[Federal Register Volume 63, Number 158 (Monday, August 17, 1998)] [Notices] [Pages 43984-43985] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 98-22127] ----------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Maritime Administration Voluntary Intermodal Sealift Agreement (VISA) AGENCY: Maritime Administration, DOT. ACTION: Notice of Open Season For Enrollment in Fiscal Year (FY) 1999 VISA Program. ----------------------------------------------------------------------- Introduction The VISA program was established pursuant to section 708 of the Defense Production Act of 1950, as amended, which provides for voluntary agreements for emergency preparedness programs. After review of a one-year prototype, VISA was approved January 30, 1997, and published in the Federal Register on February 13, 1997 (62 FR 6837). As implemented, VISA is open to U.S.-Flag Vessel Operators of militarily useful vessels, including bareboat charter operators if satisfactory signed agreements are in place committing the assets of the owner to the bareboat charterer for purposes of VISA. By order of the Maritime Administrator on August 4, 1997, participation of U.S.-flag deepwater tug/barge Operators in VISA was encouraged. Time, voyage, and space charterers are not considered U.S.-Flag Vessel Operators for purposes of VISA eligibility. Participation in VISA, as evidenced by a fully executed VISA Agreement with the Maritime Administration (MARAD), satisfies the requirement of section 653 of the Maritime Security Act of 1996 (P.L. 104-239) for Maritime Security Program (MSP) participants to enter into an Emergency Preparedness Agreement with the Secretary of Transportation and to receive DoD peacetime contract award priority by participation in a Emergency Preparedness Program, approved by the Secretary of Defense (SECDEF). VISA Concept The mission of VISA is to provide commercial sealift and intermodal shipping services and systems, including vessels, vessel space, intermodal equipment and related management services, to the Department of Defense (DoD), as necessary, to meet national defense contingency requirements or national emergencies. VISA provides for the staged, time-phased availability of participants' shipping services/systems to meet contingency requirements through prenegotiated contracts between the Government and participants. Such arrangements will be jointly planned with MARAD, USTRANSCOM, and participants in peacetime to allow effective and best valued use of commercial sealift capacity, to provide DoD assured contingency access, and to minimize commercial disruption, whenever possible. VISA Stages I and II provide for prenegotiated contracts between the DoD and participants to provide sealift capacity to meet all projected DoD contingency requirements. These contracts will be executed in accordance with approved DoD contracting methodologies. VISA Stage III will provide for additional capacity to the DoD when Stage I and II commitments or volunteered capacity are insufficient to meet contingency requirements, and adequate shipping services from non- participants are not available through established DoD contracting practices or U.S. Government treaty agreements. FY 1999 VISA Enrollment Open Season The purpose of this notice is to invite interested, qualified U.S.- Flag Vessel Operators to participate in the VISA program for FY 1999 (October 1, 1998 thru September 30, 1999). This is the first annual enrollment period since the commencement of VISA during which time participants have been enrolled in the program on an ad-hoc basis. This enrollment method was adequate during the early period of the program while the DoD VISA contracting process was under development. However, now that VISA has been fully integrated into DoD's priority for award of cargo to VISA participants, it is necessary to link the VISA enrollment cycle with DoD's peacetime cargo contracting cycle. Existing VISA participants and new applicants are required to enroll/re-enroll for the FY 1999 VISA program as described in this Notice. This alignment of VISA enrollment and eligibility for VISA priority will solidify the linkage between commitment of contingency assets by VISA participants and receiving VISA priority consideration for award of FY 1999 DoD peacetime cargo. It is the only planned enrollment period for carriers to join VISA and derive benefits for DoD peacetime contracts during FY 1999. The only exception to this open season period for VISA enrollment will be for a non-VISA carrier that reflags a vessel into U.S. registry. That carrier may join VISA upon completion of reflagging at any time during the fiscal year. Advantages of Peacetime Participation Because enrollment of carriers in VISA provides the DoD with assured access to sealift services during contingencies based on a level of commitment, as well as a mechanism for joint planning, the DoD awards peacetime cargo contracts to VISA participants on a priority basis. This applies to liner trades and charter contracts alike. Award of DoD cargoes to meet DoD peacetime and contingency requirements is made on the basis of the following priorities:U.S.