shall accrue during such periods of furlough.

§ 262.34 Suspension.

(a) In order to make available an increased number of qualified officers and unlicensed personnel to meet the higher levels of manpower demand associated with the current level of shipping activity, each officer and seaman may, at his option, in accordance with the terms of paragraph (b) of this section, waive time off for accrued vacations but receive accrued vacation pay while on active duty status.

(b) Subject to the following stated conditions, the Maritime Administrator/Maritime Subsidy Board suspends until such time that conditions warrant otherwise, the working condition requirement contained in §§ 262.31 through 262.33 of this part:

(1) In each instance the union must certify to the operator that qualified personnel are not otherwise available;

(2) Such suspension of said working condition requirement is deemed temporary;

(3) The working condition requirement contained in §§ 262.31 through 262.33 will be returned to its former status when, in the opinion of the Maritime Administrator/Maritime Subsidy Board, conditions so warrant; and

(4) The election to accept a proffered cash allowance in lieu of time off shall be optional with the crew member.

[G.O. 15, Amdt. 1, 31 FR 8494, June 17, 1966]

CADETS AND OFFICERS

8 262.50 Exclusion of cadets and cadet officers from minimum-manning and wage scales and working conditions. The Board having determined, on advice of its General Counsel, that Cadets and Cadet Officers in training on vessels receiving an operating subsidy do not come within the purview of Title III, section 301 of the Merchant Marine Act, 1936, §§ 262.1 to 262.33, and the supplements thereto are hereby amended to exclude cadets and cadet officers from the provisions thereof.

§ 262.105 Conduct of hearing and appear

ances.

The conduct of the hearing shall be a function of the Hearing Examiners' Office except where the Board shall otherwise direct. Any individual, firm, corporation, group, organization or other party interested in the outcome of the proceedings shall have the right to appear, either personally or by representation, at the hearing and be heard. The duly elected representatives of the organizations which have been certified by the National Labor Relations Board as the proper collective bargaining agencies shall have the right to represent the employees who are members of their organizations at any such hearing.

[G.O. 32, 5 FR 2229, June 14, 1940]

Upon conclusion of the hearing, a proposed report shall be prepared containing a statement of the issues, facts, findings and conclusions. A copy of this proposed report shall be served by mail upon each party who shall have appeared at the hearing and requested a copy thereof.

[G.O. 32, 5 FR 2229, June 14, 1940]

§ 262.107 Exceptions to proposed report. Within 15 days after service of the proposed report, any party may file and service exceptions to any statement therein contained, together with a brief in support thereof, except that parties on the Pacific Coast, may file and serve such exceptions and briefs within 20 days after service.

[G.O. 32, 5 FR 2229, June 14, 1940]

§ 262.108 Report and recommendations to the Board.

After expiration of the period for the filing of exceptions and briefs, a report and recommendations shall be submitted to the Board, together with the transcript of the record of the hearing and subsequent proceedings. [G.O. 32, 5 FR 2229, June 14, 1940]

§ 262.109 Final action of Board.

The final action of the Board shall be the adoption of its final report and

272.6 Subsidy maintenance and repair procedure.

272.7 Subsidy repair summaries.

272.8 Categorizing and allocating charges. 272.9 Modifications, alterations, additions, and betterments.

272.10 Maintenance and repairs; definition. 272.11 Examples of expenses ineligible for subsidy participation at the maintenance and repair rate.

272.12 Definition of "consumables", "expendables", and "expendable equipment.

272.13 Effective date.

AUTHORITY: Sec. 204, 49 Stat. 1987, as amended; 46 U.S.C. 1114.

SOURCE: General Order 20, 3d Rev., 35 FR 4048, Mar. 4, 1970, unless otherwise noted. § 272.1 Purpose.

The purpose of this part is to establish the policy and procedure to be followed by the Maritime Administration and by the subsidized steamship operators in conducting subsidy condition surveys and accomplishment and reporting of maintenance and repairs on vessels approved for operation under the Maritime Subsidy Board Operating-Differential Subsidy Agreements.

§ 272.2 Subsidy condition survey require. ments.

(a) Condition surveys of vessels approved for subsidized operation shall be conducted in the following instances:

(1) At the commencement of the first subsidized voyage of each vessel

placed in subsidized operation, except newly constructed vessels which enter subsidized service immediately upon completion of building and for which there is a survey report made by the Trial and Guarantee Survey Boards of the Maritime Administration or any other condition report satisfactory to the United States.

