Capital Construction Fund Revision
Key claim: U.S. operators of any American-built ship in domestic or foreign commerce could use MARAD’s tax-deferred Capital Construction Fund for vessel work without old geographic-trade limits, while unused or empty accounts would be closed after 10 years of inactivity.
Abstract
(Proposed Rule · Transportation Department, Maritime Administration) MARAD proposes to revise its regulations governing the filing of applications and administration of Capital Construction Fund (CCF) Program accounts. The proposed rule would (i) conform the regulations to recent statutory amendments extending CCF Program application to all U.S. built vessels engaged in United States domestic or foreign commerce, (ii) eliminate limitations on CCF Program availability to certain geographic trades, (iii) clarify the maximum allowable completion time for reconstruction projects, and (iv) provide for funds to be used for acquisitions under certain circumstances. In addition, the NPRM proposes a mechanism to terminate inactive accounts, accounts with a zero balance, and accounts where a CCF Program objective has failed to commence within a 10-year period. The proposed rule would also correct numerous citations, modernize text, update agency contact information, and remove obsolete references.
Why this matters
The Capital Construction Fund is a core MARAD tool for financing U.S.-flag vessel construction and reconstruction through tax-deferred deposits, and the proposed revision would broaden eligibility to U.S.-built ships in any commerce rather than just specified trades. The account-inactivity closure provision also cleans up dormant accounts that have accumulated under prior rules, giving operators clearer administrative expectations.