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                                                       Calendar No. 530
108th Congress                                                   Report
                                 SENATE
 2d Session                                                     108-274
======================================================================

 
              MARITIME TRANSPORTATION SECURITY ACT OF 2004

                               __________

                              R E P O R T

                                 OF THE

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                    on

                                S. 2279



                                     

                  May 20, 2004.--Ordered to be printed




       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                      one hundred eighth congress
                             second session

                     JOHN MCCAIN, Arizona, Chairman
TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
CONRAD BURNS, Montana                DANIEL K. INOUYE, Hawaii
TRENT LOTT, Mississippi              JOHN D. ROCKEFELLER IV, West 
KAY BAILEY HUTCHISON, Texas              Virginia
OLYMPIA J. SNOWE, Maine              JOHN F. KERRY, Massachusetts
SAM BROWNBACK, Kansas                JOHN B. BREAUX, Louisiana
GORDON SMITH, Oregon                 BYRON L. DORGAN, North Dakota
PETER G. FITZGERALD, Illinois        RON WYDEN, Oregon
JOHN ENSIGN, Nevada                  BARBARA BOXER, California
GEORGE ALLEN, Virginia               BILL NELSON, Florida
JOHN E. SUNUNU, New Hampshire        MARIA CANTWELL, Washington
                                     FRANK LAUTENBERG, New Jersey
           Jeanne Bumpus, Staff Director and General Counsel
                   Rob Freeman, Deputy Staff Director
                  Robert W. Chamberlin, Chief Counsel
      Kevin D. Kayes, Democratic Staff Director and Chief Counsel
                Gregg Elias, Democratic General Counsel

                                  (ii)



                                                       Calendar No. 530
108th Congress                                                   Report
                                 SENATE
 2d Session                                                     108-274
======================================================================


              MARITIME TRANSPORTATION SECURITY ACT OF 2004

                                _______
                                

                  May 20, 2004.--Ordered to be printed

                                _______
                                

       Mr. McCain, from the Committee on Commerce, Science, and 
                Transportation, submitted the following

                              R E P O R T

                         [To accompany S. 2279]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 2279) to amend title 49, United 
States Code, with respect to maritime transportation security, 
and for other purposes, having considered the same, reports 
favorably thereon with an amendment (in the nature of a 
substitute) and recommends that the bill (as amended) do pass.

                          Purpose of the Bill

  The purpose of the bill is to build upon and enhance 
implementation of the Maritime Transportation Security Act of 
2002 (P.L. 107-295), and to improve maritime transportation 
security.

                          Background and Needs

  The Maritime Transportation Security Act of 2002, which was 
signed into law November 25, 2002, established the first 
Federal requirements for maritime transportation security; 
however, many of these requirements have yet to be developed or 
implemented. Such delays threaten potential maritime security 
enhancements. In particular, the lack of coordination and 
absence of established standards and goals have lead to 
confusion for the maritime industry as to what must be done to 
improve security and to whom to go with security questions. 
Confusion of this sort could lead to less cooperation from 
industry and ultimately to lax security. S. 2279, the Maritime 
Transportation Security Act of 2004, would provide further 
direction and clarification in achieving maritime 
transportation security objectives.

                         Summary of Provisions

  S. 2279 would build on the Maritime Transportation Security 
Act of 2002, improving coordination among agencies with a 
maritime role, and requiring the establishment of standards and 
goals in an effort to provide those in the maritime industry a 
better understanding of their responsibilities pertaining to 
security. The measure includes a number of report and security 
plan refinement requirements that would further clarify 
maritime transportation security objectives.
  Specifically, the bill would impose in rem liability to 
secure payment of penalties and fines under the Act. 
Additionally, a vessel would be liable in rem for certain 
unpaid reimbursable costs, defined as costs incurred by any 
service provider, including port authorities, facility or 
terminal operators, shipping agents, Federal, State, or local 
government agencies, or other person to whom the management of 
the vessel at the port of supply is entrusted. Reimbursable 
costs could be incurred by any valid claimant for expenses 
incurred related to actions required by law enforcement in the 
handling of cargo, or certain actions required to be taken with 
respect to the vessel's crew.
  The bill includes provisions to increase the security in 
waterside cargo areas, and ensure that cargo contents of 
imported marine cargo containers would be required to be 
removed from the pier or wharf within five days of entering a 
United States port, or removed if after five days it has not 
been cleared, and sent to a Federally regulated warehouse where 
the marine container would be opened to verify its contents. 
The bill also would require a report on the current policies 
and practices to secure the shipment of empty containers, with 
recommendations included whether additional regulations or 
legislation is necessary regarding empty containers.
  The Secretary would be required to produce a report on a 
preliminary plan for coordinating, collecting, analyzing, and 
disseminating maritime information collected by Federal 
agencies on ships, cargo, crew members, and passengers. In part 
this would help bolster the information available pertaining to 
the crew, passengers, and cargoes carried on vessels operating 
in waters under the jurisdiction of the United States, and help 
increase the awareness of Federal, State, and private sector 
security personnel. Recommendations would be included 
pertaining to various potential improvements, including: co-
locating agency personnel with similar expertise; the 
utilization of private sector resources; and the expansion of 
maritime information through cooperation with the Department of 
the Navy.
  The Secretary would be required, within 180 days after 
enactment, to submit a report on the Department of Homeland 
Security's (DHS) cargo security programs, and provide 
recommendations on cargo security enhancements, and cargo 
security plans. Specifically, DHS would report on the Secure 
Systems of Transportation (SST) plan; the installation of 
radiation detectors at United States ports; non-intrusive 
inspection of marine cargo at foreign ports; and compliance 
with security standards programs. Importantly, with respect to 
the provision of the report on SST, an analysis of the 
feasibility of establishing a user fee is to be included in 
order to evaluate, certify, and validate secure systems of 
transportation, as is an analysis of the need and feasibility 
of establishing a system to inspect, monitor, and track 
intermodal shipping containers within the United States. The 
report also would contain a determination whether an 
international approach to established standards for SST is 
justified.
  The bill would require the DHS Inspector General (DHS IG) to 
report to the Senate Committee on Commerce, Science, and 
Transportation (Committee or Commerce Committee) and the House 
of Representatives Committee on Transportation and 
Infrastructure evaluating the progress made by DHS in 
implementing its SST plan.
  The DHS IG also would be required to evaluate the 
Department's cargo inspection targeting system for 
international intermodal cargo containers. This evaluation 
would be completed six months after date of enactment, and 
annually thereafter, to determine the system's effectiveness, 
the sources and quality of information, the reporting and 
analysis of statistics including the testing of targeting 
analysis, and the competence and training of employees to 
determine whether they are sufficiently capable to detect 
potential terrorist threats. Should the IG find the system 
lacking in any of the evaluated areas, the Secretary would be 
required to double the number of containers subjected to 
intrusive or non-intrusive inspection at United States ports or 
to be shipped to the United States from foreign ports.
  Section five would require the Commandant of the United 
States Coast Guard to report to Congress, within 180 days after 
enactment, on the potential benefits of establishing joint 
operational centers for port security at certain United States 
seaports, like, and including, those already established in 
Norfolk, VA; Charleston, S.C.; and San Diego, CA.
  Section six of the bill would rewrite the port security grant 
program to be established by the Undersecretary of Homeland 
Security for Border and Transportation Security, and be 
coordinated with the Director of the Office of Domestic 
Preparedness. The grant awards would be reviewed by the Federal 
Maritime Security Coordinator and the Maritime Administrator.
  Section seven would require the Maritime Administrator, in 
coordination with the Secretary of State, to identify foreign 
assistance programs that could facilitate implementation of 
port security anti-terrorism measures in foreign countries. The 
section also would require the Secretary of DHS to issue a 
report on Caribbean Basin port security effectiveness, 
readiness, and additional resources necessary. It is expected 
that utilizing the foreign assistance budget in this fashion 
will ensure that those nations that could be in jeopardy of 
losing trading privileges with the United States because of 
security deficiencies could, in fact, continue to receive 
foreign assistance from the United States, as well as continue 
United States trade.
  The Secretary of Transportation would be required, under 
section eight, to establish a curriculum to educate and 
instruct Federal and State officials on commercial maritime and 
intermodal transportation in order to facilitate performance of 
their security responsibilities.
  Section nine rewrites the MTSA 2002 requirements for research 
and development to improve port security--including explosives, 
chemical or biological detection equipment; nuclear or 
radiological detection; improved tags and seals; and tools to 
improve maritime area awareness. This would be done by the 
Director of the Science and Technology Directorate at DHS. 
There would be authorized $35,000,000 for each fiscal year 2005 
through 2009 to carry out pilot projects and implement 
technology at United States seaports related to these research 
and development (R&D;) efforts. The Director would prepare a 
report annually on these efforts and indicate the amount of 
port-security related research being conducted by the 
Directorate, the process of coordination amongst DHS 
organizations working in port security, and a description of 
plans for field implementation.
  The Secretary also would be required to identify all nuclear 
facilities in maritime areas. He would work in coordination 
with the Secretary of Energy to evaluate the security plans of 
each identified facility. The Secretaries would be required to 
address any deficiencies in security identified in their 
evaluations, and report to the Senate Committee on Commerce, 
Science, and Transportation, the House of Representatives 
Committee on Transportation and Infrastructure Committee, and 
the House of Representatives Select Committee on Homeland 
Security in both a classified and redacted manner. The bill 
also would require criminal background checks of United States 
and foreign seafarers engaged in the transportation of nuclear 
materials.
  Section 11 would require a report to include recommendations 
for harmonizing, combining, or coordinating requirements, 
procedures, and programs for conducting background checks on 
individuals engaged in transportation or transportation-related 
activities. A detailed time line for implementation of 
background checks at seaports, and recommendations for a waiver 
and appeals process also would be required. A report on the 
cruise ship industry security measures also would be required 
no later than 120 days after enactment.
  Section 13 would require a report on the design of maritime 
security grant programs. To be included in the report are 
recommendations on whether grant programs should be 
discretionary or formula based, and whether the grant program 
should include requirements for ensuring that Federal funds 
will not be substituted for grantee funds. Also included would 
be targeting requirements that ensure funding is directed in a 
manner that reflects a national, risk-based perspective on 
priority needs, the fiscal capacity of recipients, and explicit 
analysis of the impact of minimum funding to small ports.

