H.R. 2651 (111th): Maritime Workforce Development Act

111th Congress, 2009–2010. Text as of Oct 15, 2009 (Referred to Senate Committee).

Status & Summary | PDF | Source: GPO

IIB

111th CONGRESS

1st Session

H. R. 2651

IN THE SENATE OF THE UNITED STATES

October 15, 2009

Received; read twice and referred to the Committee on Commerce, Science, and Transportation

AN ACT

To amend title 46, United States Code, to direct the Secretary of Transportation to establish a maritime career training loan program, and for other purposes.

1.

Short title

This Act may be cited as the Maritime Workforce Development Act.

2.

Maritime education loan program

(a)

In general

Chapter 517 of title 46, United States Code, is amended by adding at the end the following:

51705.

Maritime career training loan program

(a)

Establishment

The Secretary of Transportation shall establish a maritime career training loan program (in this section referred to as the program) in accordance with the requirements of this section.

(b)

Purpose

The purpose of the program shall be to make maritime career training loans available to eligible students to provide for the training of United States mariners.

(c)

Administration

The program shall be carried out by the Secretary, acting through the Administrator of the Maritime Administration.

(d)

Duties

The Secretary shall—

(1)

allocate, on an annual basis, the award of loans under the program based on the needs of students;

(2)

develop an application process and eligibility criteria for the award of loans under the program;

(3)

approve applications for loans under the program based on the eligibility criteria and allocations made under paragraph (1); and

(4)

designate maritime training institutions at which loans made under the program may be used.

(e)

Designation of maritime training institutions

(1)

In general

In designating maritime training institutions under subsection (d)(4), the Secretary—

(A)

may include Federal, State, and commercial training institutions and nonprofit training organizations, except that undergraduate students at the United States Merchant Marine Academy shall not be eligible for loans under the program;

(B)

shall designate institutions based on geographic diversity and scope of classes offered;

(C)

shall ensure that designated institutions have the ability to administer the program; and

(D)

shall ensure that designated institutions meet requirements to provide training instruction for appropriate Coast Guard-approved training instruction.

(2)

Exclusions

The Secretary—

(A)

may exclude from participation in the program a maritime training institution that has had severe performance deficiencies, including deficiencies demonstrated by audits or program reviews conducted during the 5 calendar years immediately preceding the present year;

(B)

shall exclude from participation in the program a maritime training institution that has delinquent or outstanding debts to the United States, unless such debts are being repaid under or in accordance with a repayment arrangement satisfactory to the United States, or the Secretary in the Secretary’s discretion determines that the existence or amount of any such debts has not been finally determined by the appropriate Federal agency;

(C)

may exclude from participation in the program a maritime training institution that has failed to comply with quality standards established by the Department of Labor, the Coast Guard, or a State; and

(D)

may establish such other criteria as the Secretary determines will protect the financial interest of the United States and promote the purposes of this section.

(f)

State maritime academies

(1)

Use of funds for loans to students attending State maritime academies

The Secretary may obligate not more than 50 percent of the amounts appropriated to carry out this section for a fiscal year for loans to undergraduate students attending State maritime academies receiving assistance under chapter 515 of this title.

(2)

Academic standards for students

Students at State maritime academies receiving loans under the program shall maintain satisfactory progress toward the completion of their course of study as evidenced by the maintenance of a cumulative C average, or its equivalent, or academic standing consistent with the requirements for graduation, as determined by the institution.

(g)

Loan amounts and use

(1)

Maximum amounts

The Secretary may not make loans to a student under the program in an amount that exceeds $15,000 in a calendar year or $60,000 in the aggregate.

(2)

Use of loan proceeds

A student who receives a loan under the program may use the proceeds of the loan only for postsecondary expenses incurred at an institution designated by the Secretary under subsection (d)(4) for books, tuition, required fees, travel to and from training facilities, and room and board.

