I 119th CONGRESS 1st Session H. R. 3151 IN THE HOUSE OF REPRESENTATIVES May 1, 2025 Mr. Kelly of Mississippi (for himself, Mr. Garamendi , Mr. Wittman , Mr. Norcross , Mr. Higgins of Louisiana , Mr. Khanna , Ms. Elfreth , Mr. DesJarlais , Mr. McCormick , Mr. Krishnamoorthi , Mr. Rutherford , Mr. Gooden , Mr. LaLota , Ms. Pingree , Ms. Hoyle of Oregon , Mr. Messmer , Mr. Haridopolos , Mrs. Kiggans of Virginia , Mr. Fields , Mr. Carter of Louisiana , Mr. Deluzio , Mr. Moskowitz , Mr. Bera , Ms. Scanlon , Mr. Harrigan , Mr. Golden of Maine , Mr. Bergman , Mr. Fallon , Mr. Van Orden , Mr. Wied , Ms. Tokuda , Mr. Moore of Alabama , Mr. Fitzpatrick , Ms. Scholten , Mr. Moore of North Carolina , Mr. Strong , Mr. Luttrell , and Mr. Zinke ) introduced the following bill; which was referred to the Committee on Armed Services , and in addition to the Committees on Transportation and Infrastructure , Ways and Means , Energy and Commerce , Foreign Affairs , Oversight and Government Reform , Education and Workforce , Financial Services , the Judiciary , Natural Resources , Science, Space, and Technology , and Veterans' Affairs , 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 support the national defense and economic security of the United States by supporting vessels, ports, and shipyards of the United States and the U.S. maritime workforce.

1. Short title; table of contents (a) Short title This Act may be cited as the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 or the SHIPS for America Act of 2025 . (b) Table of contents The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Findings. Sec. 3. Sense of Congress. Sec. 4. Definitions. TITLE I—Oversight and accountability Sec. 101. Maritime Security Advisor; Maritime Security Board. Sec. 102. Maritime Transportation System National Advisory Committee. Sec. 103. Direct hire authority; Authorization for administrative expenses. Sec. 104. Implementation plan. Sec. 105. Federal Maritime Commission report on vessels of the United States. TITLE II—Maritime Security Trust Fund Sec. 201. Maritime Security Trust Fund established. Sec. 202. Regular tonnage taxes. Sec. 203. Presidential suspension of tonnage taxes and light money. TITLE III—Sealift capability Sec. 301. Sealift capability. Sec. 302. National Freight Strategic Plan. Sec. 303. Foreign shipping practices; controlled carriers. TITLE IV—Vessels of the United States in international commerce Subtitle A—Strategic sealift programs Sec. 401. Strategic Commercial Fleet. Sec. 402. Fleet testing and briefing requirement. Sec. 403. Assessment of undersea cable repair contingencies. Sec. 404. Modification to duties relating to equipment and repair of vessels. Subtitle B—Cargo preference Sec. 411. United States Government cargo. Sec. 412. Cargo preference implementation regulations. Sec. 413. Cargo preference oversight and audit. Sec. 414. Financing the transportation of agricultural products and other cargo. Sec. 415. Importation from China on American ships. Sec. 416. Priority for vessels of the United States. Sec. 417. Moving cargo on vessels of the United States. Sec. 418. Transportation requirements for certain exports sponsored by the Secretary of Agriculture. Sec. 419. Clarifying amendments. Sec. 420. Energizing American shipbuilding. Sec. 421. Goods imported on vessels of the United States. Sec. 422. Ship America Office. Subtitle C—Regulatory reform Sec. 431. Alternate standards. Sec. 432. Rulemaking committee on commercial maritime regulations and standards. Sec. 433. Amendments to Shipowners' Limitation of Liability Act of 1851. TITLE V—Shipbuilding Subtitle A—Shipbuilding financial incentives Sec. 501. Shipbuilding financial incentives. Sec. 502. Assistance for small shipyards. Sec. 503. Federal Ship Financing (title XI) Program. Sec. 504. Construction Reserve Fund. Sec. 505. Capital Construction Fund. Sec. 506. Anticipated commercial vessel construction survey. Sec. 507. Streamlined environmental review. Sec. 508. Eligibility for loan guarantees. Sec. 509. Reports. Sec. 510. Export control report. Subtitle B—Department of Defense Programs Sec. 511. Assessment of the use of commercial best practices for Navy shipbuilding. Sec. 512. Plan of action for use of Defense Production Act of 1950 authorities. Sec. 513. Military Sealift Command. Subtitle C—Shipbuilding innovation and infrastructure Sec. 521. United States Center for Maritime Innovation. Sec. 522. National Shipbuilding Research Program. Sec. 523. Assessment on maritime infrastructure readiness. TITLE VI—Workforce Development Subtitle A—Workforce Incentives Sec. 601. Public service loan forgiveness for Merchant Marines. Sec. 602. Eligibility for educational assistance. Sec. 603. Eligibility of mariners to attend Naval Postgraduate School. Sec. 604. Reimbursement of qualifying spouse relicensing costs and business costs. Sec. 605. Noncompetitive eligibility for Federal employment. Sec. 606. United States Merchant Marine Career Retention Program. Subtitle B—Workforce pipeline Sec. 611. Maritime workforce promotion and recruitment. Sec. 612. Centers of Excellence for Domestic Maritime Workforce Training and Education. Sec. 613. Maritime Career and Technical Education Advisory Committee. Sec. 614. Military candidates to Mariner Careers Recruitment Exchange. Sec. 615. Maritime worker data collection. Sec. 616. Military to maritime transition. Sec. 617. Early maritime education and youth involvement. Sec. 618. International scholarship for mariner and naval architecture exchanges. Subtitle C—United States Merchant Marine Academy and State maritime academies Sec. 621. Authorization of appropriations for United States Merchant Marine Academy infrastructure and facilities modernization. Sec. 622. United States Merchant Marine Academy. Sec. 623. Retirement service credit for service as a midshipman at the United States Merchant Marine Academy. Sec. 624. State maritime academies. Sec. 625. Enforcement of service obligation requirements. Sec. 626. Fuel funding for training ships operated by State maritime academies. Sec. 627. State Maritime Academy Sea Term Scholarship Programs. Sec. 628. Naval joint exercise involvement for training ships operated by State maritime academies. Subtitle D—Maritime Credentialing Modernization Sec. 631. Merchant mariner credentialing modernization. Sec. 632. Revising merchant mariner deck training requirements. Sec. 633. Inspections for transportation security. Sec. 634. Renewal of merchant mariner licenses and documents. Sec. 635. Merchant seamen licenses, certificates, and documents; manning of vessels. Sec. 636. Reactivation of expired license. TITLE VII—Amendments to the Internal Revenue Code of 1986 Sec. 701. United States Vessel Investment credit. Sec. 702. Certain payments for maritime security excluded from gross income. Sec. 703. Elimination of 30-day limitation on domestic operations. Sec. 704. Qualifying shipping activities. Sec. 705. Qualifying vessel. Sec. 706. Credit for construction of shipyard facilities. Sec. 707. Tax incentives relating to merchant marine capital construction funds. Sec. 708. Exemption of student incentive payment agreements from gross income. Sec. 709. Maritime fuel tax parity. Sec. 710. Treatment of maritime prosperity zones as opportunity zones. 2. Findings Congress finds the following: (1) Strategic sealift, made up of Government and commercial vessels and mariners, is a critical capability for executing the maritime defense strategy and the wartime and peacetime economy of the United States. (2) Ensuring a modern and ready capability will require significant investment, policy prioritization, and the innovation of the people of the United States. (3) The worldwide ocean economy is worth between $3,000,000,000,000 and $6,000,000,000,000, according to the United Nations Conference on Trade and Development. Yet, vessels of the United States carry less than 2 percent of United States international commercial cargoes by weight. (4) The United States has fewer than 200 oceangoing vessels of the United States, of which only approximately 80 vessels participate in international commerce, compared with more than 5,500 Chinese documented vessels. (5) Bracketed by the Atlantic, Pacific, and Arctic oceans, the prosperity and security of the United States has always been tied to its position as a maritime Nation. Throughout human history, the strength of maritime nations has been directly tied to the strength of their maritime industry. The United States won two world wars on the back of a strong maritime industry. (6) Decades of apathy by the United States Government has harmed our strategically important maritime industry. Our weakened shipbuilding capacity, undersized maritime workforce, and shrinking fleet of shipping vessels means the United States relies on other nations to conduct international commerce and lacks the strategic sealift to support the United States military during wartime. (7) Today, there are just 20 shipbuilders in the United States capable of building oceangoing vessels—down from more than 80 at the end of the Second World War. (8) During World War II, the United States Merchant Marine powered the Allies to victory with more than 10,000 oceangoing vessels of the United States. Today there are just 80 vessels of the United States engaged in international trade. (9) The People’s Republic of China has made investments in the maritime industry a strategic priority over the past 20 years. (10) As of 2023, shipyards in the United States had fewer than 5 shipbuilding orders for oceangoing vessels, while shipyards in the People’s Republic of China had more than 1,700 orders, according to BRS Group. According to the Office of Naval Intelligence, the People’s Republic of China became the world’s top shipbuilding and shipping nation, boasting 230 times more shipbuilding capacity than the United States. (11) With just 12,000 United States merchant mariners operating oceangoing vessels, the United States may not have a sufficient number of mariners to fully power the strategic sealift vessels necessary in a future prolonged conflict. (12) The American Civil Society of Engineers assesses that the United States has a national maintenance backlog amounting to $125,000,000,000 for bridges, $163,000,000,000 for ports, and $6,800,000,000 for inland waterways. (13) The maritime industry is inherently international. Eighty percent of United States goods are imported by sea, of which 98 percent come into the United States on foreign documented vessels. Only 2 percent of such goods come into the United States on vessels of the United States, leaving the United States economy disproportionately dependent on oceangoing trade controlled by often adversarial foreign nations. The Nation’s ability to provide services in both international and interstate commerce is critical to national and economic defense. (14) Since November 2023, vessels engaged in international commerce have been threatened by the Houthis, which has threatened global supply chains, increased costs, and required naval force protection operations in the Red Sea through the United States-led Operation Prosperity Guardian that formed in December 2023. (15) A fleet of commercial shipping vessels of the United States, crewed with citizen mariners, that is competitive in domestic and international trade enhances the United States military’s readiness, allows the United States to more strategically compete with China, and underwrites the security and survival of the United States in times of crisis and war. 3. Sense of Congress It is the sense of Congress that the United States must— (1) create a more favorable domestic and global maritime environment for vessels of the United States engaged in international commerce, shipbuilding, ship repair, maritime logistics, the maritime workforce, and naval power, contributing to assured access to the world’s oceans free from coercion from strategic competitors and asymmetric adversaries; (2) increase domestic shipbuilding and ship repair capacity, with programs and policies that enable the growth of United States shipyards and the maritime industrial base, enhance military sealift capacity, expand the United States maritime workforce, and enhance national security; (3) revitalize the international fleet of vessels of the United States and foster a comparative advantage for the United States through targeted incentives and regulatory reforms to make the fleet competitive with international carriers and to gain a sustainable share of the global maritime market in order to bolster supply chains, strengthen economic security, and lower prices, while protecting the United States economy from economic coercion; (4) take all measures necessary to ensure that sufficient military, civil, and commercial resources will be available with assured access to meet defense deployment needs and essential economic activities for our Nation in times of crisis, war, or peace; (5) recognize that a vibrant commercial shipbuilding industry provides supply chain resiliencies and creates economies of scale that improve military, Coast Guard, and Government shipbuilding and support military operations through strategic sealift to defend the freedom of the seas; (6) nurture the comparative advantages of the United States to innovate to better compete in the global maritime marketplace, grow the maritime workforce, and create a favorable environment for investments to build modern maritime facilities and world-class academic institutions; (7) ensure better coordination between Federal agencies, including the Maritime Administration, the United States Coast Guard, the Department of Defense, the Federal Maritime Commission, and all other Federal agencies with a maritime nexus, to protect, regulate, and support the United States maritime industry, resolve disputes, and implement a whole-of-Government national maritime strategy; (8) recognize that, while a strong Navy is the surest guarantee of peace, building the Navy, sustaining the Navy, and supplying the Navy is founded on a robust commercial industrial base; (9) establish reliable long-term demand signals for, and investments in, oceangoing commercial vessels that are built in the United States, documented under the laws of the United States, and crewed by United States mariners; (10) evaluate past and present maritime efforts to take actions to revitalize the United States maritime industry; (11) strengthen the United States intercoastal and domestic trade fleet, which is the foundation upon which a revitalized United States-documented shipping and domestic shipbuilding industry will be built; (12) recognize the important role that the support craft, passenger, and fishing vessel fleet play in the United States maritime industry; (13) encourage the shipping of commercial cargo on vessels of the United States, with the aim of growing the size and carrying capacity of the international fleet of vessels of the United States; (14) grow the shipping capacity of vessels of the United States and guarantee United States Government cargo during peacetime; (15) develop a whole-of-Government effort to expand, develop, and protect the maritime workforce; (16) recognize the need for more workers in the maritime sector and stimulate growth in the United States maritime and shipbuilding industries, including by increasing access to early maritime education, commissioning national marketing campaigns to demonstrate how United States shipbuilding, United States-documented shipping, and maritime workers are critical to national security, and implementing workforce accelerator programs; (17) remove barriers to training mariners, including reevaluating Coast Guard training requirements regarding faculty credentials, instructional facility designs, sea time requirements, and other identified barriers, consistent with international treaty obligations; (18) expand and nurture a robust mariner workforce that enhances the national security and strategic sealift readiness of the United States by increasing the number of United States mariners and improving existing pathways and establishing new pathways for new, current, and former merchant mariners to go to sea; (19) recognize that the United States Merchant Marine Academy and our State maritime academies are critical to training the next generation of licensed officers and engineers on vessels of the United States; (20) invest and innovate in domestic shipbuilding, ship repair, and the shipping capabilities and capacity of vessels of the United States to advance the power and influence of the maritime industry of the United States; (21) drive multi-stakeholder research, development, assessment, and deployment of emerging marine technologies and best practices related to the maritime transportation system to ensure United States leadership in next-generation shipbuilding, ship repair, and maritime logistics; (22) drive modern business and manufacturing approaches, such as innovative maritime logistics, clean fuels, and advanced nuclear energy, human-machine teaming, additive manufacturing, and other advanced technologies; (23) review and update regulations governing vessel design and engineering, vessel and facility operation, and merchant mariner credentialing, in order to revitalize the United States maritime industry; (24) seek mutually beneficial relationships with treaty allies and strategic partners to grow the domestic shipping and shipbuilding industries of the United States and to share the burden of providing freedom of navigation on the high seas, while de-risking the United States maritime domain from the People’s Republic of China, foreign countries of concern, and asymmetric or emerging maritime threats; (25) harden critical maritime infrastructure and networks, and incrementally replace infrastructure built by foreign adversaries with domestic-built and allied-built infrastructure; and (26) promote the values of the United States for freedom of the seas, worker safety and quality of life, environmental stewardship, and the resilience of our oceans, seas, and inland waterways. 4. Definitions In this Act: (1) Appropriate committees of Congress The term appropriate committees of Congress means— (A) the Committee on Armed Services, the Committee on Commerce, Science, and Transportation, and the Committee on Appropriations of the Senate; and (B) the Committee on Armed Services, the Committee on Transportation and Infrastructure, and the Committee on Appropriations of the House of Representatives. (2) Domestic commerce The term domestic commerce means the transportation of goods or passengers between places in the United States. (3) Foreign commerce The term foreign commerce means— (A) commerce or trade between the United States, its territories or possessions, or the District of Columbia, and a foreign country; and (B) commerce or trade between foreign countries. (4) Foreign country of concern The term foreign country of concern means— (A) a country that is a covered nation (as defined in section 4872(d) of title 10, United States Code); and (B) any country that the Maritime Administrator, in consultation with the Secretary of Defense, the Secretary of State, the Director of National Intelligence, and the Chair of the Federal Maritime Commission, determines to be engaged in conduct that is detrimental to the national security or foreign policy of the United States. (5) Foreign entity The term foreign entity — (A) means— (i) a government of a foreign country or a foreign political party, as those terms are defined in section 1 of the Foreign Agents Registration Act of 1938, as amended ( 22 U.S.C. 611 ); (ii) a natural person who is not a lawful permanent resident of the United States, a citizen of the United States, or any other protected individual (as such term is defined in section 274B(a)(3) of the Immigration and Nationality Act ( 8 U.S.C. 1324b(a)(3) )); or (iii) a partnership, association, corporation, organization, or other combination of persons organized under the laws of or having its principal place of business in a foreign country; and (B) includes— (i) any person (including an owner or operator of a vessel) owned by, controlled by, or subject to the direction of an entity listed in subparagraph (A); (ii) any person, wherever located, who acts as an agent, representative, or employee of an entity listed in subparagraph (A); (iii) any person who acts in any other capacity at the order, request, or under the direction or control, of an entity listed in subparagraph (A), or of a person whose activities are directly or indirectly supervised, directed, controlled, financed, or subsidized in whole or in major part by an entity listed in subparagraph (A); (iv) any person who directly or indirectly through any contract, arrangement, understanding, relationship, or otherwise, owns 25 percent or more of the equity interests of an entity listed in subparagraph (A); (v) any person with significant responsibility to control, manage, or direct an entity listed in subparagraph (A); (vi) any person, wherever located, who is a citizen or resident of a country controlled by an entity listed in subparagraph (A); or (vii) any corporation, partnership, association, or other organization organized under the laws of a country controlled by an entity listed in subparagraph (A). (6) Foreign entity of concern The term foreign entity of concern means any foreign entity that is— (A) designated as a foreign terrorist organization by the Secretary of State under section 219 of the Immigration and Nationality Act ( 8 U.S.C. 1189 ); (B) included on the list of specially designated nationals and blocked persons maintained by the Office of Foreign Assets Control of the Department of the Treasury; (C) owned by, controlled by, or subject to the jurisdiction or direction of a government of a foreign country of concern; (D) alleged by the Attorney General to have been involved in activities for which a conviction was obtained under— (i) chapter 37 of title 18, United States Code (commonly known as the Espionage Act ) ( 18 U.S.C. 792 et seq. ); (ii) section 951 or 1030 of title 18, United States Code; (iii) chapter 90 of title 18, United States Code (commonly known as the Economic Espionage Act of 1996 ); (iv) the Arms Export Control Act ( 22 U.S.C. 2751 et seq. ); (v) section 224, 225, 226, 227, or 236 of the Atomic Energy Act of 1954 ( 42 U.S.C. 2274 , 2275, 2276, 2277, and 2284); (vi) the Export Control Reform Act of 2018 ( 50 U.S.C. 4801 et seq. ); or (vii) the International Emergency Economic Powers Act ( 50 U.S.C. 1701 et seq. ); (E) designated by the Federal Maritime Commission as a controlled carrier under chapter 407 of title 46, United States Code; (F) found by the Federal Maritime Commission to be practicing unfavorable conditions in foreign trade under chapter 421 or 423 of title 46, United States Code; or (G) determined by the Maritime Administrator, in consultation with the Secretary of Defense, the Secretary of State, the Director of National Intelligence, and the Chair of the Federal Maritime Commission, to be engaged in unauthorized conduct that is detrimental to the national security or foreign policy of the United States. (7) Vessel of the United States The term vessel of the United States has the meaning given that term in section 116 of title 46, United States Code. I Oversight and accountability 101. Maritime Security Advisor; Maritime Security Board (a) Amendments Chapter 504 of part A of subtitle V of title 46, United States Code, is amended— (1) by striking the chapter heading and inserting the following: Oversight and Accountability ; (2) by redesignating section 50401 as section 50403; and (3) by inserting before section 50402, the following: 50401. Maritime Security Advisor; Maritime Security Board (a) Maritime Security Advisor (1) In general Not later than 60 days after the date of enactment of this section, the President shall appoint a Special Advisor to the President (to be known as the Maritime Security Advisor ) for coordinating national maritime affairs and policy, including developing, updating, and implementing the National Maritime Strategy as required under section 50114 of this title. (2) Duties The Maritime Security Advisor appointed under paragraph (1) shall serve as the Chair of the Maritime Security Board, shall be the principal advisor to the President on all issues related to the maritime industry, shipbuilding, and ship repair, and shall be responsible for developing, updating, and implementing the National Maritime Strategy under section 50114 of this title within and across the Federal Government. (3) Office of the Maritime Security Advisor (A) In General There is established in the Executive Office of the President, an Office of the Maritime Security Advisor. The Maritime Security Advisor described in this subsection shall be the head of such Office. (B) Employees; contracts In carrying out the functions under this section, the Maritime Security Advisor is authorized to— (i) appoint such officers and employees as the Maritime Security Advisor may deem necessary to perform the functions now or hereafter vested in the Maritime Security Advisor and to prescribe their duties; and (ii) enter into contracts and other arrangements for studies, analyses, and other services with public agencies and with private persons, organizations, or institutions, and make such payments as the Maritime Security Advisor deems necessary to carry out the provisions of this section. (b) Maritime Security Board Not later than 90 days after the date of enactment of this section, the President shall establish a board, to be known as the Maritime Security Board (in this section referred to as the Board ). (1) Composition (A) In general The Board shall be comprised of the following individuals and representatives: (i) The Maritime Security Advisor described in subsection (a). (ii) The Maritime Administrator. (iii) The Commandant of the Coast Guard. (iv) The Secretary of the Navy. (v) The Commander of the United States Transportation Command. (vi) The Chair of the Federal Maritime Commission. (vii) The Assistant Secretary of the Army for Civil Works. (viii) The chief United States delegate to the International Maritime Organization. (ix) The Under Secretary of Commerce for Oceans and Atmosphere. (x) The Commissioner for Customs and Border Protection. (xi) The Director of the Office of Management and Budget, or a designee. (xii) The Secretary of Transportation, or a designee. (xiii) The Secretary of Homeland Security, or a designee. (xiv) The Secretary of State, or a designee. (xv) The Secretary of Labor, or a designee. (xvi) The Secretary of Commerce, or a designee. (xvii) The Secretary of the Treasury, or a designee. (xviii) The Administrator of the Environmental Protection Agency, or a designee. (xix) The United States Trade Representative, or a designee. (xx) The head of each agency with a statutory responsibility for administering the Food for Peace Act ( 7 U.S.C. 1691 et seq. ), or a designee. (xxi) From the Department of Defense— (I) the Secretary of Defense, or a designee; (II) The Commander of the Military Sealift Command. (III) The Commander of Naval Sea Systems Command. (IV) a representative of the Army, as appointed by the Secretary of Defense; (V) a representative of the Air Force, as appointed by the Secretary of Defense; and (VI) a representative of the Navy, as appointed by the Secretary of Defense. (B) Nonvoting members The individuals and representatives listed in clauses (xi) through (xxi) shall be nonvoting members. (C) Chair The Maritime Security Advisor shall serve as the Chair of the Board. (2) Duties Consistent with the National Maritime Strategy under section 50114 of this title, the Board shall carry out the following duties: (A) Supporting the development of the marine transportation system of the United States, including— (i) assessing the adequacy of the marine transportation system (including ports, waterways, channels, and their intermodal connections); (ii) promoting the integration of the marine transportation system with other modes of transportation and other uses of the marine environment; and (iii) coordinating, improving the coordination of, and making recommendations with regard to Federal policies that impact the marine transportation system. (B) Establishing policy priorities relating to, and conducting independent oversight over, the financial assistance programs under part C of subtitle V of this title, including— (i) not later than 1 year after the date of enactment of the SHIPS for America Act of 2025 and annually thereafter, establishing targets for the number, type, and requirements of vessels to be included in each of— (I) the Maritime Security Fleet (consistent with the most recent Mobility Capability Requirements Study produced by United States Transportation Command); (II) the Cable Security Fleet; (III) the Tanker Security Fleet (consistent with the most recent Mobility Capability Requirements Study produced by United States Transportation Command); (IV) the Strategic Commercial Fleet; and (V) the Shipbuilding Financial Incentives Program; (ii) submitting annual recommendations to the appropriate committees of Congress for any needed changes in the authorized number of vessels eligible to participate in the programs under part C of subtitle V of this title; and (iii) conducting oversight of the administration of such financial assistance programs to ensure such programs support the strategic sealift objectives and policy of the United States, as established in section 59101 of this title. (C) Supporting the Maritime Administrator in all efforts to conduct independent oversight of passenger and cargo preference requirements and supporting efforts to enable cargo to be carried on vessels of the United States, including— (i) conducting oversight and coordinating interagency efforts to comply with cargo preference requirements established under chapter 553 of this title and section 2631 of title 10; (ii) independently verifying that all Federal agencies follow the requirements for cargoes procured, furnished, or financed by the United States Government under section 55305 of this title, and notifying the appropriate committees of Congress of any identified violations of the requirements of such section; (iii) conducting outreach among nongovernmental stakeholders, including private industry, to encourage more cargo to be moved on vessels of the United States; (iv) developing recommendations for regulations to be issued by Federal agencies to preference the movement of cargo on vessels of the United States; and (v) submitting recommendations to the appropriate committees of Congress for changes to laws relating to passenger and cargo preferences for the purpose of establishing a more robust fleet of vessels of the United States. (D) Conducting independent oversight and developing guidance and recommendations related to the enforcement of the requirements of chapters 121 and 551 of this title. (E) Coordinating national efforts to develop a robust maritime workforce that enhances the national security and strategic sealift readiness of the United States, including— (i) coordinating and conducting oversight of interagency efforts and partnerships with the maritime industry and qualified labor organizations to recruit, train, and retain qualified licensed and unlicensed merchant mariners; and (ii) coordinating and conducting oversight of interagency efforts and partnerships with the shipbuilding industry to recruit, train, and retain qualified workers in the shipbuilding industry of the United States. (F) Establishing national priorities for research and development of next-generation technologies to enhance United States leadership in the shipbuilding and maritime industries, including through the Center for Maritime Innovation established under section 50307. (G) Coordinating interagency efforts to ensure vessels of the United States operating in international commerce are privileged in regulation, taxation, fees, insurance, and policy compared to foreign vessels conducting trade with a United States-domiciled entity, while remaining consistent with the international obligations of the United States. (H) Coordinating efforts to protect vessels of the United States operating in international or domestic commerce from physical and cybersecurity threats. (I) Conducting oversight of the use of funds from the Maritime Security Trust Fund established under section 50301(b) of this title, and making recommendations to Congress for expenditures from the Trust Fund. (J) Conducting studies on subjects related to the maritime industry and international shipping, and undertaking other efforts related to strengthening the maritime security of the United States. (K) Carrying out other duties, as assigned by the President in consultation with the Maritime Security Advisor, related to the maritime industry, shipbuilding, ship repair, strategic sealift, and the marine transportation system of the United States. (3) Delegation The Board may task agencies who are represented by individuals on the Board (as described under paragraph (1)(A)) to carry out any duties of the Board. (4) Meetings The Board shall meet not less frequently than quarterly. (5) Staff The Board may hire staff to support its activities. (c) Authorization of appropriations There are authorized to be appropriated $5,000,000 for each of fiscal years 2026 through 2035, from the Maritime Security Trust Fund established under section 50301(b) of this title, to the Maritime Security Board to staff the Board and carry out the duties described in this section. (d) Report to Congress (1) In General Not later than 180 days after the President establishes the Maritime Security Board under this section, and annually thereafter, the Board shall submit a report to the appropriate committees of Congress describing— (A) the actions that the Board has taken to carry out the duties required of the Board under subsection (b)(2); and (B) a list of recommended actions that the Board recommends Congress take to enhance the strength of the United States maritime industry and support the economic and national security needs of the United States;. (2) Appropriate committees of Congress In this section, the term appropriate committees of Congress has the meaning given that term in section 4 of the SHIPS for America Act of 2025 . . (b) Clerical amendment The table of sections for chapter 504 of subtitle V of title 46, United States Code, is amended to read as follows: 50401. Maritime Security Advisor; Maritime Security Board. 50402. Maritime Transportation System National Advisory Committee. 50403. United States Committee on the Marine Transportation System. . (c) National Maritime Strategy Section 50114 of title 46, United States Code, is amended— (1) by striking subsection (a), and inserting the following: (a) In General (1) In General Subject to paragraph (2), the Maritime Security Advisor, in consultation with the Maritime Security Board, shall develop a National Maritime Strategy and submit that National Maritime Strategy to the appropriate committees of Congress (as that term is defined in section 4 of the SHIPS for America Act of 2025 ). (2) Transition Notwithstanding paragraph (1), if a national maritime strategy has been developed and submitted in accordance with this section, as in effect on the day before the date of enactment of the SHIPS for America Act of 2025 , in the 1-year period before such date of enactment, the Maritime Security Advisor shall implement and update that national maritime strategy and shall not develop a new national maritime strategy. ; and (2) by striking subsections (c) and (d) and inserting the following: (c) Implementation Upon the release of a strategy under this section, the Maritime Security Advisor, in consultation with the Maritime Security Board, shall be responsible for implementing the contents and recommendations of the strategy. (d) Update The Maritime Security Advisor, in coordination with the Maritime Security Board, shall submit to the appropriate committees of Congress (as that term is defined in section 4 of the SHIPS for America Act of 2025 ) an update to the strategy developed under subsection (a) not less often than every 5 years. (e) Public availability; implementation plan Not later than 6 months after the submission of a strategy or update under subsection (a), the Maritime Security Advisor, in consultation with the Maritime Security Board, shall make publicly available on an appropriate website each strategy or updated strategy and an implementation plan for such strategy or update. . 102. Maritime Transportation System National Advisory Committee Section 50402 is amended— (1) in subsection (b), by striking Secretary of Transportation and inserting Maritime Security Advisor and Maritime Security Board ; and (2) in subsection (c)— (A) in paragraph (1), by striking by the Secretary of Transportation ; (B) by striking paragraph (3) and inserting the following: (3) Representation Members of the Committee shall be appointed as follows: (A) The Maritime Security Advisor shall appoint the following members of the Committee: (i) At least one member to represent the Environmental Protection Agency. (ii) At least one member to represent the Department of Commerce. (iii) At least one member to represent the Corps of Engineers. (iv) At least one member to represent the Coast Guard. (v) At least one member to represent Customs and Border Protection. (vi) At least one member to represent the Maritime Administration. (vii) At least one member to represent the Department of Agriculture. (viii) At least one member to represent the State Department. (ix) At least one member to represent State and local governmental entities. (B) Additional members shall represent private sector entities that reflect a cross-section of maritime industries, including credentialed United States merchant mariners, port and water stakeholders, academia, and labor, of whom— (i) 3 shall be appointed by the majority leader of the Senate; (ii) 3 shall be appointed by the minority leader of the Senate; (iii) 3 shall be appointed by the Speaker of the House of Representatives; and (iv) 3 shall be appointed by the minority leader of the House of Representatives. (C) The Maritime Security Advisor may appoint additional members of the Committee, including additional representatives from the United States Merchant Marine Academy, State maritime academies, or other Federal agencies, as the Secretary considers appropriate. ; and (C) in paragraph (4), by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively, and adjusting the margins accordingly; (D) by redesignating paragraph (4) as subparagraph (A) and adjusting the margins accordingly; (E) by inserting after paragraph (3) the following: (4) Restrictions on members ; and (F) at the end of paragraph (4), as so designated, by inserting the following: (B) Restrictions on additional members Members appointed under this paragraph that are not representing Federal agencies— (i) shall remain on the Committee for a term of 3 years from the date that the member is appointed; and (ii) may not serve more than 2 consecutive terms. . 