                          Legislative History

  S. 2279 was introduced on April 1, 2004, by Senator Hollings 
and cosponsored by Senators McCain and Breaux. The bill would 
improve upon Public Law 107-295, the Maritime Transportation 
Security Act of 2002, which was introduced as S. 1214 on July 
20, 2001, by Senator Hollings and cosponsored by Senator 
Graham. That bill was similar to legislation introduced in the 
106th Congress.
  During the 106th Congress, in response to the findings of the 
Interagency Commission on Crime and Security in United States 
Seaports, Senators Hollings introduced S. 2965 on July 27, 
2000. The bill was cosponsored by Senators Graham, Breaux, and 
Cleland. On October 4, 2000, the Committee on Commerce, 
Science, and Transportation held an oversight hearing on 
seaport security and the recommendations of the Interagency 
Commission on Crime and Security in United States seaports. The 
Committee heard testimony from Senator Bob Graham, the Coast 
Guard, Maritime Administration, the Department of Justice, as 
well as the American Association of Port Authorities, and a 
representative from the International Longshoremen's & 
Warehousemen's Union.
  During the 107th Congress, Senator Hollings introduced S. 
1214, the Port and Maritime Security Act of 2001, which 
included improvements in response to concerns previously raised 
about S. 2965.
  On July 24, 2001, the Committee held a full Committee hearing 
on seaport security issues and S. 1214. The Committee heard 
from: Senator Bob Graham; the Maritime Administration; the 
Customs Service; Coast Guard; the Director of the Office of 
Intelligence and Security, Department of Transportation; a 
representative of the American Association of Port Authorities; 
President and CEO of Maher Terminals Inc.; the Vice President 
of International Transportation Services Inc.; a representative 
of the American Institute of Marine Underwriters; and the 
Executive Director of the Maritime Security Council.
  On August 2, 2001, S. 1214 was ordered to be reported 
favorably. The legislation was modified to incorporate 
additional security provisions and comments suggested by the 
Department of Transportation after the attacks of September 11, 
2001, and was taken up and passed by the Senate by voice vote 
on December 20, 2001. On June 4, 2002, the House of 
Representatives passed a substitute then appointed Conferees. 
The Senate appointed its Conferees on June 18, 2002, and took 
up and passed by voice vote the Conference Report on November 
14, 2002. The House of Representatives passed the measure by 
voice vote the same day and the bill was signed into law 
November 25, 2002.
  Prior to introduction of S. 2279, the Maritime Transportation 
Security Act of 2004, the Senate Committee on Commerce, 
Science, and Transportation held a hearing March 24, 2004, on 
the state of maritime security. The Committee heard testimony 
from the Commandant of the Coast Guard; the Commissioner of 
Customs and Border Protection; the Acting Administrator of the 
Transportation Security Administration; the President of the 
World Shipping Council; the Executive Director and CEO of the 
Port of New Orleans; a Senior Research Fellow from the Heritage 
Foundation; and the Director of Coast Port Security, Longshore 
Division of the International Longshore and Warehouse Union.

                            Estimated Costs

  In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 19, 2004.
Hon. John McCain,
Chairman, Committee on Commerce, Science, and Transportation,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 2279, the Maritime 
Transportation Security Act of 2004.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Deborah Reis.
            Sincerely,
                                      Elizabeth M. Robinson
                               (For Douglas Holtz-Eakin, Director).
    Enclosure.

S. 2279--Maritime Transportation Security Act of 2004

    Summary: S. 2279 would require the Departments of 
Transportation (DOT) and Homeland Security (DHS) to report on 
their progress in implementing the Maritime Transportation 
Security Act of 2002 (MTSA). The bill would amend the MTSA to 
clarify existing planning and reporting requirements. In 
addition, federal agencies would be required to complete new or 
more detailed studies of maritime security, issues, review 
certain security plans, and correct deficiencies where 
identified.
    Section 9 of the bill would authorize the appropriation of 
$3.5 million for each of fiscal years 2005 through 2009 for 
pilot programs that test newly developed security technologies. 
This section also would eliminate existing authorizations of 
$15 million annually for fiscal years 2003 through 2008 for 
research and development grants under the MTSA, resulting in a 
net increase in authorized funding of $20 million a year 
through 2008 and $35 million for 2009.
    Assuming appropriation of the authorized amounts, CBO 
estimates that the federal government would spend about $5 
million in fiscal year 2005 and $80 million over the 2005-2009 
period to implement S. 2279. (About $35 million of the 
authorized amounts would be spent after 2009.) The costs of 
complying with other bill provisions would depend on the 
findings of future security evaluations. Any security 
enhancements that may be found to be necessary by such 
evaluations also occur under current law.
    The bill would authorize DHS to impose a new civil penalty 
for leaving merchandise unattended on loading piers that could 
increase federal revenues, but CBO estimates that any revenue 
from new penalty collections would be less than $500,000 
annually. Enacting this legislation would not affect direct 
spending.
    S. 2279 contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA) and would impose no 
costs on state, local, or tribal governments. The bill would 
benefit publicly owned ports and vessels, and any costs they 
incur would result from conditions of aid.
    S. 2279 would impose a private-sector mandate as defined by 
UMRA on owners of vessels and U.S. and foreign seamen that are 
employed on vessels transporting nuclear materials in the 
navigable waters of the United States. CBO estimates that the 
cost of that private-sector mandate would not exceed the annual 
threshold established in UMRA ($120 million in 2004, adjusted 
annually for inflation).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of S. 2279 is shown in the following table. 
The costs of this legislation fall within budget function 400 
(transportation).

----------------------------------------------------------------------------------------------------------------
                                                                   By fiscal year in millions of dollars--
                                                           -----------------------------------------------------
                                                              2004     2005     2006     2007     2008     2009
----------------------------------------------------------------------------------------------------------------
                                      SPENDING SUBJECT TO APPROPRIATION \1\

Spending under the MTSA for R&D; grants:
    Authorization level \2\...............................        0       15       15       15       15        0
    Estimated outlays.....................................        0        4       10       14       15       15
Proposed changes:
    Authorization level...................................        0       20       20       20       20       35
    Estimated outlays.....................................        0        5       11       18       20       26
Spending under S. 2279 for R&D; pilot projects:
    Authorization level \2\...............................        0       35       35       35       35       35
    Estimated outlays.....................................        0        9       21       32       35       35
----------------------------------------------------------------------------------------------------------------
\1\ No amounts are included in this estimate for a possible increase in the number of cargo inspections
  performed by DHS or for correcting other security deficiencies in existing federal maritime security
  operations. If such additional inspections or other security enhancements are found to be necessary, existing
  law would require that this same improvement be made.
\2\ The MTSA authorizes $15 million a year though 2008 for port security research and development grants, (S.
  2279 would eliminate these authorizations.) No amounts were appropriated for MTSA research grants for 2004.