(h)

Student eligibility

To be eligible to receive a loan under the program, a student shall—

(1)

be eligible to hold a license or merchant mariner document issued by the Coast Guard;

(2)

provide to the Secretary such information as the Secretary may require, including all current Coast Guard documents, certifications, proof of United States citizenship or permanent legal status, and a statement of intent to enter a maritime career;

(3)

meet the enrollment requirements of a maritime training institution designated by the Secretary under subsection (d)(4); and

(4)

sign an agreement to—

(A)

complete a course of instruction at such a maritime training institution; and

(B)

maintain a license or document and work under the authority of the license or document and any associated endorsements for at least 18 months following the date of graduation from the maritime program for which the loan proceeds will be used.

(i)

Administration of loans

(1)

Contents of loan agreements

Any agreement between the Secretary and a student borrower for a loan under the program shall—

(A)

be evidenced by a note or other written instrument that provides for the repayment of the principal amount of the loan and any origination fee, together with interest thereon, in equal installments (or, if the student borrower so requests, in graduated periodic installments determined in accordance with such schedules as may be approved by the Secretary) payable quarterly, bimonthly, or monthly, at the option of the student borrower, over a period beginning 9 months from the date on which the student borrower completes study or discontinues attendance at the maritime program for which the loans are used at the institution approved by the Secretary and not exceeding 10 years;

(B)

include provision for acceleration of repayment of the whole, or any part, of such loan, at the option of the student borrower;

(C)

provide the loan without security and without endorsement;

(D)

provide that the liability to repay the loan shall be canceled upon the death of the student borrower, or if the student borrower becomes permanently and totally disabled, as determined in accordance with regulations to be issued by the Secretary;

(E)

contain a notice of the system of disclosure of information concerning default on such loan to credit bureau organizations; and

(F)

include provisions for deferral of repayment, as determined by the Secretary.

(2)

Rate of interest

A student borrower who receives a loan under the program on or after January 1, 2010, and before October 1, 2015, shall be obligated to repay the loan amount to the Secretary, together with interest beginning in the period referred to in paragraph (1)(A), at a rate to be determined as follows:

(A)

For a loan for which the first disbursement is made on or after January 1, 2010, and before October 1, 2011, 5.6 percent on the unpaid principal balance of the loan.

(B)

For a loan for which the first disbursement is made on or after October 1, 2011, and before October 1, 2012, 4.5 percent on the unpaid principal balance of the loan.

(C)

For a loan for which the first disbursement is made on or after October 1, 2012, 3.4 percent on the unpaid principal balance of the loan.

(3)

Disclosure required prior to disbursement

(A)

In general

The Secretary shall at or prior to the time the Secretary makes a loan to a student borrower under the program, provide thorough and adequate loan information on such loan to the student borrower. The disclosures required by this paragraph may be made as part of the written application material provided to the student borrower, as part of the promissory note evidencing the loan, or on a separate written form provided to the student borrower.

(B)

Contents

The disclosures shall include—

(i)

the address to which communications and payments should be sent;

(ii)

the principal amount of the loan;

(iii)

the amount of any charges collected at or prior to the disbursal of the loan and whether such charges are to be deducted from the proceeds of the loan or paid separately by the student borrower;

(iv)

the stated interest rate on the loan;

(v)

the yearly and cumulative maximum amounts that may be borrowed;

(vi)

an explanation of when repayment of the loan will be required and when the student borrower will be obligated to pay interest that accrues on the loan;

(vii)

a statement as to the minimum and maximum repayment term that the Secretary may impose, and the minimum monthly payment required by law and a description of any penalty imposed as a consequence of default, such as liability for expenses reasonably incurred in attempts by the Secretary to collect on a loan;

(viii)

a statement of the total cumulative balance, including the loan applied for, owed by the student borrower to the Secretary, and an estimate of the projected monthly payment, given such cumulative balance;

(ix)

an explanation of any special options the student borrower may have for loan consolidation or other refinancing of the loan;

(x)

a statement that the student borrower has the right to prepay all or part of the loan, at any time, without penalty;

(xi)

a statement summarizing circumstances in which repayment of the loan or interest that accrues on the loan may be deferred, and a brief notice of the program for repayment of loans, on the basis of military service, pursuant to the Department of Defense educational loan repayment program (10 U.S.C. 16302);

(xii)

a definition of default and the consequences to the student borrower if the student borrower defaults, together with a statement that the disbursement of, and the default on, a loan under this part shall be reported to a credit bureau or credit reporting agency;

(xiii)

to the extent practicable, the effect of accepting the loan on the eligibility of the student borrower for other forms of student assistance; and

(xiv)

an explanation of any cost the student borrower may incur in the making or collection of the loan.