103. Direct hire authority; Authorization for administrative expenses (a) Maritime Administration direct hire authority (1) In general The Maritime Administrator may appoint, without regard to the provisions of sections 3309 through 3319 of title 5, United States Code, candidates to positions in the competitive service within the Maritime Administration for which— (A) public notice has been given; (B) the Administrator has determined that a critical hiring need exists; and (C) the Administrator has consulted with the Director of the Office of Personnel Management regarding— (i) the positions for which the Administrator plans to recruit; (ii) the quantity of candidates the Administrator is seeking; and (iii) the assessment and selection policies the Administrator plans to utilize. (2) Definition of critical hiring need In this subsection, the term critical hiring need means personnel necessary for the implementation of this Act and associated work. (b) Coast Guard direct hire authority (1) In general The Secretary of the department in which the Coast Guard is operating may appoint, without regard to the provisions of sections 3309 through 3319 of title 5, United States Code, candidates to positions in the competitive service within offices under the Assistant Commandant for Prevention Policy of the Coast Guard, for which— (A) public notice has been given; (B) the Secretary has determined that a critical hiring need exists; and (C) the Secretary has consulted with the Director of the Office of Personnel Management regarding— (i) the positions for which the Secretary plans to recruit; (ii) the quantity of candidates the Secretary is seeking; and (iii) the assessment and selection policies the Secretary plans to utilize. (2) Definition of critical hiring need In this subsection, the term critical hiring need means personnel necessary for the implementation of this Act and associated work. (c) Competitive service In this section the term competitive service has the meaning given the term in section 2102 of title 5, United States Code. (d) Authorization of appropriations for administrative expenses There is authorized to be appropriated from the Maritime Security Trust Fund established under section 50301(b) of title 46, United States Code— (1) $30,000,000 to the Secretary of Transportation for administrative expenses of the Maritime Administration to administer subtitle V of title 46, United States Code, for each of fiscal years 2026 through 2035; (2) $30,000,000 to the Secretary of the department in which the Coast Guard is operating for administrative expenses of the Coast Guard to administer subtitle II of title 46, United States Code, for each of fiscal years 2026 through 2035; and (3) $2,000,000 to the Federal Maritime Commission for administrative expenses of the Federal Maritime Commission to administer subtitle IV of title 46, United States Code. 104. Implementation plan (a) Implementation plan required Not later than 60 days after the date of enactment of this Act, the Maritime Administrator and the Secretary of the department in which the Coast Guard is operating shall each submit to the appropriate committees of Congress and the Maritime Security Board a separate implementation plan for carrying out this Act, and the amendments made by this Act. (b) Elements Each implementation plan required under subsection (a) shall include, for each action required of the Maritime Administrator and the Secretary of the department in which the Coast Guard is operating (as applicable) in this Act, including the amendments made by this Act— (1) an identification of all administrative restructuring requirements; (2) an identification of each office or division within the Maritime Administration or Coast Guard principally responsible for each relevant section of this Act; (3) an identification of additional personnel needed to sufficiently implement this Act, a hiring plan, and a training plan; (4) an identification of any barrier (including any policy, law, or regulation) to implementation of any section of this Act, and recommendations to address those barriers; (5) a descriptive implementation timeline, taking into account the administrative needs of the Maritime Administration or the Coast Guard; and (6) any additional components determined appropriate by the Maritime Administrator or such Secretary to ensure the success of implementation of this Act. (c) Briefing Not later than 15 days after submitting each implementation plan required under subsection (a), the Maritime Administrator and the Secretary of the department in which the Coast Guard is operating shall provide a briefing to the appropriate committees of Congress on the status of that implementation plan required under subsection (a). (d) Biannual update Not less frequently than biannually following the submission of the plans under subsection (a) and for 2 years thereafter, the Maritime Administrator and the Secretary of the department in which the Coast Guard is operating shall submit to the appropriate committees of Congress separate reports containing any updates on the implementation of such plans. (e) GAO review The Comptroller General of the United States shall— (1) not later than 2 years after the date of enactment of this Act, and biennially thereafter for 10 years, conduct a review of the activities carried out in accordance with this Act, and the amendments made by this Act; and (2) submit to the appropriate committees of Congress the results of each review. 105. Federal Maritime Commission report on vessels of the United States (a) In general The Federal Maritime Commission shall annually submit a report to the Maritime Security Board and the appropriate committees of Congress evaluating the competitiveness of vessels of the United States in foreign commerce. The Maritime Security Board shall utilize the findings of such report to inform the National Maritime Strategy under section 50114 of title 46, United States Code, and other activities of the Board. (b) Contents The report shall include— (1) metrics concerning carriage of foreign commerce on vessels of the United States; (2) information about the price parity of carriage of foreign commerce on vessels of the United States versus foreign vessels (as defined in section 110 of title 46, United States Code) by market; (3) identification of markets of opportunity for the United States to compete in foreign commerce where rates are in relative parity to vessels of the United States; (4) markets in which United States interests paid above average rates for foreign commerce, including with foreign and domestic carriers; and (5) an assessment of the foreign vessel registries of peer competitor countries to determine— (A) the roles of the governments of peer competitor countries in their vessel registry processes, including policy practices that may provide a disadvantage to the United States; (B) the sizes of the fleets of foreign vessels registered with such countries, including how many of such foreign vessels are domestically built and how many are built in other countries; and (C) the price parity of vessels of the United States, as compared to foreign vessels registered with peer competitor countries that are operating in global markets identified as a priority by the Federal Maritime Commission. II Maritime Security Trust Fund 201. Maritime Security Trust Fund established Section 50301 of title 46, United States Code, is amended— (1) by striking the section heading and inserting Funds established ; (2) in subsection (e)— (A) in paragraph (2), by redesignating subparagraphs (A), (B), and (C), as clauses (i), (ii), and (iii), respectively, and adjusting the margins accordingly; (B) by redesignating paragraphs (1), (2), and (3), as subparagraphs (A), (B), and (C), respectively, and adjusting the margins accordingly; (C) in subparagraph (A), as redesignated by subparagraph (B), by striking paragraph (2) and inserting subparagraph (B) ; (D) in subparagraph (B), as redesignated by subparagraph (B), in the matter preceding clause (i), by striking Paragraph (1) and inserting Subparagraph (A) ; and (E) in subparagraph (C), as redesignated by subparagraph (B), by striking Paragraph (1) and inserting Subparagraph (A) ; (3) in subsection (f), by redesignating paragraphs (1) through (4) as subparagraphs (A) through (D), respectively, and adjusting the margins accordingly; (4) by redesignating subsections (b) through (g) as paragraphs (2) through (7), respectively, and adjusting the margins accordingly; (5) in subsection (a), by striking In General and all that follows through There is a and inserting the following: (a) Vessel Operations Revolving Fund (1) In General There is a ; (6) in paragraph (4), by striking subsection (a) and inserting paragraph (1) ; and (7) by adding at the end the following: (b) Maritime Security Trust Fund (1) In general There is a Maritime Security Trust Fund for use in carrying out programs or activities associated with supporting the merchant marine of the United States and the maritime industrial base, as authorized under the SHIPS for America Act of 2025 . (2) Transfer of amounts The Fund shall be credited with amounts equivalent to the receipts from each of the following: (A) The taxes received in the Treasury under— (i) section 60301 of this title (relating to regular tonnage taxes); (ii) section 60302 of this title (relating to special tonnage taxes); and (iii) section 60303 of this title (relating to light money). (B) The revenue collected from— (i) duties imposed under section 466 of the Tariff Act of 1930 ( 19 U.S.C. 1466 ) (relating to equipment and repair of vessels); (ii) duties, fees, or monetary penalties imposed by the United States Trade Representative under section 301 of the Trade Act of 1974 ( 19 U.S.C. 2411 ) pursuant to the determination of the Trade Representative that the targeting of the maritime, logistics, and shipbuilding sectors for dominance by the People’s Republic of China is unreasonable and burdens or restricts United States commerce, notice of which was published in the Federal Register on January 23, 2025 (90 Fed. Reg. 8089); and (iii) duties imposed under section 60502 of this title (relating to discriminating duty on goods imported in foreign vessels or from contiguous countries). (C) Any penalties paid with respect to a vessel pursuant to any of the following sections of this title: (i) Section 2017. (ii) Section 2302. (iii) Section 3318. (iv) Section 3718. (v) Section 4106. (vi) Section 5116. (vii) Section 11303. (viii) Section 11501. (ix) Section 12151. (x) Section 12507. (xi) Section 14701. (xii) Section 30707, with respect to the portion of the fine that goes to the United States Government under subsection (c) of such section. (xiii) Section 31309. (xiv) Section 31330. (xv) Section 41107. (xvi) Section 41108. (xvii) Section 42108. (xviii) Section 44104. (xix) Section 70052. (xx) Section 70119. (xxi) Section 70506. (xxii) Section 80509. (D) Any revenue generated in connection with the seizure and forfeiture of a maritime vessel under— (i) section 3 of the Act of August 5, 1935 (49 Stat. 518, chapter 438; 19 U.S.C. 1703 ); (ii) section 70052 of this title; and (iii) section 70507 of this title. (3) Total Balance The total amount in the Maritime Security Trust Fund at any time shall not exceed $20,000,000,000. (4) Expenditures Amounts in the Maritime Security Trust Fund shall be available for making expenditures before October 1, 2035, to meet those obligations of the United States heretofore and hereafter incurred which are authorized to be paid out of the Maritime Security Trust Fund under the SHIPS for America Act of 2025, including the amendments made in such Act. . 202. Regular tonnage taxes (a) Rate updates Section 60301 of title 46, United States Code, is amended— (1) in subsection (a), by striking , for fiscal years 2006 through 2010, and 2 cents per ton not to exceed a total of 10 cents per ton per year, for each fiscal year thereafter ; and (2) in subsection (b), by striking , for fiscal years 2006 through 2010, and 6 cents per ton, not to exceed a total of 30 cents per ton per year, for each fiscal year thereafter . (b) Foreign shipyard of concern (1) Definition The term foreign shipyard of concern means— (A) a shipyard owned by a firm owned or controlled by the government of a foreign country of concern or a foreign entity of concern, that has the capacity to produce both military and commercial vessels; and (B) a foreign shipyard designated under paragraph (2). (2) Designation (A) In General Beginning after October 1, 2027, the Maritime Security Advisor, in consultation with the Maritime Security Board, shall designate certain foreign shipyards that pose a threat to the national security or economic security of the United States as foreign shipyards of concern, in accordance with this paragraph. (B) Notice and comment A proposed designation under subparagraph (A) shall be subject to notice and comment in the Federal Register. (C) Annual revisions The list of shipyards designated under this paragraph shall be revised, and new shipyards may be designated, not more frequently than once a year. (c) Penalty rates; inflation Section 60301 of title 46, United States Code, is further amended— (1) by redesignating subsection (c) as subsection (e); and (2) by inserting after subsection (b) the following: (c) Penalty rate (1) In General In accordance with paragraph (2), and in addition to the tax imposed on a vessel under subsection (b), a penalty tax with no annual limit is imposed on a vessel subject to the tax imposed under subsection (b), at a rate of— (A) $5 per ton for a vessel that— (i) is owned or operated by a foreign entity of concern; (ii) is a vessel registered under a registry of a foreign country of concern; (iii) was a vessel registered under a registry of a foreign country of concern at any time during the 3 years preceding the date of the determination of the application of subsection (a) or (b); or (iv) is owned or operated by an entity, with respect to which— (I) an amount equal to 50 percent or greater of the total number of vessels ordered at the time of the determination of the application of subsection (a) or (b) are vessels ordered from a shipyard of concern; or (II) an amount equal to 50 percent or greater of the total number of vessels that the entity expects to have delivered in the period of 24 months after the time of such determination are vessels expected to be delivered by a shipyard of concern; (B) $3.50 per ton for a vessel that is owned or operated by an entity, with respect to which— (i) an amount equal to 25 percent or more, but less than 50 percent, of the total number of vessels ordered at the time of the determination of the application of subsection (a) or (b) are vessels ordered from a shipyard of concern; or (ii) an amount equal to 25 percent or more, but less than 50 percent, of the total number of vessels that the entity expects to have delivered in the period of 24 months after the time of such determination are vessels expected to be delivered by a shipyard of concern; (C) $1.25 per ton for a vessel that is owned or operated by an entity with a fleet of vessels, of which an amount equal to 50 percent or more of the number of such vessels were constructed or underwent any repairs (excluding necessary repairs as described in paragraph (1) of section 466(d) of the Tariff Act of 1930 ( 19 U.S.C. 1466(d)(1) )) in a shipyard of concern at any time during the 3 years preceding the date of the determination of the application of subsection (b). (2) Highest applicable rate A vessel with respect to which the descriptions in 2 or more subparagraphs in paragraph (1) apply, shall be subject to the highest applicable rate described in that paragraph. (3) Definitions In this subsection— (A) the terms foreign country of concern and foreign entity of concern have the meanings given those terms in section 4 of the SHIPS for America Act of 2025 ; and (B) the term foreign shipyard of concern has the meaning give that term in section 202 of that Act. (d) Index for inflation The taxes imposed under this section shall be annually increased to account for inflation. . 203. Presidential suspension of tonnage taxes and light money Section 60304 of title 46, United States Code, is amended to read as follows: 60304. Presidential suspension of tonnage taxes and light money (a) In general Except as provided in subsection (b), if the President is satisfied that the government of a foreign country does not impose discriminating or countervailing duties to the disadvantage of the United States, the President may suspend the imposition of special tonnage taxes and light money under sections 60302 and 60303 of this title on vessels of that country. (b) Exception Subsection (a) shall not apply to any vessel that— (1) is owned or operated by a foreign entity of concern (as that term is defined in section 4 of the SHIPS for America Act of 2025 ); (2) is a vessel registered under a registry of a foreign country of concern (as that term is defined in section 4 of the SHIPS for America Act of 2025 ); or (3) was a vessel registered under a registry of a foreign country of concern (as that term is defined in section 4 of the SHIPS for America Act of 2025 ) at any time during the 3 years preceding the date of the determination of the application of subsection (a). . III Sealift capability 301. Sealift capability (a) In general Subtitle V of title 46, United States Code, is amended by adding at the end the following: H Strategic sealift Sec. 59101. Objectives and policy. 59102. Procurement, maintenance, and operation. 59103. Sealift prioritization. 59104. Report on privilege. 59101. Objectives and policy (a) Objectives It is necessary for the national defense and economic security of the United States that the United States have vessels of the United States capable of providing and supporting strategic sealift— (1) sufficient to meet surge defense deployment and essential economic activities for the United States in times of crisis or war; (2) sufficient to respond unilaterally to national security threats in geographic areas not covered by alliance commitments and ensure economic security resilience for United States trade; and (3) built, operated, and maintained during all times, primarily in the United States to protect and ensure national security resiliency and avoid foreign coercion of critical supply chains. (b) Policy It is the policy of the United States to encourage and aid the development and maintenance of vessels of the United States with strategic sealift capabilities satisfying the objectives described in subsection (a). (c) Strategy required (1) In general The Maritime Security Board shall annually develop a strategy to leverage the financial assistance programs established under part C of this subtitle to expand the number of vessels of the United States needed to accomplish the objectives described under subsection (a). (2) Strategy components The strategy developed by the Maritime Security Board shall include— (A) annual goals for the number of vessels that will be brought into the fleet of vessels of the United States capable of providing strategic sealift utilizing the Maritime Security Fleet under chapter 531 of this title, the Cable Security Fleet under chapter 532 of this title, the Tanker Security Fleet under chapter 534 of this title, the Strategic Commercial Fleet under chapter 536 of this title, and the Shipbuilding Financial Incentives program, consistent with the most recent Mobility Capability Requirements Study produced by United States Transportation Command; and (B) an assessment of domestic shipbuilding capacity and a strategy to increase the capacity of the domestic shipbuilding industry utilizing the Shipbuilding Financial Incentives program. (3) National maritime strategy The strategy developed by the Maritime Security Board under paragraph (1) shall be consistent with the National Maritime Strategy developed under section 50114. (d) Report required (1) In General Upon completion, the Maritime Security Board shall transmit to the appropriate committees of Congress a summary of the strategy developed under subsection (c), with a classified annex as necessary. (2) Definition In this part, the term appropriate committees of Congress has the meaning given that term in section 4 of the SHIPS for America Act of 2025 . 59102. Procurement, maintenance, and operation (a) Statement of policy The Maritime Administrator, in coordination with the Secretary of Defense and the Secretary of Homeland Security, shall build, acquire, maintain, coordinate, support, and operate a sufficient and privileged fleet of vessels of the United States with commercial and military sealift capability. (b) Supplemental capability In developing sealift capability under this part, the Secretary of Transportation and the Secretary of Defense shall continue to support a sufficient Maritime Security Fleet under chapter 531 of this title, a Cable Security Fleet under chapter 532 of this title, a Tanker Security Fleet under chapter 534 of this title, the Strategic Commercial Fleet under chapter 536 of this title, a Military Sealift Command of the Department of the Navy, and a Ready Reserve Force component of the National Defense Reserve Fleet under section 57100 of this title, to provide capacity and resiliency for unilateral United States strategic sealift in peace, crisis, and war. (c) Judicial review No court shall have jurisdiction to review decisions made by the Maritime Administrator, the Secretary of Defense, or the Secretary of Homeland Security with respect to this section. 59103. Sealift prioritization (a) In general In acquiring, maintaining, coordinating, and supporting a fleet of vessels capable of providing sealift capacity during wartime and crisis, the Maritime Administrator, in coordination with the Secretary of Defense, shall ensure the availability of vessels, in the following order of priority: (1) Commercial vessels of the United States. (2) Vessels of the United States that are owned and operated by the United States Government. (3) Vessels of countries that are defense treaty allies of the United States. (4) Vessels of countries that are strategic partners of the United States. (b) Judicial review No court shall have jurisdiction to review decisions made by the Maritime Administrator or the Secretary of Defense with respect to this section. 59104. Report on privilege (a) In general Not later than March 1, 2026, the Secretary of Transportation, in coordination with the Secretary of Commerce, the Chair of the Federal Maritime Commission, and the Director of the Office of Management and Budget, shall submit to the appropriate committees of Congress a report including ways to ensure vessels of the United States operating in foreign commerce are privileged in regulation, taxation, fees, insurance, and policy compared to foreign vessels conducting trade with a United States domiciled entity, while remaining consistent with the international obligations of the United States. (b) Contents In submitting the report under subsection (a), the Secretary of Transportation shall include options for regulating trade with foreign vessels in order to sustain and grow the Maritime Security Fleet under chapter 531 of this title, the Cable Security Fleet under chapter 532 of this title, the Tanker Security Fleet under chapter 534 of this title, the Strategic Commercial Fleet under chapter 536 of this title, and other vessels of the United States operating in foreign commerce. . (b) Clerical amendment The table of chapters for subtitle V of title 46, United States Code, is amended by adding at the end the following: Part H—Strategic sealift . 302. National Freight Strategic Plan Section 70102(b) of title 49, United States Code, is amended— (1) in paragraph (16), by striking and after the semicolon; (2) in paragraph (17), by striking the period at the end and inserting ; and ; and (3) by adding at the end the following: (18) consideration of United States strategic sealift objectives and strategies established under section 59101 of title 46; and (19) consideration of maritime networks in multimodal freight corridors. . 303. Foreign shipping practices; controlled carriers (a) Foreign shipping practices Section 42301(b) of title 46, United States Code, is amended— (1) in paragraph (2), by inserting or passengers after transportation of cargo ; and (2) in paragraph (5), by inserting or passengers after carriage of cargo . (b) Controlled carriers Chapter 407 of title 46, United States Code, is amended— (1) in section 40701— (A) in subsection (a)— (i) in paragraph (1), by striking or at the end; (ii) in paragraph (2), by striking the period at the end and inserting ; or ; and (iii) by adding at the end the following: (3) arrange or provide passenger transportation at a fare that is below a just and reasonable level. ; (B) in subsection (b), by striking rule, or regulation and inserting rule, regulation, or fare ; (C) in subsection (c), by striking rule, or regulation and inserting rule, regulation, or fare ; and (D) in subsection (d), by striking rule, or regulation and inserting rule, regulation, or fare ; (2) in section 40702(b)— (A) in the matter preceding paragraph (1), by striking rule, or regulation and inserting rule, regulation, or fare ; (B) in paragraph (1), by striking rate or charge and inserting rate, charge, or fare ; and (C) in paragraph (2), by striking rule, or regulation and inserting rule, regulation, or fare ; (3) in section 40703, by striking a rate, charge, and inserting a rate, fare, charge, ; and (4) in section 40704— (A) in subsection (a), by striking rule, or regulation and inserting rule, regulation, or fare ; (B) in subsection (b), by striking rule, or regulation and inserting rule, regulation, or fare ; (C) in subsection (c), by striking rule, or regulation and inserting rule, regulation, or fare each place the term appears; (D) in subsection (d)— (i) in paragraph (1), by striking rule, or regulation and inserting rule, regulation, or fare each place the term appears; and (ii) in paragraph (2), by striking rule, or regulation and inserting rule, regulation, or fare each place the term appears; and (E) in subsection (e), by striking rule, or regulation and inserting rule, regulation, or fare each place the term appears. IV Vessels of the United States in international commerce A Strategic sealift programs 401. Strategic Commercial Fleet (a) In general Part C of subtitle V of title 46, United States Code, is amended by inserting after chapter 535 the following: 536 Strategic Commercial Fleet Sec. 53601. Definitions. 53602. Establishment of Strategic Commercial Fleet. 53603. Operating agreements. 53604. Payments. 53605. National security requirements. 53606. Regulations. 53601. Definitions In this chapter: (1) Administrator The term Administrator means the Maritime Administrator. (2) Appropriate committees of congress The term appropriate committees of Congress means— (A) the Committee on Armed Services, the Committee on Commerce, Science, and Transportation, and the Committee on Appropriations of the Senate; and (B) the Committee on Armed Services, the Committee on Transportation and Infrastructure, and the Committee on Appropriations of the House of Representatives. (3) Coastwise trade The term coastwise trade means commerce or trade that is subject to the requirements of section 55102. (4) Covered entity The term covered entity means— (A) any owner or operator of a vessel eligible under section 53602(d); or (B) a bid team consisting of— (i) an entity eligible under subparagraph (A); (ii) a shipyard in the United States with the ability, experience, financial resources, and other qualifications necessary for— (I) the construction of a vessel eligible for inclusion in the Strategic Commercial Fleet; or (II) the repair of such a vessel; and (iii) another legal entity that is not a foreign entity of concern. (5) Fleet The term Fleet means the Strategic Commercial Fleet established under section 53602. (6) Foreign commerce The term foreign commerce means— (A) commerce or trade between the United States, its territories or possessions, or the District of Columbia, and a foreign country; and (B) commerce or trade between foreign countries. (7) Foreign country of concern; foreign entity of concern The terms foreign country of concern and foreign entity of concern have the meanings given such terms in section 4 of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 . (8) Qualified foreign built vessel The term qualified foreign built vessel — (A) means a vessel that— (i) is not more than 14 years of age; (ii) is, prior to entry into the Fleet, documented under the laws of the United States; and (iii) was constructed (or reconstructed) outside the United States; and (B) does not include a vessel that— (i) was owned or operated by a foreign entity of concern; (ii) is a vessel of a foreign country of concern; (iii) was constructed by a shipyard that was owned or operated by a foreign entity of concern or located in a foreign country of concern; or (iv) was registered as a vessel of a foreign country of concern at any time during the 3 years prior to entry into the Fleet. (9) United States built vessel The term United States built vessel means a vessel that is constructed in the United States (and, if reconstructed, reconstructed in the United States). (10) United States citizen trust The term United States citizen trust has the meaning given such term in section 53201. 53602. Establishment of Strategic Commercial Fleet (a) In general The Administrator, in consultation with the Secretary of Defense, shall establish a fleet, to be known as the Strategic Commercial Fleet , of active, commercially viable, militarily useful, privately owned vessels to meet national defense and other security requirements and maintain a United States presence in international commercial shipping. (b) Number of vessels The Administrator shall seek to select eligible vessels described in subsection (d) for the Fleet through an annual competitive selection process in accordance with the annual target number for the Fleet recommended by the Maritime Security Board under section 50401(b)(2)(B)(i). Through such annual selection process, the Administrator shall— (1) select for inclusion in the Fleet not fewer than 10 vessels in the 12-month period that begins on the date that is 2 years after the date of enactment of this section; (2) increase the number of vessels selected for inclusion in the Fleet annually such that not later than 5 years after such date of enactment, not fewer than 20 vessels are selected for such inclusion annually; and (3) ensure that the total number of vessels included in the fleet shall be not more than 250 vessels at any point in time. (c) Solicitation; entry into fleet (1) Solicitation (A) In general Not later than 1 year after the date of enactment of this section, the Administrator shall solicit applications from covered entities to competitively select vessels that are eligible under subsection (d) and meet the requirements of this subsection for inclusion in the Fleet. (B) Public solicitation requirements In soliciting applications under subparagraph (A), the Administrator— (i) shall— (I) publish a notice in the Federal Register, which, at a minimum, identifies the requirements for the number of vessels as established by the Administrator and the Maritime Security Board under subsection (b); and (II) allow applicants not less than 30 days to submit an application for entry into the Fleet; and (ii) may, in coordination with the Maritime Security Board, include in the notice in the Federal Register— (I) target numbers for each vessel type that will be selected for inclusion in the Fleet each year; and (II) guidance on proposed annual operating support payments and annual capital support payments for each vessel type solicited, to ensure— (aa) covered entities submit applications that are priced competitively and meet the needs of the Fleet; and (bb) there is a competitive selection process as described in this section. (2) Eligible applications The Administrator shall solicit and accept applications in separate processes for each of the following: (A) Newly constructed vessels (i) In general A covered entity may submit an application for the Fleet that involves the construction of a United States built vessel and operation of such vessel as a vessel of the United States in foreign commerce. (ii) Interim vessel An application described in clause (i) from a covered entity may include a proposal for the use of an interim vessel, if such proposal provides that— (I) the covered entity will operate a qualified foreign-built vessel as a vessel of the United States in foreign commerce as part of the Fleet until the United States built vessel described in such clause enters the Fleet, in accordance with the milestones established within the operating agreement under section 53603(c)(1); (II) when the United States built vessel enters the Fleet or the covered entity fails to meet milestones established in the operating agreement, the qualified foreign-built vessel shall be removed from the Fleet; and (III) the covered entity may then transfer and register the qualified foreign-built vessel under a registry of any foreign country that is not a foreign country of concern. (B) Qualified foreign-built vessels (i) In general Through fiscal year 2030, a covered entity may submit an application for the Fleet that involves the operation of a qualified foreign-built vessel as a vessel of the United States in foreign commerce. (ii) Exception After fiscal year 2030, the Administrator may not enter into a new agreement to bring a qualified foreign-built vessel into the Fleet unless— (I) the vessel is operating as an interim vessel under subparagraph (A)(ii); or (II) the Administrator and Secretary of Defense, in consultation with the Maritime Security Board, jointly certify to the appropriate committees of Congress that adding additional qualified foreign-built vessels to the Fleet is necessary for the national security of the United States until replaced by a newly constructed vessel to meet the schedule under subsection (b). (3) Procedure (A) In general A covered entity desiring to have a vessel selected for the Fleet shall submit an eligible application under paragraph (2) as at such time, in such manner, and containing such information as the Administrator may require. Such application shall include— (i) a proposed annual operating support payment, which may cover the difference in operating costs (including costs associated with vessel repair) associated with operating the vessel as a vessel of the United States as compared to a fair and reasonable estimate of the cost of operating that type of vessel under the laws of a foreign country; (ii) in the case of an application described in paragraph (2)(A), a proposed annual capital support payment, which may cover the difference in capital costs associated with constructing the vessel in the United States as compared to a fair and reasonable estimate of the cost of constructing that type of vessel in a foreign shipyard; and (iii) any other support payments needed to make a vessel commercially viable in foreign commerce. (B) Bid team In the case of an eligible entity that is a bid team described in section 53601(4)(B), such team shall jointly submit an application under this subsection for inclusion in the Fleet. (4) Acceptance into fleet (A) In general The Administrator shall evaluate eligible applications submitted under this subsection in order to, in accordance with this paragraph, select applications that meet the requirements of this section for acceptance in the Fleet. (B) Citizenship preference In selecting applications to meet the requirements of this section, the Administrator shall ensure, to the extent sufficient qualified applications are received under this subsection, that not less than 25 percent of vessels selected for the Fleet shall be owned or operated by a covered entity that is, or a bid team led by, a citizen of the United States under section 50501. (C) Priority In evaluating eligible applications for selection in the Fleet and subject to subparagraph (B), the Administrator shall give priority to— (i) applications that represent the best value to the Federal Government; and (ii) applications for vessels, or for vessels providing services, that are determined by the Maritime Security Board to have capabilities critical to the national and economic security of the United States. (D) Relationship to the tanker security fleet If the most recent Mobility Capability Requirements Study produced by United States Transportation Command identifies a need for a fleet of tanker vessels that are vessels of the United States that exceeds the size of the Tanker Security Fleet established under chapter 534 of this title, the Administrator, in coordination with the Maritime Security Board, may select for inclusion in the Fleet a number of tanker vessels that is consistent with the requirements of the Study. (E) Considerations for review In evaluating eligible applications submitted under this subsection for selection in the Fleet, the Administrator shall— (i) determine that any vessel so selected will be suitable for use by the United States for national defense or military purposes in time of war or national emergency; (ii) determine that any vessel so selected will aid in the promotion and development of foreign commerce; (iii) determine that— (I) the proposed use of the vessel in commercial service is reasonable; and (II) the owner or operator of the vessel possesses the ability, experience, financial resources, and other qualifications necessary for the operation and maintenance of the vessel; (iv) determine that a shipyard selected to construct a vessel under this section possesses the ability, experience, financial resources, equipment, and other qualifications necessary to properly construct the vessel; (v) determine that the price for the construction (if applicable) and operation of a vessel under this section is fair and reasonable; (vi) consider whether the covered entity commits to— (I) use equipment, materials, and supplies that are produced in the United States; and (II) utilize, to the maximum extent practicable, subcontractors and suppliers that are based in the United States; (vii) consider whether the covered entity commits to repair, repower, and recondition a vessel under this section in a shipyard in the United States; and (viii) consider whether the covered entity has made commitments to worker and community investment, including through— (I) programs to expand employment opportunity for economically disadvantaged individuals; or (II) securing commitments from regional educational and training entities and institutions of higher education, as defined in section 102 of the Higher Education Act of 1965 ( 20 U.S.C. 1002 ), to provide workforce training, including programming for training and job placement of economically disadvantaged individuals. (5) Timing (A) Qualified foreign vessel Not later than 180 days after entering into an operating agreement under section 53603 with a covered entity for inclusion of a qualified foreign-built vessel into the Fleet, such vessel shall be placed into service as part of the Fleet. (B) Newly constructed vessel Not later than 36 months after entering into an operating agreement under section 53603 with a covered entity for inclusion of a newly constructed United States built vessel described in paragraph (2)(A), such vessel shall be placed into service as part of the Fleet. (C) Delayed admission The Administrator may delay the entry of a vessel selected to participate in the Fleet for— (i) a delay in the construction of such vessel; or (ii) difficulty of the owner or operator of such vessel in recruiting United States mariners as required under section 53603(b)(1)(A). (d) Vessel eligibility A vessel is eligible to be included in the Fleet if— (1) the vessel— (A) is a vessel of the United States; or (B) is not a vessel of the United States, but— (i) the owner of the vessel has demonstrated an intent to have the vessel documented under chapter 121 of this title if it is included in the Fleet; and (ii) by the time an operating agreement is entered into under section 53603, the vessel is documented under chapter 121 of this title; (2) the vessel is a United States built vessel or a qualified foreign-built vessel; (3) the vessel is— (A) a bulk carrier vessel; (B) a tanker vessel; (C) a roll-on/roll-off vessel; (D) a liquefied natural gas tanker vessel; (E) a container vessel; (F) a multi-purpose vessel; (G) a cable vessel (as defined in section 53201 of this title); (H) a heavy-lift vessel; or (I) any other type of vessel determined appropriate by the Administrator, in consultation with the Maritime Security Board; (4) the vessel is operated (or will be operated) in providing transportation in foreign commerce; (5) the vessel meets the requirements of paragraph (1), (2), (3), or (4) of subsection (e); (6) the vessel— (A) is suitable for use by the United States for national defense or military purposes in time of war or national emergency, as determined by the Secretary of Defense; (B) is commercially viable, as determined by the Administrator; and (C) has dedicated space for the training of— (i) cadets of the Merchant Marine Academy consistent with the requirements of section 51307(b); (ii) students of a State maritime academy, consistent with the requirements of section 51507; or (iii) participants in another workforce training program identified by the Administrator; and (7) the vessel will, for the period of an operating agreement under section 53603 that applies to the vessel, meet any other requirement determined appropriate by the Administrator. (e) Requirements regarding citizenship of owners, charterers, and operators (1) Vessel owned and operated by section 50501 citizens A vessel meets the requirements of this paragraph if, during the period of an operating agreement under this chapter that applies to the vessel, the vessel will be owned and operated by 1 or more persons that are citizens of the United States under section 50501. (2) Vessel owned by section 50501 citizen or United States citizen trust and chartered to documentation citizen A vessel meets the requirements of this paragraph if— (A) during the period of an operating agreement under this chapter that applies to the vessel, the vessel will be— (i) owned by a person that is a citizen of the United States under section 50501 of this title or that is a United States citizen trust; and (ii) demise chartered to a person— (I) that is eligible to document the vessel under chapter 121 of this title; (II) the chairman of the board of directors, chief executive officer, and a majority of the members of the board of directors of which are citizens of the United States under section 50501 of this title, and are appointed and subjected to removal only upon approval by the Administrator; and (III) that certifies to the Administrator that there are no treaties, statutes, regulations, or other laws that would prohibit the covered entity for the vessel from performing its obligations under an operating agreement under this chapter; (B) in the case of a vessel that will be demise chartered to a person that is owned or controlled by another person that is not a citizen of the United States under section 50501 of this title, the other person enters into an agreement with the Administrator not to influence the operation of the vessel in a manner that will adversely affect the interests of the United States; and (C) the Administrator and the Secretary of Defense notify the appropriate committees of Congress that they concur with the certification required under subparagraph (A)(ii)(III) and have reviewed and agree that there are no other legal, operational, or other impediments that would prohibit the covered entity for the vessel from performing its obligations under an operating agreement under this chapter. (3) Vessel owned and operated by defense contractor A vessel meets the requirements of this paragraph if— (A) during the period of an operating agreement under this chapter that applies to the vessel, the vessel will be owned and operated by a person that— (i) is eligible to document a vessel under chapter 121 of this title; (ii) operates or manages other United States-documented vessels for the Secretary of Defense, or charters other vessels to the Secretary of Defense; (iii) has entered into a special security agreement for purposes of this paragraph with the Secretary of Defense; (iv) makes the certification described in paragraph (2)(A)(ii)(III); and (v) in the case of a vessel described in paragraph (2)(B), enters into an agreement referred to in that paragraph; and (B) the Administrator and the Secretary of Defense notify the appropriate committees of Congress that they concur with the certification required under subparagraph (A)(iv), and have reviewed and agree that there are no other legal, operational, or other impediments that would prohibit the covered entity for the vessel from performing its obligations under an operating agreement under this chapter. (4) Vessel owned by documentation citizen and chartered to section 50501 citizen A vessel meets the requirements of this paragraph if, during the period of an operating agreement under this chapter that applies to the vessel, the vessel will be— (A) owned by a person that is eligible to document a vessel under chapter 121; and (B) demise chartered to a person that is a citizen of the United States under section 50501. 