT ADMINISTRATION.— 
(1) RESPONSIBILITY.— 
(A) NATIONAL TRUST.—The National Trust is responsible for 
administering subgrants for maritime heritage education projects 
under subsection (b). 
(B) SECRETARY.—The Secretary is responsible for admin-
istering direct grants for maritime heritage preservation projects 
under subsection (c). 
(C) STATE HISTORIC PRESERVATION OFFICERS.—State Historic 
Preservation Officers are responsible for administering subgrants 
for maritime heritage preservation projects under subsection (c). 
(2) ACTIONS.—The appropriate responsible party under paragraph 
(1) shall administer direct grants or subgrants by— 
(A) publicizing the Program to prospective grantees, sub-
grantees, and the public at large, in cooperation with the Service, 
the Maritime Administration, and other appropriate government 
agencies and private institutions; 
(B) answering inquiries from the public, including providing in-
formation on the Program as requested; 
(C) distributing direct grant and subgrant applications; 
(D) receiving direct grant and subgrant applications and ensur-
ing their completeness; 
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(E) keeping records of all direct grant and subgrant awards and 
expenditures of funds; 
(F) monitoring progress of projects carried out with direct 
grants and subgrants; and 
(G) providing to the Secretary such progress reports as may be 
required by the Secretary. 
(i) ASSISTANCE
OF MARITIME PRESERVATION ORGANIZATIONS.—The 
Secretary, the National Trust, and the State Historic Preservation Officers 
may, individually or jointly, enter into cooperative agreements with any pri-
vate nonprofit organization with appropriate expertise in maritime preserva-
tion issues, or other qualified maritime preservation organizations, to assist 
in the administration of the Program. 
(j) REPORT TO CONGRESS.—The Secretary shall submit to Congress an 
annual report on the Program, including— 
(1) a description of each project funded under the Program in the 
period covered by the report; 
(2) the results or accomplishments of each such project; and 
(3) recommended priorities for achieving the policy set forth in sec-
tion 308701 of this title. 
§ 308704. Funding 
(a) AVAILABILITY OF FUNDS FROM SALE AND SCRAPPING OF OBSOLETE 
VESSELS.— 
(1) IN GENERAL.—Notwithstanding any other provision of law, the 
amount of funds credited in a fiscal year to the Vessel Operations Re-
volving Fund established by section 50301(a) of title 46 that is attrib-
utable to the sale of obsolete vessels in the National Defense Reserve 
Fleet that are scrapped or sold under section 57102, 57103, or 57104 
of title 46 shall be available until expended as follows: 
(A) Fifty percent shall be available to the Administrator of the 
Maritime Administration for such acquisition, maintenance, repair, 
reconditioning, or improvement of vessels in the National Defense 
Reserve Fleet as is authorized under other Federal law. 
(B) Twenty five percent shall be available to the Administrator 
of the Maritime Administration for the payment or reimbursement 
of expenses incurred by or on behalf of State maritime academies 
or the United States Merchant Marine Academy for facility and 
training ship maintenance, repair, and modernization, and for the 
purchase of simulators and fuel. 
(C) The remainder shall be available— 
(i) to the Secretary to carry out the Program, as provided 
in subsection (b); or 
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(ii) if otherwise determined by the Administrator of the 
Maritime Administration, for use in the preservation and 
presentation to the public of maritime heritage property of 
the Maritime Administration. 
(2) APPLICABILITY.—Paragraph (1) does not apply to amounts cred-
ited to the Vessel Operations Revolving Fund before July 1, 1994. 
(b) USE OF AMOUNTS FOR PROGRAM.— 
(1) IN GENERAL.—Except as provided in paragraph (2), of amounts 
available each fiscal year for the Program under subsection (a)(1)(C)— 
(A) one half shall be used for grants under section 308703(b) 
of this title; and 
(B) one half shall be used for grants under section 308703(c) 
of this title. 
(2) ADMINISTRATIVE EXPENSES.— 
(A) IN GENERAL.—Not more than 15 percent or $500,000, 
whichever is less, of the amount available for the Program under 
subsection (a)(1)(C) for a fiscal year may be used for expenses of 
administering the Program. 
(B) ALLOCATION.—Of the amount available under subpara-
graph (A) for a fiscal year— 
(i) one half shall be allocated to the National Trust for ex-
penses incurred in administering grants under section 
308703(b) of this title; and 
(ii) one half shall be allocated as appropriate by the Sec-
retary to the Service and participating State Historic Preser-
vation Officers. 
(c) DISPOSAL OF VESSELS.— 
(1) REQUIREMENT.—The Secretary of Transportation shall dispose 
(by sale or by purchase of disposal services) of all vessels described in 
paragraph (2)— 
(A) in accordance with a priority system for disposing of vessels, 
as determined by the Secretary, that shall include provisions re-
quiring the Maritime Administration to— 
(i) dispose of all deteriorated high priority ships that are 
available for disposal within 12 months of their designation 
as available for disposal; and 
(ii) give priority to the disposition of those vessels that pose 
the most significant danger to the environment or cost the 
most to maintain; 
(B) in the manner that provides the best value to the Federal 
Government, except in any case in which obtaining the best value 
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