(C)

Information to be provided without cost

The information provided under this paragraph shall be available to the Secretary without cost to the student borrower.

(4)

Repayment after default

The Secretary may require any student borrower who has defaulted on a loan made under the program to—

(A)

pay all reasonable collection costs associated with such loan; and

(B)

repay the loan pursuant to an income contingent repayment plan.

(5)

Authorization to reduce rates and fees

Notwithstanding any other provision of this section, the Secretary may prescribe by regulation any reductions in the interest rate or origination fee paid by a student borrower of a loan made under the program as the Secretary determines appropriate to encourage ontime repayment of the loan. Such reductions may be offered only if the Secretary determines the reductions are cost neutral and in the best financial interest of the United States.

(6)

Collection of repayments

The Secretary shall collect repayments made under the program and exercise due diligence in such collection, including maintenance of all necessary records to ensure that maximum repayments are made. Collection and servicing of repayments under the program shall be pursued to the full extent of the law, including wage garnishment if necessary. The Secretary of the Department in which the Coast Guard is operating shall provide the Secretary of Transportation with any information regarding a mariner that may aid in the collection of repayments under this section.

(7)

Repayment schedule

A student borrower who receives a loan under the program shall repay the loan quarterly, bimonthly, or monthly, at the option of the student borrower, over a period beginning 9 months from the date the student borrower completes study or discontinues attendance at the maritime program for which the loan proceeds are used and ending not more than 10 years after the date repayment begins. Provisions for deferral of repayment shall be determined by the Secretary.

(8)

Contracts for servicing and collection of loans

The Secretary may—

(A)

enter into a contract or other arrangement with State or nonprofit agencies and, on a competitive basis, with collection agencies for servicing and collection of loans under this section; and

(B)

conduct litigation necessary to carry out this section.

(j)

Revolving loan fund

(1)

Establishment

The Secretary shall establish a revolving loan fund consisting of amounts deposited in the fund under paragraph (2).

(2)

Deposits

The Secretary shall deposit in the fund—

(A)

receipts from the payment of principal and interest on loans made under the program; and

(B)

any other monies paid to the Secretary by or on behalf of individuals under the program.

(3)

Availability of amounts

Amounts in the fund shall be available to the Secretary, without further appropriation—

(A)

to cover the administrative costs of the program, including the maintenance of records and making collections under this section; and

(B)

to the extent that amounts remain available after paying such administrative costs, to make loans under the program.

(4)

Maintenance of records

The Secretary shall maintain accurate records of the administrative costs referred to in paragraph (3)(A).

(k)

Annual report

The Secretary, on an annual basis, shall submit to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate a report on the program, including—

(1)

the total amount of loans made under the program in the preceding year;

(2)

the number of students receiving loans under the program in the preceding year; and

(3)

the total amount of loans made under program that are in default as of the date of the report.

(l)

Authorization of appropriations

There are authorized to be appropriated for each of fiscal years 2010 through 2015—

(1)

$10,000,000 for making loans under the program; and

(2)

$1,000,000 for administrative expenses of the Secretary in carrying out the program.

51706.

Maritime recruitment, training, and retention grant program

(a)

Strategic plan

(1)

In general

Not later than one year after the date of enactment of this section, and at least once every 3 years thereafter, the Secretary of Transportation, acting through the Administrator of the Maritime Administration, shall publish in the Federal Register a plan that describes the demonstration, research, and multistate project priorities of the Department of Transportation concerning merchant mariner recruitment, training, and retention for the 3-year period following the date of publication of the plan.