53603. Operating agreements (a) In general The Administrator shall require, as a condition of including any vessel in the Fleet, that the covered entity for the vessel enter into an operating agreement under this section. (b) Requirements (1) General requirements An operating agreement required under subsection (a) shall require the vessel subject to such agreement to meet the following requirements: (A) During the period in which the vessel is operating under the agreement— (i) the vessel will be crewed in accordance with section 8103 of title 46, United States Code; (ii) the vessel shall be operated within the Fleet exclusively in foreign commerce and not in coastwise trade; (iii) the covered entity will have in effect an emergency preparedness agreement described in section 53605 for the period of such agreement; and (B) Beginning on the first day of the operating agreement, the vessel will be permanently ineligible for a coastwise endorsement under section 12112 of this title or to otherwise participate in the coastwise trade, even if the operating agreement is terminated or not renewed. (2) Vessel repair requirements (A) In general Subject to subparagraphs (B) and (C), the operating agreement required under subsection (a) shall— (i) require that the vessel subject to such agreement undergo a set percentage, agreed to between the Administrator and the covered entity, of repair work (excluding necessary repairs as described in paragraph (1) of section 466(d) of the Tariff Act of 1930 ( 19 U.S.C. 1466(d)(1) )) at a shipyard in the United States; and (ii) prohibit the vessel subject to such agreement from receiving repairs at a shipyard in a foreign country of concern (as defined in section 4 of the SHIPS for America Act of 2025). (B) Exception for interim vessels The requirements of clauses (i) and (ii) of subparagraph (A) shall not apply to interim vessels included in the fleet under 53602(c)(2)(A)(ii). (C) Authority of the Secretary of Transportation Notwithstanding any other provision of law, the Secretary of Transportation may modify or waive any requirement of subparagraph (A) only if the Secretary, in consultation with the Maritime Security Board— (i) determines that waiving such requirements are in the national security interest of the United States; and (ii) makes such a determination publicly available in writing and submits the determination to the appropriate committees of Congress (as defined in section 4 of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 ). (3) Coordination with Coast Guard regarding coastwise trade prohibition The Administrator shall coordinate with the Secretary of the Department in which the Coast Guard is operating to ensure that any vessel that is, or was, covered by an operating agreement under this chapter is permanently ineligible for a coastwise endorsement under section 12112 of this title or to otherwise participate in the coastwise trade, as required under paragraph (1)(B). (c) Milestones and payments The operating agreement shall— (1) prescribe specific milestones for project completion, as agreed upon between the Administrator and the covered entity; and (2) specify the schedule of operating support payments, and as applicable, capital support payments and other incentives and payments, based on completion of such milestones and consistent with the eligible application submitted by the covered entity under section 53602(c)(3)(A), as agreed to by the Administrator and the covered entity. (d) Incentives (1) State of the art technology incentives An operating agreement required under subsection (a) may include incentives to support the testing or adoption of state of the art technology, including artificial intelligence, advanced shipbuilding techniques, automation, modern propulsion systems, environmental performance, crew safety, national defense features, and other technologies identified by the Maritime Security Board to be relevant in advancing the military and economic security of the United States. (2) Performance incentives The operating agreement may include incentive payments for eligible entities that exceed the milestones established under subsection (c)(1). (e) Term of operating agreement (1) In general An operating agreement to participate in the Fleet shall be for a period of 7 years. (2) Renewal of agreement (A) In general A covered entity for a vessel participating in the Fleet under an operating agreement under this section may apply to renew such operating agreement. (B) Renewal limitation An operating agreement under this section may be renewed not more than 2 times. (3) Termination payment (A) No-fault termination during contract Subject to subparagraph (B), a covered entity for a vessel operating under an operating agreement under this section shall receive a termination payment if any of the following applies: (i) No-fault termination Capital support payments provided to a covered entity under an operating agreement are terminated during a contract term. (ii) No-fault non-renewal An operating agreement is not selected to be renewed under paragraph (2). (B) Administrator determination for material lack of compliance In any case in which the Administrator determines under subsection (f) that a covered entity for a vessel operating under an operating agreement under this section materially fails to comply with the terms of the operating agreement and, due to such failure to comply, the operating agreement is terminated or not selected for renewal, the Administrator may determine that the covered entity is not entitled to a termination payment and subparagraph (A) shall not apply. (C) Termination payment defined In this paragraph, the term termination payment means a payment in an amount that equals the product of— (i) the percentage of the remaining useful life of the vessel, calculated using 21 years as the maximum useful life of the vessel; multiplied by (ii) the difference in the cost of constructing the vessel in the United States and the cost of constructing the vessel in a foreign country, to the extent such cost difference was not recovered by the covered entity through payments received under any operating agreement under this section. (f) Termination by Administrator for lack of program participant compliance If a covered entity for a vessel operating under an operating agreement under this section materially fails to comply with the terms of the operating agreement— (1) the Administrator shall notify the covered entity and provide a reasonable opportunity to comply with the operating agreement; and (2) if the covered entity fails to achieve such compliance, the Administrator— (A) shall terminate the operating agreement; (B) shall not renew the operating agreement under subsection (e)(2); and (C) may take steps to recover an amount equal to the payments and incentives provided to the covered entity under this chapter. (g) Nonrenewal for lack of funds If, by the first day of a fiscal year, sufficient funds have not been appropriated under the authority provided by this chapter for that fiscal year, then the Administrator shall notify the appropriate committees of Congress that operating agreements authorized under this chapter for which sufficient funds are not available will not be renewed for that fiscal year if sufficient funds are not appropriated by the 60th day of that fiscal year. (h) Release of vessels from obligations (1) In general A vessel covered by an operating agreement under this chapter is released from any further obligation under the operating agreement, except for the requirements of paragraph (2), if— (A) the Administrator terminated or did not renew the operating agreement under subsection (f); (B) the covered entity elects to not renew its operating agreement with the Administrator; (C) the vessel is ineligible for renewal under subsection (e)(2); or (D) funds are not appropriated to the Administrator for payments under the operating agreement under this chapter for any fiscal year by the 60th day of that fiscal year. (2) Coastwise trade Consistent with the requirements of subsection (b)(1)(B), a vessel released from obligations under paragraph (1) shall remain permanently ineligible for a coastwise endorsement under section 12112 of this title or to otherwise participate in the coastwise trade. (3) Authority to transfer vessel (A) In general After a vessel is released from obligations under paragraph (1), the covered entity may transfer and register such vessel under a foreign registry that— (i) is acceptable to the Administrator and the Secretary of Defense, and allows the requisitioning of the vessel for title or use, notwithstanding section 56101 of this title; and (ii) is not a foreign country of concern. (B) Emergency acquisition of vessels If chapter 563 of this title is applicable to a vessel after registration in a foreign registry described in subparagraph (A), then the vessel is available to be requisitioned by the Secretary of Transportation pursuant to such chapter. (i) Judicial review No court shall have jurisdiction to review the Administrator's decision with respect to the award or non-award of an operating agreement issued under this chapter. 53604. Payments (a) In general An operating agreement under this chapter shall require that the Administrator make payments to the covered entity, in accordance with the milestones established under section 53603(c)(1) and the operating agreement under section 53603 and subject to the availability of appropriations under subsection (e). (b) Limitations Notwithstanding any other provision of this chapter, the Administrator shall not make any payment under this chapter for a vessel— (1) with respect to any day for which— (A) the vessel is not operated or maintained in accordance with an operating agreement under this chapter; (B) the vessel is under a charter to the United States Government; or (C) except as provided under subsection (c), the vessel is engaged in transporting military or other preference cargoes under section 55302(a), 55304, 55305, or 55314 of this title, section 2631 of title 10, or any other cargo preference law of the United States; or (2) that participates in the coastwise trade in violation of the operating agreement and section 53603(b)(1)(B). (c) Preference cargos (1) In general The Secretary of Transportation may waive the requirement of subsection (b)(1)(C) to the extent, in the manner, and on the terms the Secretary prescribes, only if— (A) the Administrator, acting in the Administrator's capacity as Director of the National Shipping Authority— (i) determines the non-availability of qualified vessels of the United States that are not enrolled in the Strategic Commercial Fleet; and (ii) notifies the Secretary of such determination; (B) the Secretary ensures reasonable notice has been provided to the owners and operators of qualified vessels of the United States that are not enrolled in the Strategic Commercial Fleet prior to making the waiver determination; and (C) by not later than 7 days after issuing a waiver under this subsection, the Secretary notifies the appropriate committees of Congress and posts such waiver on a public website of the Maritime Administration. (2) Non-delegation The Secretary of Transportation shall not delegate the waiver authority provided under paragraph (1). (d) Operating agreement is obligation of United States Government An operating agreement under this chapter constitutes a contractual obligation of the United States Government to pay the amounts provided for in the agreement, subject to the availability of appropriations under subsection (e). (e) Appropriations from the Maritime Security Trust Fund (1) In general There is authorized to be appropriated to the Administrator for payments to covered entities under this section, out of the Maritime Security Trust Fund established under section 50301(b) of this title— (A) for fiscal year 2026, $150,000,000; (B) for fiscal year 2027, $300,000,000; (C) for fiscal year 2028, $550,000,000; (D) for fiscal year 2029, $800,000,000; (E) for fiscal year 2030, $1,000,000,000; (F) for fiscal year 2031, $1,200,000,000; (G) for fiscal year 2032, $1,400,000,000; (H) for fiscal year 2033, $1,600,000,000; (I) for fiscal year 2034, $1,900,000,000; and (J) for fiscal year 2035, $2,100,000,000. (2) Availability Amounts made available under paragraph (1) shall remain available until expended. (f) Clarification The provision by the Administrator of a payment under this section shall not be considered to be a major Federal action under the National Environmental Policy Act of 1969 ( 42 U.S.C. 4321 et seq. ) or an undertaking for the purposes of division A of subtitle III of title 54, United States Code. (g) Buy America Section 54101(d)(2) shall apply to any funds obligated by the Administrator under this section that are used to construct or repair a United States-built vessel. 53605. National security requirements (a) Emergency preparedness agreement required The Administrator, in coordination with the Secretary of Defense, shall establish an emergency preparedness program under this section under which the program participant for an operating agreement under this chapter shall agree, as a condition of the operating agreement, to enter into an emergency preparedness agreement with the Administrator. The Administrator shall negotiate and enter into an emergency preparedness agreement with each program participant as promptly as practicable after the program participant has entered into the operating agreement. (b) Use of existing program The Administrator may use an existing emergency preparedness program, as of the date of enactment of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 , to satisfy the requirements of subsection (a). (c) Terms of agreement The terms of an emergency preparedness agreement under this section shall— (1) provide that upon request by the Secretary of Defense during time of war or national emergency, or whenever determined by the Secretary of Defense to be necessary for national security or contingency operation (as that term is defined in section 101(a) of title 10), the program participant shall make available commercial transportation resources (including services) described in subsection (e) to the Secretary of Defense; (2) shall include such additional terms as may be established by the Administrator and the Secretary of Defense; and (3) shall allow for the modification or addition of terms upon agreement by the Administrator and the program participant and the approval by the Secretary of Defense. (d) Participation after expiration of operating agreement The Administrator may not require, through an emergency preparedness agreement or an operating agreement, that a program participant covered by an operating agreement continue to participate in an emergency preparedness agreement after the operating agreement has expired according to its terms or is otherwise no longer in effect. After the expiration of an emergency preparedness agreement, a program participant may voluntarily continue to participate in the agreement. (e) Resources made available The commercial transportation resources to be made available under an emergency preparedness agreement shall include vessels or capacity in vessels, terminal facilities, management services, and other related services, or any agreed portion of such nonvessel resources for activation as the Secretary of Defense may determine to be necessary, seeking to minimize disruption of the program participant's service to commercial customers. (f) Compensation (1) In general The Administrator shall include in each emergency preparedness agreement provisions approved by the Secretary of Defense under which the Secretary of Defense shall pay fair and reasonable compensation for all commercial transportation resources provided pursuant to this section. (2) Specific requirements Compensation under this subsection— (A) shall not be less than the program participant's commercial market charges for like transportation resources; (B) shall be fair and reasonable considering all circumstances; (C) shall be provided from the time that a vessel or resource is required by the Secretary of Defense until the time it is redelivered to the program participant and is available to reenter commercial service; and (D) shall be in addition to and shall not in any way reflect amounts payable under section 53604 of this title. (g) Temporary replacement vessels Notwithstanding section 55302(a), 55304, 55305, or 55314 of this title, section 2631 of title 10, or any other cargo preference law of the United States— (1) a program participant may operate or employ in foreign commerce a foreign vessel, or capacity in a foreign vessel, as a temporary replacement for a vessel of the United States or vessel of the United States capacity that is activated by the Secretary of Defense under an emergency preparedness agreement or a primary Department of Defense sealift-approved readiness program; and (2) such replacement vessel or vessel capacity shall be eligible during the replacement period to transport preference cargoes subject to sections 55302(a), 55304, 55305, and 55314 of this title and section 2631 of title 10, to the same extent as the eligibility of the vessel or vessel capacity replaced. (h) Redelivery and liability of the United States for damages (1) In general All commercial transportation resources activated under an emergency preparedness agreement shall, upon termination of the period of activation, be redelivered to the program participant in the same good order and condition as when received, less ordinary wear and tear, or the Secretary of Defense shall fully compensate the program participant for any necessary repair or replacement. (2) Limitation on United States liability Except as may be expressly agreed in an emergency preparedness agreement, or as otherwise provided by law, the Government shall not be liable for disruption of a program participant's commercial business or other consequential damages to the program participant arising from the activation of commercial transportation resources under an emergency preparedness agreement. 53606. Regulations The Administrator and the Secretary of Defense may each prescribe rules as necessary to carry out their respective responsibilities under this chapter. . (b) Conforming amendments Section 51307(b) of title 46, United States Code, is amended— (1) in paragraph (1)— (A) in the matter preceding subparagraph (A)— (i) by striking , or the and inserting , the ; and (ii) by inserting , or the Strategic Commercial Fleet under chapter 536 of this title before to— ; and (B) in subparagraph (A), by striking or Tanker Security Fleet vessel and inserting Tanker Security Fleet vessel, or Strategic Commercial Fleet vessel ; and (2) in paragraph (2), by striking or 534 and inserting 534, or 536 . (c) Clerical amendment The table of chapters for subtitle V of title 46, United States Code, is amended by inserting after the item relating to chapter 535 the following: 536. Strategic Commercial Fleet 53601 . 402. Fleet testing and briefing requirement (a) Test Not later than 180 days after the date of enactment of this Act, the Commander of the United States Transportation Command, in coordination with the Secretary of the Navy and the Maritime Administrator, shall devise a tabletop exercise to test the effective control of the Maritime Security Fleet under chapter 531 of title 46, United States Code, and the Tanker Security Fleet under chapter 534 of such title, in case of crisis or war. (b) Briefing After completion of the tabletop exercise under subsection (a), the Commander shall submit to the appropriate committees of Congress a briefing on the results of such tabletop exercise. (c) Annual testing Beginning not later than 1 year after the briefing is submitted under subsection (b), the Commander shall— (1) carry out tabletop drills to test effective control of the Maritime Security Fleet under chapter 531 of title 46, United States Code, and the Tanker Security Fleet under chapter 534 of such title; and (2) provide to the appropriate committees of Congress a briefing after each such drill on the results of such drill. 403. Assessment of undersea cable repair contingencies (a) In general Not later than 180 days after the date of enactment of this Act, the Secretary of Defense, in coordination with the Maritime Administrator, the Federal Communications Commission, and other relevant Federal agencies, shall submit to the appropriate committees of Congress an assessment on the ability and preparedness of the USNS Zeus and the Cable Security Fleet under chapter 532 of title 46, United States Code, to repair transoceanic submarine fiber optic cables that may be damaged or cut by adversaries. (b) Contents The assessment under subsection (a) shall include— (1) a description of preparedness to address a situation in which the cables of partner countries in both the Pacific and Atlantic Oceans are damaged or severed at or around the same time; (2) a determination as to how long it would take for the Cable Security Fleet, in coordination with partner countries, to repair such cables; and (3) the options available to provide connectivity in an emergency or crisis caused by, or related to, the damaging or severing of such cables. 404. Modification to duties relating to equipment and repair of vessels (a) In general Section 466 of the Tariff Act of 1930 ( 19 U.S.C. 1466 ) is amended— (1) in subsection (a), in the first sentence, by striking 50 per centum on the cost thereof in such foreign country and inserting 70 percent of the cost thereof in such foreign country or, in the case of a foreign country of concern (as defined in section 4 of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 ), 200 percent of the cost thereof in such country ; and (2) by adding at the end the following: (i) Temporary exception for repairs made in certain countries (1) In general During the period beginning on the date of enactment of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 and ending on December 31, 2035, the duty imposed under subsection (a) shall, except as provided by paragraph (2), not apply to the cost of equipment, or any part of equipment, purchased for, or expenses of repair parts or materials to be used for, or repairs made in a foreign country on, a vessel engaged in foreign trade if the Maritime Administrator confirms that— (A) the vessel— (i) is participating in— (I) the Maritime Security Fleet under chapter 531 of title 46, United States Code; (II) the Cable Security Fleet under chapter 532 of such title; (III) the Tanker Security Fleet under chapter 534 of such title; or (IV) the Strategic Commercial Fleet under chapter 536 of such title; or (ii) has entered into an emergency preparedness agreement under section 53107 or 53407 of title 46, United States Code, or a contingency agreement under section 53207 of such title, or has otherwise entered into a voluntary agreement and plan of action with the Maritime Administrator as authorized under section 708(c) of the Defense Production Act of 1950 ( 50 U.S.C. 4558(c) ); and (B) the owner or master of the vessel certifies to the Maritime Administrator in writing that a good faith effort was made to purchase equipment or carry out repairs in a shipyard in the United States. (2) Inapplicability to foreign countries of concern Duty-free treatment under paragraph (1) does not apply with respect to the cost of equipment, or any part of equipment, purchased for repairs made in a foreign country of concern (as defined in section 4 of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 ) on a vessel engaged in foreign trade, or expenses of repair parts or materials to be used for such repairs, or other expenses of such repairs. . (b) Report required Not less than 2 years after the date of enactment of this Act, and every 2 years thereafter through December 31, 2035, the Maritime Administrator shall submit to the appropriate committees of Congress a report— (1) describing the number of vessels that paid the duties under section 466 of the Tariff Act of 1930 ( 19 U.S.C. 1466 ), and the location where the repairs described in such section occurred; (2) (A) identifying shipyards of the United States that have capacity to carry out vessel repairs; and (B) describing the extent to which vessels of the United States chose to conduct repairs in such shipyards during the period covered by the report; (3) evaluating the effectiveness of section 466 of the Tariff Act of 1930 ( 19 U.S.C. 1466 ) in encouraging the repair of vessels of the United States in shipyards of the United States; and (4) making recommendations for additional regulatory or legislative steps which could be taken to support the United States vessel repair industrial base. (c) Effective date The amendments made by subsection (a) apply with respect to parts, materials, and equipment purchased, and repairs to vessels initiated, after the date of enactment of this Act. B Cargo preference 411. United States Government cargo (a) Sense of congress It is the sense of Congress that— (1) only the Maritime Administrator, acting in the Administrator’s capacity as Director of the National Shipping Authority, has the authority to determine the non-availability of qualified capacity of vessels of the United States (referred to in this subsection as qualified United States flag capacity ) at fair and reasonable rates for commercial vessels of the United States to meet the requirements of section 55305 or 55314 of title 46, United States Code; (2) the requirements of section 55305 or 55314 of title 46, United States Code, may only be waived temporarily by the President, the Secretary of Defense, or the Secretary of Transportation during a declared emergency justifying such a temporary waiver, following a determination by the Maritime Administrator, acting in the Maritime Administrator's capacity as Director of the National Shipping Authority, of the non-availability of qualified United States flag capacity at fair and reasonable rates for commercial vessels of the United States pursuant to section 55305(d) of title 46, United States Code; and (3) nothing in title II of the Food for Peace Act ( 7 U.S.C. 1721 et seq. ) authorizes an agency to waive the requirements of section 55305 or 55314 of title 46, United States Code, without first obtaining— (A) delegated authority from the President of the United States; (B) an emergency declaration justifying such a temporary waiver, pursuant to section 55305(d) of title 46, United States Code; and (C) a determination by the Maritime Administrator, acting in the Maritime Administrator’s capacity as Director of the National Shipping Authority, on the non-availability of qualified United States flag capacity at fair and reasonable rates for commercial vessels of the United States pursuant to section 55305(d) of title 46, United States Code. (b) Applicable percentage (1) In general Section 55305(a) of title 46, United States Code, is amended by striking at least 50 and inserting 100 . (2) Effective date The amendment made by paragraph (1) shall take effect on the date that is 180 days after the date of enactment of this Act. (c) Waiver Section 55305(d)(1) of title 46, United States Code, is amended to read as follows: (1) Waiver authority (A) In general Notwithstanding any other provision of law, when the President, the Secretary of Defense, or the Secretary of Transportation declares the existence of an emergency justifying a temporary waiver of this section or section 55314 of this title, the President, the Secretary of Defense, or the Secretary of Transportation, following a determination by the Maritime Administrator, acting in the Administrator’s capacity as Director, National Shipping Authority, in consultation with the Maritime Security Board, of the non-availability of qualified United States flag capacity at fair and reasonable rates for commercial vessels of the United States to meet the requirements of this section or section 55314 of this title, may waive compliance with such section to the extent, in the manner, and on the terms the Maritime Administrator, acting in such capacity, prescribes, and no other waivers of the requirements of this section or section 55314 of this title shall be authorized. (B) Interagency agreement for the determination of non-availability (i) In general Not later than 180 days after the date of enactment of the SHIPS for America Act of 2025 , the Maritime Security Advisor shall facilitate an interagency agreement between the Maritime Administrator and the head of each agency subject to the requirements of subsection (a). (ii) Contents Each interagency agreement shall include— (I) an explanation of the process the agency shall follow to request a determination of non-availability by the Maritime Administrator under subparagraph (A); (II) a standard process that the Maritime Administrator shall follow for making such a determination of non-availability; and (III) deadlines— (aa) for when an agency shall submit a request for such a determination of non-availability prior to the transportation of equipment, materials, or commodities subject to subsection (a); and (bb) for when the Maritime Administrator shall make such a determination of non-availability after receiving a request for a temporary waiver under subparagraph (A). (iii) Congressional notification The Maritime Security Advisor shall notify the appropriate committees of Congress— (I) when each interagency agreement required under this subparagraph is finalized; and (II) any time that an interagency agreement required under this subparagraph is updated. . (d) Clarification Section 55305(d)(3)(B) of title 46, United States Code, is amended by inserting Maritime Security Board and the after to the . 412. Cargo preference implementation regulations (a) Regulations and guidance Not later than 180 days after the date of enactment of this Act, the Maritime Administrator, notwithstanding any other provision of law, regulation, or administrative order, shall— (1) promulgate regulations under subchapter III of chapter 5 of title 5, United States Code, to fully implement and ensure compliance with sections 55305, 55314, 55315, and 55316 of title 46, United States Code; (2) issue interagency guidance to other Federal departments and agencies on how to administer the programs that are subject to such sections in accordance with those sections, as applicable; and (3) publish such guidance in the Federal Register and on the website of the Maritime Administration. (b) Consultation The Administrator may consult with the Food Aid Consultative Group established by section 205 of the Food for Peace Act ( 7 U.S.C. 1725 ) in carrying out this section. (c) Repeal of earlier regulatory deadline Subsection (a) of section 3502 of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ( 46 U.S.C. 55305 note; Public Law 117–263 ), is repealed. 413. Cargo preference oversight and audit Section 55301 of title 46, United States Code, is amended— (1) in subsection (a)(2), by striking section 55305 and inserting sections 55305, 55314, 55315, and 55316 ; and (2) by adding at the end the following: (d) Notification of violation The Maritime Administrator shall— (1) upon receiving any credible information, as determined by the Administrator, that a Federal department or agency that administers a program covered by a report required under subsection (a) was not in compliance with the requirements of section 55305, 55314, 55315, or 55316 of this title (as applicable), notify the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Transportation and Infrastructure of the House of Representatives not later than 14 days after receiving such information; and (2) upon receiving any credible information, as determined by the Administrator, that a Federal department or agency that administers a program covered by a report required under subsection (a) was not in compliance with the requirements of section 2631 of title 10, United States Code, notify the Committee on Commerce, Science, and Transportation and the Committee on Armed Services of the Senate and the Committee on Transportation and Infrastructure and the Committee on Armed Services of the House of Representatives not later than 14 days after receiving such information. . 414. Financing the transportation of agricultural products and other cargo (a) In general Subchapter II of chapter 553 of title 46, United States Code, is amended by inserting after section 55315 the following: 55316. Financing the transportation of agricultural products and other cargo (a) Financing of increased costs The Secretary of Transportation shall finance any reasonable increased ocean freight costs, as assessed by the Maritime Administrator, incurred in any fiscal year by a covered agency that result from the application of section 55305 of this title, including the application of such section to the activities specified in section 55314(b) of this title. (b) Reimbursement of increased costs (1) In general The Secretary of Transportation shall reimburse a covered agency for the amount by which, in any fiscal year— (A) the total cost of ocean freight and ocean freight differential for which obligations are incurred by the covered agency under section 55305 of this title, including pursuant to the application of such section to the activities specified in section 55314(b) of this title; exceeds; and (B) 20 percent of the total value of the cargo, including agricultural products, transported under such section 55305, including pursuant to the application of such section to such activities, and the cost of the ocean freight and ocean freight differential, as assessed by the Maritime Administrator, on which obligations are incurred by the covered agency during that fiscal year. (2) Agricultural products shipped from inventory For purposes of this subsection, agricultural products shipped from the inventory of the Corporation shall be valued as provided in section 412(d) of the Food for Peace Act ( 7 U.S.C. 1736f(d) ). (c) Interagency agreement (1) In general Not later than 180 days after the date of enactment of the SHIPS for America Act of 2025 , the Secretary of Transportation shall enter into an interagency agreement with the head of each agency entitled to a reimbursement under subsection (b)(1). (2) Contents Each interagency agreement shall include— (A) an explanation of the process the agency shall follow to receive a reimbursement from the Secretary of Transportation under this section; (B) a standard methodology for calculating the reimbursement an agency is entitled to under this section; and (C) deadlines— (i) by which an agency shall submit a reimbursement request in order to receive reimbursement; and (ii) by which the Secretary of Transportation shall approve a properly filed reimbursement request, which date shall not be more than 90 days after the date on which the reimbursement request is submitted. (3) Congressional notification The Secretary of Transportation shall notify the appropriate committees of Congress— (A) when each interagency agreement required under this subsection is finalized; and (B) any time that an interagency agreement required under this subsection is updated. (d) Agricultural product defined In this section, the term agricultural product has the meaning given the term in section 55314 of title 46, United States Code. (e) Audit required (1) In general For each fiscal year, the Inspector General of the Department of Transportation shall conduct an audit of all reimbursements made by the Secretary of Transportation under this section during such fiscal year to ensure all such reimbursements were made in accordance with the requirements of this section. (2) Documents required Each agency entitled to reimbursement under subsection (b) shall— (A) provide to the Inspector General any documents or other information requested by the Inspector General in order to complete the audit, including the information described in subparagraph (B); and (B) require any party that enters into a contract with such agency related to the implementation of section 55305 of this title, or any activities specified in section 55314(b) of this title, to provide the agency, as a condition for entering into such contract, with information relevant for the audit as determined by the Inspector General. (3) Report Not later than 90 days after the end of each fiscal year, the Inspector General shall submit a report detailing the findings of such audit with respect to such fiscal year to the appropriate committees of Congress and make the report publicly available. (f) Authorization of appropriations For each fiscal year, there is authorized to be appropriated, out of the Maritime Security Trust Fund established under section 50301(b) of this title, an amount sufficient to reimburse the Secretary of Transportation for the costs incurred under this section, including administrative expenses. (g) Definition of covered agency For purposes of this section, the term covered agency means any agency that administers an activity specified in section 55314(b) of this title. . (b) Clerical amendment The table of sections for subchapter II of chapter 553 of title 46, United States Code, is amended by inserting after the item relating to section 55315 the following: 55316. Financing the transportation of agricultural products and other cargo. . 415. Importation from China on American ships (a) In general Chapter 605 of title 46, United States Code, is amended by adding at the end the following: 60508. Importation on American ships (a) In general Notwithstanding any other provision of law, not less than the covered percentage, as described in subsection (b), of covered goods by tonnage imported into the United States from a foreign port shall be imported on a vessel that is— (1) a vessel of the United States; (2) crewed by United States mariners; and (3) built in the United States. (b) Percentage A covered percentage under this section is the following: (1) One percent in the year that is 5 years after the date of enactment of this section. (2) Two percent in the year that is 6 years after the date of enactment of this section. (3) Three percent in the year that is 7 years after the date of enactment of this section. (4) Four percent in the year that is 8 years after the date of enactment of this section. (5) Five percent in the year that is 9 years after the date of enactment of this section. (6) Six percent in the year that is 10 years after the date of enactment of this section. (7) Seven percent in the year that is 11 years after the date of enactment of this section. (8) Eight percent in the year that is 12 years after the date of enactment of this section. (9) Nine percent in the year that is 13 years after the date of enactment of this section. (10) Ten percent in the year that is 14 years after the date of enactment of this section. (c) Application The requirement under subsection (a) shall be applied to any shipper importing goods into the United States that originates from a foreign port or place. (d) Fine for failure To comply (1) In general On an annual basis, the Maritime Administrator shall issue a fine to any entity failing to comply with the requirements under this section. (2) Amount The amount of a fine under this section shall be in an amount set by the Maritime Administrator that is greater than the difference in cost between— (A) the cost of employing a vessel of the United States that is built in the United States and crewed by United States mariners; and (B) the cost of employing a foreign vessel that is registered under the laws of a country with an open registry and is built outside of the United States. (3) Use of amounts Any amount collected under this subsection shall be deposited in the Maritime Security Trust Fund. (e) Rulemaking required Not later than 4 years after the date of enactment of this section, the Maritime Administrator, in coordination with the Secretary of Homeland Security and the Chairman of the Federal Maritime Commission, shall promulgate a final rule that establishes a system that— (1) identifies persons and goods that are subject to the requirements of this section; (2) establishes requirements for such persons and goods that meet the applicable percentages established under subsection (b); (3) establishes clear enforcement mechanisms to ensure compliance with this section; and (4) determines the amount of a fine issued under subsection (d). (f) Definitions In this section: (1) Country with an open registry The term country with an open registry means a country that allows vessels to be documented under the laws of the country, without regard to the citizenship of the owner of the vessel or the citizenship of the crew of the vessel. (2) Covered goods The term covered goods means goods manufactured in the People’s Republic of China. (3) Shipper The term shipper has the meaning given such term in section 40102 of this title. . (b) Clerical amendment The table of sections for chapter 605 of title 46, United States Code, is amended by adding at the end the following: 60508. Importation on American ships. . 