    Basis of estimate: For this estimate, CBO assumes that S. 
2799 will be enacted by the end of fiscal year 2004 and that 
the amounts authorized for grants for pilot projects will be 
appropriated for each year beginning in 2005. The proposed 
changes in authorization levels shown in the above table 
include $35 million authorized for the pilot projects, less $15 
million for each of years 2005 through 2008 (which the 
legislation would eliminate). Outlays are estimated on the 
basis of spending for similar grant programs. CBO estimates 
that carrying out the various studies, progress reports, and 
assessments required by the bill would cost the DHS and other 
federal agencies less than $500,000 a year.
    Section 4 would require the Inspector General (IG) of the 
DHS to evaluate the department's cargo inspection targeting 
system. The targeting system involves reviewing shipping 
documents and other information to identify high-risk cargoes, 
which are then inspected. This provision would give the 
department one year in which to double the number of physical 
inspections of containers of imported cargo at U.S. or foreign 
ports if the IG determines that the existing system is not 
sufficient for security purposes.
    The CBO cost estimates for S. 2279 does not includes any 
costs associated with increasing the number of container 
inspections under section 4 because it is uncertain how (or if) 
this provision would change the department's future plans and 
operations. CBO estimates that the costs of doubling the 
inspection program would be significant--about $50 million for 
training, acquisition of detection equipment, and other one-
time activities and about $25 million a year for salaries and 
other operating expenses. We cannot predict, however, whether 
the IG will determine that the current program is inadequate or 
how many inspections the department will choose to perform in 
the future in the absence of this requirement. The number of 
container inspections has increased from about 170,000 
containers in 2002 to nearly 490,000 in 2003 and an estimated 
520,000 this year. Assuming appropriation of the necessary 
amounts in future years, CBO expects that this number would 
continue to grow, but possibly more slowly than may be required 
under the bill.
    Section 10 would require DHS to evaluate security plans for 
nuclear facilities located near navigable waterways and to 
ensure that any identified deficiencies are corrected. The CBO 
cost estimate does not include any costs for carrying out this 
provision because the periodic review and updating of security 
programs for these facilities are already required under 
current law. Owners and operators of nuclear facilities 
(including those owned by the Tennessee Valley Authority) 
currently must maintain security plans as a condition of 
federal licensing. Other laws, including the MTSA, require the 
periodic review and (if necessary) revision of plans and 
programs for nuclear facility security.
    This estimate is based on information provided by DHS and 
other federal agencies.
    Estimated impact on state, local, and tribal governments: 
S. 2279 contains no intergovernmental mandates as defined in 
UMRA and would impose no costs on state, local, or tribal 
governments. The bill would require DHS to report on the status 
of implementing the requirements for port and vessel security 
that are in current law.
    Specifically, the bill would require DHS to update the 
Congress on its efforts to gather information on vessels 
operating on, or bound for, the waters of the United States. 
The original mandate for both public and private entities to 
submit vessel information to the federal government was created 
in the MTSA. The bill also would require DHS to report on and 
analyze its efforts to secure and screen imported cargo. The 
reporting requirements would impose no new mandates on ports, 
terminals, and vessels, some of which are owned by local, 
state, and regional authorities.
    S. 2279 would amend current law to expand the scope and 
funding of the research and development program for port 
security. State and local governments, among other entities, 
would benefit from the additional $20 million authorized for 
each fiscal year to conduct pilot projects, to purchase and 
test technology, and to improve shipping containers, and 
tracking. Other sections of the bill also would benefit 
publicly owned ports and vessels. Any costs they incur would 
result from conditions of aid.
    Estimated impact on the private sector: S. 2279 would 
impose a private-sector mandate as defined by UMRA on certain 
owners of vessels and U.S. and foreign seamen. The bill would 
mandate that vessel owners require seamen transporting nuclear 
materials in the navigable waters of the United States to 
undergo criminal background checks. According to information 
from government representatives, most U.S. seamen undergo those 
background checks under current law, and the cost to the 
private sector for the additional checks would not be large. 
CBO estimates that the cost to comply with the mandate would 
not exceed the annual threshold established in UMRA ($120 
million in 2004, adjusted annually for inflation).
    Estimated prepared by: Federal Costs: Deborah Reis. Impact 
on State, Local, and Tribal Governments: Gregory Waring. Impact 
on the Private Sector: Jean Talarico.
    Estimated approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                      Regulatory Impact Statement

  In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported:
  The bill would require containers be cleared from a pier or 
wharf within five days of entering a United States port. If 
such action is not taken, the container would be removed at the 
expense of the person in custody of the cargo.

                       NUMBER OF PERSONS COVERED

  This legislation updates and clarifys the port security 
requirements found in the Maritime Transportation and Security 
Act of 2002. It is expected there will be no greater number of 
persons covered by this legislation.

                            ECONOMIC IMPACT

  S. 2279 would authorize $35,000,000 for each fiscal year 2005 
through 2009. These funding levels are not expected to have an 
inflationary impact on the nation's economy. A fine of up to 
$5,000 could be imposed by the Secretary of DHS for each bill 
of lading for general order merchandise remaining after those 
five days.

                                PRIVACY

  This legislation updates and clarifys the port security 
requirements found in the Maritime Transportation and Security 
Act of 2002. It is expected there will be no greater impact on 
the individuals covered by this legislation.

                               PAPERWORK

  Section 6 of the legislation creates a grant program which 
may create additional paperwork for applicants and for DHS in 
administering the program.

                      Section-by-Section Analysis


Section 1. Short Title; Table of Contents

  Section 1 contains the title and table of contents for the 
bill.

Sec. 2. In Rem Liability; Enforcement; Pier and Wharf Security Costs

  Section 2 of the bill would amend title 46, United States 
Code, to require vessels subject to and in violation of the 
regulations in chapter 701 be liable in rem for any civil 
penalty assessed pursuant to section 70120 of title 46, United 
States Code. Proceedings against the vessel may be brought in 
the United States district court for any district in which such 
vessel may be found. The vessel also would be held liable in 
rem for the reimbursable costs incurred by any valid claimant 
related to implementation and enforcement of chapter 701 with 
respect to the vessel and cargo. Reimbursable costs by valid 
claimants for which in rem jurisdiction is conferred are 
limited to those actions taken with respect to the care and 
custody of the crew or cargo under lawful order.
  Section 2 also would give the United States the power to 
restrain violators of regulations of chapter 701 and if an 
owner, agent, master, officer, or person in charge of a vessel 
is liable (or there is reasonable cause) for a penalty or fine 
under section 70120, and authorize the Secretary to refuse or 
revoke any clearance the vessel or cargo may require. The 
clearance refused in this subsection may be granted by filing a 
bond of other surety satisfactory to the Secretary.
  The section would further amend title 46 to require uncleared 
merchandise remaining on a wharf or pier to be removed within 5 
calendar days to public stores or a general order warehouse 
where its contents will be inspected to determine the cargo 
contents. This provision is intended to determine the security 
risk posed by certain cargo as early as practicable. Further, 
the section would allow the Secretary of Homeland Security to 
impose an administrative penalty of $5,000 for each bill of 
lading for general order cargo that remains on the wharf or 
pier.

Sec. 3. Maritime Information

  Section 3 would require the Secretary of Homeland Security to 
provide a plan to the Senate Committee on Commerce, Science, 
and Transportation and the House of Representatives Committee 
on Transportation and Infrastructure for the implementation of 
section 70113 of title 46, United States Code. Section 70113 
requires the Secretary of Homeland Security to establish a 
coordinated system of collecting information on vessels, crew, 
passengers, and cargo aimed at improving maritime domain 
awareness. The plan, required to be submitted within 3 months 
of enactment, must identify agencies that can provide maritime 
information relating to vessels, crew, passengers and cargo and 
shall provide a time line for the agencies to coordinate their 
efforts. The section would further require the plan to 
establish when automatic and long-range vessel tracking will be 
integrated into the maritime intelligence system. The section 
also would require the plan to contain recommendations on co-
locating agency personnel to reduce costs and increase 
efficiency, as well as evaluating how naval intelligence could 
be incorporated into the effort of collecting and analyzing 
commercial maritime information. Additionally, the section 
would require the Secretary to evaluate, as part of the plan, 
the use of private sector resources to collect and analyze 
information, and identify potential sources of private sector 
information sources, and make recommendations on educating 
Federal officials on commercial maritime operations in order to 
facilitate security. The report would include recommendations 
on how to disseminate security information to State, local, and 
private security personnel in order to prevent transportation 
security incidents, and the need to establish of a public-
private information sharing analysis center.

