MARAD PROPOSES TO AMEND TITLE XI FUNDS MANAGEMENT POLICY
The U.S. Maritime Administration has proposed to amend its rules regarding the management of funds for its loan guarantee program.
Recent legislation authorizes the Transportation secretary under the 1936 Merchant Marine Act to hold funds from Title XI obligors as collateral by depositing them with the Treasury and investing them in Treasury obligations.
MarAd said its proposed rulemaking to accommodate the legislation would change the current procedures to “simplify, reduce costs of and expedite Title XI closings.”
The Title XI program is a loan guarantee that provides the “full faith and credit” of the U.S. government for payment of debt obligations for:
* U.S. or foreign shipowners to finance or refinance either U.S.-flag vessels or eligible export vessels constructed, reconstructed, or reconditioned in U.S. shipyards.
* U.S. shipyards for the purpose of financing new shipbuilding technology.
The guaranteed obligations are sold in the private sector, including banks, pension funds, life insurance companies and the general public.
MarAd said it would take comments from industry about its proposed rulemaking through Aug. 12. For more information, contact Richard M. Lorr, MarAd’s assistant chief counsel for ship financing, at (202) 366-5882.