416. Priority for vessels of the United States (a) In general Part D of subtitle V of title 46, United States Code, is amended by inserting after chapter 553 the following: 555 Priority for vessels of the United States Sec. 55501. Priority for vessels of the United States. 55501. Priority for vessels of the United States (a) In general The Secretary of Transportation may allow a vessel of the United States to be given priority at any port in the United States, ahead of a waiting vessel of a foreign country of concern (as defined in section 4 of the SHIPS for America Act of 2025 ) or owned by a foreign entity of concern (as so defined). (b) Exception Notwithstanding subsection (a), if the Secretary of Transportation finds that it is in the national interest, the Secretary may eliminate the priority under this section at any port. The Secretary shall report to the appropriate committees of Congress, as defined in section 4 of the SHIPS for America Act of 2025 , by not later than 30 days after an action eliminating priority under this section. . (b) Clerical amendment The table of chapters for subtitle V of title 46, United States Code, is amended by inserting after the item relating to chapter 553 the following: 555. Priority for vessels of the United States 55501 . 417. Moving cargo on vessels of the United States (a) Assessment required Not later than 180 days after the date of enactment of this Act, the Maritime Security Advisor, in consultation with the Secretary of Transportation, the Secretary of Commerce, the Chairman of the Federal Maritime Commission, and the United States Trade Representative, shall— (1) conduct an assessment that identifies authorities available under current Federal law, as of the date of such identification, that may be utilized to incentivize the movement of commercial cargo on vessels of the United States in international commerce; (2) review methods for greater assurances of access, in crisis and conflict, to vessels of international allies and partners of the United States; and (3) makes recommendations to the President to utilize such authorities. (b) Inclusions The assessment required under subsection (a) shall include an evaluation of— (1) tax benefits for taxpayers who ship goods aboard vessels of the United States; (2) modifications to import and export duties for goods imported or exported aboard vessels of the United States; (3) privileges for vessels of the United States that enable vessels of the United States to provide improved service relative to other vessels in international commerce; and (4) any other authorities that would incentivize the movement of goods aboard vessels of the United States. (c) Report to Congress Upon carrying out the assessment required under subsection (a), the Maritime Security Advisor shall submit to the appropriate committees of Congress— (1) a list of the recommendations made under subsection (a)(3); and (2) a list of additional actions that could be taken by Congress to further incentivize the movement of commercial cargo on vessels of the United States. (d) Definition In this section, the term vessel of the United States has the meaning given the term in section 116 of title 46, United States Code. 418. Transportation requirements for certain exports sponsored by the Secretary of Agriculture Section 55314 of title 46, United States Code, is amended— (1) by inserting before subsection (b) the following: (a) Applicability The requirements under section 55305 of this title shall apply with respect to the activities specified in subsection (b). ; (2) in subsection (b)— (A) in the matter preceding paragraph (1), by striking Secretary of Agriculture or the Commodity Credit Corporation and inserting Federal Government ; (B) in paragraph (1), by inserting titles I, II, or III of after carried out under ; (C) in paragraph (4), by striking agricultural commodities or their products and inserting agricultural products ; (D) in paragraph (5), by striking agricultural commodities or their products and inserting agricultural products ; (E) in paragraph (6), by striking agricultural commodities or their products and inserting agricultural products ; (F) in paragraph (7), by striking agricultural commodities and inserting agricultural products ; (G) by redesignating paragraphs (4), (5), (6), and (7) as paragraphs (6), (7), (8), and (9), respectively; and (H) by inserting after paragraph (3) the following: (4) carried out under the Food for Progress Act of 1985 ( 7 U.S.C. 1736o ); (5) carried out under the McGovern-Dole International Food for Education and Child Nutrition Program under section 3107 of the Farm Security and Rural Investment Act of 2002 ( 7 U.S.C. 1736o–1 ); ; and (3) by adding at the end the following: (c) Agricultural product defined In this section, the term agricultural product means any food product, including an agricultural commodity (as such term is defined in section 402 of the Food for Peace Act ( 7 U.S.C. 1732 )), specialty crop (as such term is defined in section 3 of the Specialty Crops Competitiveness Act of 2004 ( 7 U.S.C. 1621 note)), or processed food product, exported from the United States. . 419. Clarifying amendments (a) Agricultural commodities emergency assistance clarification Section 202(a) of the Food for Peace Act ( 7 U.S.C. 1722(a) ) is amended by striking Notwithstanding and inserting Subject to the requirements of sections 55305 and 55314 of title 46, United States Code, and notwithstanding . (b) Administrative provisions clarification Section 407(b)(2)(A) of the Food for Peace Act ( 7 U.S.C. 1736a(b)(2)(A) ) is amended by striking Notwithstanding and inserting Subject to the requirements of sections 55305 and 55314 of title 46, United States Code, and notwithstanding . (c) Emergency food security program clarification Section 491(c)(1) of the Foreign Assistance Act of 1961 ( 22 U.S.C. 2292(c)(1) ) is amended by inserting and the requirements of sections 55305 and 55314 of title 46, United States Code after section 492 . 420. Energizing American shipbuilding (a) National policy on strategic energy asset export transportation (1) Requirement for transportation of exports of natural gas on vessels documented under laws of the United States Section 3 of the Natural Gas Act ( 15 U.S.C. 717b ) is amended by adding at the end the following: (g) Transportation of exports of natural gas on vessels documented under laws of the United States (1) Condition for approval Except as provided in paragraph (7), with respect to an application to export natural gas under subsection (a), the Commission shall include in the order issued for that application the condition that the person transport the natural gas on a vessel that meets the requirements described in paragraph (3). (2) Purpose The purpose of the requirement under paragraph (1) is to ensure that, of all natural gas exported by vessel in a calendar year, the following percentage is exported by a vessel that meets the requirements described in paragraph (3): (A) In each of the 7 calendar years following the calendar year in which this subsection is enacted, not less than 2 percent. (B) In each of the 8th and 9th calendar years following the calendar year in which this subsection is enacted, not less than 3 percent. (C) In each of the 10th and 11th calendar years following the calendar year in which this subsection is enacted, not less than 4 percent. (D) In each of the 12th and 13th calendar years following the calendar year in which this subsection is enacted, not less than 6 percent. (E) In each of the 14th and 15th calendar years following the calendar year in which this subsection is enacted, not less than 7 percent. (F) In each of the 16th and 17th calendar years following the calendar year in which this subsection is enacted, not less than 9 percent. (G) In each of the 18th and 19th calendar years following the calendar year in which this subsection is enacted, not less than 11 percent. (H) In each of the 20th and 21st calendar years following the calendar year in which this subsection is enacted, not less than 13 percent. (I) In the 22nd calendar year after the calendar year in which this subsection is enacted and each calendar year thereafter, not less than 15 percent. (3) Requirements for vessels A vessel meets the requirements described in this paragraph— (A) with respect to each of the 5 calendar years following the calendar year in which this subsection is enacted— (i) if— (I) the vessel is documented under the laws of the United States; and (II) with respect to any retrofit work necessary for the vessel to export natural gas— (aa) such work is done in a shipyard in the United States; and (bb) any component of the vessel listed in paragraph (4) that is installed during the course of such work is manufactured in the United States; or (ii) if— (I) the vessel is built in the United States; (II) the vessel is documented under the laws of the United States; (III) all major components of the hull or superstructure of the vessel are manufactured (including all manufacturing processes from the initial melting stage through the application of coatings for iron or steel products) in the United States; and (IV) the components of the vessel listed in paragraph (4) are manufactured in the United States; and (B) with respect to the 6th calendar year following the calendar year in which this subsection is enacted, and each calendar year thereafter, if the vessel meets the requirements of subparagraph (A)(ii). (4) Components The components of a vessel listed in this paragraph are the following: (A) Air circuit breakers. (B) Welded shipboard anchor and mooring chain. (C) Powered and non-powered valves in Federal Supply Classes 4810 and 4820 used in piping. (D) Machine tools in the Federal Supply Classes for metal-working machinery numbered 3405, 3408, 3410 through 3419, 3426, 3433, 3438, 3441 through 3443, 3445, 3446, 3448, 3449, 3460, and 3461. (E) Auxiliary equipment for shipboard services, including pumps. (F) Propulsion equipment, including engines, propulsion motors, reduction gears, and propellers. (G) Shipboard cranes. (H) Spreaders for shipboard cranes. (I) Rotating electrical equipment, including electrical alternators and motors. (J) Compressors, pumps, and heat exchangers used in managing and re-liquefying boil-off gas from liquefied natural gas. (5) Waiver authority The Commission may waive the requirement under clause (i)(II)(bb) or (ii)(IV), as applicable, of paragraph (3)(A) with respect to a component of a vessel if the Maritime Administrator determines that— (A) application of the requirement would— (i) result in an increase of 25 percent or more in the cost of the component of the vessel; or (ii) cause unreasonable delays to be incurred in building or retrofitting the vessel; or (B) such component is not manufactured in the United States in sufficient and reasonably available quantities of a satisfactory quality. (6) Opportunities for credentialed merchant mariners Except as provided in paragraph (7), the Commission shall include, in any order issued under subsection (a) that authorizes a person to export natural gas, a condition that the person provide opportunities for individuals with a merchant mariner credential (as defined in section 2101 of title 46, United States Code) to receive experience and training necessary to become credentialed in working on a vessel transporting natural gas. (7) Exception The Commission may not include in any order issued under subsection (a) authorizing a person to export natural gas to a nation with which there is in effect a free trade agreement requiring national treatment for trade in natural gas a condition described in paragraph (1), or a condition described in paragraph (6), if the United States Trade Representative certifies to the Commission, in writing, that such condition would violate obligations of the United States under such free trade agreement. (8) Use of Federal information In carrying out paragraph (1), the Commission— (A) shall use information made available by— (i) the Energy Information Administration; or (ii) any other Federal agency or entity the Commission determines appropriate; and (B) may use information made available by a private entity only if applicable information described in subparagraph (A) is not available. . (2) Conforming amendment Section 3(c) of the Natural Gas Act ( 15 U.S.C. 717b(c) ) is amended by striking or the exportation of natural gas and inserting or, subject to subsection (g), the exportation of natural gas . (b) Crude oil Section 101 of title I of division O of the Consolidated Appropriations Act, 2016 ( 42 U.S.C. 6212a ) is amended— (1) in subsection (b), by striking subsections (c) and (d) and inserting subsections (c), (d), and (f) ; and (2) by adding at the end the following: (f) Transportation of exports of crude oil on vessels documented under laws of the United States (1) In general Notwithstanding any other provision of law and except as provided in paragraph (6), as a condition to export crude oil, the President shall require that a person exporting crude oil transport the crude oil on a vessel that meets the requirements described in paragraph (3). (2) Purpose The purpose of the requirement under paragraph (1) is to ensure that, of all crude oil exported by vessel in a calendar year, the following percentage is exported by a vessel that meets the requirements described in paragraph (3): (A) In each of the 7 calendar years following the calendar year in which this subsection is enacted, not less than 3 percent. (B) In each of the 8th, 9th, and 10th calendar years following the calendar year in which this subsection is enacted, not less than 6 percent. (C) In each of the 11th, 12th, and 13th calendar years following the calendar year in which this subsection is enacted, not less than 8 percent. (D) In the 14th calendar year following the calendar year in which this subsection is enacted and each calendar year thereafter, not less than 10 percent. (3) Requirements for vessels A vessel meets the requirements described in this paragraph— (A) with respect to each of the 4 calendar years following the calendar year in which this subsection is enacted— (i) if— (I) the vessel is documented under the laws of the United States; and (II) with respect to any retrofit work necessary for the vessel to export crude oil— (aa) such work is done in a shipyard in the United States; and (bb) any component of the vessel listed in paragraph (4) that is installed during the course of such work is manufactured in the United States; or (ii) if— (I) the vessel is built in the United States; (II) the vessel is documented under the laws of the United States; (III) all major components of the hull or superstructure of the vessel are manufactured (including all manufacturing processes from the initial melting stage through the application of coatings for iron or steel products) in the United States; and (IV) the components of the vessel listed in paragraph (4) are manufactured in the United States; and (B) with respect to the 5th calendar year following the calendar year in which this subsection is enacted and each calendar year thereafter, if the vessel meets the requirements of subparagraph (A)(ii). (4) Components The components of a vessel listed in this paragraph are the following: (A) Air circuit breakers. (B) Welded shipboard anchor and mooring chain. (C) Powered and non-powered valves in Federal Supply Classes 4810 and 4820 used in piping. (D) Machine tools in the Federal Supply Classes for metal-working machinery numbered 3405, 3408, 3410 through 3419, 3426, 3433, 3438, 3441 through 3443, 3445, 3446, 3448, 3449, 3460, and 3461. (E) Auxiliary equipment for shipboard services, including pumps. (F) Propulsion equipment, including engines, propulsion motors, reduction gears, and propellers. (G) Shipboard cranes. (H) Spreaders for shipboard cranes. (I) Rotating electrical equipment, including electrical alternators and motors. (5) Waiver authority The President may waive the requirement under clause (i)(II)(bb) or clause (ii)(IV), as applicable, of paragraph (3)(A) with respect to a component of a vessel if the Maritime Administrator determines that— (A) application of the requirement would— (i) result in an increase of 25 percent or more in the cost of the component of the vessel; or (ii) cause unreasonable delays to be incurred in building or retrofitting the vessel; or (B) such component is not manufactured in the United States in sufficient and reasonably available quantities of a satisfactory quality. (6) Exception The President may not, under paragraph (1), condition the export of crude oil to a nation with which there is in effect a free trade agreement requiring national treatment for trade in crude oil if the United States Trade Representative certifies to the President, in writing, that such condition would violate obligations of the United States under such free trade agreement. (7) Opportunities for credentialed merchant mariners The Maritime Administrator shall ensure that the owner or operator of a vessel transporting crude oil provides opportunities for individuals with a merchant mariner credential (as defined in section 2101 of title 46, United States Code) to receive experience and training necessary to become credentialed in working on such vessels. (8) Use of Federal information In carrying out paragraph (1), the President— (A) shall use information made available by— (i) the Energy Information Administration; or (ii) any other Federal agency or entity the Commission determines appropriate; and (B) may use information made available by a private entity only if applicable information described in subparagraph (A) is not available. . (c) Energy Information Administration information The Secretary of Energy, acting through the Administrator of the Energy Information Administration (referred to in this section as the Secretary ), shall collect, and make readily available to the public on the internet website of the Energy Information Administration, information on exports by vessel of natural gas and crude oil, including— (1) forecasts for, and data on, those exports for the calendar year following the calendar year in which this Act is enacted and each calendar year thereafter; and (2) forecasts for those exports for multiyear periods after the date of enactment of this Act, as determined appropriate by the Secretary. 421. Goods imported on vessels of the United States Chapter 605 of title 46, United States Code, is amended— (1) in section 60502(a)(1)— (A) in the matter preceding subparagraph (A), by striking the vessel ; (B) in subparagraph (A), by striking is entitled and all that follows through imported in and inserting the following: the cost of importing goods aboard the vessel is comparable to or greater than the cost of importing goods aboard ; and (C) in subparagraph (B)— (i) by striking (i) is owned and inserting the following: the vessel— (i) is owned ; and (ii) by adjusting the margins of clause (ii) appropriately; and (2) in section 60503(a), by inserting , except for the duties imposed under section 60502 of this chapter, after suspension of discriminating duties . 422. Ship America Office (a) In general Chapter 553 of title 46, United States Code, is amended by adding at the end the following: IV Ship America Office 55341. Establishment of Ship America Office (a) Establishment The Maritime Administrator shall establish within the Maritime Administration an office to be known as the Ship America Office . The Maritime Administrator shall appoint the head of the Ship America Office (in this section referred to as the Ship America Associate Administrator ). (b) Duties The Ship America Associate Administrator shall have the following duties: (1) Providing assistance to private sector entities, Federal financial assistance recipients, Federal agencies, Federal contractors, and owners and operators of oceangoing vessels of the United States to facilitate the movement of commercial and government cargo on vessels of the United States in international commerce. (2) Maximizing compliance across Federal agencies with this chapter, section 2631 of title 10, and any other cargo preference law of the United States. (3) Providing training and assistance to Federal employees, in all Federal agencies responsible for shipping preference cargo, on the legal obligations under this chapter, section 2631 of title 10, United States Code, and any other cargo preference law of the United States. (4) Developing a ‘Ship America’ verification program to develop self-certification industry standards, in partnership with private sector entities, to allow private sector entities to verifiably demonstrate that a product was transported to the United States aboard a vessel of the United States. (5) Supporting the efforts of the executive branch to develop and sustain a fleet of vessels of the United States and maritime industrial base to meet the sealift needs of Federal agencies. (6) Where practicable, making accessible, and regularly updating, the publicly available contact information for oceangoing vessels of the United States for the purposes of moving international commerce. (7) Publishing, and regularly updating, centralized information on the commercial benefits available to private sector entities for moving commercial cargo on oceangoing vessels of the United States. (8) Preparing the reports under subsection (c). (c) Reports required Not later than 1 year after the date of enactment of this section, and biennially thereafter, the Maritime Administrator, acting through the Ship America Associate Administrator, shall report to the appropriate committees of Congress (as defined in section 4 of the SHIPS for America Act of 2025 ) and the Maritime Security Board on— (1) the opportunities and challenges faced by commercial entities to move cargo on oceangoing vessels of the United States; and (2) recommendations to increase international commerce moving on vessels of the United States. . (b) Clerical amendment The table of sections for chapter 553 of title 46, United States Code, is amended by adding at the end the following: “SUBCHAPTER IV—Ship America Office 55341. Establishment of Ship America Office. . C Regulatory reform 431. Alternate standards (a) In general Chapter 33 of title 46, United States Code, is amended— (1) by redesignating sections 3317 and 3318 as sections 3318 and 3319, respectively; and (2) by inserting after section 3316 the following: 3317. Alternate standards (a) In general Not later than 1 year after the date of enactment of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 , the Secretary, in consultation with the Maritime Administrator, shall establish alternate standards to allow self-propelled vessels providing oceangoing transportation that are not documented under chapter 121 of this title to receive a certificate of inspection if the vessel will become a documented vessel. (b) Requirements Under the program established under subsection (a), a self-propelled vessel used to provide oceangoing transportation that is not documented under chapter 121 of this title shall be eligible for a certificate of inspection if the Secretary determines that— (1) the owner of the vessel has agreed to apply to have the vessel documented under chapter 121 upon receiving the certificate; (2) at the time of the receipt of such certificate, the vessel is eligible for documentation under such chapter; (3) the vessel is classed by and designed in accordance with the rules of a classification society accepted by the Secretary; (4) the vessel complies with applicable international agreements and associated guidelines, as determined by the country in which the vessel was documented immediately before becoming documented under chapter 121, notwithstanding any other law including any regulation; (5) the vessel has been assessed for cybersecurity and surveillance risks; and (6) the country in which the vessel was documented immediately before becoming documented under chapter 121 has not been identified by the Secretary as inadequately enforcing international vessel regulations as to that vessel. (c) Continued eligibility for certificate This section does not apply to a vessel after any date on which the vessel fails to comply with the applicable international agreements and associated guidelines referred to in subsection (b)(4). (d) Reliance on classification society (1) In general The Secretary may rely on a certification from the American Bureau of Shipping or, subject to paragraph (2), another classification society accepted by the Secretary to establish that a vessel is in compliance with the requirements of paragraphs (3), (4), and (6) of subsection (b) and of subsection (c). (2) Foreign classification society The Secretary may accept certification from a foreign classification society under paragraph (1) only— (A) to the extent that the government of the foreign country in which the society is headquartered provides access on a reciprocal basis to the American Bureau of Shipping; and (B) if the foreign classification society has offices and maintains records in the United States. (e) Rulemaking procedure The Secretary may initiate a rulemaking procedure to implement this standard. (f) Savings provision Nothing in this section shall be interpreted to affect requirements related to merchant seamen credentials under part E of subtitle II of this title or the requirements related to manning of vessels under part F of such subtitle. . (b) Clerical amendment The table of sections for chapter 33 of title 46, United States Code, is amended by striking the items relating to sections 3317 and 3318 and inserting the following: 3317. Alternate standards. 3318. Fees. 3319. Penalties. . 432. Rulemaking committee on commercial maritime regulations and standards (a) Definitions In this section: (1) Covered regulation The term covered regulation — (A) means a commercial regulation or standard issued by the Coast Guard relating to the operation of vessels in foreign commerce, including— (i) vessel design and engineering standards; (ii) merchant mariner training and credentialing; or (iii) vessel operating and environmental standards; and (B) does not include any commercial regulation or standard issued by the Coast Guard that exclusively applies to vessels in domestic commerce. (2) Rulemaking committee The term rulemaking committee means the committee established under subsection (b). (3) Secretary The term Secretary means the Secretary of the department in which the Coast Guard is operating. (b) Establishment of rulemaking committee There is established, in the department in which the Coast Guard is operating, a rulemaking committee on commercial maritime regulations and standards to— (1) review, and develop findings and recommendations regarding, the covered regulations; and (2) provide to the Secretary a report on opportunities to review and update regulations governing vessel design and engineering, vessel and facility operation and environmental standards, and merchant mariner credentialing, in order to— (A) revitalize the merchant marine and the commercial maritime industry in the United States; and (B) better align, and limit redundancies between, the regulatory standards of the Coast Guard and the International Maritime Organization and international treaty requirements, while protecting United States mariners and the United States maritime industry from foreign regulations that undermine the maritime industrial competitiveness of the United States. (c) Members (1) Composition of rulemaking committee The Secretary shall appoint the following as members of the rulemaking committee: (A) Each of the following Federal officers or employees, or their designees: (i) The Maritime Security Advisor. (ii) The Maritime Administrator. (iii) The Commandant of the Coast Guard. (iv) The Secretary of Commerce. (v) The Administrator of the Environmental Protection Agency. (vi) The Chair of the Federal Maritime Commission. (vii) The chief United States delegate to the International Maritime Organization. (B) Representatives from recognized classification societies, including the American Bureau of Shipping. (C) Representatives of industry, including— (i) owners and operators of vessels in domestic and foreign commerce of the United States; (ii) shipbuilders; and (iii) other representatives of industry the Secretary determines appropriate. (D) Individuals with a merchant mariner credential, as defined in section 2101 of title 46, United States Code. (E) Representatives of maritime labor organizations. (F) Experts in maritime safety and regulatory matters. (G) Other stakeholders the Secretary determines appropriate. (2) Period of appointment; vacancies (A) In general A member of the rulemaking committee shall be appointed for the life of the rulemaking committee. (B) Vacancies A vacancy in the rulemaking committee— (i) shall not affect the powers of the rulemaking committee; and (ii) shall be filled in the same manner as the original appointment. (3) Chairperson and vice chairperson The Secretary shall select a Chairperson and Vice Chairperson from among the members of the rulemaking committee. (d) Meetings (1) Initial meeting Not later than 180 days after the date of enactment of this Act, the Secretary shall convene the rulemaking committee for the first meeting of the rulemaking committee. (2) Quorum A majority of the members of the rulemaking committee shall constitute a quorum, but a lesser number of members may hold hearings. (e) Duties of committee (1) Considerations The rulemaking committee shall consider each of the following: (A) How the covered regulations interact with and compare to the treaty requirements and regulations established by the International Maritime Organization, including comparisons and interactions on the basis of— (i) safety; (ii) cost; (iii) enforceability and compliance; and (iv) international competitiveness. (B) The benefits and challenges vessel owners and operators and United States mariners encounter when complying with both regulations of the International Maritime Organization and the covered regulations. (C) The role that covered regulations play in enhancing the size and strength of the merchant marine and the domestic and international fleet of the United States. (D) Recommended changes to covered regulations, and regulatory frameworks, to better promote alignment with international standards and the standards of countries that are allies and partners, with a focus on— (i) increasing opportunities for qualified mariners that enter the merchant marine and reducing the barriers that lead qualified mariners to leave the merchant marine; (ii) increasing the number of vessels documented under the laws of the United States that are operating in domestic and foreign commerce; (iii) enhancing United States leadership within the International Maritime Organization and other international treaty organizations with a focus on the maritime industry; (iv) streamlining regulatory processes and processing timelines to minimize duplicative reviews and eliminate preventable delays; and (v) maintaining and enhancing the safety and security of the merchant marine. (E) Recommended changes to covered regulations and regulatory frameworks that govern mariner education training requirements, which may include— (i) expanding the pool of qualified instructors for mariner training programs; (ii) streamlining requirements related to training facility size and design to improve operational efficiencies at mariner training facilities, including requirements related to classroom size and design; (iii) standardizing and streamlining training course and curriculum approval and evaluation to provide more certainty to mariner training programs; and (iv) enhancing opportunities for mariner training programs to flexibly integrate sea-time into course instruction, consistent with treaty requirements and regulations established by the International Maritime Organization. (F) Any other matters the Secretary determines appropriate. (2) Report Not later than 12 months after the date of enactment of this Act, the rulemaking committee shall submit to the Secretary a report that includes the findings and recommended changes to covered regulations of the rulemaking committee, as required under paragraph (1). (f) Powers of rulemaking committee (1) Hearings The rulemaking committee may hold such hearings, sit and act at such times and places, take such testimony, and receive such evidence as the rulemaking committee considers advisable to carry out this section. (2) Information from Federal agencies (A) In general The rulemaking committee may secure directly from a Federal department or agency such information as the rulemaking committee considers necessary to carry out this section, as permitted by law. (B) Furnishing information On request of the Chairperson of the rulemaking committee, the head of the department or agency shall furnish the information to the rulemaking committee. (g) Rulemaking committee personnel matters (1) No compensation A member of the rulemaking committee shall not be compensated for service on the rulemaking committee. (2) Travel expenses A member of the rulemaking committee shall be allowed travel expenses, including per diem in lieu of subsistence, at rates authorized for employees of agencies under subchapter I of chapter 57 of title 5, United States Code, while away from their homes or regular places of business in the performance of services for the rulemaking committee. (h) Administration Except as specified otherwise in this section, the rulemaking committee shall be treated as a committee established under chapter 151 of title 46, United States Code, for purposes of section 15109 of such title and shall not be considered a temporary organization under section 3161 of title 5, United States Code. (i) Termination The rulemaking committee shall terminate on the earlier of— (1) the date that is 90 days after the date on which the rulemaking committee submits the report under subsection (e)(2); or (2) the date that is 7 years after the date on which the rulemaking committee is established. (j) Duties of the Secretary The Secretary shall— (1) not later than 30 days after receiving the rulemaking committee’s report under subsection (e)(2), submit to the appropriate committees of Congress, and make publicly available, a copy of such report and the Secretary’s views on the recommendations of the committee; and (2) not later than 90 days after submitting the report under paragraph (1)— (A) initiate a rulemaking activity and make such policy and guidance updates determined necessary by the Secretary to address the consensus recommendations reached by the rulemaking committee under subsection (e); (B) submit a report to the appropriate committees of Congress identifying the recommendations of the rulemaking committee that require legislative changes; and (C) submit a report to the Secretary of State identifying recommendations of the rulemaking committee that require changes to treaty requirements and regulations established by the International Maritime Organization, including recommendations that should inform the policy of the United States as a member of the International Maritime Organization. 