Margate Shipping Company, and Chestnut Shipping Company; Notice of Application for Payment of Unused Operating-Differential Subsidy

DEPARTMENT OF TRANSPORTATION

Maritime Administration

[Docket S-928]

Margate Shipping Company, and Chestnut Shipping Company; Notice

of Application for Payment of Unused Operating-Differential Subsidy

Notice is hereby given that Margate Shipping Company (Margate) and

Chestnut Shipping Company (Chestnut) request the extensions of their

operating-differential subsidy agreements (ODSA) for five years or, in

the alternative, a new five year ODSA, for the purpose of using

available but unused days of operating-differential subsidy (ODS),

which have accrued under their respective ODSAs, commencing as of

January 1, 1974. Additionally, pursuant to section 605(b) of the

Merchant Marine Act, 1936, as amended, Margate and Chestnut

(applicants) request that the subsidizable lives of the following

vessels be extended to the indicated dates:

------------------------------------------------------------------------

Vessel Extended date

------------------------------------------------------------------------

CHESTNUT HILL...................... December 1, 2001.

KITTANNING......................... March 1, 2002.

CHELSEA............................ February 28, 2000.

CORONADO........................... December 28, 1998.

CHERRY VALLEY...................... July 10, 1999*.

------------------------------------------------------------------------

*The Maritime Administration has previously extended the subsidizable

lives of the CHERRY VALLEY, CHELSEA, and CORONADO to February 28,

1997.

On January 3, 1972, Margate entered into Contract MA/MSB-134 for

the CORONADO, CHERRY VALLEY, and CHELSEA. Chestnut entered into

Contract MA/MSB-299 for the CHESTNUT HILL and KITTANNING on December

17, 1973.

On November 9, 1989, the Maritime Administration (MARAD) approved a

vessel sharing/substitution system in which Contract MA/MSB-299 and MA/

MSB-134 were amended to include the CHILBAR, GOLDEN GATE, EDGAR M.

QUEENY, ENERGY INDEPENDENCE, and FREDERICKSBURG, provided that the

annual amount of ODS accrued for all vessels operating under the two

ODSAs would not exceed five ship years of subsidized operation in any

given year.

On December 22, 1993, MARAD agreed to separate Contract MA/MSB-134

and MA/MSB-299 into distinct ODSA contracts to correct the inequitable

result of terminating these agreements 20 years from the date of entry

into subsidized service of the first vessel delivered. The separate

agreements provided that each subsidized vessel would have a full 20-

year operating period from date of entry into service until termination

of its ODSA.

Margate's ODSAs on the CORONADO, CHERRY VALLEY, and CHELSEA

(Contracts MA/MSB-134(a), (b), and (c) expired on December 27, 1993,

July 9, 1994, and February 27, 1995, respectively, when each vessel

reached 20 years of age. At present Chestnut may operate the following

vessels under Contracts MA/MSB-299(a) and (b), which expire on November

30, 1996 and on February 28, 1997, when the CHESTNUT HILL and

KITTANNING reach 20 years of age:

CHESTNUT HILL

KITTANNING

CHELSEA

CORONADO

CHERRY VALLEY

CHILBAR

FREDERICKSBURG

The applicants advise that the unused subsidy days for the Margate

and Chestnut ODSAs commencing January 1, 1974, are as follows:

------------------------------------------------------------------------

Unused

ODSAs days

------------------------------------------------------------------------

Contracts MA/MSB-134, 134(a), (b), and (c).................. 729.00

Contracts MA/MSB-299, 299(a) and (b) (to September 1995).... 3,153.90

Less subsidy sharing days (to September 1995)............... (857.00)

-----------

2,296.90

------------------------------------------------------------------------

According to the applicants, Chestnut and Margate have a total of

3,025.90 unused subsidy days (729.00 days plus 2,296.90 days). Margate

and Chestnut request that if Brookville Shipping, Inc.'s application is

granted (see 60 Fed. Reg. 54099, Oct. 19, 1995), that Margate and

Chestnut also be enabled to obtain the full unused benefits of their

ODSAs by extending Contracts MA/MSB-134 (a), (b), and (c) and Contract

MA/MSB-299 (a) and (b) for an additional five years beyond their

expiration dates, or in the alternative, Margate and Chestnut request

that the Maritime Subsidy Board (Board) enter into five year ODSAs with

Margate and Chestnut for the payment of ODS for the number of unused

subsidy days of their respective ODSAs.

In connection with this request, Margate and Chestnut further ask

the Board to permit them to share the unused subsidy days among the

CHESTNUT HILL, KITTANNING, CHELSEA, CORONADO, CHERRY VALLEY, CHILBAR,

and FREDERICKSBURG without limitation

[[Page 61288]]

as to the number of days that may be used in any one year.

As indicated earlier, Margate and Chestnut are requesting an

extension of the subsidizable lives of their vessels so that these

vessels would remain eligible to operate with ODS under the extended

contracts or new contracts as the case may be. According to the

applicants, the effect of extending the lives of these vessels will

enable Chestnut and Margate to utilize the unused subsidy days. The

applicants advise that such an extension of the lives of the vessels

will not give advantage or be prejudicial as between U.S. citizens

operating in the trade, since there would be no increase in vessels or

change in service, and the service will not be in addition to existing

service; accordingly, section 605(c) is not a bar to the request.

This application may be inspected in the Office of the Secretary,

Maritime Administration. Any person, firm or corporation having any

interest in such request and desiring to submit comments concerning the

application must file written comments in triplicate with the

Secretary, Maritime Administration, Room 7210, Nassif Building, 400

Seventh Street SW., Washington D.C. 20590. Comments must be received no

later than 5:00 p.m. on December 13, 1995. The Maritime Subsidy Board

will consider any comments submitted and take such action with respect

thereto as may be deemed appropriate.

(Catalog of Federal Domestic Assistance Program No. 2.804 Operating-

Differential Subsidies).

By Order of the Maritime Subsidy Board.

Dated: November 22, 1995.

Joel C. Richard,

Secretary.

[FR Doc. 95-29133 Filed 11-28-95; 8:45 am]

BILLING CODE 4910-81-P