MAINTENANCE AND REPAIR REIMBURSEMENT PILOT PROGRAM.

SEC. 3503. MAINTENANCE AND REPAIR REIMBURSEMENT PILOT PROGRAM. Section 3517 of the Maritime Security Act of 2003 (46 U.S.C. 53101 note) is amended to read as follows:“SEC. 3517. MAINTENANCE AND REPAIR REIMBURSEMENT PILOT PROGRAM.“(a) Authority to Enter Agreements.—“(1) In general.—The Secretary of Transportation shall carry out a pilot program under which the Secretary shall enter into an agreement with 1 or more contractors under chapter 531 of title 46, United States Code, regarding maintenance and repair of 1 or more vessels that are subject to an operating agreement under that chapter.“(2) Requirement of agreement.—The Secretary shall, subject to the availability of appropriations, require 1 or more persons to enter into an agreement under this section as a condition of awarding an operating agreement to the person under chapter 531 of title 46, United States Code, for 1 or more vessels that normally make port calls in the United States.“(b) Terms of Agreement.—An agreement under this section—“(1) shall require that except as provided in subsection (c), all qualified maintenance or repair on the vessel shall be performed in the United States;“(2) shall require that the Secretary shall reimburse the contractor in accordance with subsection (d) for the costs of qualified maintenance or repair performed in the United States; and“(3) shall apply to qualified maintenance or repair performed during the 5-year period beginning on the date the vessel begins operating under the operating agreement under chapter 531 of title 46, United States Code.“(c) Exception to Requirement to Perform Work in the United States.—A contractor shall not be required to have qualified maintenance or repair work performed in the United States under this section if—“(1) the Secretary determines that there is no facility capable of meeting all technical requirements of the qualified maintenance or repair in the United States located in the geographic area in which the vessel normally operates available to perform the work in the time required by the contractor to maintain its regularly scheduled service; 119 STAT. 3549“(2) the Secretary determines that there are insufficient funds to pay reimbursement under subsection (d) with respect to the work; or“(3) the Secretary fails to make the certification described in subsection (e)(2).“(d) Reimbursement.—“(1) In general.—The Secretary shall, subject to the availability of appropriations, reimburse a contractor for costs incurred by the contractor for qualified maintenance or repair performed in the United States under this section.“(2) Amount.—The amount of reimbursement shall be equal to the difference between—“(A) the fair and reasonable cost of obtaining the qualified maintenance or repair in the United States; and“(B) the fair and reasonable cost of obtaining the qualified maintenance or repair outside the United States, in the country in which the contractor would otherwise undertake the qualified maintenance or repair.“(3) Determination of fair and reasonable costs.—The Secretary shall determine fair and reasonable costs for purposes of paragraph (2).“(e) Notification Requirements.—“(1) Notification by contractor.—The Secretary is not required to pay reimbursement to a contractor under this section for qualified maintenance or repair, unless the contractor—“(A) notifies the Secretary of the intent of the contractor to obtain the qualified maintenance or repair, by not later than 90 days before the date of the performance of the qualified maintenance or repair; and“(B) includes in such notification—“(i) a description of all qualified maintenance or repair that the contractor should reasonably expect may be performed;“(ii) a description of the vessel’s normal route and port calls in the United States;“(iii) an estimate of the cost of obtaining the qualified maintenance or repair described under clause (i) in the United States; and“(iv) an estimate of the cost of obtaining the qualified maintenance or repair described under clause (i) outside the United States, in the country in which the contractor otherwise would undertake the qualified maintenance or repair.“(2) Certification by secretary.—“(A) Not later than 30 days after the date of receipt of notification under paragraph (1), the Secretary shall certify to the contractor—“(i) whether the cost estimates provided by the contractor are fair and reasonable;“(ii) if the Secretary determines that such cost estimates are not fair and reasonable, the Secretary’s estimate of fair and reasonable costs for such work;“(iii) whether there are available to the Secretary sufficient funds to pay reimbursement under subsection (d) with respect to such work; and119 STAT. 3550“(iv) that the Secretary commits such funds to the contractor for such reimbursement, if such funds are available for that purpose.“(B) If the contractor notification described in paragraph (1) does not include an estimate of the cost of obtaining qualified maintenance and repair in the United States, then not later than 30 days after the date of receipt of such notification, the Secretary shall—“(i) certify to the contractor whether there is a facility capable of meeting all technical requirements of the qualified maintenance and repair in the United States located in the geographic area in which the vessel normally operates available to perform the qualified maintenance and repair described in the notification by the contractor under paragraph (1) in the time period required by the contractor to maintain its regularly scheduled service; and“(ii) if there is such a facility, require the contractor to resubmit such notification with the required cost estimate for such facility.“(f) Regulations.—“(1) Requirement to issue notice of proposed rule making.—The Secretary shall—“(A) by not later than 30 days after the effective date of this subsection, issue a notice of proposed rule making to implement this section; “(B) in such notice, solicit the submission of comments by the public regarding rules to implement this section; and“(C) provide a period of at least 30 days for the submission of such comments.“(2) Interim rules.—Upon expiration of the period for submission of comments pursuant to paragraph (1)(C), the Secretary may prescribe interim rules necessary to carry out the Secretary’s responsibilities under this section. For this purpose, the Secretary is excepted from compliance with the notice and comment requirements of section 553 of title 5, United States Code. At the time interim rules are issued, the Secretary shall solicit comments on the interim rules from the public and other interested persons. Such period for comment shall not be less than 90 days. All interim rules prescribed under the authority of this subsection that are not earlier superseded by final rules shall expire no later than 270 days after the effective date of this subsection.“(g) Qualified Maintenance or Repair Defined.—In this section the term ‘qualified maintenance or repair’—“(1) except as provided in paragraph (2), means—“(A) any inspection of a vessel that is—“(i) required under chapter 33 of title 46, United States Code; and“(ii) performed in the period in which the vessel is subject to an agreement under this section; “(B) any maintenance or repair of a vessel that is determined, in the course of an inspection referred to in subparagraph (A), to be necessary; and119 STAT. 3551“(C) any additional maintenance or repair the contractor intends to undertake at the same time as the work described in subparagraph (B); and“(2) does not include—“(A) maintenance or repair not agreed to by the contractor to be undertaken at the same time as the work described in paragraph (1); or“(B) any emergency work that is necessary to enable a vessel to return to a port in the United States.“(h) Annual Report.—The Secretary shall submit to the Congress by not later than September 30 each year a report on the program under this section. The report shall include a listing of future inspection schedules for all vessels included in the Maritime Security Fleet under section 53102 of title 46, United States Code.“(i) Authorization of Appropriations.—In addition to the other amounts authorized by this title, for reimbursement of costs of qualified maintenance or repair under this section there is authorized to be appropriated to the Secretary of Transportation $19,500,000 for each of fiscal years 2006 through 2011.” .