(2) At the commencement of the first voyage of each vessel after resumption of subsidized operation following temporary withdrawal from subsidized operation. For the purposes of the surveys required by this paragraphs (a)(2) and (6) of this section, a vessel which is not withdrawn from the agreement shall not be considered as temporarily withdrawn if it performs unsubsidized voyages in a subsidized service of the same operator.

(3) At the commencement of the first voyage of each vessel following the effective date of the establishment of a maintenance and repair subsidy rate, if such subsidy rate was not established as of paragraph (a)(1) of this section.

(4) During the drydocking period incident to the vessel's American Bureau of Shipping Special Surveys.

(5) Upon the discontinuance of a maintenance and repair subsidy rate.

(6) Upon the withdrawal of each vessel from subsidized service, either temporarily or permanently. For the purposes of the surveys required by this paragraphs (a)(6) and (2) of this section, a vessel which is not withdrawn from the agreement shall not be considered as temporarily withdrawn if it performs unsubsidized voyages in a subsidized service of the same operator.

(7) Upon termination of the last voyage of each vessel under the operating-differential subsidy contract or at the end of the contract period with respect to subsidized vessels in idle status at that time, unless such contract is immediately superseded by a operating-differential subsidy

new

contract with the same operator.

(b) A vessel commencing subsidized operation outside the continental limits of the United States shall be surveyed immediately at her first port of call in the United States, and it shall be incumbent upon the operator

to make arrangements with the appropriate Ship Repair and Maintenance Field Office for the conducting of such survey.

§ 272.3 Subsidy condition instructions; general.

Instructions and information relative to conducting subsidy condition surveys as outlined in § 272.2, and to take other action determined to be necessary to protect the Government's interest, will be furnished the respective Region Director by the Division of Ship Repair and Maintenance; however, the Ship Repair and Maintenance Field Offices are authorized, when requested by subsidized operators, to conduct conditions surveys specified in § 272.2. At the time a subsidy condition survey is to be conducted, the operator is to be invited to arrange for attendance of his representative; however, such representative is not required to be present.

(a) Condition surveys conducted in conformance with requirements of paragraphs (a)(1), (2), (3), and (4) of § 272.2 will be reported on Ship Survey Report, Form MA-58, and shall be prepared in sufficient detail to readily reveal a comprehensive picture of the conditions noted with an evaluation of each item in accordance with the instructions on the form. Condition report forms-MA-55 Turbine and Gears, MA-56 Tooth Contact Report, MA-57 Drydock Report, and MA-59 Diesel Engine Report-are to be used as applicable.

(b) The condition surveys prescribed in paragraphs (a)(5), (6), and (7) of § 272.2 shall be accomplished as follows:

(1) The subsidized operator shall prepare and furnish the appropriate Ship Repair and Maintenance Field Office detailed repair specifications covering all work outstanding on the vessel after completion of repairs for the voyage immediately preceding the survey requirement. The Ship Repair and Maintenance Field Office shall conduct an inspection of the vessel prior to its next sailing for the purpose of assuring that the operator's specifications cover outstanding defects which require attention and

which are attributable to subsidized operation. These specifications, together with the findings of the Ship Repair and Maintenance Field Office regarding the contents thereof, shall constitute the subsidy condition survey report required by the Operating-Differential Subsidy Contract.

(2) In those cases involving discontinuance of maintenance and repair rate, permanent withdrawal from subsidized service, or contract termination without simultaneous renewal, only that work contained in these specifications and verified by the Ship Repair and Maintenance Field Office as defects attributable to subsidized operation, will be considered for subsidy participation, if such work is accomplished not later than the next drydocking period (periodical or otherwise) and the ownership of the vessel is retained by the particular operator: Provided, however, That the transfer of the ownership of a vessel to the United States pursuant to the provisions of section 510 of the Merchant Marine Act, 1936, as amended, shall not preclude subsidy participation otherwise permitted.

(3) The costs of correcting all maintenance and repair items which are noted on any condition survey report shall be chargeable to the period of operations covered by the report, except that effective January 1, 1964, the costs of any such items which have been noted on a recapture condition survey report as previously required and which are properly includable in the subsidized accountings, shall be chargeable to the recapture period in which the work is performed.

(c) The operator shall make arrangements with the appropriate Ship Repair and Maintenance Field Office for the conducting of surveys required by this part. The operator shall assist the representative of the Ship Repair and Maintenance Field Office, and shall permit access to all parts of the vessel, its log books and records.

official

§ 272.4 Execution of subsidy condition survey reports.

All survey reports are to be signed by the operator's authorized representative for the vessel involved, if

such representative was in attendance, and the Superintendent Engineer or equivalent, as well as by the Marine Surveyor who conducted the survey, and by the appropriate representative of the Region Ship Repair and Maintenance Office under whose jurisdiction the survey was conducted.

