quirement so it seems to us this money should properly be invested because we see no prospect of its being needed. Mr. PELLY. What is the balance of the Federal ship mortgage insurance fund now which you are holding in cash? Mr. ALEXANDER. About $6 million. Mr. PELLY. And you think that the demands might be such that you are afraid to invest it in a Government bond because it might not be liquid? Mr. ALEXANDER. I think that the general opinion is that it is a prudent thing to do to hold this money in cash under this title XI insurance program. Mr. PELLY. It seems to me when a provision was written into the law that it could be invested and earn interest that it might well be that you are not prudent in not investing it. Was the matter considered or is the money just sitting there? Mr. ALEXANDER. No; this matter is constantly being considered, sir. If it appears it should be invested we would ask that the Treasurer of the United States invest it. Mr. PELLY. Has that $6 million been an average balance which has run along for quite some time? Does it fluctuate from period to period? Mr. ALEXANDER. Perhaps we can have some figures from the record, if I may respond in that way. This is Mr. Yowell, in charge of this title XI program for Maritime. Mr. YoWELL. At the present time we have $5.9 million in the fund. Against that we hold on the first mortgages of ships which have been foreclosed on, $3.2 million. That money should be paid. We have reserved this money in anticipation of need for paying off the mortgage rather than borrowing money from the Treasury which we have done in the past and then paid them off. We anticipate we will pay off this $3.2 million now. We feel there is sufficient money. That would leave cash of about $2.7 million. We will need that only in the event of additional defaults. Mr. PELLY. Actually, that money is in the Treasury itself and is utilized by the Treasurer of the United States in the national interest, so it is not just sitting in a bank and giving some private bank a nice balance on which to earn money. Mr. YoWELL. It is in the Treasury; yes, sir. Mr. PELLY. Assuming now that you want the same provision as is in the Federal ship mortgage insurance fund, and permission under the war risk insurance account to invest that money, what would you anticipate that you would invest it in? Would it be a long-term Government bond or a short-term Government bond? Mr. ALEXANDER. The Treasurer of the United States would make that determination. Mr. PELLY. I am sure he would know what is best for the fund. I think this is very advisable to have this investment provision. Thank you. Mr. BONNER. Are there any other witnesses desiring to be heard on this bill? 1962-MISCELLANEOUS MERCHANT MARINE LEGISLATION TUESDAY, SEPTEMBER 25, 1962 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON MERCHANT MARINE OF THE Washington, D.C. Also present: Representative Boykin. Staff: John M. Drewry, chief counsel, and W. B. Winfield, chief clerk. (H.R. 12869, H.R. 12968, and H.R. 12973 follow with departmental [H.R. 12869, 87th Cong., 2d sess.] A BILL To provide that the vessel Montauk may be a United States-flag commercial vessel Be it enacted by the Senate and House of Representatives of the United States (46 Hon. HERBERT C. BONNER, THE GENERAL COUNSEL OF THE TREASURY, Chairman, Committee on Merchant Marine and Fisheries, DEAR MR. CHAIRMAN: Reference is made to your request for the views of The purpose of the bill is to permit additional time for qualification of the According to the records of the Bureau of Customs of this Department, this of Merchantile Steamship Corp., under temporary certificate of registry No. 11, issued at Galveston, Tex., on December 14, 1960. This document is subject to surrender because of changes which have been made in the vessel affecting tonnage and length. While the Bureau of Customs administers the documentation laws, the administration of the laws pertaining to the eligibility of vessels for the carriage of cargoes under section 901 is primarily within the jurisdiction of the Maritime Administration. If favorable consideration is given to this bill, the Department anticipates no administrative difficulties in carrying out its purposes. The Department has been advised by the Bureau of the Budget that there is no objection from the standpoint of the administration's program to the submission of this report to your committee. Sincerely yours, FRED B. SMITH, Deputy General Counsel. [H.R. 12968, 87th Cong., 2d sess.] A BILL To amend section 901 (b) of the Merchant Marine Act, 1936, to eliminate certain time limitations Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That clause (2) of the last proviso of subsection (b) of section 901 of the Merchant Marine Act, 1936, as amended (46 U.S.C. 1241(b)), is amended by striking out "not later than one year subsequent to the date of the enactment of this amendment". Hon. HERBERT C. BONNER, COMPTROLLER GENERAL OF THE UNITED STATES, Chairman, Committee on Merchant Marine and Fisheries, DEAR MR. CHAIRMAN: Further reference is made to your letter of August 29, 1962, acknowledged on September 4, requesting the comments of the General Accounting Office concerning H.R. 12968, 87th Congress, 2d session, entitled “A bill to amend section 901 (b) of the Merchant Marine Act, 1936, to eliminate certain time limitations." We have no special information or knowledge as to the desirability of or need for the proposed legislation and, therefore, we make no recommendation with respect to its enactment. Sincerely yours, JOSEPH CAMPBELL, Comptroller General of the United States. GENERAL SERVICES ADMINISTRATION, Washington, D.C., September 24, 1962. Hon. HERBERT C. BONNER, Chairman, Committee on Merchant Marine and Fisheries, DEAR MR. CHAIRMAN: Your letter of August 29, 1962, requests comments concerning H.R. 12968, a bill to amend section 901 (b) of the Merchant Marine Act, 1936, to eliminate certain time limitations. This legislative proposal would remove the provision whereby an owner of a vessel under U.S. registry who had contracted for the rebuilding of such vessel abroad and had so notified the Maritime Administration of such contract would be required to have the rebuilding completed and the vessel thereafter documented under U.S. registry on its first arrival at a U.S. port not later than 1 year subsequent to the enactment of Public Law 87-266 (75 Stat. 565; 46 U.S.C. 1241). Removal of the time limitation would permit such privately owned U.S.