Sec. 4. Intermodal Cargo Security Plan

  Section 4 would require the Secretary of Homeland Security to 
submit an intermodal cargo security plan to Congress within 180 
days after enactment. Under the section, the plan would be 
required to include recommendations on how to integrate various 
cargo security programs into the certification process of SST 
found in section 70116 of title 46, United States Code. 
Further, the plan would provide evaluation of the necessary 
resources to certify and validate SST and also would include a 
feasibility analysis on establishing a user fee in order to 
investigate and certify SST. The section also would require the 
DHS IG to review progress on the implementation of the SST 
program. This section also would require DHS to report to 
Congress on the progress of installing radiation detectors at 
all major United States seaports and include an anticipated 
completion date and cost estimate. Additionally, a report would 
be required detailing to what extent foreign seaports have been 
willing to use screening equipment at their ports and indicate 
which specific foreign ports would be willing to use their own 
screening equipment for cargo exported to the United States. 
The report would describe to what extent additional resources 
may be necessary to maximize scrutiny of cargo in foreign 
seaports, in the event that a insufficient amount of screening 
is being done.
  The section would further require the DHS IG to, within six 
months after enactment and annually thereafter, analyze and 
report to Congress on the system of targeting international 
intermodal containers for inspection. The DHS IG would be 
directed to include an assessment on the effectiveness of the 
system, including the sources of information used to target 
containers to determine the effectiveness of the system and its 
potential gaps and weaknesses to determine if it is adequate to 
prevent international intermodal containers from being used for 
purposes of terrorism. The assessment also would evaluate the 
targeting system for reporting and analyzing inspection 
statistics and testing the system, as well as the competence 
and training of the employees operating the system, to 
determine whether it is sufficiently effective to detect 
potential acts of terrorism and if more steps need to be taken 
to remedy deficiencies in targeting.
  If the DHS IG's office determines that the targeting system 
is insufficient to detect potential acts of terrorism, the 
Secretary of Homeland Security would be required to double the 
amount of inspections of international intermodal containers 
(including either intrusive and non-intrusive inspections) at 
United States ports or to be shipped to the United States from 
foreign seaports in the fiscal year following the report. The 
requirement to inspect double the amount of containers would 
ensue after each report of insufficiency.

Sec. 5. Joint Operations Center for Port Security

  Section 5 would require the Commandant of the United States 
Coast Guard to report to Congress, within 180 days of 
enactment, on the potential benefits of establishing joint 
operational centers for port security at certain United States 
seaports; to evaluate the three existing joint operational 
centers; and to consider to what extent these centers could be 
beneficial in the implementation and operation of maritime area 
security plans. It also would require the USCG to consider how 
specific security functions could be folded into their 
operations and to consider where else these Centers should be 
established.

Sec. 6. Maritime Transportation Security Plan Grants

  Section 6 would rewrite portions (Section 70101(a) of tile 
46) of the port security grant program designed to help 
implement the Area Maritime Transportation Security plans and 
to help fund compliance with the Federal security plans. The 
rewrite would align the program with the process developed for 
awarding grants. The section does not change the criteria for 
awarding grants which are to be used to address the 
vulnerabilities in security and will take into account national 
economic and strategic defense concerns. The grants would be 
administered by Undersecretary of Border and Transportation 
Security, and awarded after review and comment of the United 
States Coast Guard Captain of the Port and the regional 
Maritime Administrator. Grants would be required to be 
coordinated with other Office of Domestic Preparedness grants.

Sec. 7. Assistance for Foreign Ports

  Section 7 would amend MTSA (70109 of title 46, United States 
Code) to require the Maritime Administration to work with the 
State Department to identify foreign assistance programs 
available domestically that could help implement port security 
anti-terrorism measures in foreign countries including 
countries that lack effective antiterrorism measures, to help 
these countries achieve compliance with the internationally set 
standards for port security.

Sec. 8. Federal and State Commercial Maritime Transportation Training

  Section 8 would supplement the existing MTSA security 
training requirements and would require the Maritime 
Administration (MARAD) in coordination with Federal Law 
Enforcement Training Center (FLETC) to establish a curriculum 
to educate Federal and State officials on commercial maritime 
and intermodal transportation in order to assist them in the 
performance of their security responsibilities. In developing 
the training and standards, MARAD would be required to consult 
with each agency within the Department of Homeland Security 
which has jurisdiction over maritime security as well as the 
FLETC and work with the Center to educate DHS officials on 
transportation elements that could impact and improve maritime 
security.

Sec. 9. Research and Development

  Section 9 would replace the MTSA research and development 
(R&D;) grants section with one that transfers control from the 
Department of Transportation to the Science and Technology 
Directorate within the Department of Homeland Security. It will 
conduct investigations, fund pilot programs, award grants, and 
conduct research and development. The section would expand the 
research conducted from only merchandise, to include target 
inspection of vessels, cargo, crewmembers, or passengers 
arriving in any port or place in the United States. It would 
maintain the detection of explosives, chemical, or biological 
agents in current law and add radiological materials to the 
existing research requirement. The section also would allow R&D; 
funding to be used to look at the ability to increase 
awareness, including satellite tracking systems, of potential 
terrorist threats that would have an impact on facilities, 
vessels, and infrastructure on or near navigable waterways, 
including underwater. The section also would fund R&D; for tools 
which would mitigate the consequences of a terrorist act on, 
near, or under navigable waterways.
  The section would further require the Under Secretary of the 
Science and Technology Directorate to conduct pilot projects at 
United States ports to test the effectiveness and applicability 
of new port security technology. Testing could include new 
detection and screening technologies, projects to protect 
United States ports and infrastructure on, near or next to the 
navigable waters of the United States, and tools for responding 
to a terrorist threat or incident at United States ports. The 
section would authorize $35 million for each fiscal year 2005 
through 2009 to carry out research and development.
  The section also would require, for each fiscal year 2005 
through 2009, a report to be submitted that will describe any 
port security-related research in the preceding fiscal year; 
describe the amount of DHS resources dedicated to research that 
can be applied to port security; the steps taken to coordinate 
with other DHS agencies to ensure that research efforts are 
coordinated with port security efforts; describe how the 
results will be implemented in the field; lay out the plans for 
research in the current fiscal year; and include a description 
of the funding levels for the research in the preceding, 
current, and next fiscal years.

Sec. 10. Nuclear Facilities in Maritime Areas

  Section 10 would amend section 70103(b) of title 46, United 
States Code, (the Area Maritime Transportation Security Plans) 
to include the identification of all nuclear facilities on, 
near or in close proximity to navigable waterways that may be 
damaged by a transportation security incident and also to 
evaluate each nuclear facility's security plan for that 
facility's ability to protect itself from damage or disruption 
in a transportation security incident originating in or on the 
navigable waterway. The Secretary of Homeland Security would 
have the ability to correct any deficiencies in security 
identified during the evaluation process. After the 
evaluations, the Secretary would be required to transmit a 
report to Congress describing the results of the identification 
and evaluation, describing the subsequent corrective actions 
taken, and evaluating the technology used to protect nuclear 
facilities. The report would be delivered to Congress in both a 
classified and redacted form. The section also would establish 
a requirement for criminal background checks for all United 
States and foreign seamen employed on vessels transporting 
nuclear materials in the United States's navigable waters.

Sec. 11. Transportation Worker Background Investigation Programs

  Section 11 would require the Secretary of Homeland Security 
to report to Congress within 120 days after enactment with 
recommendations for harmonizing, combining, or coordinating 
requirements, procedures, and programs for conducting 
background checks for individuals engaged in transportation or 
transportation-related activities. The section would require 
the report contain a detailed time line for implementation of 
such harmonization, combination, or coordination, and a review 
of the requirements of the appeals and waiver process.

Sec. 12. Report on Cruise Ship Security

  Section 12 would require the Secretary of Homeland Security 
to report to Congress within 120 days on the security of ships 
and facilities used in the cruise line industry. The report 
would contain, among other things, an assessment of security of 
cruise ships that originate at foreign ports; the security of 
ports utilized for cruise ship docking; the costs incurred by 
the cruise line industry to carry out MTSA 2002; and the costs 
of canine units and hand-held explosive detection wands. In 
addition, the report would be required to contain a description 
of the need and feasibility of deploying explosive detection 
systems and canine units; an assessment of security measures 
taken by the Secretary of Homeland Security to increase the 
security of the cruise line industry; a summary of passenger 
fees paid to be used for inspections and the feasibility of 
creating a dedicated passenger vessel security fund from such 
fees; and the Secretary's recommendations if any to improve 
cruise ship security.

Sec. 13. Report on Design of Maritime Security Grant Programs

  Section 13 would require the Secretary of Homeland Security 
to report to Congress within 90 days on the design of maritime 
security grant programs and include recommendations on whether 
it should be discretionary or formula based; requirements for 
ensuring that Federal funds will not be substituted for grantee 
funds; targeting the funds to the highest priority needs; and 
matching requirements that provide incentive to grantees to 
invest their own funds.

                        Changes in Existing Law

  In compliance with paragraph 12 of rule XXVI of the Standing 
Rules of the Senate, changes in existing law made by the bill, 
as reported, are shown as follows (existing law proposed to be 
omitted is enclosed in black brackets, new material is printed 
in italic, existing law in which no change is proposed is shown 
in roman):

              MARITIME TRANSPORTATION SECURITY ACT OF 2002

                TITLE I--MARITIME TRANSPORTATION SAFETY

                             * * * * * * *

SEC. 109. MARITIME SECURITY PROFESSIONAL TRAINING.