(2)

Contents

A plan published under paragraph (1) shall contain strategies and identify potential projects to address merchant mariner recruitment, training, and retention issues in the United States.

(3)

Factors

In developing a plan under paragraph (1), the Secretary shall take into account, at a minimum—

(A)

the availability of existing research (as of the date of publication of the plan);

(B)

the need to ensure results that have broad applicability;

(C)

the benefits of economies of scale and the efficiency of potential projects; and

(D)

the likelihood that the results of potential projects will be useful to policymakers and stakeholders in addressing merchant mariner recruitment, training, and retention issues.

(4)

Consultation

In developing a plan under paragraph (1), the Secretary shall consult with representatives of the maritime industry, labor organizations, and other governmental entities and parties with an interest in the maritime industry.

(5)

Transmittal to Congress

The Secretary shall transmit copies of a plan published under paragraph (1) to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate.

(b)

Demonstration projects

(1)

In general

The Secretary may award grants to a maritime training institution to carry out demonstration projects that implement the priorities identified in the plan prepared under subsection (a)(1), for the purpose of developing and implementing methods to address merchant mariner recruitment, training, and retention issues.

(2)

Grant awards

Grants shall be awarded under this subsection on a competitive basis under guidelines and requirements to be established by the Secretary.

(3)

Applications

To be eligible to receive a grant for a project under this subsection, a maritime training institution shall submit to the Secretary a grant proposal that includes, at a minimum—

(A)

information demonstrating the estimated effectiveness of the project; and

(B)

a method for evaluating the effectiveness of the project.

(4)

Eligible projects

Projects eligible for grants under this subsection may include—

(A)

the establishment of maritime technology skill centers developed through local partnerships of industry, labor, education, community-based organizations, economic development organizations, or Federal, State, and local government agencies to meet unmet skills needs of the maritime industry;

(B)

projects that provide training to upgrade the skills of workers who are employed in the maritime industry;

(C)

projects that promote the use of distance learning, enabling students to take courses through the use of media technology, such as videos, teleconferencing, and the Internet;

(D)

projects that assist in providing services to address maritime recruitment and training of youth residing in targeted high poverty areas within empowerment zones and enterprise communities;

(E)

the establishment of partnerships with national and regional organizations with special expertise in developing, organizing, and administering merchant mariner recruitment and training services; and

(F)

the establishment of maritime training programs that foster technical skills and operational productivity in communities in which economies are related to or dependent upon the maritime industry.

(c)

Projects authorized

(1)

Projects

The Secretary may award grants to carry out projects identified in a plan published under subsection (a)(1) under which the project sponsor will—

(A)

design, develop, and test an array of approaches to providing recruitment, training, or retention services to one or more targeted populations;

(B)

in conjunction with employers, organized labor, other groups (such as community coalitions), and Federal, State, or local agencies, design, develop, and test various training approaches in order to determine effective practices; or

(C)

assist in the development and replication of effective service delivery strategies for the national maritime industry as a whole.

(2)

Research projects

The Secretary may award grants to carry out research projects identified in a plan published under subsection (a)(1) that will contribute to the solution of maritime industry recruitment, training, and retention issues in the United States.

(3)

Multistate or regional projects

The Secretary may award grants to carry out multistate or regional projects identified in a plan published under subsection (a)(1) to effectively disseminate best practices and models for implementing maritime recruitment, training, and retention services designed to address industry-wide skill shortages.

(4)

Grant awards

Grants shall be awarded under this subsection on a competitive basis under guidelines and requirements to be established by the Secretary.

(d)

Authorization of appropriations

There are authorized to be appropriated for each of fiscal years 2010 through 2015—

(1)

$10,000,000 for making grants under this section; and

(2)

$1,000,000 for administrative expenses of the Secretary in carrying out this section.

.

(b)

Conforming amendment

The analysis for such chapter is amended by adding at the end the following:

51705. Maritime career training loan program.

51706. Maritime recruitment, training, and retention grant program.

.

Passed the House of Representatives October 14, 2009.

Lorraine C. Miller,

Clerk.