-flag commercial vessel to participate in the movement of tonnage under the provisions of the Cargo Preference Act immediately upon documentation, and such vessel would not be excluded for a 3-year period from the date of documentation. Under the Federal Property and Administrative Services Act of 1949 (63 Stat. 383; 40 U.S.C. 481) General Services Administration is interested in traffic management on behalf of executive agencies from the viewpoint of a user of transportation services. Accordingly, since H.R. 12968 does not affect users of transportation services, the mission of GSA is not sufficiently affected to warrant an expression of opinion on the merits of this legislative proposal. The Bureau of the Budget has advised that, from the standpoint of the administration's program, there is no objection to the submission of this report to your committee. Sincerely yours, BERNARD L. BOUTIN, Administrator. [H.R. 12973, 87th Cong., 2d sess.] A BILL To provide that the steamship Glenbrook may be a United States flag commercial vessel for the purposes of section 901(b) of the Merchant Marine Act, 1936 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the steamship Glenbrook owned by the Wall Street Traders, Inc., New York, New York, shall be deemed to be a privately owned United States flag commercial vessel for the purposes of subsection (b) of section 901 of the Merchant Marine Act, 1936, as amended (46 U.S.C. 1241(b)), notwithstanding the last sentence of such subsection, if such vessel is documented under United States registry on its first arrival at a United States port after the date of enactment of this Act. Hon. HERBERT C. BONNER, THE GENERAL COUNSEL OF THE TREASURY, Chairman, Committee on Merchant Marine and Fisheries, House of Representatives, DEAR MR. CHAIRMAN: Reference is made to your request for the views of this Department on H.R. 12973, to provide that the steamship Glenbrook may be a U.S.-flag commercial vessel for the purposes of section 901 (b) of the Merchant Marine Act, 1936. The purpose of the bill is to permit additional time for qualification of the Glenbrook, official number 245776, as a carrier for Government-aid cargoes under the provisions of section 901(b) (46 U.S.C. 1241(b)), as amended by Public Law 87-266. Under the terms of the amendment, the Glenbrook, which is being rebuilt abroad, must be redocumented as a vessel of the United States at its first arrival at a U.S. port not later than September 21, 1962. The proposed legislation would extend the time for the documentation of the Glenbrook to its first arrival in a U.S. port after the date of enactment. According to the records of the Bureau of Customs of this Department, this vessel is presently documented as a vessel of the United States in the ownership of Wall Street Traders, Inc., a New York corporation, under permanent enrollment No. 63, issued at New York, N.Y., on October 7, 1960. This document should have been exchanged for a register before the vessel departed on its foreign voyage (46 U.S.C. 278). Since that exchange was not effected, the document will be taken up upon the vessel's return, and a new document will be issued, after disposition of the penalties incurred under section 278, showing the changes in the vessel's tonnage and length. While the Bureau of Customs administers the documentation laws, the administration of the laws pertaining to the eligibility of vessels for the carriage of cargoes under section 901 is primarily with the jurisdiction of the Maritime Administration. If favorable consideration is given to this bill, the Department anticipates no administrative difficulties in carrying out its purposes. The Department has been advised by the Bureau of the Budget that there is no objection from the standpoint of the administration's program to the submission of this report to your committee. Sincerely yours, FRED B. SMITH, Deputy General Counsel. Mr. BONNER. The committee will come to order. Mr. Alexander, when you appeared in the Senate, did you testify on all of these vessels in question or just the vessels contained in S. 3649? (H.R. 12869, same subject.) STATEMENT OF DONALD W. ALEXANDER, MARITIME ADMINISTRATOR Mr. ALEXANDER. Mr. Chairman, the testimony in the Senate committee hearing was given by the Deputy Administrator, Mr. Gulick. I will have included in the statement here this morning this point as to the testimony given in the Senate hearing and the point at which the Spitfire came into the discussion. This will be covered if I may give it in order as I relate it in this statement which I have prepared and with your permission I would like to give it. Mr. BONNER. You may proceed. Mr. ALEXANDER. Mr. Gulick did testify on all three vessels in the Senate hearing, though. Mr. BONNER. You may proceed. Mr. ALEXANDER. Thank you. Gentlemen, Section 901(b) of the Merchant Marine Act, 1936, as amended by Public Law 87-266, provides that for purposes of determining eligibility for participation in cargoes reserved for "privately owned U.S.-flag commercial vessels" under that section-the cargo preference law-the term "privately owned U.S.-flag commercial vessels" shall not be deemed to include any vessel which subsequent to the date of enactment of that amendment-September 21, 1961-is documented under foreign laws or is rebuilt outside the United States, until such vessel has been documented under the laws of the United States for a period of 3 years. The section, as amended, makes an exception if prior to enactment of the amendment (1) the owner of a vessel, or contractor for the purchase of a vessel, originally constructed in the United States and rebuilt abroad or contracted to be rebuilt abroad, has notified the Maritime Administration of its intent to document such vessel under U.S. registry and such vessel is so documented on its first arrival at a U.S. port not later than 1 year subsequent to the date of enactment of the amendment or (2) the owner of a vessel under U.S. registry has made a contract for the rebuilding abroad of such vessel and has notified the Maritime Administration of such contract and such rebuilding is completed and such vessel is thereafter documented under U.S. registry on its first arrival at a U.S. port not later than 1 year subsequent to the date of enactment of the amendment. The date of enactment of the amendment was September 21, 1961. H.R. 12869 would provide that, despite the requirement of section 901 (b) that to be deemed a privately owned U.S.-flag commercial |