                         [46 U.S.C. 70101 note]

  (a) In General.--
          (1) Development of standards.--Not later than 6 
        months after the date of enactment of this Act, the 
        Secretary of Transportation shall develop standards and 
        curriculum to allow for the training and certification 
        of maritime security professionals. In developing these 
        standards and curriculum, the Secretary shall consult 
        with the National Maritime Security Advisory Committee 
        established under section 70112 of title 46, United 
        States Code, as amended by this Act.
          (2) Secretary to consult on standards.--In developing 
        standards under this section, the Secretary may, 
        without regard to the Federal Advisory Committee Act (5 
        U.S.C. App.), consult with the Federal Law Enforcement 
        Training Center, the United States Merchant Marine 
        Academy's Global Maritime and Transportation School, 
        the Maritime Security Council, the International 
        Association of Airport and Port Police, the National 
        Cargo Security Council, and any other Federal, State, 
        or local government or law enforcement agency or 
        private organization or individual determined by the 
        Secretary to have pertinent expertise.
  (b) Minimum Standards.--The standards established by the 
Secretary under subsection (a) shall include the following 
elements:
          (1) The training and certification of maritime 
        security professionals in accordance with accepted law 
        enforcement and security guidelines, policies, and 
        procedures, including, as appropriate, recommendations 
        for incorporating a background] check process for 
        personnel trained and certified in foreign ports.
          (2) The training of students and instructors in all 
        aspects of prevention, detection, investigation, and 
        reporting of criminal activities in the international 
        maritime environment.
          (3) The provision of off-site training and 
        certification courses and certified personnel at United 
        States and foreign ports used by United States-flagged 
        vessels, or by foreign-flagged vessels with United 
        States citizens as passengers or crewmembers, to 
        develop and enhance security awareness and practices.
  (c) Federal and State Commercial Maritime Transportation 
Training.--The Secretary of Transportation shall establish a 
curriculum, to be incorporated into the curriculum developed 
under subsection (a)(1), to educate and instruct Federal and 
State officials on commercial maritime and intermodal 
transportation. The curriculum shall be designed to familiarize 
those officials with commercial maritime transportation in 
order to facilitate performance of their commercial maritime 
and intermodal transportation security responsibilities. In 
developing the standards for the curriculum, the Secretary 
shall consult with each agency in the Department of Homeland 
Security with maritime security responsibilities to determine 
areas of educational need. The Secretary shall also coordinate 
with the Federal Law Enforcement Training Center in the 
development of the curriculum and the provision of training 
opportunities for Federal and State law enforcement officials 
at appropriate law enforcement training facilities.
  [(c)] (d) Training Provided to Law Enforcement and Security 
Personnel.--
          (1) In general.--The Secretary is authorized to make 
        the training opportunities provided under this section 
        available to any Federal, State, local, and private law 
        enforcement or maritime security personnel in the 
        United States or to personnel employed in foreign ports 
        used by vessels with United States citizens as 
        passengers or crewmembers.
          (2) Academies and schools.--The Secretary may provide 
        training under this section at--
                  (A) each of the 6 State maritime academies;
                  (B) the United States Merchant Marine 
                Academy;
                  (C) the Appalachian Transportation Institute; 
                and
                  (D) other security training schools in the 
                United States.
  [(d)] (e) Use of Contract Resources.--The Secretary may 
employ Federal and contract resources to train and certify 
maritime security professionals in accordance with the 
standards and curriculum developed under this Act.
  [(e)] (f) Annual Report.--The Secretary shall transmit an 
annual report to the Senate Committee on Commerce, Science, and 
Transportation and the House of Representatives Committee on 
Transportation and Infrastructure on the expenditure of 
appropriated funds and the training under this section.
  [(f)] (g) Authorization of Appropriations.--There are 
authorized to be appropriated to the Secretary to carry out 
this section $5,500,000 for each of fiscal years 2003 through 
2008.