433. Amendments to Shipowners' Limitation of Liability Act of 1851 (a) In general Section 30523 of title 46, United States Code, is amended— (1) by striking subsection (a) and inserting the following: (a) Limit of owner liability (1) In general Except as provided in section 30524 of this title, the liability of— (A) the owner of a vessel of the United States for any claim, debt, or liability described in subsection (b) shall not exceed the value of the vessel and pending freight; and (B) the owner of a foreign vessel for any claim, debt, or liability described in subsection (b) shall not exceed the amount that is 5 times the value of the vessel and pending freight. (2) Multiple owners If a vessel has more than one owner, the proportionate share of the liability under paragraph (1) of any one such owner shall not exceed that owner’s proportionate interest in the vessel and pending freight. ; and (2) by striking subsection (c) and inserting the following: (c) Claims not subject to limitation Subsection (a) does not apply to— (1) a claim for wages; or (2) with respect to the liability of an owner of a foreign vessel, a claim, debt, or liability arising from personal injury or wrongful death of a person who was not a crewmember or passenger of the foreign vessel at the time the injury (including fatal injury, if applicable) occurred. . (b) Amendment to cessation of certain actions Section 30529(c) of title 46, United States Code, is amended by striking the matter in question and inserting a matter subject to consideration for limitation under section 30523 or section 30524 . (c) Effective date The amendments made by subsections (a) and (b) shall apply to any liability subject to section 30523(a) of title 46, United States Code, that arises on or after the date of enactment of this Act. V Shipbuilding A Shipbuilding financial incentives 501. Shipbuilding financial incentives (a) In general Part C of subtitle V of title 46, United States Code, is amended by inserting after chapter 537 the following: 538 Shipbuilding financial incentives 53801. Shipbuilding financial incentives (a) Establishment The Maritime Administrator shall establish a program that, in accordance with the requirements of this section, provides Federal financial assistance to covered entities to— (1) aid in the construction of a vessel that shall be documented under the laws of the United States; or (2) incentivize a qualified shipyard investment. (b) Definitions In this section: (1) Appropriate committees of congress The term appropriate committees of Congress means the Committee on Commerce, Science, and Transportation and the Committee on Appropriations of the Senate and the Committee on Armed Services and the Committee on Appropriations of the House of Representatives. (2) Covered entity The term covered entity means— (A) any proposed vessel purchaser who is a citizen of the United States; or (B) any shipyard of the United States with the ability, experience, financial resources, and other qualifications to construct or repair a military vessel or a vessel to be used in the foreign commerce of the United States. (3) Foreign commerce The term foreign commerce means— (A) commerce or trade between the United States, its territories or possessions, or the District of Columbia, and a foreign country; and (B) commerce or trade between foreign countries. (4) Foreign country of concern; foreign entity of concern The terms foreign country of concern and foreign entity of concern have the meanings given such terms in section 4 of the SHIPS for America Act of 2025 . (5) Qualified shipyard investment The term qualified shipyard investment means an investment to construct, modernize, or expand— (A) a shipyard of the United States that constructs or repairs civilian or military vessels; or (B) a manufacturing facility— (i) that is— (I) a component supplier; (II) a subcomponent supplier; or (III) a manufacturing equipment supplier; (ii) that is based in the United States; and (iii) (I) at which at least 50 percent of the products produced will be sold to shipyards of the United States or used to construct vessels of the United States; or (II) at which the investment will more than double the facility’s capacity to produce products to be sold to shipyards of the United Sates or used to construct vessels of the United States, as determined by the Administrator. (c) Procedure (1) Application A covered entity desiring financial assistance under this section shall submit an application to the Maritime Administrator. (2) Requirements In order for a covered entity to qualify for financial assistance under this section, the covered entity shall— (A) for financial assistance related to construction of a vessel of the United States as described in subsection (a)(1)— (i) enter into an agreement with the Maritime Administrator establishing that the vessel that is constructed with Federal financial assistance shall be, for a period of not less than 10 years, documented under the laws of the United States; and (ii) agree to carry out all construction in a shipyard of the United States as the result of competitive bidding, after due advertisement, with the right reserved by the Administrator to disapprove any or all bids; (B) for financial assistance related to qualified shipyard investments as described in subsection (a)(2), use the financial assistance award amounts to incentivize investments in— (i) facilities or equipment related to shipbuilding or ship repair; or (ii) maritime component suppliers and subcomponent suppliers with over 50 percent maritime use in each such investment; and (C) make commitments to worker and community investment, including through— (i) programs to expand employment opportunity for economically disadvantaged individuals; and (ii) securing commitments from regional educational and training entities and institutions of higher education to provide workforce training, including programming for training and job placement of economically disadvantaged individuals. (3) Review of applications (A) Considerations for review With respect to the review by the Maritime Administrator of an application submitted— (i) the Maritime Administrator may not approve an application for construction of a vessel as described in subsection (a)(1) unless the Administrator— (I) determines that a vessel funded through the program— (aa) will aid in the promotion and development of foreign commerce; and (bb) will be suitable for use by the United States for national defense or military purposes in time of war or national emergency; (II) determines that the vessel purchaser applying for funding under this section possesses the ability, experience, financial resources, and other qualifications necessary for the operation and maintenance of the proposed new vessel; (III) determines that the shipyard that will construct a vessel under this section possesses the ability, experience, financial resources, equipment, and other qualifications necessary to properly to construct the proposed vessel; (IV) confirms that any newly constructed vessel has dedicated space for the training of cadets of the United States Merchant Marine Academy (consistent with the requirements of section 51307(b)), State maritime academies (consistent with the requirements of section 51507), or other workforce training programs identified by the Administrator; and (V) has notified the appropriate committees of Congress not later than 15 days before making any commitment to provide Federal financial assistance to any covered entity; and (ii) the Maritime Administrator may not approve an application to incentivize qualified shipyard investments as described in subsection (a)(2) unless the Administrator— (I) confirms that the covered entity has received an incentive offered by a governmental entity to a covered entity for the purposes of supporting a qualified shipyard investment within that jurisdiction; (II) ensures that the covered entity has an executable plan to sustain the facility without additional Federal financial assistance under this subsection for the facility; (III) determines that the project to which the application relates is in the economic and national security interests of the United States; and (IV) receives detailed information on— (aa) the customers, or categories of customers, which the covered entity plans to serve; (bb) the type of expenditures which the covered entity plans to make; and (cc) the workforce positions that the covered entity plans to employ, including any required recruitment, training, and hiring; and (iii) the Maritime Administrator may consider— (I) whether the covered entity has previously received financial assistance under this section; (II) the price for the construction or repair of a vessel that has been negotiated between a shipyard and proposed vessel purchaser, and whether the negotiated price is fair and reasonable; (III) whether the covered entity commits to use equipment, materials, and supplies that are produced in the United States, and utilize, to the maximum extent practicable, subcontractors and suppliers that are based in the United States; and (IV) whether the covered entity commits to utilizing new or emerging technologies. (B) Records The Maritime Administrator may request records and information from the covered entity. The covered entity shall provide the records and information requested by the Administrator. (C) Priority In providing Federal financial assistance to covered entities under this section, the Maritime Administrator may— (i) for an application for construction of a vessel as described in subsection (a)(1), give priority to applicants that— (I) propose the construction of vessels of higher transport capability and productivity; (II) commit to have modifications done in the United States to a vessel constructed with such financial assistance; or (III) propose the construction or modification of a vessel to meet the national security needs of the United States; and (ii) for an application to incentivize a qualified shipyard investment as described in subsection (a)(2), give priority to applicants that— (I) propose to expand production capacity to enable more military or commercial vessels to be constructed or repaired in the United States; (II) commit to using new or emerging technologies or vessel design processes that increase production times or lower production costs; or (III) have experience making qualified shipyard investments or operating shipyards for commercial or military oceangoing vessels. (4) National defense features (A) In general Upon receiving an application for the construction of a vessel under this section, the Maritime Administrator shall submit to the Secretary of the Navy the plans and specifications for the proposed vessel for review. (B) Recommendations Not later than 30 days after the date of receiving the plans and specifications for a vessel as provided for under subparagraph (A), the Secretary of the Navy may make recommendations to the Maritime Administrator for the design of the vessel, which would enable the economical and speedy conversion of the vessel into a vessel suitable for use of the United States Government in times of war or national emergency. (C) Requirement to implement recommendations If the Maritime Administrator agrees with such recommendations, the Maritime Administrator shall require the covered entity to carry out such recommendations as a condition of receiving Federal financial assistance under this section with respect to that vessel. (5) Relationship to other financial assistance programs A covered entity may not receive financial assistance under this section for a vessel which is enrolled in the Strategic Commercial Fleet Program. (d) Award amounts (1) Construction of a vessel of the United States (A) In General For financial assistance related to construction of a vessel of the United States, as described in subsection (a)(1), the Maritime Administrator shall determine the appropriate amount and funding for each financial assistance award made under this section. (B) Determination In making the determination under subparagraph (A), the Maritime Administrator shall consider the difference in the cost of constructing the proposed vessel within the United States over the fair and reasonable estimate of cost of the construction of that type of vessel if it were constructed under similar plans and specifications (excluding national defense features as described in subsection (c)(4)) in a foreign shipbuilding center that is deemed by the Administrator to furnish a fair and representative example for the determination of the estimated foreign cost of construction of vessels of the type proposed to be constructed. (2) Qualified shipyard investments For financial assistance provided to incentivize qualified shipyard investments as described in subsection (a)(2), the Maritime Administrator shall determine the appropriate amount for each financial assistance award made to a covered entity to maximize private sector investments and to expand shipyard and ship building capacity of the United States. (3) Use of funds A covered entity that receives a financial assistance award under this section may only use the financial assistance award amounts to— (A) (i) finance the construction of a vessel to be built in the United States and documented under the laws of the United States; or (ii) support site development, construction, and modernization for qualified shipyard investments; and (B) support workforce development for a shipyard or qualified shipyard investment. (e) Applications for reconstruction, conditioning, or repowering The Maritime Administrator may, if determined to be in the national and economic security interests of the United States and consistent with the requirements of this section, consider an application as described in subsection (a)(1), and award financial assistance under this section, for the reconstruction, reconditioning, or repowering of an existing vessel in a shipyard of the United States. (f) Pilot program for vessels in domestic commerce (1) In general The Maritime Administrator may, if determined to be in the national and economic security interests of the United States and consistent with all other requirements of this section (except the requirement under subsection (c)(3)(A)(i)(I)(aa)), establish a pilot program to consider an application as described in subsection (a)(1), and award financial assistance under this section for the construction of a vessel for use in service other than the foreign commerce. (2) Eligible vessels In addition to all other requirements of this section (except the requirement under subsection (c)(3)(A)(i)(I)(aa)), a vessel qualifying for funding through the pilot program under this subsection shall only be eligible if the Administrator certifies that the vessel of the United States that will be constructed— (A) (i) will operate in an emerging industry or a new trade lane; (ii) will not compete with existing vessels of the United States; and (iii) will not serve a market already served by a vessel of the United States with a coastwise endorsement; (B) (i) will replace an existing vessel of the United States that is or will be acquired by the Administrator to be placed in the National Defense Reserve Fleet, pursuant to section 57101; and (ii) will operate for not longer than 21 years and upon disposition will be placed in the National Defense Reserve Fleet, pursuant to section 57101; or (C) will be an oceanographic research vessel (as defined in section 2101 of this title). (3) Rule of construction Nothing in this subsection shall be construed to alter the requirements under section 55102. (g) Clawback (1) Milestones For all awards to covered entities under this section, the Administrator shall, before the award is made, determine target milestones by which the vessel’s construction or a qualified shipyard investment shall be completed. (2) Progressive recovery for delays Subject to paragraph (3), if a covered entity does not meet such target milestones, the Administrator shall progressively recover up to the full amount of an award provided to a covered entity under this section. (3) Waiver In the case of delays that do not meet such target milestones, the Administrator may waive elements of the progressive recovery described in paragraph (2) that is incorporated in each award after— (A) making a formal determination that circumstances beyond the ability of the covered entity to foresee or control are responsible for delays; and (B) submitting congressional notification. (4) Congressional notification The Administrator shall notify the appropriate committees of Congress— (A) of the target dates described in paragraph (1) for each award; and (B) of any waivers provided under paragraph (3) not later than 15 days after the date on which such a waiver was provided. (h) Emergency preparedness The Maritime Administrator shall require any vessel that is constructed with financial assistance under this section to participate in an emergency preparedness program that is approved by the Secretary of Defense. (i) Clarification The provision by the Administrator of Federal financial assistance for a project described in this section shall not be considered to be a major Federal action under the National Environmental Policy Act of 1969 ( 42 U.S.C. 4321 et seq. ) or an undertaking for the purposes of division A of subtitle III of title 54, United States Code. (j) Buy America Section 54101(d)(2) shall apply to any funds obligated by the Administrator under this section. (k) GAO review The Comptroller General of the United States shall— (1) not later than 2 years after the date of disbursement of the first financial award under this section, and biennially thereafter for 10 years, conduct a review of the program under this section; and (2) submit to the appropriate committees of Congress the results of each review. (l) Prohibition on use of funds (1) In general No funds made available under this section may— (A) be used to construct, modify, or improve a facility outside of the United States; (B) be provided to a foreign entity of concern or to support a foreign entity of concern; or (C) be used to purchase materials that are procured or sourced from a foreign entity of concern, if such funds are for construction of a vessel as described in subsection (a)(1). (2) Stock buybacks An entity receiving financial assistance under this section may not engage in any stock buyback for a period of 5 years after receiving such assistance. (m) Authorization of appropriations There is authorized to be appropriated to the Administrator, out of the Maritime Security Trust Fund established under section 50301(b) of this title, $250,000,000 for each of fiscal years 2026 through 2035 to provide financial assistance to covered entities under this section, to remain available until expended. . (b) Clerical amendment The table of chapters at the beginning of part C of subtitle V of title 46, United States Code, and at the beginning of subtitle V of such title, are each amended by inserting after the item relating to chapter 537 the following new item: 538. Shipbuilding financial incentives 53801 . (c) Conforming amendment Title V of the Act of June 29, 1936 (49 Stat. 1995; chapter 858) is repealed. 502. Assistance for small shipyards Section 54101 of title 46, United States Code, is amended— (1) in subsection (b)(1)— (A) in subparagraph (A), by striking ; and and inserting a semicolon; (B) in subparagraph (B), by striking the period and inserting ; and ; and (C) by adding at the end the following: (C) long-term industrial base growth that supports the national security and economic security needs of the merchant marine of the United States. ; and (2) in subsection (i)— (A) by inserting out of the Maritime Security Trust Fund established under section 50301(b) of this title before to the Administrator of the Maritime Administration ; and (B) by striking for fiscal year 2021 to carry out this section $20,000,000 and inserting $100,000,000 for each of fiscal years 2026 through 2035 . 503. Federal Ship Financing (title XI) Program (a) Establishment of revolving loan fund Section 53702 of title 46, United States Code, is amended by adding at the end the following: (c) Establishment of revolving loan fund Not later than 30 days after the date of enactment of the SHIPS for America Act of 2025 , the Secretary shall establish a revolving loan fund to be administered by the National Surface Transportation and Innovation Finance Bureau established under section 116 of title 49. Any funds appropriated to carry out this chapter shall be deposited in the fund, along with any proceeds generated from the loan guarantee program under this chapter including any fees collected under section 53713 or 53714. The Secretary or Administrator shall make a guarantee of payments or commitment to guarantee payments under subsection (a) or for the Secretary to make direct loan obligations under subsection (b) out of the revolving loan fund. (d) Authorization of appropriations There is authorized to be appropriated, out of the Maritime Security Trust Fund established under section 50301(b) of this title, $100,000,000 for fiscal year 2026 to be available until expended to the revolving loan fund established under subsection (c). . (b) Funding limits Section 53704 of title 46, United States Code, is amended— (1) in subsection (a), by striking facilities. and inserting facilities, and not less than 50 percent of obligations guaranteed under this chapter shall be for projects that do not receive any payments or Federal financial assistance from financial assistance programs established under this part. ; and (2) in subsection (c), by adding at the end the following: (5) Vessel of National Interest The Administrator shall ensure that the system of risk categories under paragraph (2) takes into consideration whether a project subject to a guarantee under this chapter is a project to construct, reconstruct, or recondition a Vessel of National Interest. . (c) Eligible purposes of obligations Section 53706(a)(8) of title 46, United States Code, is amended— (1) by striking States. and inserting States that is required— ; and (2) by adding at the end the following new subparagraphs: (A) for the vessel to be a vessel of the United States; (B) for the vessel to be issued a coastwise endorsement under chapter 121; (C) to convert a civilian vessel of the United States to a more useful military configuration; (D) for any vessel under contract to the Federal Government; or (E) for any United States-built vessel participating in— (i) the Maritime Security Program or the Emergency Preparedness Program under chapter 531; (ii) the Cable Security Fleet under chapter 532; (iii) the Tanker Security Fleet under chapter 534; (iv) the Strategic Commercial Fleet under chapter 536; (v) the Shipbuilding Financial Incentive under chapter 538; or (vi) the National Defense Reserve Fleet under section 57100. . (d) Buy America Section 53733 of title 46, United States Code, is amended by striking subsection (f) and inserting the following: (f) Buy America Section 54101(d)(2) shall apply to any funds obligated by the Administrator under this section. . 504. Construction Reserve Fund (a) Definitions Section 53301(a) of title 46, United States Code, is amended— (1) in paragraph (1), by striking a new vessel and inserting an eligible vessel ; (2) in paragraph (2)— (A) in the paragraph heading, by striking New vessel and inserting Eligible vessel ; (B) in the matter preceding subparagraph (A), by striking new vessel and inserting eligible vessel ; and (C) in subparagraph (A)— (i) in clause (i), by striking after December 31, 1939 ; (ii) in clause (ii), by striking and after the semicolon; (iii) by redesignating clause (iii) as clause (iv); and (iv) by inserting after clause (ii), the following: (iii) operated in foreign commerce or domestic commerce of the United States or in the fisheries; and ; and (3) by adding at the end the following: (3) Foreign commerce The term foreign commerce means— (A) commerce or trade between the United States, its territories or possessions, or the District of Columbia, and a foreign country; and (B) commerce or trade between foreign countries. . (b) Authority for Construction Reserve Funds Section 53302(a) of title 46, United States Code, is amended by striking or acquisition of a new vessel and inserting repowering, or acquisition of an eligible vessel . (c) Persons eligible To establish funds Section 53303 of title 46, United States Code, is amended— (1) by striking the matter preceding paragraph (1) and inserting the following: A citizen of the United States may make an agreement with the Secretary of Transportation under this chapter to establish a construction reserve fund if that citizen— ; (2) in paragraph (1), by striking in the foreign or domestic commerce of the United States and inserting documented under the laws of the United States and operating in foreign commerce or domestic commerce of the United States ; (3) in paragraph (2), by striking being operated in the foreign or domestic commerce of the United States and inserting documented under the laws of the United States and operating in foreign commerce or domestic commerce of the United States ; (4) in paragraph (3), by striking in the foreign or domestic commerce of the United States and inserting documented under the laws of the United States and operating in foreign commerce or domestic commerce of the United States ; (5) in paragraph (4)— (A) by striking being operated in the foreign or domestic commerce of the United States and inserting documented under the laws of the United States and operating in foreign commerce or domestic commerce of the United States ; and (B) by striking or after the semicolon; (6) in paragraph (5)— (A) by striking in the foreign or domestic commerce of the United States and inserting documented under the laws of the United States to operate in foreign commerce or domestic commerce of the United States ; and (B) by striking the period at the end and inserting ; or ; and (7) by adding at the end the following: (6) commits, as a part of the agreement with the Secretary under this chapter, to construct, reconstruct, recondition, repower, or acquire, and operate, an eligible vessel by not later than 5 years after the date on which the construction reserve fund is established. . (d) Vessel ownership Section 53304 of title 46, United States Code, is amended by striking constructed or acquired each place the term appears and inserting constructed, reconstructed, reconditioned, repowered, or acquired . (e) Basis for determining gain or loss Section 53307 of title 46, United States Code, is amended— (1) in the section heading, by striking new vessels and inserting eligible vessels ; (2) by striking a new vessel and inserting an eligible vessel ; (3) by striking the new vessel and inserting the eligible vessel ; (4) by inserting repowered, after reconditioned, ; and (5) by inserting repowering, after reconditioning, . (f) Obligation of deposits Section 53310 of title 46, United States Code, is amended— (1) in subsection (a)— (A) by striking a new vessel each place the term appears and inserting an eligible vessel ; and (B) in paragraph (1)(A), by striking or reconditioning and inserting , repowering, or reconditioning ; and (2) by striking subsections (b) and (c) and inserting the following: (b) Additional requirements for certain vessels In addition to the requirements of subsection (a)(1), for an eligible vessel not constructed under the construction-differential program or not bought from the Secretary of Transportation, construction shall commence with reasonable dispatch after the date of the construction contract, as determined by the Secretary of Transportation and certified by such Secretary to the Secretary of the Treasury. (c) Extensions The Secretary of Transportation may grant extensions of the period within which the deposits must be expended or obligated, except that such extensions may not be for a total of more than 15 years for the expenditure or obligation of deposits. . (g) Clerical amendment The table of sections for chapter 533 of title 46, United States Code, is amended by striking the item relating to section 53307 and inserting the following: 53307. Basis for determining gain or loss and for depreciating eligible vessels. . 505. Capital Construction Fund (a) In general Chapter 535 of subtitle V of title 46, United States Code, is amended— (1) in section 53501— (A) by redesignating paragraphs (2), (3), (4), (5), (6), (7), (8), and (9), as paragraphs (3), (5), (7), (8), (9), (10), (11), and (12), respectively; (B) by inserting after paragraph (1) the following: (2) Cargo handling equipment The term cargo handling equipment means any vehicle or land-based equipment (excluding marine container chassis), and the associated marine terminal or port landside infrastructure, used at a marine terminal to lift or move cargo— (A) manufactured in the United States (including any territory or possession of the United States); or (B) manufactured outside of the United States, if such equipment is not produced in the United States in sufficient and reasonably available quantities or of a satisfactory quality as determined by the Secretary. ; (C) by inserting after paragraph (3), as redesignated by subparagraph (A), the following: (4) Foreign commerce The term foreign commerce means— (A) commerce or trade between the United States, its territories or possessions, or the District of Columbia, and a foreign country; and (B) commerce or trade between foreign countries. ; (D) by inserting after paragraph (5), as redesignated by subparagraph (A), the following: (6) Marine terminal The term marine terminal means wharves, bulkheads, quays, piers, docks, and other berthing locations and adjacent storage or adjacent areas and structures associated with the primary movement of cargo or materials from vessel to shore, or from shore to vessel, including structures which are devoted to receiving, handling, holding, consolidating, loading, or delivery of waterborne shipments, including areas devoted to the maintenance of the terminal or equipment. ; and (E) in paragraph (3)(A)(iii), as redesignated by subparagraph (A), by striking foreign or domestic trade of the United States and inserting foreign commerce or domestic trade of the United States ; and (F) in paragraph (8)(A)(iii), as redesignated by subparagraph (A), by striking foreign or domestic trade of the United States and inserting foreign commerce or domestic trade of the United States ; (2) in section 53503— (A) by striking subsection (a) and inserting the following: (a) In General (1) Citizen agreements A citizen of the United States may make an agreement with the Secretary under this chapter to establish a capital construction fund for a vessel if that citizen— (A) owns or leases an eligible vessel; or (B) commits, as a part of such agreement, to build and operate an eligible vessel not later than 5 years after establishing the capital construction fund. (2) Operator agreements An operator of a United States marine terminal may make an agreement with the Secretary under this chapter to establish a capital construction fund for the marine terminal. ; and (B) by striking subsection (b), and inserting the following: (b) Allowable purpose The purpose of the agreement shall be to provide— (1) replacement vessels, additional vessels, or reconstructed vessels, built in the United States and documented under the laws of the United States, for operation in the foreign commerce or domestic trade of the United States or in the fisheries of the United States; or (2) replacement cargo handling equipment, additional cargo handling equipment, or reconstructed cargo handling equipment for operation at marine terminals in the United States. ; (3) in section 53504(b), by inserting or United States marine terminal after agreement vessel ; (4) by striking section 53505 and inserting the following: 53505. Ceiling on deposits (a) Maximum deposits The amount deposited in a capital construction fund for a taxable year may not exceed the amount specified in the agreement under section 53503(a), which shall be an amount that is related to a commitment to invest the revenue from the capital construction fund into funding the construction of new vessels or funding cargo handling equipment. (b) Revenue For the purposes of subsection (a), the revenue from the capital construction fund may include— (1) income attributable to the operation of the agreement vessel in foreign commerce or domestic trade or fisheries or the operation of a marine terminal in the United States; (2) the amount allowable as a deduction under section 167 of the Internal Revenue Code of 1986 for the taxable year with respect to the agreement vessels or cargo handling equipment; (3) the net proceeds from the disposition of an agreement vessel or cargo handling equipment or insurance or indemnity attributable to the vessel or cargo handling equipment; and (4) the receipts from the investment or reinvestment of amounts held in the fund. (c) Reductions for lessees For a lessee, the maximum amount that may be deposited for an agreement vessel under subsection (a) for any period shall be reduced by any amount the owner is required or permitted, under the capital construction fund agreement, to deposit for that period for the vessel under subsection (a). ; (5) in section 53506— (A) in subsection (a), by striking Except as provided in subsection (b), amounts in the fund may be invested only in interest-bearing securities approved by the Secretary. ; and (B) in subsection (b), by striking With the approval of the Secretary, an agreed percentage (but not more than 60 percent) of the assets of the fund and inserting An agreed percentage of the assets of the fund ; (6) in section 53509— (A) by striking subsection (a), and inserting the following: (a) In general Subject to subsections (b) and (c), a withdrawal from a capital construction fund is a qualified withdrawal if it is made under the terms of the agreement and is for— (1) the acquisition, construction, repowering, or reconstruction of— (A) a qualified vessel or a barge or container that is part of the complement of a qualified vessel; or (B) cargo handling equipment; or (2) the payment of the principal on indebtedness incurred in the acquisition, construction, repowering, or reconstruction of— (A) a qualified vessel or a barge or container that is part of the complement of a qualified vessel; or (B) cargo handling equipment. ; (B) by redesignating subsection (c) as subsection (e); and (C) by inserting after subsection (b) the following: (c) Restriction No withdrawals may be made from a capital construction fund to purchase fully automated cargo handling equipment that is remotely operated or remotely monitored with or without the exercise of human intervention or control, if the Secretary determines such equipment would result in a net loss of jobs within a marine terminal. (d) Prohibition on certain cranes No withdrawals may be made from a capital construction fund to purchase cranes manufactured in the People’s Republic of China or by foreign entities of concern (as defined in section 4 of the SHIPS for America Act of 2025 ). ; (7) in section 53510— (A) in subsection (b), by inserting cargo handling equipment, after barge, both places the term appears; (B) in subsection (c), by inserting cargo handling equipment, after barge, both places the term appears; and (C) in subsection (d), by inserting cargo handling equipment, after barges, ; (8) in section 53511(e)(1), by striking the table contained therein and inserting the following: If the amount remains in the fund at the close of the- The applicable percentage is- 16th taxable year 20 percent 17th taxable year 40 percent 18th taxable year 60 percent 19th taxable year 80 percent 20th taxable year 100 percent ; and (9) in section 53512(b)(1), by adding cargo handling equipment, after advanced . (b) Cargo handling equipment availability The Secretary shall annually publish in the Federal Register a request for information regarding the availability of cargo handling equipment manufactured in the United States and shall share the results of such request for information with capital construction fund holders. 506. Anticipated commercial vessel construction survey (a) In general Chapter 501 of title 46, United States Code, is amended by adding at the end the following: 50115. Anticipated commercial vessel construction survey (a) Definition In this section, commercial vessel of the United States means a vessel that is documented under the laws of the United States, not less than 6,000 deadweight tons, and operated in the domestic trade of the United States or foreign commerce, and may include— (1) a bulk carrier vessel; (2) a tanker vessel; (3) a roll-on/roll-off vessel; (4) a liquefied natural gas tanker vessel; (5) a container vessel; (6) a multi-purpose vessel; (7) a cable vessel (as defined in section 53201); (8) a heavy-lift vessel; or (9) any other type of vessel determined appropriate by the Administrator, in consultation with the Maritime Security Board. (b) In general Not later than 180 days after the date of enactment of this section, and annually thereafter, the Maritime Administrator shall conduct a survey of owners, agents, or operators of commercial vessels of the United States to identify plans for the construction, maintenance, and modernization of commercial vessels of the United States. (c) Purpose The purpose of the survey conducted under this section is to inform the maritime industrial base of the future need for the construction of commercial vessels. (d) Inclusions In conducting the survey under this section, the Maritime Administrator shall collect the following information from owners, agents, or operators of commercial vessels of the United States who participate in the survey: (1) The number of commercial vessels of the United States the participant is looking to construct during the 10-year period beginning on the date on which the participant takes the survey. (2) The capabilities of the vessels described in paragraph (1) that the participant is seeking in constructing such vessels. (3) Estimated timelines for when the participant aims to place each such vessel into service. (4) The number of major repairs of commercial vessels of the United States and overhauls of such commercial vessels the participant is looking to carry out during the 10-year period described in paragraph (1). (5) The major components that a shipbuilder would need from industrial base suppliers to support the construction, overhaul, or repair of commercial vessels of the United States during such 10-year period. (6) Estimates for the capital expenditures the participant is planning to make for the construction, overhaul, or repair of commercial vessels of the United States during such 10-year period. (7) Any additional information the Maritime Administrator determines appropriate. (e) Participation The Administrator may not require any owner, agent, or operator of a commercial vessel of the United States to participate in the survey unless that owner, agency, or operator is participating in a financial assistance program established under part C of this subtitle. (f) Release of findings (1) Distribution Each year, the Maritime Administrator may release the findings of the survey with shipyards in the United States and other maritime industrial base stakeholders the results of the survey conducted under this section for such year in such a manner as the Administrator determines appropriate. (2) Proprietary information Notwithstanding any other provision of law, including section 552 of title 5, United States Code, at the request of a survey participant, the Maritime Administrator shall withhold proprietary information provided as a part of a survey conducted under this section. (3) Coordination To the maximum extent practicable, the Maritime Administrator shall seek to conduct the annual surveys under this section and publish the results of such surveys on a similar timeline as the timeline for the annual naval vessel construction plans under section 231(a)(1) of title 10 and other shipbuilding construction surveys published by other Federal agencies. . (b) Clerical amendment The table of sections for chapter 501 of title 46, United States Code, is amended by inserting after the item relating to section 50114 the following: 50115. Anticipated commercial vessel construction survey. . 507. Streamlined environmental review Section 41001(6) of the Fixing America's Surface Transportation Act ( 42 U.S.C. 4370m(6) ) is amended— (1) in subparagraph (A)— (A) in the matter preceding clause (i), by inserting the maritime industry after waterways, ; (B) by redesignating clauses (iii) and (iv) as clauses (iv) and (v), respectively; and (C) by inserting after clause (ii) the following: (iii) is covered by a programmatic plan or environmental review developed for a project related to the maritime industry; ; and (2) by adding at the end the following: (D) Maritime industry For the purposes of subparagraph (A), the term construction of infrastructure for the maritime industry includes construction of— (i) shipyards and ship repair facilities; (ii) port terminals and other port facilities; (iii) manufacturing facilities for equipment and technology instrumental to the facilitation of maritime trade and commerce, as defined by the Council; and (iv) other industrial base facilities that support the Navy or the merchant marine of the United States. . 508. Eligibility for loan guarantees Section 1703(b) of the Energy Policy Act of 2005 ( 42 U.S.C. 16513(b) ) is amended by inserting at the end the following: (14) Marine transportation systems, including commercial vessels of the United States, shipyards, marine terminals, and port facilities. . 509. Reports (a) Report on National Defense Reserve Fleet (1) In general Not later than 180 days after the date of enactment of this Act, and every 2 years thereafter, the Maritime Administrator, in consultation with the Commander of the United States Transportation Command and the Secretary of the Navy, and in accordance with paragraph (2), shall submit to the appropriate committees of Congress and the Maritime Security Board a report— (A) outlining a plan for using the shipbuilding financial incentives program authorized under section 53801 of title 46, United States Code, as added by section 501, and the financial incentive programs under subpart C of subtitle V of title 46, United States Code, to supplement the size and readiness of the National Defense Reserve Fleet and to improve national shipbuilding and shipping infrastructure; and (B) describing ways in which an expanded and creative view of the make-up of vessels with Voluntary Intermodal Sealift Agreements or Voluntary Tanker Agreements and the shipbuilding financial incentives program authorized under such section can be used to ensure government access to other vessels that are critical to national security, such as icebreakers, oil and natural gas tankers, floating dry docks, salvage vessels, dredges, ocean tugs, offshore construction vessels, multi-use workboats, and commercial shipping vessels using small nuclear reactors. (2) Additional consultation In preparing the report under paragraph (1), the Maritime Administrator shall also consult with the Secretary of Commerce and the Secretary of Energy with respect to shipping vessels or mobile maritime power plants using small nuclear reactors. (b) Report on de-Risking maritime sector Not later than 180 days after the date of enactment of this Act, and every 2 years thereafter, the Secretary of Defense and the Secretary of Homeland Security, in coordination with the Secretaries of Treasury and State, the Maritime Administrator, the United States Trade Representative, and the Director of the Office of Management and Budget, shall submit to the appropriate committees of Congress and the Maritime Security Board a report outlining a comprehensive strategy for de-risking the United States maritime domain from the People’s Republic of China and other asymmetric or emerging maritime threats. (c) Report on restricting flow of capital to CCP Not later than 180 days after the date of enactment of this Act, the Secretary of Transportation, the Secretary of Defense, the Secretary of Commerce, the Secretary of State, and the Secretary of the Treasury shall submit to the appropriate committees of Congress and the Maritime Security Board a report on ways and means for restricting the flow of capital from the United States to Chinese Communist Party maritime industries, which shall include recommendations for promoting the flow of capital within and between the United States and treaty allies of the United States. The report shall also include a survey of banks, pension funds, and large financial institutions, with recommendations for ways the United States can incentivize domestic financial investments in the maritime industry. 