46 C.F.R. § 252.32 Maintenance (upkeep) and repairs.
Title 46 - Shipping
(a) Subsidy items. The fair and reasonable maintenance and repair costs not compensated by insurance, if eligible for subsidy under the ODSA and the regulations in 46 CFR part 272, incurred by the operator during the calendar year. (b) Subsidy rate. The subsidy rate for maintenance and repair shall be the U.S.-foreign cost differential determined from price estimates of representative items of maintenance and repair work and by using the repair practices of the foreign-flag competition. See paragraph (b)(4) of this section for an example calculation. (1) Cost survey. MARAD shall select a sample of jobs which are representative of the various types of maintenance and repair work—drydocking and underwater repairs, machinery repairs, hull and deck repairs, electrical repairs, exterior painting and interior painting, etc. The jobs shall be described fully and combined into a standard set of specifications based on a particular type of vessel. The same specifications shall be used for obtaining all price estimates. MARAD shall request reliable and mutually acceptable ship repair cost experts to ascertain the U.S. and foreign M&R prices. MARAD shall survey foreign countries during a three-year cycle. The survey year prices shall be adjusted in the years between surveys by price adjustments estimated by the ship repair cost experts. (2) Country cost differential. A country cost differential shall be determined for each country where work was performed on the competitive vessels. The country cost differential shall be 100 percent minus the ratio of the estimated foreign price to the U.S. price estimate. The U.S. price estimate shall be representative of the coastal area included in the subsidized service (for example East Coast) or, if more than one coast is served, the coast where the company is home based. For example: (3) Distribution of repairs. The distribution of repairs refers to the countries where M&R work was performed on the vessels of the foreign-flag competitor. When data on the repairing practices are obtained directly from the foreign competitor, they shall be used. If information about such practices is unavailable—or only partially available—data, published by the classification societies and Lloyd's Voyage Record, reporting the dates and localities of drydocking and completion of the various types of vessel surveys, shall be used for determining the geographical distribution of the unknown repairing practices. If such information is unavailable, repairing practices shall be determined on the basis of the industry as a whole. (4) M&R subsidy rate. The U.S.-foreign cost differential for the foreign-flag competitor shall be determined by multiplying the percentage distribution of repairs for each country where repair work was performed by the country cost differential for that country, and by adding the resulting weighted cost differential for all countries. For example: (c) Data submission requirement. The operator is required to submit a Subsidy Repair Summary (Form MA–140) quarterly, in accordance with 46 CFR part 272. [51 FR 40426, Nov. 7, 1986, as amended at 54 FR 5086, Feb. 1, 1989; 58 FR 17349, Apr. 2, 1993; 61 FR 32706, June 25, 1996]
Title 46: Shipping
PART 252—OPERATING-DIFFERENTIAL SUBSIDY FOR BULK CARGO VESSELS ENGAGED IN WORLDWIDE SERVICES
Subpart D—Calculation of Subsidy Rates
§ 252.32 Maintenance (upkeep) and repairs.
Determination of Country Cost Differential [Year_1985; U.S. Atlantic_Gulf Coast; Foreign Country_Singapore]------------------------------------------------------------------------ Foreign Repair category price U.S. price------------------------------------------------------------------------Drydocking and Underwater Repairs............. $89,840 $300,245Tank Cleaning and Coating..................... 70,160 77,080Boiler Repairs................................ 10,545 47,550Machinery Repairs............................. 22,505 108,165Hull and Deck Repairs......................... 33,500 99,370Piping System................................. 71,905 215,830Electrical Repairs............................ 12,340 36,660Exterior Painting............................. 5,035 30,640Interior Painting............................. 390 1,470 -------------------------Estimate Totals............................... 316,220 917,010------------------------------------------------------------------------Foreign/U.S. Price Ratio_34%.Country Cost Differential (100-34)_66%.
ABC Bulk Company, Inc., Maintenance and Repair Subsidy Rate---------------------------------------------------------------------------------------------------------------- Distribution of repairs Country cost Principal competitor ----------------------------------- differential Weighted cost differentials Country (1) Percent percent (2) ___ (1) x (2) (percent) (3)----------------------------------------------------------------------------------------------------------------Liberia.......................... U.K................. 15 19 2.9 Japan............... 20 36 7.2 Singapore........... 65 57 37.1 ----------------------------- Subsidy rate................. .................... ........... ............ 47----------------------------------------------------------------------------------------------------------------