                           UNITED STATES CODE

                           TITLE 46. SHIPPING

                       SUBTITLE VI. MISCELLANEOUS

                       CHAPTER 701. PORT SECURITY

Sec. 70103. Maritime transportation security plans

  (a) National Maritime Transportation Security Plan.--(1) The 
Secretary shall prepare a National Maritime Transportation 
Security Plan for deterring and responding to a transportation 
security incident.
  (2) The National Maritime Transportation Security Plan shall 
provide for efficient, coordinated, and effective action to 
deter and minimize damage from a transportation security 
incident, and shall include the following:
          (A) Assignment of duties and responsibilities among 
        Federal departments and agencies and coordination with 
        State and local governmental agencies.
          (B) Identification of security resources.
          (C) Procedures and techniques to be employed in 
        deterring a national transportation security incident.
          (D) Establishment of procedures for the coordination 
        of activities of--
                  (i) Coast Guard maritime security teams 
                established under this chapter; and
                  (ii) Federal Maritime Security Coordinators 
                required under this chapter.
          (E) A system of surveillance and notice designed to 
        safeguard against as well as ensure earliest possible 
        notice of a transportation security incident and 
        imminent threats of such a security incident to the 
        appropriate State and Federal agencies.
          (F) Establishment of criteria and procedures to 
        ensure immediate and effective Federal identification 
        of a transportation security incident, or the 
        substantial threat of such a security incident.
          (G) Designation of--
                  (i) areas for which Area Maritime 
                Transportation Security Plans are required to 
                be prepared under subsection (b); and
                  (ii) a Coast Guard official who shall be the 
                Federal Maritime Security Coordinator for each 
                such area.
          (H) A risk-based system for evaluating the potential 
        for violations of security zones designated by the 
        Secretary on the waters subject to the jurisdiction of 
        the United States.
          (I) A recognition of certified systems of intermodal 
        transportation.
          (J) A plan for ensuring that the flow of cargo 
        through United States ports is reestablished as 
        efficiently and quickly as possible after a 
        transportation security incident.
  (3) The Secretary shall, as the Secretary considers 
advisable, revise or otherwise amend the National Maritime 
Transportation Security Plan.
  (4) Actions by Federal agencies to deter and minimize damage 
from a transportation security incident shall, to the greatest 
extent possible, be in accordance with the National Maritime 
Transportation Security Plan.
  (5) The Secretary shall inform vessel and facility owners or 
operators of the provisions in the National Transportation 
Security Plan that the Secretary considers necessary for 
security purposes.
  (b) Area Maritime Transportation Security Plans.--(1) The 
Federal Maritime Security Coordinator designated under 
subsection (a)(2)(G) for an area shall--
          (A) submit to the Secretary an Area Maritime 
        Transportation Security Plan for the area; and
          (B) solicit advice from the Area Security Advisory 
        Committee required under this chapter, for the area to 
        assure preplanning of joint deterrence efforts, 
        including appropriate procedures for deterrence of a 
        transportation security incident.
  (2) The Area Maritime Transportation Security Plan for an 
area shall--
          (A) when implemented in conjunction with the National 
        Maritime Transportation Security Plan, be adequate to 
        deter a transportation security incident in or near the 
        area to the maximum extent practicable;
          (B) describe the area and infrastructure covered by 
        the plan, including the areas of population or special 
        economic, environmental, or national security 
        importance that might be damaged by a transportation 
        security incident;
          (C) describe in detail how the plan is integrated 
        with other Area Maritime Transportation Security Plans, 
        and with facility security plans and vessel security 
        plans under this section;
          (D) include consultation and coordination with the 
        Department of Defense on matters relating to Department 
        of Defense facilities and vessels;
          (E) include any other information the Secretary 
        requires; and
          (F) be updated at least every 5 years by the Federal 
        Maritime Security Coordinator.
  (3) The Secretary shall--
          (A) review and approve Area Maritime Transportation 
        Security Plans under this subsection; and
          (B) periodically review previously approved Area 
        Maritime Transportation Security Plans.
  (4) In security zones designated by the Secretary in each 
Area Maritime Transportation Security Plan, the Secretary shall 
consider--
          (A) the use of public/private partnerships to enforce 
        security within the security zones, shoreside 
        protection alternatives, and the environmental, public 
        safety, and relative effectiveness of such 
        alternatives; and
          (B) technological means of enhancing the security 
        zones of port, territorial waters, and waterways of the 
        United States.
  (5) Waterways located near nuclear facilities.--
          (A) Identification and security evaluation.--The 
        Secretary shall--
                  (i) identify all nuclear facilities on, 
                adjacent to, or in close proximity to navigable 
                waterways that might be damaged by a 
                transportation security incident; and
                  (ii) in coordination with the Secretary of 
                Energy, evaluate the security plans of each 
                such nuclear facility for its adequacy to 
                protect the facility from damage or disruption 
                from a transportation security incident 
                originating in the navigable waterway, 
                including threats posed by navigation, 
                underwater access, and the introduction of 
                harmful substances into water coolant systems.
          (B) Rectification of deficiencies.--The Secretary, in 
        coordination with the Secretary of Energy, shall take 
        such steps as may be necessary or appropriate to 
        correct any deficiencies in security identified in the 
        evaluations conducted under subparagraph (A).
          (C) Report.--As soon as practicable after completion 
        of the evaluation under subparagraph (A), the Secretary 
        shall transmit a report, in both classified and 
        redacted format, to the Senate Committee on Commerce, 
        Science, and Transportation, the House of 
        Representatives Committee on Transportation and 
        Infrastructure, and the House of Representatives Select 
        Committee on Homeland Security--
                  (i) describing the results of the 
                identification and evaluation required by 
                subparagraph (A);
                  (ii) describing the actions taken under 
                subparagraph (B); and
                  (iii) evaluating the technology utilized in 
                the protection of nuclear facilities (including 
                any such technology under development).
  (c) Vessel and facility security plans.--(1) Within 6 months 
after the prescription of interim final regulations on vessel 
and facility security plans, an owner or operator of a vessel 
or facility described in paragraph (2) shall prepare and submit 
to the Secretary a security plan for the vessel or facility, 
for deterring a transportation security incident to the maximum 
extent practicable.
  (2) The vessels and facilities referred to in paragraph (1)--
          (A) except as provided in subparagraph (B), are 
        vessels and facilities that the Secretary believes may 
        be involved in a transportation security incident; and
          (B) do not include any vessel or facility owned or 
        operated by the Department of Defense.
  (3) A security plan required under this subsection shall--
          (A) be consistent with the requirements of the 
        National Maritime Transportation Security Plan and Area 
        Maritime Transportation Security Plans;
          (B) identify the qualified individual having full 
        authority to implement security actions, and require 
        immediate communications between that individual and 
        the appropriate Federal official and the persons 
        providing personnel and equipment pursuant to 
        subparagraph (C);
          (C) include provisions for--
                  (i) establishing and maintaining physical 
                security, passenger and cargo security, and 
                personnel security;
                  (ii) establishing and controlling access to 
                secure areas of the vessel or facility;
                  (iii) procedural security policies;
                  (iv) communications systems; and
                  (v) other security systems;
          (D) identify, and ensure by contract or other means 
        approved by the Secretary, the availability of security 
        measures necessary to deter to the maximum extent 
        practicable a transportation security incident or a 
        substantial threat of such a security incident;
          (E) describe the training, periodic unannounced 
        drills, and security actions of persons on the vessel 
        or at the facility, to be carried out under the plan to 
        deter to the maximum extent practicable a 
        transportation security incident, or a substantial 
        threat of such a security incident;
          (F) be updated at least every 5 years; [and]
          (G) be resubmitted for approval of each change to the 
        vessel or facility that may substantially affect the 
        security of the vessel or [facility.] facility; and
          (H) establish a requirement, coordinated with the 
        Department of Energy, for criminal background checks of 
        all United States and foreign seamen employed on 
        vessels transporting nuclear materials in the navigable 
        waters of the United States.
  (4) The Secretary shall--
          (A) promptly review each such plan;
          (B) require amendments to any plan that does not meet 
        the requirements of this subsection;
          (C) approve any plan that meets the requirements of 
        this subsection; and
          (D) review each plan periodically thereafter.
  (5) A vessel or facility for which a plan is required to be 
submitted under this subsection may not operate after the end 
of the 12-month period beginning on the date of the 
prescription of interim final regulations on vessel and 
facility security plans, unless--
          (A) the plan has been approved by the Secretary; and
          (B) the vessel or facility is operating in compliance 
        with the plan.
  (6) Notwithstanding paragraph (5), the Secretary may 
authorize a vessel or facility to operate without a security 
plan approved under this subsection, until not later than 1 
year after the date of the submission to the Secretary of a 
plan for the vessel or facility, if the owner or operator of 
the vessel or facility certifies that the owner or operator has 
ensured by contract or other means approved by the Secretary to 
deter to the maximum extent practicable a transportation 
security incident or a substantial threat of such a security 
incident.
  (7) The Secretary shall require each owner or operator of a 
vessel or facility located within or adjacent to waters subject 
to the jurisdiction of the United States to implement any 
necessary interim security measures, including cargo security 
programs, to deter to the maximum extent practicable a 
transportation security incident until the security plan for 
that vessel or facility operator is approved.
  (d) Nondisclosure of information.--Notwithstanding any other 
provision of law, information developed under this chapter is 
not required to be disclosed to the public, including--
          (1) facility security plans, vessel security plans, 
        and port vulnerability assessments; and
          (2) other information related to security plans, 
        procedures, or programs for vessels or facilities 
        authorized under this chapter.