510. Export control report Not later than 1 year after the date of enactment of this Act, the Secretary of State and the Secretary of Commerce shall jointly submit to Congress a report assessing methods to reduce the use of export controls and other restrictions under the Arms Export Control Act ( 22 U.S.C. 2751 et seq. ) and the International Traffic in Arms Regulations under subchapter M of chapter I of title 22, Code of Federal Regulations, and the Export Control Reform Act of 2018 ( 50 U.S.C. 4801 et seq. ) and the Export Administration Regulations under subchapter C of chapter VII of title 15, Code of Federal Regulations, or successor regulations, that limit the ability of foreign-owned marine industrial base companies to participate in the United States shipbuilding industry, specifically including shipbuilding for the Federal Government, while ensuring appropriate safeguards for United States-based firms and American workers. B Department of Defense Programs 511. Assessment of the use of commercial best practices for Navy shipbuilding (a) Assessment (1) In general The Secretary of the Navy, in coordination with the Secretary of Transportation and the Secretary of the Department in which the Coast Guard is operating, shall— (A) conduct an assessment of best practices used in the construction and repair of commercial, oceangoing maritime vessels; and (B) identify— (i) opportunities for the Navy and Coast Guard to leverage those best practices to make ship construction and repair efforts of combatant and non-combatant vessels more efficient; and (ii) advanced technologies that can be leveraged to improve the overall readiness and dominance of the United States maritime fleet (both commercial and military), to specifically include small modular reactors for ship power and propulsion. (2) Elements The assessment required by paragraph (1) shall include the following: (A) An evaluation of the best practices described in subparagraph (A) of such paragraph, including best practices used by commercial shipyards in foreign allied countries, consideration of commercial design standards, and the vessel construction manager model used to construct the National Security Multi Mission Vessel Program, that could improve the efficiency of shipbuilding and repair by the Navy and Coast Guard. (B) An identification of commercial-grade components and capabilities being used in state-of-the-art commercial, oceangoing maritime vessels and an assessment of whether the Navy and Coast Guard could better use commercial off-the-shelf components or capabilities to reduce costs, improve efficiencies, or enhance capabilities in the construction of new naval vessels and cutters, and in repair of naval vessels and cutters. (C) A determination as to whether shipbuilding and acquisition programs of the Navy and Coast Guard use modern best practices from the commercial maritime industry in terms of contracting, ship design, construction, overhaul, and maintenance. (D) An identification of technologies and procedures that are used in commercial shipbuilding that, if used by the Navy and Coast Guard, would improve the efficiency of designing and constructing new naval vessels. (E) An identification of technologies and procedures that are used in commercial shipbuilding and repair that, if used by the Navy and Coast Guard, would improve the efficiency of repairing naval vessels. (F) An identification of opportunities to improve commonality in ship design, ship components, and shipbuilding procedures between commercial, oceangoing maritime vessels, naval vessels, and cutters that could lead to improved efficiencies and a more resilient industrial base to support shipbuilding and repair for military and civil maritime vessels. (G) An identification of advanced nuclear technologies that are under development for use in commercial shipbuilding that, if used by the Navy and Coast Guard, would improve the operational capability of naval vessels and cutters. (H) An identification of the barriers preventing or making prohibitive the use of small modular reactors in naval or commercial, oceangoing maritime vessels, including— (i) ambiguity in regulations governing nuclear propulsion restricting the commercial maritime industry from utilizing nuclear propulsion or collaborating between United States and foreign entities under export controls requirements, including section 744.5 of title 15, Code of Federal Regulations (or a similar successor regulation); and (ii) a lack of clarity in the meaning of maritime (civil) nuclear propulsion plant projects contained in the Export Administration Regulations and Naval Nuclear Propulsion contained in the International Traffic in Arms Regulations (Cat VI). (I) An evaluation of education and technology development best practices used by commercial shipyards in foreign allied countries, and an identification of education and technology development opportunities, that could improve the efficiency of shipbuilding and repair by the Navy and Coast Guard. (J) An evaluation of whether adoption of the best practices evaluated under subparagraph (A) for the construction and repair of naval vessels and cutters would support the domestic commercial maritime shipbuilding industry, the commercial maritime industrial base, and the merchant marine of the United States. (b) Briefing Not later than 180 days after the date of the enactment of this Act, the Secretary of the Navy shall provide to the congressional defense committees a briefing on— (1) the results of the assessment required by subsection (a); and (2) a plan to execute any measures pursuant to such assessment. (c) Strategy Required Not later than 1 year after the date of enactment of this Act, and biennially thereafter, the Secretary of the Navy and Secretary of the Department in which the Coast Guard is operating shall— (1) provide to the appropriate committees of Congress strategies describing how measures identified as a result of the assessment required by subsection (a) will be incorporated into shipbuilding programs for the Navy and Coast Guard; and (2) publish a public version of the strategies. (d) Congressional defense committees defined In this section, the term congressional defense committees has the meaning given that term in section 101(a) of title 10, United States Code. 512. Plan of action for use of Defense Production Act of 1950 authorities (a) In general Not later than 180 days after the date of the enactment of this Act, the President shall submit to the appropriate committees of Congress a report on a plan of action for any use of authorities available under title III of the Defense Production Act of 1950 ( 50 U.S.C. 4531 et seq. )— (1) to establish or enhance a domestic production capability for the construction of militarily useful, commercial maritime vessels that can be operated in foreign commerce or the domestic commerce of the United States; (2) to establish, improve, or enhance the defense shipyard industrial base; or (3) to establish, improve, or enhance maritime port infrastructure of the United States, including containers and ship-to-shore cranes that were built in the United States and are owned by citizens of the United States. (b) Coordination The President shall develop the plan of action required by subsection (a) in consultation with— (1) the maritime security advisor (as established by this Act); (2) the Maritime Security Board (as established by this Act); (3) an advisory committee established under section 708(d) of the Defense Production Act of 1950 ( 50 U.S.C. 4558(d) ); and (4) such stakeholders in the private sector as the President considers appropriate. (c) Appropriate committees of Congress defined In this section, the term appropriate committees of Congress means— (1) the Committee on Armed Services, the Committee on Commerce, Science, and Transportation, and the Committee on Appropriations of the Senate; and (2) the Committee on Armed Services, the Committee on Transportation and Infrastructure, and the Committee on Appropriations of the House of Representatives. 513. Military Sealift Command (a) Authority To offer increased paid leave accrual The Secretary of the Navy is authorized to offer government merchant mariners employed by Military Sealift Command paid leave accrual at a faster rate than provided pursuant to the standard General Schedule (GS) system to make government seafaring jobs more competitive with the commercial sector. (b) Report on recruiting and retention efforts (1) In general Not later than 180 days after the date of the enactment of this Act, and annually thereafter, the Secretary of the Navy, in coordination with the Commander of the Military Sealift Command and the Maritime Security Board, and in consultation with the Commander of United States Transportation Command, the Commander of United States Fleet Forces Command, and the Assistant Secretary of the Navy for Research, Development and Acquisition, shall submit to the appropriate committees of Congress a report on efforts to improve recruitment and retention of Military Sealift Command Mariners. (2) Elements The report required under paragraph (1) shall consider— (A) opportunities to enhance the integration of Military Sealift Commander civilian mariners into the military command structure; (B) providing training on the roles and significance of Military Sealift Command civilian mariner workforce to relevant military commands; and (C) authorities required to improve recruitment and retention of civilian mariners in Military Sealift Command. (c) Report on extending charter durations Not later than 90 days after the date of the enactment of this Act, the Secretary of the Navy shall submit to the appropriate committees of Congress a report assessing the merits of extending the maximum charter durations of commercial and specialty vessels for the Military Sealift Command. C Shipbuilding innovation and infrastructure 521. United States Center for Maritime Innovation (a) In general Section 50307(e) of title 46, United States Code, is amended— (1) in paragraph (1), by inserting through the establishment, management, and coordination of geographically and topically diverse maritime incubators after maritime transportation system ; and (2) by striking paragraphs (2), (3), and (4), and inserting the following: (2) Cooperative agreement The cooperative agreement shall be with an organization or persons with substantial experience in the maritime industry, as determined by the Secretary, in consultation with the Maritime Security Board. (3) Selection The Center shall be— (A) selected through a competitive process of eligible entities, and if a private entity, a domestic entity; (B) based in the United States with technical expertise in emerging marine technologies and practices related to the maritime transportation system; and (C) located in close proximity to eligible entities with expertise in United States emerging maritime technologies and practices. (4) Coordination The Secretary of Transportation shall coordinate with the Maritime Security Board and other agencies critical for science, research, and regulation of emerging marine technologies for the maritime sector, including the Department of Defense, the Department of Energy, the Environmental Protection Agency, the National Science Foundation, the Coast Guard, the National Oceanic and Atmospheric Association, and the Marine Board of the National Academies when establishing the Center. (5) Responsibilities The Center shall carry out the following activities: (A) Establish and support maritime incubators in accordance with paragraph (6). (B) Accelerate the adoption or integration of commercial technologies within the maritime industry to transform the capacity and capabilities of the merchant marine of the United States. (C) Serve as the principal liaison between the Maritime Security Board and maritime incubators. (D) Carry out programs, projects, and other activities to strengthen the merchant marine of the United States and the maritime industrial base. (E) Coordinate and harmonize the activities of other organizations and elements of the maritime industry on matters relating to commercial technologies, dual use technologies, and the innovation of such technologies. (F) Coordinate and advise efforts among elements of the maritime industry on matters relating to the development, procurement, and fielding of nontraditional capabilities and connect entities developing those capabilities with the relevant incubators. (G) Coordinate with maritime industry stakeholders to identify operational challenges that have the potential to be addressed through the use of nontraditional capabilities, including dual-use technologies that are being developed and financed in the commercial sector. (H) Coordinate with maritime industry stakeholders and relevant Federal agencies to enhance the capacity and performance of seaports of the United States, including through hardening security, enhancing preparedness, and developing United States-based supply chains for port technologies and equipment. (I) Coordinate with other research and development programs and centers focused on modes of transportation besides maritime to develop intermodal interoperability with the maritime industry. (J) Develop a standard design for commercial vessels and components and features of commercial vessels to be manufactured in the United States, using mature, proven designs, which— (i) includes, to the maximum extent practicable, included parts, components, and material manufactured in and sourced from the United States; (ii) does not include any parts, components, or materials manufactured by foreign entities of concern or which are produced in foreign countries of concern (as such terms are defined in section 4 of the SHIPS for America Act of 2025 ); and (iii) includes priorities for design identified in consultation with the Secretary of the Navy, as necessary for strategic sealift, informed by requirements to sustain a wartime economy and military operations. (K) Lead engagement with industry, academia, labor organizations, and other nongovernmental entities to develop— (i) innovative, commercial, and dual-use manufacturing technologies and processes to construct, rehabilitate, or repair maritime vessels of the Armed Forces or the merchant marine of the United States; (ii) additional naval architecture programs at institutions of higher education in the United States and to expand existing naval architecture programs; (iii) next-generation propulsion technologies for the merchant marine of the United States, to include small modular reactors, low-emission or carbon capture propulsion technologies, and other renewable energy solutions; (iv) new and innovative hardware, software, and systems for remote or autonomous operations at ports, intermodal facilities, or aboard oceangoing vessels; (v) technology and infrastructure solutions that enhance the safe operation of oceangoing vessels to protect lives, property, and the environment; (vi) solutions to recruit, train, and retain a skilled workforce capable of supporting a vibrant and growing United States maritime industry; and (vii) the capacity of international allies and partners of the United States, with respect to manufacturing technologies and processes, to construct, rehabilitate, or repair maritime vessels. (L) Work with academic and private sector response training centers and Centers of Excellence for Domestic Maritime Workforce Training and Education to develop maritime strategies and workforce development plans applicable to various segments of the United States maritime industry, including the inland, deep water, and coastal fleets. (M) Establish programs and initiatives to share— (i) shipbuilding best practices and maritime technology between vessels of the Department of Defense and commercial vessels of the United States; and (ii) port technology and logistics best practices between the Department of Defense and commercial port operators and port authorities within the United States. (N) Carry out such other activities as the Maritime Security Board determines appropriate. (6) Establishment of maritime incubators (A) Establishment The Center shall, in consultation with the Maritime Security Board, seek out, identify, and support the development of and experimentation with commercial technologies that have the potential to be implemented within the maritime industry, through the establishment of a series of maritime incubators. (B) Reflection Each incubator shall reflect the unique nature of the region’s capabilities and academic and investor base. (C) Selection Incubators shall be— (i) selected through a competitive process of eligible entities, and if a private entity, a domestic entity; (ii) based in the United States with technical expertise in emerging marine technologies and practices related to the maritime transportation system; (iii) based within a United States maritime security investment zone as defined in section 1400Z–3 of the Internal Revenue Code of 1986 (as added by section 708 of this Act); and (iv) topic-specific, according to regional maritime expertise in United States emerging maritime technologies and practices, to include designated incubators focused on— (I) clean energy, carbon capture, and alternative fuels; (II) ports and shoreside infrastructure; (III) vessel design and naval architecture; (IV) shipbuilding and next generation manufacturing; (V) advanced materials for ship construction; and (VI) other areas for maritime innovation and technology, as determined by the Center in coordination with the Maritime Security Board. (D) Incubator Responsibilities Each maritime incubator shall— (i) serve as the principal liaison between the Center and individuals and entities that can contribute to innovation within the maritime industry, including other maritime incubators under this subsection, entrepreneurs, startups, commercial technology companies, and venture capital sources; and (ii) establish and support multi-stakeholder research and innovation partnerships, as described in subparagraph (G). (E) Report Each incubator shall submit quarterly activity and status reports to the Center. (F) Review and termination (i) In general The Maritime Administrator may, in consultation with the Maritime Security Board, terminate an agreement with an eligible entity selected to lead a maritime incubator if the Administrator certifies that the eligible entity is failing to meet the requirements of this section. (ii) Reselection If the Administrator terminates an agreement with an eligible entity to lead a maritime incubator, the Center shall initiate a new selection process as required under subparagraph (C) to select a new eligible entity. (iii) Review of Eligible Entities Not later than 5 years after the establishment of maritime incubators under this paragraph, and every 5 years thereafter, the Administrator, in coordination with the Maritime Security Board, shall conduct a review of all eligible entities selected to lead a maritime incubator and confirm the entity is adequately fulfilling the requirements of this section. (G) Multi-stakeholder partnerships (i) In general The maritime incubators established under this subsection shall establish and support multi-stakeholder research and innovation partnerships that— (I) have the potential to generate technologies, processes, products, or other solutions that support the United States maritime industry; (II) have as an objective the technology transfer or commercialization of the work product generated by the partnership, which may include work product that incorporates intellectual property developed by the Federal Government and licensed to the partnership in accordance with clause (iii); and (III) incentivize and expand geographically diverse participation in graduate and undergraduate institutions of higher education, community college, and other workforce programs relevant to the maritime industry. (ii) Support provided Support provided by the maritime incubator to a multi-stakeholder research and innovation partnership under this subsection may include— (I) providing funding or other resources to the partnership; (II) participating in the partnership; (III) providing technical and technological advice and guidance to the partnership; (IV) suggesting and introducing other participants for inclusion in the partnership; (V) providing the partnership with insight into desired solutions for defense and security needs; (VI) providing access to Ready Reserve ships for testing new technologies and conducting research, as the maritime incubator determines appropriate, in coordination with the Center and the Administrator; and (VII) such other forms of support as the Center, in consultation with maritime incubators and Maritime Security Board, determines appropriate. (iii) Availability of intellectual property To the extent the Center determines appropriate, the Center, in coordination with the maritime incubators, shall seek to actively inform potential participants in multi-stakeholder research and innovation partnerships of the availability of intellectual property developed by the Federal Government that may be licensed to the partnership. (7) Report Not later than 180 days after the date of enactment of the SHIPS for America Act of 2025 , and annually thereafter, the Center shall submit to the Maritime Security Board and the appropriate congressional committees a report on the activities, advances, outcomes, and work product of the maritime incubators and the multi-stakeholder research and innovation partnerships supported under this subsection. (8) Authorization of appropriations In addition to the funding contributed under subsection (a)(4), there is authorized to be appropriated, out of the Maritime Security Trust Fund established under section 50301(b) of this title, $50,000,000 for each of fiscal years 2026 through 2035. (9) Definitions In this subsection: (A) Multi-stakeholder research and innovation partnership The term multi-stakeholder research and innovation partnership means a partnership composed of any combination of 2 or more of the following: (i) Institutions of higher education (as defined in section 102 of the Higher Education Act of 1965 ( 20 U.S.C. 1002 )) with research and innovation capability. (ii) Nonprofit organizations that provide policy, research, outreach, operations, organizational, management, testing, evaluation, technology transfer, legal, financial, or advocacy expertise. (iii) For-profit commercial enterprises that may be publicly or privately owned, early stage or mature, and incorporated or operating by another ownership structure. (iv) Centers of excellence for domestic maritime workforce training and education (established under section 51706). (v) Maritime labor organizations. (vi) Departments or agencies of the Federal Government with expertise, operations, or resources related to the objectives of the multi-stakeholder research and innovation partnership. (vii) State maritime academies (as defined in section 51102(4)). (viii) The United States Merchant Marine Academy. (ix) National research laboratories with expertise, operations, or resources related to the objectives of the partnership. (x) Operators and users of vessels of the University-National Oceanographic Laboratory System. (B) Nontraditional capability The term nontraditional capability means a solution to an operational challenge that can significantly leverage commercial innovation or external capital with minimal dependencies on fielded systems. (C) Maritime industry The term maritime industry includes— (i) shipbuilders and ship repair facilities; (ii) ship owners; (iii) port operators; (iv) personnel of the merchant marine of the United States; (v) manufacturers of equipment, software, and technology instrumental to the facilitation of maritime trade and commerce; and (vi) other members of the industrial base that support the Navy or the merchant marine of the United States. . (b) Transition A Center for Maritime Innovation established by the Secretary of Transportation through a cooperative agreement pursuant to section 50307 of title 46, United States Code, as of the day before the date of enactment of this Act shall— (1) be deemed to be the United States Center for Maritime Innovation under section 50307 of title 46, United States Code, as of the date of enactment of this Act, with all the authorities granted by such section; and (2) coordinate activities of the Center with the Maritime Security Board pursuant to subsection (e)(4) of such section, as amended by this Act. 522. National Shipbuilding Research Program Section 50105(c) of title 46, United States Code, is amended to read as follows: (c) National Shipbuilding Research Program (1) In General The Maritime Administrator shall establish and carry out, in coordination with the Secretary of the Navy, the National Shipbuilding Research Program. (2) Purposes The purpose of the National Shipbuilding Research Program shall be to develop plans for the economical construction of vessels and their propelling machinery, of most modern economical types, giving thorough consideration to all well-recognized means of propulsion and taking into account the benefits from standardized production where practicable and desirable. (3) Activities The National Shipbuilding Research Program shall— (A) support technology transfers and industry networking; (B) select and execute research and development projects, which may include— (i) advancing best practices in shipbuilding and ship repair, including alternative project management and project financing arrangements for shipyards, such as public-private financing; (ii) improving efficiency across the shipyard industrial base of the United States; and (iii) developing, maturing, and implementing industry-relevant shipbuilding and sustainment technologies; (C) carry out ad hoc initiatives focused on specific target areas in shipbuilding and ship repair; and (D) carry out additional activities as determined by the Maritime Administrator or the Secretary of Defense. . 523. Assessment on maritime infrastructure readiness (a) In general Not later than 180 days after the date of enactment of this Act, the Maritime Administrator shall submit to Congress a report on the status and resources and authorities needed to execute and complete necessary vessels, harborcraft, port, shipyard, and other infrastructure improvements to ensure the national security interests of the United States and support the domestic and foreign commerce of the United States. (b) Contents The report under subsection (a) shall include— (1) consideration of existing literature and reporting from Federal and non-Federal sources; (2) an assessment of the number of commercial shipping vessels by class required to sustain a peace-time and wartime national economy; (3) an assessment of opportunities to leverage private sector funding to enhance the capability of marine infrastructure of the United States; (4) an evaluation of future infrastructure needs to support alternative fuels for vessels and harborcraft; (5) an assessment of an ability to construct and repair seaports and shipyards during national security emergencies, including readiness to construct temporary facilities, and carry out marine salvage and firefighting operations; and (6) an evaluation of the possible effects on the commercial operations of United States ports and other critical infrastructure of prohibiting any entity that owns or operates a port or terminal in the United States from using or sharing data with— (A) LOGINK; (B) any logistics platform controlled by, affiliated with, or subject to the jurisdiction of the Chinese Communist Party or the Government of the People’s Republic of China; or (C) any logistics platform that shares data with a system described in subparagraph (A) or (B). (c) Definitions (1) Critical infrastructure The term critical infrastructure has the meaning given the term in section 721(a) of the Defense Production Act of 1950 ( 50 U.S.C. 4565(a) ). (2) LOGINK The term LOGINK means the public, open, shared logistics information network known as the National Public Information Platform for Transportation and Logistics by the Ministry of Transport of the People’s Republic of China. VI Workforce Development A Workforce incentives 601. Public service loan forgiveness for Merchant Marines Section 455(m) of the Higher Education Act of 1965 ( 20 U.S.C. 1087e(m) ) is amended— (1) in paragraph (3)(B)(i), by inserting the United States Merchant Marine (as described in paragraph (5)), a United States shipyard, after law enforcement, ; and (2) by adding at the end the following: (5) Full-time job in United States Merchant Marine For purposes of loan cancellation under this subsection, a full-time job in the United States Merchant Marine shall mean possession of a Merchant Mariner Credential authorized by the Coast Guard and employment on board a vessel of the United States for not less than 150 days in a calendar year. . 602. Eligibility for educational assistance (a) In General Chapter 521 of title 46, United States Code, is amended by adding at the end the following: 52102. Eligibility for educational assistance (a) Eligibility A covered individual shall be treated as an individual described in section 3311(b)(1) of title 38, United States Code, for purposes of entitlement to educational assistance under chapter 33 of such title. (b) Covered individual (1) In General In this section, the term covered individual means an individual who— (A) served as a full-time, credentialed United States Merchant Mariner for not less than 10 years; (B) as a result of such service received the Merchant Marine Expeditionary Medal or another award for service in a designated combat zone after the date of enactment of this section; and (C) is not eligible under any other provision of law for benefits under laws administered by the Secretary of Veterans Affairs. (2) Full-time, credentialed United States Merchant Mariner For purposes of paragraph (1), serving as a full-time, credentialed United States Merchant Mariner means possession of a Merchant Mariner Credential authorized by the Coast Guard and employment on board a vessel of the United States for not less than 150 days in a calendar year. (c) Reimbursement There is authorized to be appropriated to the Secretary of Veterans Affairs such sums as may be necessary to carry out this section from the Maritime Security Trust Fund established under section 50301(b) of this title. . (b) Clerical amendment The table of sections for chapter 521 of title 46, United States Code, is amended by adding at the end the following: 52102. Eligibility for educational assistance. . 603. Eligibility of mariners to attend Naval Postgraduate School (a) In general Section 8545 of title 10, United States Code, is amended— (1) in subsection (a), by adding at the end the following new paragraph: (3) The Secretary may permit an officer or unlicensed mariner of the United States Merchant Marine to receive instruction at the Naval Postgraduate School. ; (2) in subsection (b)(1), by adding at the end the following new sentence: The Secretary of Transportation shall bear the cost of the instruction received by officers and unlicensed mariners of the United States Merchant Marine detailed for that instruction. ; and (3) in subsection (c), by inserting , and officers and unlicensed mariners of the United States Merchant Marine, after Coast Guard . (b) Report required Not later than 180 days after the date of enactment of this Act, the Secretary of Transportation, in consultation with the Secretary of Defense, shall submit to Congress a report assessing what matters relating to military training it would be beneficial for mariners to study at the Naval Postgraduate School. 604. Reimbursement of qualifying spouse relicensing costs and business costs (a) In General Chapter 521 of title 46, United States Code, as amended by section 602, is further amended by adding at the end the following: 52103. Reimbursement of qualifying spouse relicensing costs and business costs (a) In General The Secretary of Transportation shall establish a program to reimburse an individual serving in the merchant marine of the United States for qualified relicensing costs and qualified business costs of the spouse of that individual when the individual relocates to a new jurisdiction or geographic area as the result of a reassignment as a result of service as a commissioned officer in the Navy Reserve (including the Strategic Sealift Officer Program, Navy Reserve), the Coast Guard Reserve, or any other reserve component of the Armed Services of the United States. (b) Limitations (1) Relicensing Reimbursement provided to a member under this subsection for qualified relicensing costs may not exceed $1,000 in connection with each relocation described in paragraph (1). (2) Business costs Reimbursement provided to a member under this subsection for qualified business costs may not exceed $1,000 in connection with each relocation described in paragraph (1). (3) Deadline No reimbursement may be provided under this subsection for qualified relicensing costs or qualified business costs paid or incurred after December 31, 2035. (c) Qualified relicensing costs In this section, the term qualified relicensing costs means costs, including exam, continuing education courses, business license, permit, and registration fees, incurred by the spouse of an individual serving in the merchant marine of the United States if— (1) the spouse was licensed or certified in a profession, or owned a business, during the individual's previous assignment and requires a new professional license or certification, or business license or permit, to engage in that profession in a new jurisdiction because of the individual's relocation described in paragraph (1); and (2) the costs were incurred or paid to secure or maintain the professional license or certification, or business license or permit, from the new jurisdiction in connection with such relocation. (d) Qualified business costs In this section, the term qualified business costs means costs, including moving services for equipment, equipment removal, new equipment purchases, information technology expenses, and inspection fees, incurred by the spouse of an individual serving in the merchant marine of the United States if— (1) the spouse owned a business during the individual's previous assignment and the costs result from the individual's relocation described in paragraph (1); and (2) the costs were incurred or paid to move such business to a new location in connection with such relocation. (e) Authorization of Appropriations There is authorized to be appropriated out of the Maritime Security Trust Fund, established under section 50301(b) of this title, to carry out this section, $500,000 for each of fiscal years 2026 through 2035. . (b) Clerical amendment The table of sections for chapter 521 of title 46, United States Code, as amended by section 602, is further amended by adding at the end the following: 52103. Reimbursement of qualifying spouse relicensing costs and business costs. . 605. Noncompetitive eligibility for Federal employment (a) Amendment Chapter 521 of title 46, United States Code, as amended by sections 602 and 604, is amended by adding at the end the following: 52104. Noncompetitive eligibility for Federal employment (a) Definition of agency In this section, the term agency — (1) has the meaning given the term Executive agency in section 105 of title 5, United States Code; (2) includes the United States Postal Service and the Postal Regulatory Commission; and (3) does not include the Government Accountability Office. (b) Appointment authority The head of an agency may appoint noncompetitively— (1) a graduate of the United States Merchant Marine Academy who has met all of the requirements of their cadet commitment agreement under section 51306 of title 46, United States Code; or (2) a credentialed United States Merchant Mariner with an officer or rating endorsement who has completed not less than 7 years of service aboard a vessel of the United States. . (b) Clerical amendment The table of sections for chapter 521 of title 46, United States Code, as amended by sections 602 and 604, is amended by adding at the end the following: 52104. Noncompetitive eligibility for Federal employment. . 606. United States Merchant Marine Career Retention Program (a) Sense of Congress It is the sense of Congress that— (1) it takes years of training and experience, and costly license trainings, to earn mariner qualifications; (2) with just around 12,000 merchant mariners of the United States operating oceangoing vessels, compared with China’s more than 1,700,000 seafarers, the United States may not have a sufficient number of mariners to fully power the strategic sealift vessels necessary in a future prolonged conflict; (3) the United States requires a qualified workforce of sufficient size that is ready and available to crew vessels of the United States for national defense or national emergency; and (4) a workforce committed to take all measures possible to expand, develop, and protect the domestic maritime workforce should— (A) support a retention program to permit credentialed merchant mariners to maintain recency through a coordinated Federal program, in coordination with maritime labor organizations; and (B) implement civil service, workplace, and hiring protections. (b) Amendment Chapter 521 of title 46, United States Code, as amended by sections 602, 604, and 605, is further amended by adding at the end the following: 52105. United States Merchant Marine Career Retention Program (a) Establishment The Maritime Administrator shall establish a program, to be known as the United States Merchant Marine Career Retention Program , to ensure that a qualified workforce of sufficient size is ready to crew strategic sealift vessels in the event of a national defense or national emergency activation. Through the United States Merchant Marine Career Retention Program, the Maritime Administrator shall establish and administer mechanisms to register merchant mariners and mariner employers to participate in the Program. (b) Implementation The Maritime Administrator shall— (1) appoint a board of directors to oversee the United States Merchant Marine Career Retention Program; (2) appoint and facilitate a working group to recommend policies, procedures, and a prioritization matrix for the United States Merchant Marine Career Retention Program, which shall be composed of representatives from major stakeholders, including maritime labor organizations, credentialed United States Merchant Mariners, vessel owners, vessel operators, the United States Merchant Marine Academy, State maritime academies, United States Military Sealift Command, and other likely employers of members of the United States Merchant Marine Career Retention Program; and (3) submit to Congress an annual evaluation of the United States Merchant Marine Career Retention Program. (c) Membership in United States Merchant Marine Career Retention Program (1) In general There shall be 2 paths to enrollment in the United States Merchant Marine Career Retention Program as described in paragraphs (2) and (3). (2) Members who work ashore who hold mariner qualifications (A) Opportunities The United States Merchant Marine Career Retention Program shall provide individuals who hold Coast Guard issued mariner qualifications who work ashore with an opportunity to maintain, or potentially upgrade, their mariner qualifications and credentials by— (i) providing qualified service at sea on vessels of the United States; and (ii) participating in compulsory training. (B) Structure The United States Merchant Marine Career Retention Program shall be open for enrollment to both licensed and unlicensed mariners and provide members with an 8–3–1 schedule as follows: (i) 8 months shoreside employment. (ii) 3 months sailing employment designed to ensure that members meet the minimum sea-time requirement to maintain the credentials required by the Standards of Training, Certification, and Watchkeeping certification, or, depending on mariner and employer requirements, more frequent, but shorter-duration sailing assignments. (iii) 1 month vacation, which is in addition to vacation provided by the shoreside employer. (C) Ashore employers (i) Employer obligations The employer of a member of the United States Merchant Marine Career Retention Program described under this paragraph shall grant the member— (I) an unpaid leave of absence for the duration of the member’s training, sailing, and vacation with the United States Merchant Marine Career Retention Program; and (II) the same or an equivalent position with the employer when the member returns from training, sailing, or vacation with the United States Merchant Marine Career Retention Program. (D) Sea day assignments The United States Merchant Marine Career Retention Program shall, with respect to members described under this paragraph— (i) maintain records of each member’s qualifications, sea time, and availability, and prioritize assignments on these and other factors with the goal of maximizing the United States Merchant Marine Career Retention Program readiness to support strategic sealift; (ii) maintain a job call program office that coordinates how jobs become available for members from State maritime academies, vessel operating companies, maritime labor organizations, United States Military Sealift Command, and other organizations responsible for crewing vessels of the United States of qualifying tonnage or horsepower; (iii) establish partnerships with State maritime academies and the United States Military Sealift Command that aim to establish reliable crewing jobs with job cycles that maximize the readiness of United States Merchant Marine Career Retention Program; (iv) dispatch members to fill available jobs, prioritizing maximizing readiness for strategic sealift, taking into consideration mariner availability and credentials, sea time requirements to maintain merchant mariner credentials, predicted program demand for specific ratings, and expected expansion or contraction of the program’s membership; and (v) coordinate with vessel operators and labor organizations to ensure that members in the United States Merchant Marine Career Retention Program are given opportunities to fulfill their sea time and maintain the credentials required by the Standards of Training, Certification, and, Watchkeeping certification. (E) USERRA protections Members of the United States Merchant Marine Career Retention Program described under this paragraph shall be entitled to protections and obligations under chapter 43 of title 38 (commonly known as the Uniformed Services Employment and Reemployment Rights Act ). (F) Requirement A member in the United States Merchant Marine Career Retention Program described under this paragraph may not fail to accept a sea day assignment and remain in good standing with the Program, unless a hardship exemption is provided by the Maritime Administrator under subsection (e). (3) Members serving on foreign vessels (A) In general The United States Merchant Marine Career Retention Program shall be open for enrollment to individuals who— (i) hold Coast Guard issued merchant mariner credentials required by the Standards of Training, Certification, and Watchkeeping Certification; (ii) have completed their service obligations with respect to any previous enrollment in a Federal or State maritime academy, if applicable; and (iii) are serving on a foreign vessel (as defined in section 110) that is not owned by a foreign entity of concern (as that term is defined in section 4 of the SHIPS for America Act of 2025 ) or a vessel registered under a registry of a foreign country of concern or operated under the authority of a foreign country of concern (as that term is defined in such section 4). (B) Requirement Members of the United States Merchant Marine Career Retention Program described under this paragraph shall maintain— (i) Standards of Training, Certification, and Watchkeeping Certification currency; (ii) a valid merchant mariner credential, unlimited as to horsepower or tonnage, issued by the United States Coast Guard as an officer in the merchant marine of the United States, accompanied by the appropriate national and international endorsements and certifications required by the Coast Guard for service aboard vessels on domestic and international voyages, without limitation; (iii) a valid transportation worker identification credential; (iv) a Coast Guard medical certificate; and (v) classes and certifications described in subparagraph (C). (C) Certifications The Administrator shall publish a list of classes and certifications required for individuals described in subparagraph (A) to be eligible for the United States Merchant Marine Career Retention Program. (D) Rule of construction Nothing in subparagraph (A) shall be construed to allow the United States Coast Guard to prevent or delay a merchant mariner who is otherwise eligible from attaining a more advanced rank or credential for Merchant Mariners sailing on foreign vessels. (E) USERRA protections Members of the United States Merchant Marine Career Retention Program described under this paragraph shall be entitled to protections and obligations under chapter 43 of title 38 (commonly known as the Uniformed Services Employment and Reemployment Rights Act ). (d) Enforcement The Maritime Administrator shall ensure all members of the Merchant Marine Career Retention Program remain in good standing with the requirements of the Program. (1) Enforcement Subject to paragraph (2), members found to be in noncompliance with the requirements of the Program shall— (A) have their reservist status terminated; and (B) forfeit the protections provided under chapter 43 of title 38 (commonly known as the Uniformed Services Employment and Reemployment Rights Act ). (2) Exception In cases where the Maritime Administrator determines a hardship exists, which prevents the mariner from meeting the requirements of the Program, the requirements of paragraph (1) shall not apply. (e) Authorization of appropriations There is authorized to be appropriated out of the Maritime Security Trust Fund established under section 50301(b) of this title, to carry out this section, $2,000,000 for each of fiscal years 2025 through 2034. . (c) Clerical amendment The table of sections for chapter 521 of title 46, United States Code, as amended by sections 602, 604, and 605, is amended by adding at the end the following: 52105. United States Merchant Marine Career Retention Program. . B Workforce Pipeline 611. Maritime workforce promotion and recruitment Section 539A of the Servicemember Quality of Life Improvement and National Defense Authorization Act for Fiscal Year 2025 ( Public Law 118–159 ), is amended— (1) in subsection (a), by striking the heads of such other Federal agencies as the Secretary determines appropriate and inserting the Maritime Security Board ; and (2) by amending subsection (f) to read as follows: (f) Authorization of appropriations (1) Fiscal years 2025 through 2028 There are authorized to be appropriated out of the Maritime Security Trust Fund, established under section 50301(b) of title 46, United States Code, to the Secretary of the Navy, for each of fiscal years 2025 through 2028, $15,000,000 to carry out this section. (2) Fiscal years 2029 through 2034 There are authorized to be appropriated out of the Maritime Security Trust Fund, established under section 50301(b) of title 46, United States Code, to the Secretary of the Navy, for each of fiscal year 2029 through 2034, $25,000,000 to carry out this section. . 