Construction Reserve Fund

 

To promote the construction, reconstruction, reconditioning, or acquisition of merchant vessels built and documented under the laws of the United States for purposes of national defense and the development of U.S. commerce.

General information about this opportunity
Last Known Status
Active
Program Number
20.812
Federal Agency/Office
Agency: Department of Transportation
Office: Maritime Administration (MARAD)
Type(s) of Assistance Offered
Direct Payments for Specified Use
Program Accomplishments
Fiscal Year 2014: Over $70,000,000.00 of new vessel construction was undertaken with funds deposited in CRFs. Fiscal Year 2015: No Current Data Available Fiscal Year 2016: No Current Data Available
Authorization
Merchant Marine Act of 1936, Section 511, Public Law 74-835, 46 U.S.C 1161.
Who is eligible to apply/benefit from this assistance?
Applicant Eligibility
A Construction Reserve Fund (CRF) may be established by any citizen of the United States who owns, in whole or in part, a vessel or vessels operating in the foreign or domestic commerce of the U.S., or in the fisheries. Additionally, any citizen who is operating such vessel or vessels owned by another individual may establish a CRF.
Beneficiary Eligibility
Any citizen of the United States who owns, in whole or in part, a vessel or vessels operating in the foreign or domestic commerce of the U.S. or in the fisheries. Additionally, any citizen who is operating such vessel or vessels owned by another individual.
Credentials/Documentation
Be able to provide proof of requirements called for in Applicant Eligibility section of this program. The program is excluded from coverage under OMB Circular No. A-87. This program is excluded from coverage under 2 CFR 200, Subpart E - Cost Principles.
What is the process for applying and being award this assistance?
Pre-Application Procedure
Contact the Maritime Administration, Office of Financial Approvals and Marine Insurance. This program is excluded from coverage under OMB Circular No. A-102. Environmental impact information is not required for this program. This program is excluded from coverage under E.O. 12372.
Application Procedure
This program is excluded from coverage under 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. You may manually enter in any other application procedures not found above
See Federal Register Notice (46 CFR 287.4). Persons seeking to establish a Construction Reserve Fund may make application by letter to the headquarters office shown below. This program is excluded from coverage under OMB Circular No. A-102 and A- 110.
Award Procedure
Review of the application by the Office of Financial Approvals and Marine Insurance to determine citizenship of the applicant, if applicant is owner or operator of the vessel and if the proposed objective of construction, reconstruction or acquisition is acceptable.
Deadlines
Contact the headquarters or regional office, as appropriate, for application deadlines.
Approval/Disapproval Decision Time
From 60 to 90 days.
Appeals
Not Applicable.
Renewals
Not Applicable.
How are proposals selected?
Review of the application by the Office of Financial Approvals and Marine Insurance to determine citizenship of the applicant, if applicant is owner or operator of the vessel and if the proposed objective of construction, reconstruction or acquisition is acceptable.
How may assistance be used?
The Construction Reserve Fund (CRF), authorized under 46 USC 1161, is a financial assistance program which provides tax deferral benefits to U.S. flag operators. The CRF permits the fundholder to deposit gains attributable to the sale of, or indemnification for, loss of vessels and to defer tax on such gains provided the gains are to be reinvested in vessels. Also the CRF allows the accumulation of earnings from operations of vessels documented in the U.S., or the earnings from the investment of the Fund. The ability to accumulate funds and the tax deferral provision have enabled fundholders to construct or reconstruct in the United States, and documented under the laws of the United States, larger and better-equipped vessels, to reduce mortgage debt on the vessels, and to construct a greater number of vessels than would be possible without the program.
What are the requirements after being awarded this opportunity?
Reporting
Not Applicable.
Auditing
Not Applicable.
Records
See Reports section of this program.
Other Assistance Considerations
Formula and Matching Requirements
This program has no statutory formula.
Matching requirements are not applicable to this program.
MOE requirements are not applicable to this program.
Length and Time Phasing of Assistance
Depends on each individual program agreed upon between the Maritime Administration and the applicant. Method of awarding/releasing assistance: by letter of credit.
Who do I contact about this opportunity?
Regional or Local Office
See Regional Agency Offices. Offices listed in appendix IV of the Catalog.
Headquarters Office
Daniel Ladd 1200 New Jersey Avenue, S.E. , Washington, District of Columbia 20590 Phone: (202)366-1859
Website Address
http://www.marad.dot.gov
Financial Information
Account Identification
69-1750-0-1-403.
Obligations
(Direct Payments for Specified Use) FY 14 $0; FY 15 est $0; and FY 16 est $0 - Company's own funds are used for the program.
Range and Average of Financial Assistance
Defer tax on gains by depositing the gains attributable to the sale of or indemnification for loss of vessels in accordance with the program.
Regulations, Guidelines and Literature
Part 287, Title 46 CFR; Order and Form of Resolution which outlines details pertaining to the establishment and maintenance of the Construction Reserve Fund.
Examples of Funded Projects
Fiscal Year 2014: Crowley Holdings, Inc. took delivery of the Articulated Tug-Barge Alert/750-2, which transports over 325,000 barrels of petroleum products to Florida every week. The vessel was built using funds in Crowley’s CRF. Fiscal Year 2015: No Current Data Available Fiscal Year 2016: No Current Data Available

 


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