Sec. 70107. Grants

  [(a) In General.--The Secretary of Transportation, acting 
through the Maritime Administrator, shall establish a grant 
program for making a fair and equitable allocation among port 
authorities, facility operators, and State and local agencies 
required to provide security services of funds to implement 
Area Maritime Transportation Security Plans and facility 
security plans. The program shall take into account national 
economic and strategic defense considerations.]
  (a) In General.--The Under Secretary of Homeland Security for 
Border and Transportation Security shall establish a grant 
program for making a fair and equitable allocation of funds to 
implement Area Maritime Transportation Security Plans and to 
help fund compliance with Federal security plans among port 
authorities, facility operators, and State and local agencies 
required to provide security services. Grants shall be made on 
the basis of the need to address vulnerabilities in security 
subject to review and comment by the appropriate Federal 
Maritime Security Coordinators and the Maritime Administration. 
The grant program shall take into account national economic and 
strategic defense concerns and shall be coordinated with the 
Director of the Office of Domestic Preparedness to ensure that 
the grant process is consistent with other Department of 
Homeland Security grant programs.
  (b) Eligible Costs.--The following costs of funding the 
correction of Coast Guard identified vulnerabilities in port 
security and ensuring compliance with Area Maritime 
Transportation Security Plans and facility security plans are 
eligible to be funded:
          (1) Salary, benefits, overtime compensation, 
        retirement contributions, and other costs of additional 
        Coast Guard mandated security personnel.
          (2) The cost of acquisition, operation, and 
        maintenance of security equipment or facilities to be 
        used for security monitoring and recording, security 
        gates and fencing, marine barriers for designated 
        security zones, security-related lighting systems, 
        remote surveillance, concealed video systems, security 
        vessels, and other security-related infrastructure or 
        equipment that contributes to the overall security of 
        passengers, cargo, or crewmembers.
          (3) The cost of screening equipment, including 
        equipment that detects weapons of mass destruction and 
        conventional explosives, and of testing and evaluating 
        such equipment, to certify secure systems of 
        transportation.
          (4) The cost of conducting vulnerability assessments 
        to evaluate and make recommendations with respect to 
        security.
  (c) Matching Requirements.--
          (1) 75-percent federal funding.--Except as provided 
        in paragraph (2), Federal funds for any eligible 
        project under this section shall not exceed 75 percent 
        of the total cost of such project.
          (2) Exceptions.--
                  (A) Small projects.--There are no matching 
                requirements for grants under subsection (a) 
                for projects costing not more than $25,000.
                  (B) Higher level of support required.--If the 
                Secretary of Transportation determines that a 
                proposed project merits support and cannot be 
                undertaken without a higher rate of Federal 
                support, then the Secretary may approve grants 
                under this section with a matching requirement 
                other than that specified in paragraph (1).
  (d) Coordination and Cooperation Agreements.--The Secretary 
of Transportation shall ensure that projects paid for, or the 
costs of which are reimbursed, under this section within any 
area or port are coordinated with other projects, and may 
require cooperative agreements among users of the port and port 
facilities with respect to projects funded under this section.
  (e) Administration.--
          (1) In general.--The program shall require eligible 
        port authorities, facility operators, and State and 
        local agencies required to provide security services, 
        to submit an application, at such time, in such form, 
        and containing such information and assurances as the 
        Secretary of Transportation may require, and shall 
        include appropriate application, review, and delivery 
        mechanisms.
          (2) Minimum standards for payment or reimbursement.--
        Each application for payment or reimbursement of 
        eligible costs shall include, at a minimum, the 
        following:
                  (A) A copy of the applicable Area Maritime 
                Transportation Security Plan or facility 
                security plan.
                  (B) A comprehensive description of the need 
                for the project, and a statement of the 
                project's relationship to the applicable Area 
                Maritime Transportation Security Plan or 
                facility security plan.
                  (C) A determination by the Captain of the 
                Port that the security project addresses or 
                corrects Coast Guard identified vulnerabilities 
                in security and ensures compliance with Area 
                Maritime Transportation Security Plans and 
                facility security plans.
          (3) Procedural safeguards.--The Secretary of 
        Transportation shall by regulation establish 
        appropriate accounting, reporting, and review 
        procedures to ensure that amounts paid or reimbursed 
        under this section are used for the purposes for which 
        they were made available, all expenditures are properly 
        accounted for, and amounts not used for such purposes 
        and amounts not obligated or expended are recovered.
          (4) Project approval required.--The Secretary of 
        Transportation may approve an application for the 
        payment or reimbursement of costs under this section 
        only if the Secretary of Transportation is satisfied 
        that--
                  (A) the project is consistent with Coast 
                Guard vulnerability assessments and ensures 
                compliance with Area Maritime Transportation 
                Security Plans and facility security plans;
                  (B) enough money is available to pay the 
                project costs that will not be reimbursed by 
                the United States Government under this 
                section;
                  (C) the project will be completed without 
                unreasonable delay; and
                  (D) the recipient has authority to carry out 
                the project as proposed.
  (f) Audits and Examinations.--A recipient of amounts made 
available under this section shall keep such records as the 
Secretary of Transportation may require, and make them 
available for review and audit by the Secretary of 
Transportation, the Comptroller General of the United States, 
or the Inspector General of the Department of Transportation.
  (g) Reports on Security Funding and Compliance.--
          (1) Initial report.--Within 6 months after the date 
        of enactment of this Act, the Secretary of 
        Transportation shall transmit an unclassified report to 
        the Senate Committee on Commerce, Science, and 
        Transportation and the House of Representatives 
        Committee on Transportation and Infrastructure, that--
                  (A) includes a funding proposal and rationale 
                to fund the correction of Coast Guard 
                identified vulnerabilities in port security and 
                to help ensure compliance with Area Maritime 
                Transportation Security Plans and facility 
                security plans for fiscal years 2003 through 
                2008; and
                  (B) includes projected funding proposals for 
                fiscal years 2003 through 2008 for the 
                following security programs:
                          (i) The Sea Marshall program.
                          (ii) The Automated Identification 
                        System and a system of polling vessels 
                        on entry into United States waters.
                          (iii) The maritime intelligence 
                        requirements in this Act.
                          (iv) The issuance of transportation 
                        security cards required by section 
                        70105.
                          (v) The program of certifying secure 
                        systems of transportation.
          (2) Other expenditures.--The Secretary of 
        Transportation shall, as part of the report required by 
        paragraph (1) report, in coordination with the 
        Commissioner of Customs, on projected expenditures of 
        screening and detection equipment and on cargo security 
        programs over fiscal years 2003 through 2008.
          (3) Annual reports.--Annually, beginning 1 year after 
        transmittal of the report required by paragraph (1) 
        until October 1, 2009, the Secretary of Transportation 
        shall transmit an unclassified annual report to the 
        Senate Committee on Commerce, Science, and 
        Transportation and the House of Representatives 
        Committee on Transportation and Infrastructure, on 
        progress in achieving compliance with the correction of 
        Coast Guard identified vulnerabilities in port security 
        and compliance with Area Maritime Transportation 
        Security Plans and facility security plans that--
                  (A) identifies any modifications necessary in 
                funding to ensure the correction of Coast Guard 
                identified vulnerabilities and ensure 
                compliance with Area Maritime Transportation 
                Security Plans and facility security plans;
                  (B) includes an assessment of progress in 
                implementing the grant program established by 
                subsection (a);
                  (C) includes any recommendations the 
                Secretary may make to improve these programs; 
                and
                  (D) with respect to a port selected by the 
                Secretary of Transportation, describes progress 
                and enhancements of applicable Area Maritime 
                Transportation Security Plans and facility 
                security plans and how the Maritime 
                Transportation Security Act of 2002 has 
                improved security at that port.
  (h) Authorization of Appropriations.--There are authorized to 
be appropriated to the Secretary of Transportation for each of 
fiscal years 2003 through 2008 such sums as are necessary to 
carry out subsections (a) through (g).
  [(i) Research and Development Grants for Port Security.--
          [(1) Authority.--The Secretary of Transportation is 
        authorized to establish and administer a grant program 
        for the support of research and development of 
        technologies that can be used to secure the ports of 
        the United States. The Secretary may award grants under 
        the program to national laboratories, private nonprofit 
        organizations, institutions of higher education, and 
        other entities. The Secretary shall establish 
        competitive procedures for awarding grants under the 
        program and criteria for grant applications and 
        eligibility.
          [(2) Use of funds.--Grants awarded pursuant to 
        paragraph (1) shall be used to develop--
                  [(A) methods to increase the ability of the 
                Customs Service to inspect, or target for 
                inspection, merchandise carried on any vessel 
                that will arrive or has arrived at any port or 
                place in the United States;
                  [(B) equipment to accurately detect 
                explosives, or chemical and biological agents, 
                that could be used to commit terrorist acts 
                against the United States;
                  [(C) equipment to accurately detect nuclear 
                materials, including scintillation-based 
                detection equipment capable of attachment to 
                spreaders to signal the presence of nuclear 
                materials during the unloading of containers;
                  [(D) improved tags and seals designed for use 
                on shipping containers to track the 
                transportation of the merchandise in such 
                containers, including ``smart sensors'' that 
                are able to track a container throughout its 
                entire supply chain, detect hazardous and 
                radioactive materials within that container, 
                and transmit such information to the 
                appropriate authorities at a remote location;
                  [(E) tools to mitigate the consequences of a 
                terrorist act at a port of the United States, 
                including a network of sensors to predict the 
                dispersion of radiological, chemical, or 
                biological agents that might be intentionally 
                or accidentally released; or
                  [(F) applications to apply existing 
                technologies from other industries to increase 
                overall port security.
          [(3) Administrative provisions.--
                  [(A) No duplication of effort.--Before making 
                any grant, the Secretary of Transportation 
                shall coordinate with other Federal agencies to 
                ensure the grant will not be used for research 
                and development that is already being conducted 
                with Federal funding.
                  [(B) Accounting.--The Secretary of 
                Transportation shall by regulation establish 
                accounting, reporting, and review procedures to 
                ensure that funds made available under 
                paragraph (1) are used for the purpose for 
                which they were made available, that all 
                expenditures are properly accounted for, and 
                that amounts not used for such purposes and 
                amounts not expended are recovered.
                  [(C) Recordkeeping.--Recipients of grants 
                shall keep all records related to expenditures 
                and obligations of funds provided under 
                paragraph (1) and make them available upon 
                request to the Inspector General of the 
                Department of Transportation and the Secretary 
                of Transportation for audit and examination.
                  [(D) Annual review and report.--The Inspector 
                General of the Department of Transportation 
                shall annually review the program established 
                under paragraph (1) to ensure that the 
                expenditures and obligations of funds are 
                consistent with the purposes for which they are 
                provided and report the findings to Congress.
          [(4) Authorization of appropriations.--There is 
        authorized to be appropriated $15,000,000 for each of 
        the fiscal years 2003 through 2008 to carry out the 
        provisions of this subsection.]
  (i) Research and Development.--
          (1) In general.--As part of the research and 
        development program within the Science and Technology 
        directorate, the Secretary of Homeland Security shall 
        conduct investigations, fund pilot programs, award 
        grants, and otherwise conduct research and development 
        across the various portfolios focused on making United 
        States ports safer and more secure. Research conducted 
        under this subsection may include--
                  (A) methods or programs to increase the 
                ability to target for inspection vessels, 
                cargo, crewmembers, or passengers that will 
                arrive or have arrived at any port or place in 
                the United States;
                  (B) equipment to detect accurately 
                explosives, chemical, or biological agents that 
                could be used to commit terrorist acts against 
                the United States;
                  (C) equipment to detect accurately nuclear or 
                radiological materials, including 
                scintillation-based detection equipment capable 
                of signalling the presence of nuclear or 
                radiological materials;
                  (D) improved tags and seals designed for use 
                on shipping containers to track the 
                transportation of the merchandise in such 
                containers, including ``smart sensors'' that 
                are able to track a container throughout its 
                entire supply chain, detect hazardous and 
                radioactive materials within that container, 
                and transmit that information to the 
                appropriate law enforcement authorities;
                  (E) tools, including the use of satellite 
                tracking systems, to increase the awareness of 
                maritime areas and to identify potential 
                terrorist threats that could have an impact on 
                facilities, vessels, and infrastructure on or 
                adjacent to navigable waterways, including 
                underwater access;
                  (F) tools to mitigate the consequences of a 
                terrorist act on, adjacent to, or under 
                navigable waters of the United States, 
                including sensor equipment, and other tools to 
                help coordinate effective response to a 
                terrorist action;
                  (G) applications to apply existing 
                technologies from other areas or industries to 
                increase overall port security; and
                  (H) improved container design, including 
                blast-resistant containers.
          (2) Implementation of technology.--
                  (A) In general.--In conjunction with ongoing 
                efforts to improve security at United States 
                ports, the Director of the Science and 
                Technology Directorate, in consultation with 
                other Department of Homeland Security agencies 
                with responsibility for port security, may 
                conduct pilot projects at United States ports 
                to test the effectiveness and applicability of 
                new port security projects, including--
                          (i) testing of new detection and 
                        screening technologies;
                          (ii) projects to protect United 
                        States ports and infrastructure on or 
                        adjacent to the navigable waters of the 
                        United States, including underwater 
                        access; and
                          (iii) tools for responding to a 
                        terrorist threat or incident at United 
                        States ports and infrastructure on or 
                        adjacent to the navigable waters of the 
                        United States, including underwater 
                        access.
                  (B) Authorization of appropriations.--There 
                are authorized to be appropriated to the 
                Secretary of Homeland Security $35,000,000 for 
                each of fiscal years 2005 through 2009 to carry 
                out pilot projects under subparagraph (A).
          (3) Administrative provisions.--
                  (A) No duplication of effort.--Before making 
                any grant, the Secretary of Homeland Security 
                shall coordinate with other Federal agencies to 
                ensure the grant will not be used for research 
                and development that is already being conducted 
                with Federal funding.
                  (B) Accounting.--The Secretary of Homeland 
                Security shall by regulation establish 
                accounting, reporting, and review procedures to 
                ensure that funds made available under 
                paragraph (1) are used for the purpose for 
                which they were made available, that all 
                expenditures are properly accounted for, and 
                that amounts not used for such purposes and 
                amounts not expended are recovered.
                  (C) Recordkeeping.--Recipients of grants 
                shall keep all records related to expenditures 
                and obligations of funds provided under 
                paragraph (1) and make them available upon 
                request to the Inspector General of the 
                Department of Homeland Security and the 
                Secretary of Homeland Security for audit and 
                examination.