612. Centers of Excellence for Domestic Maritime Workforce Training and Education Section 51706 of title 46, United States Code, is amended— (1) in subsection (c)(1)(B)(iii), by striking nonprofit entity and inserting entity ; and (2) by adding to the end the following: (d) Authorization of Appropriations There is authorized to be appropriated out of the Maritime Security Trust Fund, established under section 50301(b) of this title, to carry out this section, $25,000,000 for each of fiscal years 2026 through 2035. . 613. Maritime Career and Technical Education Advisory Committee (a) Definitions In this section: (1) Administrator The term Administrator means the Maritime Administrator. (2) Advisory Committee The term Advisory Committee means the Maritime Career and Technical Education Advisory Committee established under subsection (b). (b) Advisory Committee plan and establishment (1) Plan Not later than 180 days after the date of enactment of this Act, the Administrator shall develop a plan, and notify Congress of such plan, to establish a Maritime Career and Technical Education Advisory Committee to— (A) bring representatives of maritime industrial base employers and education providers together to identify joint opportunities to train needed workers for maritime careers; and (B) develop and disperse best practices and recommendations for the improvement of shipbuilding education and training programs, naval architecture education programs, and merchant marine training and certification programs. (2) Establishment Not later than 1 year after the date of enactment of this Act, the Administrator shall establish the Advisory Committee. (c) Membership (1) Administrator The Advisory Committee shall include the Administrator (or a delegate of the Administrator) who shall serve as Chair of the Advisory Committee. (2) Representatives The Advisory Committee shall be composed of representatives from each of the following, to be appointed the Administrator: (A) Maritime education, including representatives from— (i) the Centers of Excellence for Domestic Maritime Workforce Training and Education designated by the Maritime Administration, taking into consideration— (I) geographic diversity; (II) the rate of employment after graduation; (III) training or skillset diversity; and (IV) other qualities as determined by the Administrator; (ii) the United States Naval Sea Cadet Corps; (iii) kindergarten through grade 12 maritime education programs designated by the Maritime Administration; (iv) the oceanographic science community, including from a University-National Oceanographic Laboratory System institution; and (v) institutions of higher education. (B) The maritime workforce, including representatives from— (i) skilled workers representing a wide swath of the career and technical maritime industry both onshore and offshore; (ii) career and technical education certified instructors; and (iii) maritime labor organizations. (C) Maritime industry, including representatives from— (i) shipbuilding, ship repair, and shipyard industry stakeholders; (ii) maritime industrial base coalitions; (iii) shipping industry stakeholders; and (iv) owners and operators of vessels of the United States. (D) Technical nonprofit organizations with expertise in the maritime industry, including representatives from— (i) think tanks; (ii) recognized classification societies; and (iii) professional societies. (E) The Federal Government, including representatives from— (i) the Department of Education; (ii) the Department of Labor; (iii) the Department of Transportation; (iv) the Department of the Navy; (v) the United States Coast Guard; (vi) the National Oceanic and Atmospheric Administration; (vii) the Army Corps of Engineers; and (viii) the Federal Maritime Commission. (F) Any other representatives that the Maritime Administrator determines appropriate to appoint. (d) Meetings (1) In general The Advisory Committee shall meet not less often than annually. (2) Quorum established Two thirds of all members appointed by the Administrator under subsection (c) shall constitute a quorum for a meeting of the Advisory Committee. (3) Working groups The Advisory Committee shall include working groups that shall meet not less often than quarterly each year. (e) FACA Chapter 10 of title 5, United States Code, shall apply to the Advisory Committee. (f) Development of curricula Consistent with the purposes of the Advisory Committee established in subsection (b) and applicable law (including regulations), the Advisory Committee shall recommend curricula for key skills for maritime professionals and make such curricula publicly available to institutions of higher education, career and technical education schools, and State maritime academies. (g) Reporting The Advisory Committee shall submit to the appropriate committees of Congress and the Maritime Security Board and publish on the website of the Maritime Administration, an annual report that includes best practices and policy recommendations, as described in subsection (b). (h) Rule of construction Nothing in this section shall be construed to create new regulatory authority or supersede existing law (including regulations) as of the day before the date of enactment of this Act, relating to shipbuilding education and training programs, naval architecture education programs, and merchant marine training and certification programs. 614. Military candidates to Mariner Careers Recruitment Exchange (a) Duties of Secretary of Defense The Secretary of Defense shall— (1) encourage and incentivize military recruiters to recommend the United States Department of Transportation Maritime Administration to potential recruits who do not qualify for military service in the Armed Forces; and (2) establish a mechanism for military recruiters to introduce recruits described in paragraph (1) who are interested in maritime service to representatives from the Maritime Administration, in accordance with the procedures established under subsection (b). (b) Duties of the Maritime Administrator The Maritime Administrator shall— (1) establish a mechanism to receive recruitment referrals from military recruiters; (2) provide hand-off services to connect recruits with educational resources and institutions, recognized Maritime Centers of Excellence, eligible maritime industry employers, and other maritime industry career services, as appropriate; (3) track the number of referrals from the Department of Defense; and (4) track the number of recruits who enroll in maritime industry programs, to the extent practicable. (c) Reporting requirement (1) Briefing on the implementation strategy Not later than 90 days after the date of enactment of this Act, the Maritime Administrator, in coordination with the Secretary of Defense, shall submit a briefing to the appropriate committees of Congress about a strategy for implementing the activities required under this section, including— (A) a timeline for implementation; and (B) the identification of the Department of Defense recruiter incentives and training required for maximum utility in carrying out such activities. (2) Annual report on program efficacy One year after the date of enactment of this Act, and annually thereafter, the Maritime Administrator, in coordination with the Secretary of Defense, shall submit a report to the appropriate committees of Congress on the efficacy and utility of the activities carried out under this section, including— (A) the number of Department of Defense referrals to the Maritime Administration; (B) the number of Maritime Administration hand-offs to the maritime industry; (C) an assessment of the efficacy of the activities carried out under this section; and (D) challenges and recommendations relating to such activities. 615. Maritime worker data collection (a) Publication of report The Maritime Administrator shall publish an biennial report on the state of the merchant mariner workforce. (b) Completion of report The Maritime Administrator shall complete the biennial report required under subsection (a) or enter into a contract with another entity to complete the report. (c) Content of report The biennial report required under subsection (a) shall include, at minimum— (1) a count of United States Merchant Mariners with valid merchant mariner credentials and credentials in continuity endorsement; (2) a count of inactive but credentialed and formerly credentialed United States Merchant Mariners, to the extent practicable, and an evaluation of— (A) the challenges to identifying such individuals; (B) opportunities to partner with Federal, State, local, and non-government entities to identify such individuals; and (C) an action plan of how to implement the opportunities described under subparagraph (B); (3) a count of United States mariners and foreign workers employed on vessels, rigs, platforms, and other vehicles or structures off the coast of the United States and an evaluation of the percentage of United States and foreign workers employed on— (A) coastwise-endorsed vessels; and (B) vessels of the United States which do not have a coastwise endorsement; (4) a listing of actively operating vessels of the United States; (5) a report of merchant mariner requirements needed in the event of a national defense sealift operation and any gaps identified in quantity and quality, and other variables of concern, as determined by the Administrator; (6) a general outlook for the future of the merchant mariner industry and potential gaps or surpluses of merchant mariners; (7) identification of any concerns in the credentialing of merchant mariners, which may include general processing issues, shortage of training providers or instructors, and barriers to entry due to costs to the economically disadvantaged; and (8) recommendations, based on data collected, on ways to— (A) improve retention of existing merchant mariners; (B) create expedited pathways for mariners with expired credentials to renew their credentials; and (C) encourage new merchant mariners to enter the industry. (d) Accessibility of data (1) In general Except as provided in paragraph (2), the Maritime Administrator, and any authorized agent of the Maritime Administrator, shall have full access to available Coast Guard mariner credentialing data, in a manner that ensures the protection of personally identifiable information, in order to complete the report required under subsection (a). (2) Exception The Maritime Administrator, and any authorized agent of the Maritime Administrator, may not have access to confidential medical information pursuant to paragraph (1). (e) Authorization of appropriations There is authorized to be appropriated out of the Maritime Security Trust Fund, established under section 50301(b) of title 46, United States Code, to carry out this section, $1,000,000 for each of the fiscal years 2026 through 2030. 616. Military to maritime transition (a) Recommendations required Not later than 180 days after the date of enactment of this Act, the Secretary of Defense, in consultation with the Secretary of the Navy, the Secretary of the Air Force, the Secretary of the Army, the Secretary of the department in which the Coast Guard is operating, the Maritime Security Board, the Department of Veterans Affairs, and the Department of Labor, shall submit a report to the appropriate committees of Congress containing— (1) recommendations about how to increase and improve opportunities for transitioning servicemembers to secure employment in the maritime industry at sea and shoreside; and (2) a plan to implement those recommendations. (b) Considerations In carrying out subsection (a), the Secretary of Defense shall— (1) identify barriers that servicemembers face when trying to transition to the United States maritime industry, including the merchant marines, shipbuilding, ship repair, and shipping; (2) consider opportunities to improve, expedite, and alleviate the burdens on servicemembers transitioning to the maritime industry, including efforts to— (A) inform transitioning servicemembers of employment opportunities in the United States maritime industry; (B) assist transitioning servicemembers in determining how their military credentials and experience translate to credentialed civilian employment in the maritime industry; (C) increase the establishment and uptake of accelerated or bridge programs to assist separating members of the Armed Forces in translating military credentials and experience into maritime industry credentials and employment; (D) increase the availability and accessibility of preparatory activities under the SkillBridge program established under section 1143(e) of title 10, United States Code, in the United States maritime industry; (E) incorporate the maritime industry in the Transition Assistance Program, as described in chapter 58 of title 10, United States Code; and (F) enhance the activities carried out pursuant to the Military to Mariners Act of 2022 (section 11514 of division K of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ( Public Law 117–263 )); and (3) specifically consider the transition of servicemembers to employment in the shipbuilding and ship repair maritime industries. 617. Early maritime education and youth involvement (a) Secretary of the Navy budget request In the Secretary of the Navy's annual budget submission to Congress, the Secretary of the Navy shall include, as a distinct item, the funding request for the United States Naval Sea Cadet Corps. (b) Engagement with elementary school and secondary school students The Maritime Administrator shall encourage designated Centers of Excellence for Domestic Maritime Workforce Training and Education to engage with students in kindergarten through grade 12. 618. International scholarship for mariner and naval architecture exchanges (a) In general The Maritime Administrator shall establish an international exchange program for mariners, naval architects, and marine engineers between the United States and countries described in subsection (b). (b) Eligible participants In carrying out the program under this section, the Administrator shall limit participation to United States citizens and citizens of— (1) member countries of NATO; (2) treaty allies of the United States; and (3) major non-NATO allies of the United States. (c) Placements In carrying out the program under this section, the Administrator shall seek corporate and government partners for placement of eligible participants of the program. (d) Authorization of appropriations There is authorized to be appropriated out of the Maritime Security Trust Fund, established under section 50301(b) of title 46, United States Code, $2,000,000 to carry out this section for each of fiscal years 2026 through 2035. C United States Merchant Marine Academy and State maritime academies 621. Authorization of appropriations for United States Merchant Marine Academy infrastructure and facilities modernization (a) Findings Congress finds the following: (1) The United States Merchant Marine Academy plays a critical role in training service-obligated licensed merchant mariners to operate commercial vessels, in peacetime and during times of conflict. (2) The United States Merchant Marine Academy is 1 of the 5 Federal service academies and plays a critical role in maintaining a domestic, commercial maritime industry, with each graduate having a commitment to serve not less than 8 years in the foreign and domestic commerce and the national defense of the United States, which may include service on a merchant vessel documented under chapter 121 of title 46, and graduates make up more than 80 percent of the United States Navy’s Strategic Sealift Officer Program. (3) The United States defense readiness and economic security relies on a strong investment in training and cultivating United States Merchant Marine officers at the United States Merchant Marine Academy. (4) Most of the facilities at the United States Merchant Marine Academy date back to the Academy’s founding, have not been modernized since, and are not conducive to the immersive training and demanding coursework today’s Midshipmen are required to complete. (5) Rehabilitating and modernizing the campus infrastructure at the United States Merchant Marine Academy is necessary to ensuring current and future generations of Midshipmen receive a first-class education. (b) Sense of the Senate It is the sense of the Senate— (1) to ensure that the United States continues to have a sufficient number of service-obligated licensed merchant mariners to meet current and future economic and national security needs, the Maritime Administration and the Department of Transportation have a responsibility to provide suitable academic, training, and dormitory facilities at the United States Merchant Marine Academy by rapidly implementing a comprehensive plan for campus-wide modernization in accordance with section 51329 of title 46, United States Code, (referred to in this section as the Campus Modernization Plan ) and providing sufficient accountability and oversight to ensure that milestones in such plan are met; (2) in developing the comprehensive Campus Modernization Plan for the United States Merchant Marine Academy, the Maritime Administration, and the Department of Transportation should utilize, to the maximum extent practicable, the Merchant Marine Academy Full Speed Ahead Plan developed by the Maritime Security Infrastructure Council as summarized in the Congressional Record, dated February 28, 2024; (3) given the conditions of the United States Merchant Marine Academy as of the date of enactment of this section, a comprehensive, campus-wide modernization is needed to significantly upgrade or replace facilities throughout the campus; and (4) the Maritime Administration and the Department of Transportation should identify opportunities to utilize design-build contracts to increase delivery times and reduce costs. (c) Campus Modernization Plan Chapter 513 of title 46, United States Code, is amended by adding at the end the following: 51329. 10-year Campus Modernization Plan (a) In general Not later than 180 days after the date of enactment of this section, the Secretary shall develop and begin to implement a comprehensive Campus Modernization Plan (referred to in this section as the Campus Modernization Plan ), informed by the United States Merchant Marine Academy Full Speed Ahead Plan developed by the Maritime Security Infrastructure Council as summarized in the Congressional Record, dated February 28, 2024, to carry out a campus-wide modernization at the United States Merchant Marine Academy. (b) Objectives In carrying out the Campus Modernization Plan authorized under subsection (a), the Administrator shall prioritize the following objectives: (1) Promoting modern education best practices by constructing learning facilities that leverage state-of-the art technologies and learning best practices. (2) Providing Midshipmen with access to facilities needed to pass the United States Coast Guard License Exam for Third Mate or Third Assistant Engineer Unlimited. (3) Ensuring Midshipmen have access to facilities sufficient to enable Midshipmen to maintain physical readiness standards required of United States Navy officers. (4) Developing campus infrastructure to ensure the Academy attracts a diverse pool of applicants. (5) Providing facilities that enable industry engagement and continuing education opportunities. (6) Maintaining a safe and secure campus environment for all Midshipmen, which shall include any facilities or infrastructure needed to meet the requirements of sections 51326, 51327, or 51328 of this title. (7) Implementing, to the extent practicable, the facilities and infrastructure recommendations in chapter 4 of the report titled Organizational Assessment of the United States Merchant Marine Academy: A Path Forward issued by the National Academy of Public Administration in November 2021. (c) Inclusions In meeting the objectives of subsection (b), the Campus Modernization Plan authorized under subsection (a) shall include— (1) construction of new facilities or significant renovation of existing facilities to provide— (A) Standards of Training, Certification, and Watchkeeping applications laboratories; (B) a Safety Of Life At Sea training pool; (C) engineering powerplant laboratories; (D) athletic facilities that meet the needs of both male and female students; (E) enhanced waterfront facilities, to include a new pier; (F) a visitor welcome center and main campus security office building; (G) housing facilities for senior staff and faculty; and (H) sufficient parking facilities for faculty, staff, and campus visitors; (2) upgrades to all classrooms and laboratories with modern information technology infrastructure; (3) a campus-wide upgrade and retrofit of— (A) the electric distribution power grid; (B) the sanitary sewer system piping; (C) the storm drainage system; and (D) the drinking water system, including development of a separate and redundant fire suppression system; and (4) renovations of existing campus facilities to ensure all campus facilities— (A) are structurally sound; (B) have reliable heating and air conditioning systems; (C) have functioning plumbing and electrical systems; (D) are protected from the elements, including through roof replacements and window repairs or replacements, as needed; (E) are accessible in accordance with the Americans with Disabilities Act of 1990; and (F) have working fire alarm and fire suppression systems. (d) Requirements For the duration of the Campus Modernization Plan authorized under subsection (a), the Administrator shall ensure that the Academy remains fully operational. (e) Use of a Federal construction agent Consistent with the requirements of section 3515(d)(3) of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ( Public Law 117–263 ), the Administrator shall seek to enter into an agreement with a Federal construction agent to carry out the Campus Modernization Plan authorized under subsection (a). (f) Authorization of appropriations There are authorized to be appropriated to the Department of Transportation, out of the Maritime Security Trust Fund established under section 50301(b) of this title, for fiscal years 2026 through 2035, for the phased rehabilitation, modernization, and construction of facilities and infrastructure at the United States Merchant Marine Academy, in accordance with this section, including the Campus Modernization Plan authorized in subsection (a), $1,020,000,000 of which— (1) $54,000,000 is authorized to be appropriated for fiscal year 2026 for design and planning purposes, which shall be used for the development of a design-build plan for the phased rehabilitation, modernization, and construction of facilities and infrastructure at the United States Merchant Marine Academy in accordance with the Campus Modernization Plan; and (2) for fiscal years 2027 through 2035, $107,333,333 is authorized to be appropriated for each year for construction and contingency purchases necessary to execute the Campus Modernization Plan. . (d) Clerical amendment The table of sections for chapter 513 of title 46, United States Code, is amended by adding at the end the following: 51329. 10-Year Campus Modernization Plan. . 622. United States Merchant Marine Academy (a) Sense of Congress It is the sense of Congress that— (1) the United States Merchant Marine Academy, one of our Nation’s 5 Federal service academies, is vital to our national security, and modernizing the Academy's aging infrastructure and investing in faculty and students must be congressional priorities; (2) sufficient funding must be provided to enable the maximum student enrollment that the campus infrastructure of the United States Merchant Marine Academy can support; and (3) considering the Academy’s role as a co-equal military service academy, the United States Merchant Marine Academy should be included in the rotation of presidential attendance at graduations. (b) Authorization of appropriations Section 51301 of title 46, United States Code, is amended by adding at the end the following: (d) Authorization of appropriations There are authorized to be appropriated to the Department of Transportation out of the Maritime Security Trust Fund established under section 50301(b) of this title, $125,000,000 for each of fiscal years 2026 through 2035 for Academy operations. . (c) Report on enrollment Not later than 180 days after the date of enactment of this Act, the Maritime Administrator shall submit a report to the appropriate committees of Congress identifying the additional resources needed to increase enrollment at the United States Merchant Marine Academy. 623. Retirement service credit for service as a midshipman at the United States Merchant Marine Academy (a) Civil service retirement system Section 8331(13) of title 5, United States Code, is amended, in the flush text following subparagraph (C), by inserting or the United States Merchant Marine Academy after Naval Academy . (b) Federal employees’ retirement system Section 8401(31) of title 5, United States Code, is amended, in the flush text following subparagraph (C), by inserting or the United States Merchant Marine Academy after Naval Academy . (c) Applicability The amendments made by this section shall apply to— (1) any annuity, the eligibility for which is based on a separation occurring before, on, or after the date of enactment of this Act; and (2) any period of service as a midshipman at the United States Merchant Marine Academy occurring before, on, or after the date of enactment of this Act. 624. State maritime academies (a) In general Not later than 1 year after the date of enactment of this Act, the Maritime Administrator shall submit a report to Congress containing the results of a study to evaluate the additional resources needed to allow State maritime academies to increase enrollment and produce additional mariners. (b) Need for additional State maritime academies Such study shall consider whether there is a need for additional State maritime academies in States that do not operate a maritime academy. (c) Authorization of appropriations Section 51501 of title 46, United States Code, is amended by adding at the end the following: (d) Authorization of appropriations There is authorized to be appropriated out of the Maritime Security Trust Fund established under section 50301(b) of this title, $10,000,000 for assistance to State maritime academies under subsection (a) for each of fiscal years 2026 through 2035. . 625. Enforcement of service obligation requirements (a) In general The Maritime Administrator shall ensure that— (1) each citizen who is appointed as a cadet at the United States Merchant Marine Academy and signs a cadet commitment agreement under section 51306 of title 46, United States Code, meets the service obligation requirements of that agreement; and (2) each individual that signs a student incentive payment agreement under section 51509 of title 46, United States Code, meets the service obligation requirements under that agreement. (b) Reporting requirement The Maritime Administrator shall establish an electronic system through which each individual with a service obligation under such section 51306 or 51509 (referred to in this section as a service-obligated mariner ) shall annually demonstrate that they are meeting their service obligation or have a valid deferment consistent with section 51310 of title 46, United States Code, or section 51510 of title 46, United States Code, as applicable. (c) Notification of violation The Maritime Administrator shall transmit a written notice to each service-obligated mariner who fails to meet the reporting requirement of subsection (b), notifying such individual of the applicable penalties established under section 51306 of title 46, United States Code, or section 51509 of title 46, United States Code, for failure to carry out the applicable service requirements, including cost recovery. (d) Report to Congress Not later than 180 days after the date of enactment of this section, and annually thereafter, the Maritime Administrator shall submit to the appropriate committees of Congress a report on the status of all service-obligated mariners, which shall include— (1) information about how each service-obligated mariner is meeting their service obligation requirement, which shall be based on the results of the data collected under subsection (b); (2) the number of service-obligated mariners who have not met their service obligation and have not complied with the reporting requirement under subsection (b); and (3) the number of actions taken by the Maritime Administrator under sections 51306(b), 51306(d), 51306(f), and 51509(g) to recover costs from service-obligated mariners who have not demonstrated that they have met their service obligation requirements. 626. Fuel funding for training ships operated by State maritime academies (a) Conforming Amendment Section 51504 of title 46, United States Code, is amended by striking subsection (f) and inserting the following: (f) Fuel costs Subject to the availability of appropriations, the Secretary shall pay to each State maritime academy the costs of fuel used by a vessel provided under this section while used for training in accordance with section 51512. . (b) Amendment Chapter 515 of title 46, United States Code, is amended by adding at the end the following: 51512. Funding for training ships operated by State maritime academies (a) Fuel funding (1) In general Subject to the availability of appropriations, the Secretary shall pay to each State maritime academy the costs of fuel used by a vessel that is loaned to the State maritime academy in accordance with section 51504 while used for training. (2) Maximum amounts The amount of the payment to a State maritime academy under subsection (a) may not exceed $20,000,000 for each of fiscal years 2026 through 2035. (3) Prohibition Maritime academies that receive funding under subsection (a) may not— (A) profit from charging cadets to go to sea for their licensing when using federally provided fuel; or (B) utilize the vessel as housing for students outside of seasonal training cruises, unless students elect voluntarily to live aboard the vessel. (4) Requirement Each State maritime academy that receives fuel costs under this section shall offer billets for liaison officers from each military service during the time such vessel is provided to that State maritime academy. (b) Crew (1) In General Each State maritime academy shall make crew positions available on a vessel that is loaned to the State maritime academy for mariners enrolled in the United States Merchant Marine Career Retention Program established under section 52105. (2) Crew funding For each crew slot filled by a mariner enrolled in the career retention program, as provided for under paragraph (1), the Secretary shall pay the crew costs for that mariner, subject to the availability of appropriations. (c) Authorization of appropriations There is authorized to be appropriated out of the Maritime Security Trust Fund, established under section 50301(b) of this title, $120,000,000 to carry out this section for each of fiscal years 2026 through 2035. . (c) Clerical amendment The table of sections for chapter 515 of title 46, United States Code, is amended by adding at the end the following: 51512. Fuel funding for training ships operated by State maritime academies. . 627. State Maritime Academy Sea Term Scholarship Programs (a) In General Chapter 515 of title 46, United States Code, as amended by section 627, is further amended by adding at the end the following: 51513. State Maritime Academy Sea Term Scholarship Programs (a) In general The Maritime Administrator shall work with private entities in the maritime industry to establish a scholarship program— (1) for students at State maritime academies to offset expenses associated with completion of a summer sea term to receive sea-time required to earn a Coast Guard license; and (2) which is entirely or predominantly funded through contributions from a private entity. (b) Contributed funds The Maritime Administrator shall enter into a cooperative agreement, or other agreement, with private entities in the maritime industry to accept funding from private entities for the purpose of establishing such a scholarship program. The cooperative agreement may include any terms considered necessary by the Maritime Administrator. (c) Privileges The Maritime Administrator may provide certain privileges to a private entity who contributes funds for a scholarship program under this section, including opportunities to provide information about employment opportunities with the private entity to students enrolled in the scholarship program. (d) Structure In establishing a scholarship program to offset expenses associated with a summer sea term— (1) the Maritime Administrator may enter into an agreement with a student at a State maritime academy that has an agreement with the Secretary of Transportation under section 51505 of this title, to offset expenses associated with completion of a summer sea term; or (2) the Maritime Administrator may enter into an agreement with a State maritime academy that has an agreement with the Secretary of Transportation under section 51505 of this title, to offset expenses for all students who participate in a summer sea term program. (e) Relationship to financial assistance programs Recognizing the need for licensed merchant mariners, the Maritime Administrator shall encourage participants of the financial assistance programs under part C of this subtitle, to enter into agreements under this section to establish scholarship programs to offset expenses associated with summer sea term. (f) Requirements for students Any student who benefits from a scholarship program under this section shall enter into an agreement with the Maritime Administrator which requires the student to— (1) complete the course of instruction at the academy the individual is attending; (2) obtain a merchant mariner license, without limitation as to tonnage or horsepower, from the Coast Guard as an officer in the merchant marine of the United States, accompanied by the appropriate national and international endorsements and certification required by the Coast Guard for service aboard vessels on domestic and international voyages, without limitation, within 3 months of completion of the course of instruction at the academy the individual is attending; (3) serve in a position that supports the foreign and domestic commerce and the national defense of the United States for at least 1 year after graduation from the academy— (A) as a merchant marine officer on a documented vessel or a vessel owned and operated by the United States Government or by a State; or (B) as a commissioned officer on active duty in an Armed Force of the United States, as a commissioned officer in the National Oceanic and Atmospheric Administration, or in other maritime-related Federal employment which serves the national security interests of the United States, as determined by the Maritime Administrator; and (4) report to the Maritime Administrator on compliance with this subsection. (g) Authorization of appropriations There is authorized to be appropriated out of the Maritime Security Trust Fund, established under section 50301(b) of this title, $2,500,000 to carry out this section for each of fiscal years 2026 through 2035. . (b) Clerical amendment The table of sections for chapter 515 of title 46, United States Code, as amended by section 627, is further amended by adding at the end the following: 51513. State Maritime Academy Sea Term Scholarship Programs. . 628. Naval joint exercise involvement for training ships operated by State maritime academies (a) In general The Secretary of the Navy, in coordination with the Maritime Administrator, shall, to the extent practicable, include in national and international maritime warfare exercises not less than 1 training vessel used by a State maritime academy and maintained pursuant to section 51504 of title 46, United States Code, in order to provide an opportunity to integrate merchant mariners with naval and military operations. (b) Participants Subject to guidance issued by the Secretary of the Navy and Maritime Administrator, an individual may participate in the exercise aboard that training ship if the individual is— (1) a licensed merchant mariner; or (2) a student from the United States Merchant Marine Academy, a State maritime academy, a Center of Excellence for Domestic Maritime Workforce Training and Education, or a merchant marine center established under section 147 of the Workforce Innovation and Opportunity Act ( 29 U.S.C. 3197 ), as added by section 612 of this Act. (c) Priority In selecting participants under subsection (b) the Administrator shall give priority to students described in paragraph (2) of subsection (b). (d) Vessels In coordination with the Secretary of the Navy, the Maritime Administrator shall rotate training vessels to ensure that each training vessel described in subsection (a) has an equal opportunity to participate in such exercises. D Maritime Credentialing Modernization 631. Merchant mariner credentialing modernization (a) Merchant mariner credentialing modernization The Secretary of the department in which the Coast Guard is operating shall carry out necessary system and process changes to carry out the activities described in paragraphs (1) through (4). (1) Licensing, certification, and documentation database Replacement of the merchant mariner licensing, certification, and documentation database such that the database allows for— (A) the electronic submission of merchant mariner credential applications (including sea service, professional qualifications, course completion data, safety and suitability, and medical records) and course approval requests; (B) direct submission of sea service information from employers and course completion data from training providers and other stakeholders to provide data securely and directly so that documentation does not need to be submitted later by the merchant mariner; and (C) the electronic processing and evaluation of information for the issuance of credentials and course approvals, including the capability for the Secretary to complete remote evaluation of the information submitted. (2) System for data exchange Implementation of a system that provides for the exchange of data with government agencies and industry stakeholders, which provides the Maritime Administration and other agencies, as appropriate, anonymized and aggregated data showing the following: (A) The total amount of sea service for individuals with a valid merchant mariner credential. (B) The number of credentialed mariners by individual rating and the capability to filter data by endorsements. (C) Demographic information, including age, gender, ethnicity, and address or location. (D) National Maritime Center processing times. (E) The number of Coast Guard approved training providers, and, for each such training provider, the number of courses taken by individuals who have, or who are applying for, a merchant mariner credential from that training provider. (3) Public facing portal Implementation of a system that includes a public facing portal in the .gov domain instead of the .mil domain to accept merchant mariner applicant information, including credential applications, course completion data, and course approval requests, that complies with the requirements for cybersecurity and privacy information of electronic systems in the .gov domain. (4) Examination processes Upgrading the examination processes for merchant mariner examinations, by— (A) implementing an examination regime that provides for electronic and third party administration of examinations; (B) reassessing the content of tests through the development of job task analysis for all credentials; and (C) implementing a robust system to analyze examination data. (b) Report The Secretary of the department in which the Coast Guard is operating shall submit— (1) an annual report to the Committee on Commerce, Science, and Transportation, the Committee on Appropriations, and the Committee on Armed Services of the Senate, and the Committee on Transportation and Infrastructure, the Committee on Appropriations, and the Committee on Armed Services of the House of Representatives, on the progress of the system and process changes required under subsection (a); and (2) a final report to those Committees 1 year after full operating capability of the complete system, comprised of all 4 systems required under subsection (a). (c) Authorization of appropriations There is authorized to be appropriated out of the Maritime Security Trust Fund, established under section 50301(b) of title 46, United States Code, to carry out this section, $20,000,000 for fiscal year 2026, to remain available until expended. 