§ 272.5 Distribution.

It shall be the responsibility of the respective Maritime Administration Region Office to compile sufficient copies of the subsidy surveys in order to make distribution as follows:

(a) One copy to the Division of Ship Repair and Maintenance, Washington, D.C.

(b) One copy to the operator of the subsidized vessel involved.

(c) One copy to be retained in the files of the Region Ship Repair and Maintenance Office under whose jurisdiction the survey was conducted.

§ 272.6 Subsidy maintenance and repair procedure.

(a) The preparation of specifications, the awarding of maintenance and repair contracts, the inspection and approval of maintenance and repairs as to workmanship, quality, materials, and satisfactory completion are all the responsibility of the subsidized operator.

(b) The repairing and maintenance upkeep of subsidized vessels by any subsidiary company, holding company, affiliate company, or associate company of the operator, as differentiated from directly hired shore gang labor, is subject to written approval by the Maritime Administration pursuant to section 803, Merchant Marine Act, 1936, as amended. Requests for such approval shall be addressed to the appropriate Region Director. When such work is performed on subsidized vessels by any subsidiary company, holding company, affiliate company, or associate company of the operator, the specifications shall be itemized in detail and item priced.

(c) Maintenance and repair specifications, including those covering work to be performed by operator's shore gang are to be prepared in sufficient detail to permit determination of the reason

ableness of prices. Contractor's invoices shall contain the starting and completion dates of each job, the contractor's price on each individual item contained in the specifications, and whenever applicable, the item numbers contained in the applicable subsidy survey shall be indicated against the respective corrective items in the maintenance and repair specifications. Itemized prices shall be furnished for s work performed by shore gangs and #such item prices shall be further segregated between labor and material charges.

Spe

(d) In all cases where the operator furnishes material to the contractor from (1) ship's stores, (2) operator's warehouse, or (3) direct purchase for a specified job, he shall note on the invoice, requisition slip, expenditure voucher, or other form of transfer memorandum, the contract number and item number on which said material was used. The following form is suggested:

Requisitioned Materials-Received and Installed in connection with: Voyage No.Order No.- -Item No.

Operator's representative

(e) A priced copy of the certified invoice, requisition slip, expenditure voucher, property transfer notice, or other form of transfer memorandum tashall be attached by operator to the bcontract referred to and submitted in support of the "Subsidy Repair Summary" (Form MA-140).

§ 272.7 Subsidy repair summaries.

(a) The subsidized operators shall prepare a Subsidy Repair Summary (Form MA-140) for those vessels, including the voyages of vessels which t have been temporarily withdrawn from subsidized service, whose voyages terminated in any one quarter of a year, January 1 through March 31, or April 1 through June 30, etc. This Summary must be carefully prepared and certified by the Superintendent Engineer or other responsible official of the company, as follows:

This is to certify that, to the best of my knowledge and belief, and based on recorded entries through this is a true and correct statement of repair and mainte

nance expenditures for the period stated and that the repair and maintenance items indicated as eligible for subsidy participation are reasonably attributable to service subsequent to commencement of the first voyage under the Operating-Differential Subsidy Agreement and were necessary, satisfactorily completed, and the price is fair and reasonable (exceptions are listed on separate page).

The Subsidy Repair Summary (Form MA-140) must cover all expenditures both domestic and foreign made on requisitions for maintenance and repairs. On vessels which have been permanently withdrawn from the Operating-Differential Subsidy Contract, the operators shall submit repair summaries properly supported by the documents referred to in paragraph (b) of this section, covering only the correction of defects noted in off-subsidy survey reports. Each operator shall furnish his own required supply of this Form.

(b) The subsidized operator shall submit the Subsidy Repair Summary, as well as supplements thereto, supported by copies of documents pertinent thereto, such as repair specifications, material requisitions or purchase orders, invoices, underwriters, and classification society surveys, property transfer notice, scrap credit or other forms of credit memoranda, etc. (if invoice is itemized and fully descriptive of work with item prices, then specifications or purchase order is not required), to the appropriate Region Ship Repair and Maintenance Office upon completion of repairs charged to the terminating voyage(s). In the case of a single voyage summary, the submission shall be within 120 days after the vessel involved has sailed from her last U.S. port of call on the next outward voyage, and in the case of a multi-voyage summary, within 120 days after the close of the quarter.

(c) The appropriate Region Ship Repair and Maintenance Office shall make a review of the repair summary for the purpose of ascertaining that all pertinent and required information and data are attached, and shall transmit the Subsidy Repair Summary with all supporting data to the Chief, Divi