Sec. 70109. Notifying foreign authorities

  (a) In General.--If the Secretary, after conducting an 
assessment under section 70108, finds that a port in a foreign 
country does not maintain effective antiterrorism measures, the 
Secretary shall notify the appropriate authorities of the 
government of the foreign country of the finding and recommend 
the steps necessary to improve the antiterrorism measures in 
use at the port.
  (b) Training Program.--[The Secretary,] The Administrator of 
the Maritime Administration, in cooperation with the Secretary 
of State, shall operate a port security training program for 
ports in foreign countries that are found under section 70108 
to lack effective antiterrorism measures.
  (c) Foreign Assistance Programs.--The Administrator of the 
Maritime Administration, in coordination with the Secretary of 
State, shall identify foreign assistance programs that could 
facilitate implementation of port security antiterrorism 
measures in foreign countries. The Administrator and the 
Secretary shall establish a program to utilize those programs 
that are capable of implementing port security antiterrorism 
measures at ports in foreign countries that the Secretary 
finds, under section 70108, to lack effective antiterrorism 
measures.

                             * * * * * * *

Sec.  70117. In rem liability for civil penalties and certain costs

  (a) In General.--Any vessel subject to the provisions of this 
chapter, which is used in violation of this chapter or any 
regulations issued hereunder shall be liable in rem for any 
civil penalty assessed pursuant to section 70120 and may be 
proceeded against in the United States district court for any 
district in which such vessel may be found.
  (b) Reimbursable Costs.--
          (1) In general.--Any vessel subject to the provisions 
        of this chapter shall be liable in rem for the 
        reimbursable costs incurred by any valid claimant 
        related to implementation and enforcement of this 
        chapter with respect to the vessel, including port 
        authorities, facility or terminal operators, shipping 
        agents, Federal, State, or local government agencies, 
        and other persons to whom the management of the vessel 
        at the port of supply is entrusted, and any fine or 
        penalty relating to reporting requirements of the 
        vessel or its cargo, crew, or passengers, and may be 
        proceeded against in the United States district court 
        for any district in which such vessel may be found.
          (2) Reimbursable costs defined.--In this subsection 
        the term ``reimbursable costs'' means costs incurred by 
        any service provider, including port authorities, 
        facility or terminal operators, shipping agents, 
        Federal, State, or local government agencies, or other 
        person to whom the management of the vessel at the port 
        of supply is entrusted, for--
                  (A) vessel crew on board, or in transit to or 
                from, the vessel under lawful order, including 
                accommodation, detention, transportation, and 
                medical expenses; and
                  (B) required handling under lawful order of 
                cargo or other items on board the vessel.

Sec. 70118. Enforcement by injunction or withholding of clearance

  (a) Injunction.--The United States district courts shall have 
jurisdiction to restrain violations of this chapter or of 
regulations issued hereunder, for cause shown.
  (b) Withholding of Clearance.--
          (1) If any owner, agent, master, officer, or person 
        in charge of a vessel is liable for a penalty or fine 
        under section 70120, or if reasonable cause exists to 
        believe that the owner, agent, master, officer, or 
        person in charge may be subject to a penalty under 
        section 70120, the Secretary may, with respect to such 
        vessel, refuse or revoke any clearance required by 
        section 4197 of the Revised Statutes of the United 
        States (46 U.S.C. App. 91).
          (2) Clearance refused or revoked under this 
        subsection may be granted upon filing of a bond or 
        other surety satisfactory to the Secretary.

Sec. 70119. Security of piers and wharfs

  (a) In General.--Notwithstanding any other provision of law, 
the Secretary shall require any uncleared, imported merchandise 
remaining on the wharf or pier onto which it was unladen for 
more than 5 calendar days to be removed from the wharf or pier 
and deposited in the public stores or a general order 
warehouse, where it shall be inspected for determination of 
contents, and thereafter a permit for its delivery may be 
granted.
  (b) Penalty.--The Secretary may impose an administrative 
penalty of $5,000 for each bill of lading for general order 
merchandise remaining on a wharf or pier in violation of 
subsection (a).

[Sec. 70117. Civil penalty]

Sec. 70120. Civil penalty

  Any person that violates this chapter or any regulation under 
this chapter shall be liable to the United States for a civil 
penalty of not more than $25,000 for each violation.

                           UNITED STATES CODE

                   TITLE 50. WAR AND NATIONAL DEFENSE

       CHAPTER 12. VESSELS IN TERRITORIAL WATERS OF UNITED STATES

Sec. 192. Seizure and forfeiture of vessel; fine and imprisonment

  (a) In General.--If any owner, agent, master, officer, or 
person in charge, or any member of the crew of any such vessel 
fails to comply with any regulation or rule issued or order 
given under the provisions of this title, or obstructs or 
interferes with the exercise of any power conferred by this 
title, the vessel, together with her tackle, apparel, 
furniture, and equipment, shall be subject to seizure and 
forfeiture to the United States in the same manner as 
merchandise is forfeited for violation of the customs revenue 
laws; and the person guilty of such failure, obstruction, or 
interference shall be punished by imprisonment for not more 
than ten years and may in the discretion of the court, be fined 
not more than $10,000.
  (b) Application to Others.--If any other person knowingly 
fails to comply with any regulation or rule issued or order 
given under the provisions of this title, or knowingly 
obstructs or interferes with the exercise of any power 
conferred by this title, he shall be punished by imprisonment 
for not more than ten years and may, at the discretion of the 
court, be fined not more than $10,000.
  (c) Civil Penalty.--A person violating this [Act,] title, or 
a regulation prescribed under this [Act,] title, shall be 
liable to the United States Government for a civil penalty of 
not more than $25,000 for each violation. Each day of a 
continuing violation shall constitute a separate violation.
  (d) In rem liability.--Any vessel subject to the provisions 
of this title that is used in violation of this title, or any 
regulations issued hereunder, shall be liable in rem for any 
civil penalty assessed pursuant to subsection (c) and may be 
proceeded against in the United States district court for any 
district in which such vessel may be found.
  (e) Injunction.--The United States district courts shall have 
jurisdiction to restrain violations of this title or of 
regulations issued hereunder, for cause shown.
  (f) Withholding of clearance.--
          (1) If any owner, agent, master, officer, or person 
        in charge of a vessel is liable for a penalty or fine 
        under subsection (c), or if reasonable cause exists to 
        believe that the owner, agent, master, officer, or 
        person in charge may be subject to a penalty or fine 
        under subsection (c), the Secretary may, with respect 
        to such vessel, refuse or revoke any clearance required 
        by section 4197 of the Revised Statutes of the United 
        States (46 U.S.C. App. 91).
          (2) Clearance refused or revoked under this 
        subsection may be granted upon filing of a bond or 
        other surety satisfactory to the Secretary of the 
        Department in which the Coast Guard is operating.