632. Revising merchant mariner deck training requirements (a) General definitions Section 2101 of title 46, United States Code, is amended— (1) by redesignating paragraphs (20) through (56) as paragraphs (21) through (57), respectively; and (2) by inserting after paragraph (19) the following: (20) merchant mariner credential means a merchant mariner license, certificate, or document that the Secretary is authorized to issue pursuant to this title. . (b) Examinations Section 7116 of title 46, United States Code, is amended by striking subsection (c). (c) Merchant mariners documents (1) General requirements Section 7306 of title 46, United States Code, is amended to read as follows: 7306. General requirements and classifications for members of deck departments (a) In general The Secretary may issue a merchant mariner credential, to members of the deck department in the following classes: (1) Able Seaman-Unlimited. (2) Able Seaman-Limited. (3) Able Seaman-Special. (4) Able Seaman-Offshore Supply Vessels. (5) Able Seaman-Sail. (6) Able Seaman-Fishing Industry. (7) Ordinary Seaman. (b) Classification of credentials The Secretary may classify the merchant mariner credential issued under subsection (a) based on— (1) the tonnage and means of propulsion of vessels; (2) the waters on which vessels are to be operated; or (3) other appropriate standards. (c) Considerations In issuing the credential under subsection (a), the Secretary may consider the following qualifications of the merchant mariner: (1) Age. (2) Character. (3) Habits of life. (4) Experience. (5) Professional qualifications demonstrated by satisfactory completion of applicable examinations or other educational requirements. (6) Physical condition, including sight and hearing. (7) Other requirements established by the Secretary, including career patterns and service appropriate to the particular service, industry, or job functions the individual is engaged. . (2) Clerical amendment The table of sections for chapter 73 of title 46, United States Code, is amended by striking the item relating to section 7306 and inserting the following: 7306. General requirements and classifications for members of deck departments. . (3) General requirements for members of engine departments Section 7313(b) of title 46, United States Code, is amended by striking and coal passer . (4) Training Section 7315 of title 46, United States Code, is amended— (A) by amending subsection (a) to read as follows: (a) Graduation from a nautical school program approved by the Secretary may be substituted for the service requirements under sections 7307 through 7311a and 7314. ; (B) in subsection (b)— (i) by striking one-third and inserting one-half ; and (ii) by striking 7307–7311 of this title and inserting 7307–7311a and 7314 ; and (C) by striking subsection (c). (d) Reduction of lengths of certain periods of service (1) In general Title 46, United States Code, is amended— (A) in section 7307, by striking 3 years and inserting 18 months ; (B) in section 7308, by striking 18 months and inserting 12 months ; and (C) in section 7309, by striking 12 months and inserting 6 months . (2) Temporary reduction of lengths of certain periods of service Section 3534(j) of the National Defense Authorization Act for Fiscal Year 2024 ( Public Law 118–31 ) is repealed. (e) Merchant mariner credentials Section 7510 of title 46, United States Code, is amended by striking subsection (d). (f) Implementation The Secretary of the department in which the Coast Guard is operating shall implement the amended requirements under subsections (c)(3), (c)(4), and (d)(1) of this section without regard to chapters 5 and 6 of title 5, United States Code, and Executive Orders 12866 and 13563 ( 5 U.S.C. 601 note). 633. Inspections for transportation security (a) In General Chapter 81 of part F of subtitle II of title 46, United States Code, is amended by adding at the end the following: 8109. Inspections for transportation security (a) In General (1) Inspection The Secretary shall periodically, but not less than once annually, inspect each covered facility to verify that the owner or operator of the covered facility has a valid exemption under subsection (c) of section 30 of the Outer Continental Shelf Lands Act ( 43 U.S.C. 1356(c) ). (2) Covered facility In this subsection, the term covered facility means a vessel, rig, platform, or other vehicle or structure that, but for an exemption under subsection (c) of section 30 of the Outer Continental Shelf Lands Act ( 43 U.S.C. 1356(c) ) would otherwise be subject to the regulations under subsection (a)(3) of such section. (b) Transportation security card During an inspection under this section, the Secretary shall confirm that all crew members that are required to have a transportation worker identification credential pursuant to section 70105 have such a credential. . (b) Clerical amendment The table of sections for chapter 81 of title 46, United States Code, is amended by adding at the end the following: 8109. Inspections for transportation security. . 634. Renewal of merchant mariner licenses and documents Section 7507 of title 46, United States Code, is amended by adding at the end the following: (d) Renewal With respect to any renewal of a valid merchant mariner credential issued under this part that is not an extension under subsection (a) or (b), the validity period of such credential shall begin the day after the expiration of the current credential. . 635. Merchant seamen licenses, certificates, and documents; manning of vessels (a) Citizenship or noncitizen nationality (1) In general Section 7102 of title 46, United States Code, is amended— (A) in the section heading, by inserting or noncitizen nationality after Citizenship ; and (B) by inserting or noncitizen nationals (as such term is described in section 308 of the Immigration and Nationality Act ( 8 U.S.C. 1408 )) after citizens of the United States . (2) Clerical amendment The table of sections for chapter 71 of title 46, United States Code, is amended by striking the item relating to section 7102 and inserting the following: 7102. Citizenship or noncitizen nationality. . (b) Citizenship or noncitizen nationality notation on merchant mariners’ documents (1) In general Section 7304 of title 46, United States Code, is amended— (A) in the section heading, by inserting or noncitizen nationality after Citizenship ; and (B) by inserting or noncitizen national (as such term is described in section 308 of the Immigration and Nationality Act ( 8 U.S.C. 1408 )) after citizen of the United States . (2) Clerical amendment The table of sections for chapter 73 of title 46, United States Code, is amended by striking the item relating to section 7304 and inserting the following: 7304. Citizenship or noncitizen nationality notation on merchant mariners’ documents. . (c) Citizenship or noncitizen nationality (1) In general Section 8103 of title 46, United States Code, is amended— (A) in the section heading by inserting or noncitizen nationality after Citizenship ; (B) in subsection (a), by inserting or noncitizen national after citizen of the United States ; (C) in subsection (b)— (i) in paragraph (1)(A)(i), by inserting or noncitizen national after citizen of the United States ; and (ii) in paragraph (3)— (I) in the matter preceding subparagraph (A), by inserting or noncitizen nationality after citizenship ; and (II) in subparagraph (C), by inserting or noncitizen nationals after citizens of the United States ; (D) in subsection (c), by inserting or noncitizen nationals after citizens of the United States ; (E) in subsection (d)— (i) in paragraph (1), by inserting or noncitizen nationals after citizens of the United States ; and (ii) in paragraph (2), by inserting or noncitizen national after citizen of the United States each place it appears; (F) in subsection (e), in the matter preceding paragraph (1), by inserting or noncitizen national after citizen of the United States each place it appears; (G) in subsection (i)(1)(A), by inserting or noncitizen national after citizen of the United States ; (H) in subsection (k)(1)(A), by inserting or noncitizen national after citizen of the United States ; and (I) by adding at the end the following: (l) Noncitizen national defined In this section, the term noncitizen national means an individual described in section 308 of the Immigration and Nationality Act ( 8 U.S.C. 1408 ). . (2) Clerical amendment The table of sections for chapter 81 of title 46, United States Code, is amended by striking the item relating to section 8103 and inserting the following: 8103. Citizenship or noncitizen nationality and Navy Reserve requirements. . (d) Command of documented vessels Section 12131(a) of title 46, United States Code, is amended by inserting or noncitizen national (as such term is described in section 308 of the Immigration and Nationality Act ( 8 U.S.C. 1408 )) after citizen of the United States . (e) Invalidation of certificates of documentation Section 12135(2) of title 46, United States Code, is amended by inserting or noncitizen national (as such term is described in section 308 of the Immigration and Nationality Act ( 8 U.S.C. 1408 )) after citizen of the United States . 636. Reactivation of expired license (a) In General Chapter 75 of subtitle II of part E, of title 46, United States Code, is amended by adding at the end the following: 7512. Authority for reactivation of United States Merchant Mariner credentials (a) Licenses and certificates of registry Notwithstanding sections 7106 and 7107, the Secretary of the department in which the Coast Guard is operating may renew for not more than 2 years an expired license or certificate of registry issued for an individual under chapter 71 if the Secretary determines that the renewal is in response to a national emergency declared by Congress or declared under section 201 of the National Emergencies Act ( 50 U.S.C. 1621 ), as deemed necessary by the Secretary. (b) Merchant mariner documents Notwithstanding section 7302(g), the Secretary may renew for not more than 2 years an expiring merchant mariner's document issued for an individual under chapter 73 if the Secretary determines that the renewal is in response to a national emergency proclaimed by the President or declared by Congress, as deemed necessary by the Secretary. (c) Manner of renewal Any renewal granted under this section may be granted to individual seamen or a specifically identified group of seamen. . (b) Clerical amendment The table of sections for chapter 75 of title 46, United States Code, is amended by adding at the end the following: 7512. Authority for reactivation of United States Merchant Mariner credentials. . VII Amendments to the internal revenue code of 1986 701. United States vessel investment credit (a) In general Subpart E of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 48E the following new section: 48F. United States vessel investment credit (a) In general For purposes of section 46, the United States Vessel Investment credit for any taxable year is an amount equal to the applicable percentage of any qualified investment for such taxable year with respect to any qualified vessel. (b) Applicable percentage For purposes of subsection (a), the applicable percentage with respect to any qualified vessel shall be an amount equal to the sum of— (1) 33 percent, plus (2) in the case of any qualified vessel for which the owner of such vessel will, as part of the agreement described in subsection (d)(1)(F) and for the duration of such agreement, obtain protection and indemnity insurance with respect to such vessel from an insurance company that is domiciled and headquartered in the United States and is an underwriter that is approved by the Maritime Administrator, 5 percent, plus (3) in the case of any qualified vessel which is classified by and designed in accordance with the rules of the American Bureau of Shipping or any other classification society headquartered in the United States and recognized by the Secretary of the department in which the Coast Guard is operating in accordance with section 3316 of title 46, United States Code, 2 percent. (c) Qualified investment For purposes of subsection (a), the qualified investment with respect to any qualified vessel is equal to the amount paid or incurred by the taxpayer in connection with the construction, repowering, or reconstruction of such vessel— (1) in a shipyard of the United States, and (2) by an entity which is not a foreign entity of concern. (d) Qualified vessel (1) In general For purposes of this section, the term qualified vessel means a cargo vessel— (A) which is a United States flag vessel (as defined in section 1355), (B) which, in the case of any repowering or reconstruction of such vessel, was originally constructed in the United States, (C) which operates in providing transportation in the United States foreign trade (as such term is defined in section 1355(a)), (D) which is not a passenger vessel, as defined in section 2101 of title 46, United States Code, (E) which is— (i) a bulk carrier vessel, (ii) a tanker vessel, (iii) a roll-on/roll-off vessel, (iv) a container vessel, (v) a multi-purpose vessel, (vi) a cable vessel, (vii) a heavy-lift vessel, or (viii) any other type of vessel determined appropriate by the Maritime Administrator, in consultation with the Maritime Security Board, (F) which, pursuant to an agreement between the taxpayer and the Maritime Administrator, operates as a vessel of the United States for a period of not less than 10 years, (G) which has entered into an emergency preparedness agreement under section 53107 or 53407 of title 46, United States Code, or a contingency agreement under section 53207 of such title, or has otherwise entered into a voluntary agreement and plan of action with the Administrator of the Maritime Administration as authorized under section 708(c) of the Defense Production Act of 1950 ( 50 U.S.C. 4558(c) ), and (H) the construction of which begins before January 1, 2033. (2) Exclusion related to foreign entities of concern The term qualified vessel shall not include a vessel which— (A) is, or was previously, owned or operated by a foreign entity of concern, (B) was constructed, repowered, or reconstructed in a shipyard which is owned or operated by a foreign entity of concern, or (C) was registered as a vessel of a foreign country of concern at any time prior to being placed in service by the taxpayer. (e) Definitions (1) Vessels For purposes of subsection (d)(1)(E), any term used in such paragraph which is also used in chapter 536 of title 46, United States Code, shall have the same meaning as when used in such chapter. (2) Foreign entity of concern; foreign country of concern For purposes of this section, the terms foreign entity of concern and foreign country of concern have the same meaning given such terms under section 4 of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 . (f) Certain progress expenditure rules made applicable Rules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of subsection (a). (g) Regulations The Secretary, in consultation with the Maritime Administrator, shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including any regulations or guidance which may be necessary or appropriate to recapture the benefit of any credit determined under this section with respect to any qualified vessel, or any increase in the applicable percentage under subsection (b) with respect to any qualified vessel, in the case of any taxpayer which fails to comply with the terms of the agreement described in subsection (d)(1)(F) with respect to such qualified vessel. . (b) Conforming amendments (1) Section 46 of the Internal Revenue Code of 1986, as amended by section 13702(b)(1) of Public Law 117–169 , is amended— (A) in paragraph (6), by striking and at the end, (B) in paragraph (7), by striking the period at the end and inserting , and , and (C) by adding at the end the following: (8) the United States Vessel Investment credit. . (2) Section 49(a)(1)(C) of such Code, as amended by section 13702(b)(2) of Public Law 117–169 , is amended— (A) in clause (vii), by striking and at the end, (B) in clause (viii), by striking the period at the end and inserting , and , and (C) by adding at the end the following: (ix) with respect to any qualified vessel (as defined in section 48F(d)), the portion of the basis of such vessel attributable to amounts paid or incurred by the taxpayer in connection with the construction, repowering, or reconstruction of such vessel. . (3) The table of sections for subpart E of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 48E the following new item: Sec. 48F. United States Vessel Investment credit. . (c) Recapture for failure To operate as a vessel of the United States Section 50(a) of the Internal Revenue Code of 1986 is amended— (1) in paragraph (4), by striking or any applicable transaction to which paragraph (3)(A) applies and inserting any applicable transaction to which paragraph (3)(A) applies, or any violation to which paragraph (6)(A) applies , (2) by redesignating paragraph (6) as paragraph (7), (3) by inserting after paragraph (5) the following new paragraph: (6) Failure to operate qualified vessel as a vessel of the United States (A) In general If an applicable taxpayer violates any of the requirements of the agreement described in section 48F(d)(1)(F) during the duration of such agreement with respect to any investment credit property which is eligible for the United States Vessel Investment credit under section 48F(a), then the tax under this chapter for the taxable year in which such violation occurs shall be increased by 100 percent of the aggregate decrease in the credits allowed under section 38 for all prior taxable years which would have resulted solely from reducing to zero any credit determined under section 46 which is attributable to the United States Vessel Investment credit under section 48F(a) with respect to such property. (B) Exception Subparagraph (A) shall not apply if the applicable taxpayer demonstrates to the satisfaction of the Secretary and the Maritime Administrator that the taxpayer is in compliance with the agreement described in section 48F(d)(1)(F) within 30 days of a determination and notice by the Secretary. (C) Regulations and guidance The Secretary shall issue such regulations or other guidance as the Secretary determines necessary or appropriate to carry out the purposes of this paragraph, including regulations or other guidance which provide for requirements for recordkeeping or information reporting for purposes of administering the requirements of this paragraph. , and (4) in paragraph (7) (as redesignated by paragraph (2))— (A) in subparagraph (C), by striking or (3) and inserting (3), or (4) , and (B) by striking subparagraph (E) and inserting the following: (E) Applicable taxpayer For purposes of this subsection, the term applicable taxpayer means any taxpayer who has been allowed— (i) for purposes of paragraph (3), a credit under section 48D(a) for any prior taxable year, or (ii) for purposes of paragraph (6), a credit under section 48F(a) for any prior taxable year. . (d) Elective payment and transfer of credit (1) Elective payment Section 6417 of the Internal Revenue Code of 1986 is amended— (A) in subsection (b), by adding at the end the following: (13) The United States Vessel Investment credit under section 48F. , and (B) in subsection (d)(1)— (i) in subparagraph (E), by striking (C), or (D) each place it appears and inserting (C), (D), or (E) , (ii) by redesignating subparagraph (E) (as amended by clause (i)) as subparagraph (F), and (iii) by inserting after subparagraph (D) the following: (E) Election with respect to United States vessel investment credit If a taxpayer other than an entity described in subparagraph (A) makes an election under this subparagraph with respect to any taxable year in which such taxpayer has made a qualified investment with respect to any qualified vessel (as defined in section 48F), such taxpayer shall be treated as an applicable entity for purposes of this section for such taxable year, but only with respect to the credit described in subsection (b)(13). . (2) Transfer Section 6418(f)(1)(A) of the Internal Revenue Code of 1986 is amended by adding at the end the following: (xii) The United States Vessel Investment credit under section 48F. . (e) Exception relating to alternative tax on qualifying shipping activities Section 1357(c) of the Internal Revenue Code of 1986 is amended— (1) in paragraph (1), by striking paragraph (2) and inserting paragraph (2) or (4) , and (2) by adding at the end the following: (4) Exception for United States vessel investment credit Paragraph (1) shall not apply with respect to any credit allowed to the taxpayer under section 48F. . (f) Effective date The amendments made by this section shall apply to property placed in service after December 31, 2025. 702. Certain payments for maritime security excluded from gross income (a) In general Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 139I the following new subsection: 139J. Maritime security payments (a) In general Gross income shall not include any payment made pursuant to— (1) section 53106 of title 46, United States Code, (2) section 53801 of such title, (3) section 53206 of such title, (4) section 53406 of such title, (5) section 53604 of such title, (6) section 54101 of such title, or (7) section 54301 of such title. (b) Denial of double benefit No deduction or credit shall be allowed for, or by reason of, any expenditure to the extent of the amount excluded under subsection (a) for any payment which was provided with respect to such expenditure. The adjusted basis of any property shall be reduced by the amount excluded under subsection (a) which was provided with respect to such property. . (b) Clerical amendment The table of sections for part III of subchapter B of chapter 1 of such Code is amended by inserting after the item relating to section 139I the following new item: Sec. 139J. Maritime security payments. . (c) Effective date The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act. 703. Elimination of 30-day limitation on domestic operations (a) In general Section 1355 of the Internal Revenue Code of 1986 is amended— (1) in subsection (f), by striking paragraph (4), and (2) in subsection (g)(2), by striking subparagraph (D). (b) Effective date The amendments made by this section shall apply to taxable years beginning after the date of enactment of this Act. 704. Qualifying shipping activities Section 1356(b) of the Internal Revenue Code of 1986 (relating to qualifying shipping activities) is amended by striking activities in operating and inserting the carriage of goods (as defined in section 1 of the Carriage of Goods by Sea Act ( 46 U.S.C. 30701 note)) by . 705. Qualifying vessel Section 1355(a) of the Internal Revenue Code of 1986 is amended— (1) by striking paragraph (4) and inserting the following: (4) Qualifying vessel The term qualifying vessel means a vessel which is— (A) self-propelled (or a combination self-propelled and non-self-propelled), (B) a United States flag vessel or a United States-owned foreign flag vessel, (C) either— (i) a vessel designed primarily for use on the high seas which has a draft of more than 12 feet, or (ii) not less than 6,000 deadweight tons, and (D) used exclusively in the United States foreign trade during the period that the election under this subchapter is in effect. , and (2) by adding at the end the following: (8) United States-owned foreign flag vessel The term United States-owned foreign flag vessel means any vessel which— (A) is documented under the laws of a country (other than the United States) or a foreign registry which is not a foreign country of concern (as defined by section 4 of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 ), (B) is owned by a person which— (i) (I) is a citizen of the United States (as determined under section 50501 of title 46, United States Code), or (II) is controlled (within the meaning of section 954(d)(3)) by a citizen of the United States (as so determined), and (ii) owns a fleet of United States flag vessels, (C) is strategically and commercially managed from within the United States, and (D) has entered into an emergency preparedness agreement under section 53107 or 53407 of title 46, United States Code, or a contingency agreement under section 53207 of such title, or has otherwise entered into a voluntary agreement and plan of action with the Maritime Administrator as authorized under section 708(c) of the Defense Production Act of 1950 ( 50 U.S.C. 4558(c) ). . 706. Credit for construction of shipyard facilities (a) In general Subpart E of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986, as amended by section 701(a), is amended by inserting after section 48F the following new section: 48G. Credit for construction of shipyard facilities (a) In general For purposes of section 46, the shipyard investment tax credit for any taxable year is an amount equal to 25 percent of the qualified investment for such taxable year with respect to any qualified shipyard facility of a taxpayer described in section 48D(c)(1). (b) Qualified investment (1) In general For purposes of subsection (a), the qualified investment with respect to any qualified shipyard facility for any taxable year is the basis of any qualified property placed in service by the taxpayer during such taxable year which is part of a qualified shipyard facility. (2) Qualified property The term qualified property shall have the same meaning given such term in section 48D(b)(2), except that subparagraph (A)(iv) of such section shall be applied by substituting qualified shipyard facility for advanced manufacturing facility . (3) Qualified shipyard facility For purposes of this section, the term qualified shipyard facility means a facility— (A) which is located within the United States (including any territory or possession of the United States), and (B) for which the primary purpose is— (i) constructing or repairing commercial or military oceangoing vessels, (ii) manufacturing components which are critical (as determined by the Secretary, in consultation with the Secretary of the Navy and the Maritime Administrator) to the operation of commercial or military oceangoing vessels, or (iii) manufacturing equipment which is used to produce or repair commercial or military oceangoing vessels. (4) Certain progress expenditure rules made applicable Rules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of subsection (a). (c) Denial of double benefit This section shall not apply to any property placed in service by the taxpayer during the taxable year if a credit was allowed under section 48F to such taxpayer during such taxable year. (d) Regulations The Secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section. (e) Termination of credit The credit allowed under this section shall not apply to property placed in service after December 31, 2032. . (b) Conforming amendments (1) Section 46 of the Internal Revenue Code of 1986, as amended by section 701(b)(1), is amended— (A) in paragraph (7), by striking and at the end, (B) in paragraph (8), by striking the period at the end and inserting , and , and (C) by adding at the end the following: (9) the shipyard investment tax credit. . (2) Section 49(a)(1)(C) of such Code, as amended by section 701(b)(2), is amended— (A) in clause (viii), by striking and at the end, (B) in clause (ix), by striking the period at the end and inserting , and , and (C) by adding at the end the following: (x) the basis of any qualified property (as defined in subsection (b)(2) of section 48G) which is part of a qualified shipyard facility (as defined in subsection (b)(3) of such section). . (3) Section 50(a)(2)(E) of such Code, as amended by section 13702(b) of Public Law 117–169 , is amended by striking or 48E(e) and inserting 48E(e), or 48G(b)(4) . (4) The table of sections for subpart E of part IV of subchapter A of chapter 1 of such Code, as amended by section 701(b)(3), is amended by inserting after the item relating to section 48F the following new item: Sec. 48G. Shipyard investment tax credit. . (c) Elective payment and transfer of credit (1) Elective payment Section 6417 of the Internal Revenue Code of 1986, as amended by section 701, is amended— (A) in subsection (b), by adding at the end the following: (14) The shipyard investment tax credit under section 48G. , and (B) in subsection (d)(1)— (i) in subparagraph (F), by striking (D), or (E) each place it appears and inserting (D), (E), or (F) , (ii) by redesignating subparagraph (F) (as amended by clause (i)) as subparagraph (G), and (iii) by inserting after subparagraph (E) the following: (F) Election with respect to the shipyard investment tax credit If a taxpayer other than an entity described in subparagraph (A) makes an election under this subparagraph with respect to any taxable year in which such taxpayer has placed in service any qualified property which is part of a qualified shipyard facility (as defined in section 48G), such taxpayer shall be treated as an applicable entity for purposes of this section for such taxable year, but only with respect to the credit described in subsection (b)(14). . (2) Transfer Section 6418(f)(1)(A) of the Internal Revenue Code of 1986, as amended by section 701, is amended by adding at the end the following: (xiii) The shipyard investment tax credit under section 48G. . (d) Exception relating to alternative tax on qualifying shipping activities Paragraph (4) of section 1357(c) of the Internal Revenue Code of 1986, section 701(e), is amended to read as follows: (4) Exception for United States vessel investment credit and shipyard investment tax credit Paragraph (1) shall not apply with respect to any credit allowed to the taxpayer under section 48F or 48G. . (e) Effective date The amendments made by this section shall apply to property placed in service after December 31, 2025. 707. Tax incentives relating to merchant marine capital construction funds (a) In general Section 7518 of the Internal Revenue Code of 1986 is amended— (1) in subsection (a)— (A) by striking paragraph (1) and inserting the following: (1) In general The amount deposited in a fund established under chapter 535 of title 46 of the United States Code (hereinafter in this section referred to as a capital construction fund ) for a taxable year may not exceed the amount specified in the agreement under section 53503(a) of such title, which shall be an amount that is related to a commitment to invest the revenue from the capital construction fund into funding the construction of new vessels or funding cargo handling equipment. , (B) in paragraph (2), by striking paragraph (1)(B) each place it appears and inserting paragraph (1) , and (C) by adding at the end the following new paragraph: (4) Revenue For the purposes of paragraph (1), the revenue from the capital construction fund may include— (A) income attributable to the operation of any agreement vessel in foreign commerce or domestic trade or fisheries or the operation of a marine terminal in the United States, (B) the net proceeds from the disposition of an agreement vessel or cargo handling equipment or insurance or indemnity attributable to the vessel or cargo handling equipment, (C) the receipts from the investment or reinvestment of amounts held in the fund, and (D) the amount allowable as a deduction under section 167 for the taxable year with respect to the agreement vessels or cargo handling equipment. , (2) in subsection (b)(2), by striking Amounts in any capital construction fund and all that follows through (not in excess of 60 percent) and inserting An agreed percentage , (3) in subsection (e)— (A) by striking paragraph (1) and inserting the following: (1) In general A qualified withdrawal from the fund is one made in accordance with the terms of the agreement but only if it is for— (A) the acquisition, construction, repowering, or reconstruction of— (i) a qualified vessel or a barge or container that is part of the complement of a qualified vessel, or (ii) cargo handling equipment, or (B) the payment of the principal on indebtedness incurred in the acquisition, construction, repowering, or reconstruction of— (i) a qualified vessel or a barge or container that is part of the complement of a qualified vessel, or (ii) cargo handling equipment. Except to the extent provided in regulations prescribed by the Secretary, subparagraph (A), and so much of subparagraph (B) as relates only to barges and containers, shall apply only with respect to barges and containers constructed in the United States. , (B) by redesignating paragraph (2) as paragraph (4), and (C) by inserting after paragraph (1) the following: (2) Fully automated cargo handling equipment No withdrawals may be made from a capital construction fund to purchase fully automated cargo handling equipment that is remotely operated or remotely monitored with or without the exercise of human intervention or control, if the Secretary determines such equipment would result in a net loss of jobs within a marine terminal. (3) Prohibition on people's republic of china cranes No withdrawals may be made from a capital construction fund to purchase cranes manufactured in the People's Republic of China. , (4) in subsection (f)— (A) in paragraph (2), by inserting cargo handling equipment, after barge, both places the term appears, (B) in paragraph (3), by inserting cargo handling equipment, after barge, both places the term appears, and (C) in paragraph (4), by inserting cargo handling equipment, after barges, , (5) in subsection (g)— (A) in the flush matter at the end of paragraph (2), by inserting cargo handling equipment, after advanced , and (B) in paragraph (5)(A)— (i) in the heading, by striking 25 years and inserting 15 years , (ii) by striking 26th, 27th, 28th, 29th, or 30th taxable year and inserting following specified taxable year , and (iii) by striking the table contained therein and inserting the following: If the amount remains in the fund at the close of the- The applicable percentage is- 16th taxable year 20 percent 17th taxable year 40 percent 18th taxable year 60 percent 19th taxable year 80 percent 20th taxable year 100 percent , and (6) in subsection (i), by striking as in effect on the date of the enactment of this section . (b) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2025. 708. Exemption of student incentive payment agreements from gross income (a) In general Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986, as amended by section 702, is further amended by inserting after section 139J the following new section: 139K. Student incentive payment agreements In the case of an individual who has entered into an agreement described in section 51509 of title 46, United States Code, gross income does not include any student incentive payments made to such individual pursuant to such agreement. . (b) Clerical amendment The table of sections for part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986, as amended by section 702, is further amended by inserting after the item relating to section 139J the following new item: Sec. 139K. Student incentive payment agreements. . (c) Effective date The amendments made by this section shall apply with respect to payments made after December 31, 2025. 709. Maritime fuel tax parity (a) In general Section 4041(g) of the Internal Revenue Code of 1986 is amended by adding at the end the following new sentence: For purposes of subsection (a)(2), the exemption under paragraph (1) shall also apply to fuel sold for use or used by a vessel which is both described in section 4042(c)(1) and actually engaged in trade between the Atlantic or Pacific ports of the United States (including any territory or possession of the United States). . (b) Effective date The amendment made by this section shall apply to fuel sold for use or used after December 31, 2025. 710. Treatment of maritime prosperity zones as opportunity zones (a) In general Subchapter Z of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: 1400Z–3. Treatment of maritime prosperity zones as opportunity zones (a) In general A maritime prosperity zone shall be treated as a qualified opportunity zone. (b) Special rules In applying this subchapter to any maritime prosperity zone which is a qualified opportunity zone solely by reason of this section— (1) In general For purposes of determining— (A) whether any property which would not be qualified opportunity fund business property without regard to this section is qualified opportunity fund business property, and (B) whether any corporation or partnership which is not a qualified opportunity fund business without regard to this section is a qualified opportunity fund business, section 1400Z–2(d) shall be applied with the modifications described in paragraph (2). (2) Modifications The modifications described in this paragraph are as follows: (A) Start date Subparagraphs (B)(i)(I), (C)(i), and (D)(i)(I) of section 1400Z–2(d)(2) shall each be applied by substituting the date of the enactment of the Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2025 for December 31, 2017 . (B) Qualified business property Property shall not be treated as qualified opportunity zone business property unless such property is substantially used in an industry which is assigned a code under the North American Industrial Classification System which is described in paragraph (3). (C) Qualified business A trade or business shall not be treated as a qualified opportunity zone business unless such trade or business operates in an industry which is assigned a code under the North American Industrial Classification System which is described in paragraph (3). (3) Eligible north American industrial classification system codes The following codes under the North American Industrial Classification System are the codes described in this paragraph: (A) 48311 (deep sea freight transportation). (B) 483113 (coastal and Great Lakes freight transportation). (C) 483211 (inland water freight transportation). (D) 4883 (support activities for water transportation). (E) 3366 (ship and boat building). (c) Maritime prosperity zone For purposes of this chapter— (1) In general The term maritime prosperity zone means any population census tract that— (A) contains or is determined by the Maritime Administrator to be a viable site for— (i) a shipyard of the United States, (ii) a port, or (iii) a harbor facility, and (B) is designated as a maritime prosperity zone under paragraph (2). (2) Designation A population census tract is designated as a maritime prosperity zone under this paragraph if— (A) the Maritime Administrator, in consultation with the Secretary of the Navy and the Maritime Security Board, nominates the tract for designation as a maritime prosperity zone and notifies the Secretary in writing of such nomination, and (B) the Secretary certifies such nomination and designates such tract as a qualified maritime prosperity zone. (3) Number of population census tracts designated Not more than 100 population census tracts may be designated as maritime prosperity zone. (4) Period for which designation is in effect Except as provided in paragraph (2), a designation as a maritime prosperity zone shall remain in effect for the period— (A) beginning on the date of the designation, and (B) ending at the close of the 5th calendar year beginning on or after such date of designation. . (b) Clerical amendment The table of sections for subchapter Z of chapter 1 of such Code is amended by adding at the end the following new item: Sec. 1400Z–3. Treatment of maritime prosperity zones as opportunity zones. . (c) Effective date The amendments made by this section shall take effect on the date of the enactment of this Act.