-flag vessel capacity operated by VISA participants, and U.S.-flag Vessel Sharing Agreement (VSA) capacity held by VISA participants. U.S.-flag vessel capacity operated by non-participants. Combination U.S.-flag/foreign-flag vessel capacity operated by VISA participants, and combination U.S.-flag/foreign-flag VSA capacity held by VISA participants. Combination U.S.-flag/foreign-flag vessel capacity operated by non-participants. U.S.-owned or operated foreign-flag vessel capacity and VSA capacity held by VISA participants. U.S.-owned or operated foreign-flag vessel capacity and VSA capacity held by non-participants. Foreign-owned or operated foreign-flag vessel capacity of non-participants. [[Page 43985]] Participants Any U.S.-Flag Vessel Operator organized under the laws of a state of the United States, or the District of Columbia, who is able and willing to commit militarily useful sealift assets and assume the related consequential risks of commercial disruption, may be eligible to participate in the VISA program. While vessel brokers and agents play an important role as a conduit to locate and secure appropriate vessels for the carriage of DoD cargo, they may not become participants in the VISA program due to lack of requisite vessel ownership or operation. Brokers and agents should encourage the carriers they represent, however, to join the program. Commitment Any U.S.-Flag Vessel Operator desiring to receive preference in the award of DoD peacetime contracts must commit no less than 50 percent of its total U.S.-flag militarily useful capacity in Stage III of the VISA program. A participant desiring to bid on DoD peacetime contracts will be required to provide commitment levels to meet DoD-established Stage I and/or II minimum percentages of the participant's military useful, oceangoing U.S-flag fleet capacity on an annual basis. The United States Transportation Command (USTRANSCOM) and MARAD will coordinate to ensure that the amount of sealift assets committed to Stages I and II will not have an adverse national economic impact. To minimize domestic commercial disruption, participants operating vessels in the domestic Jones Act trades are not required to commit the capacity of those U.S. domestic trading vessels to VISA Stages I and II. Overall VISA commitment requirements are based on annual enrollment. In order to protect a U.S.-Flag Vessel Operator's market share during contingency activation, VISA allows participants to join with other vessel operators in Carrier Coordination Agreements (CCA's) to satisfy commercial or DoD requirements. VISA provides a defense against antitrust laws in accordance with section 708 of the Defense Production Act of 1950. CCA's must be submitted to MARAD for coordination with the Department of Justice for approval, before they can be utilized. Compensation In addition to receiving priority in the award of DoD peacetime cargo, compensation during contingency activation provides multiple methodologies that each participant may choose during enrollment which are commensurate with risk and service provided. The rate methodology determinations for liners and charters are undergoing development, but will be available for use at the commencement of the FY 1999 VISA participation period. Enrollment Immediately following publication of this Notice, current VISA participants will receive a re-enrollment package from the Director, Office of Sealift Support, which will also include VISA Stage III capacity calculation worksheets to review and approve. These documents must be returned to MARAD no later than August 31, 1998, to allow processing time for the October 1, 1998, commencement date of the FY 1999 VISA participation period. New applicants may enroll by obtaining a VISA application package from the Director, Office of Sealift Support. The application package will include the February 13, 1997 VISA Agreement, instructions for completing and submitting the application, blank VISA Application forms, and a request for information regarding the operations and U.S. citizenship of the applicant in order to assist MARAD in making a determination of the applicant's eligibility. An applicant must be able to provide an affidavit that demonstrates that it is at least a citizen of the United States, for purposes of vessel documentation, within the meaning of 46 U.S.C., section 12102, and that it owns, or bareboat charters and controls, oceangoing, militarily useful vessel(s) for purposes of committing assets to VISA. New VISA applicants must return completed FY 1999 VISA application documents to MARAD not later than August 31, 1998. Once MARAD has reviewed the application and determined VISA eligibility, MARAD will sign the VISA application document which completes the eligibility phase of the VISA enrollment process; however, the applicant is not yet a VISA participant, due to the remaining requirement to enter into contingency contracts with DoD. For the FY 1999 VISA open season, and prior to being re-enrolled in VISA, all current VISA participants and eligible new VISA applicants will be required to execute a joint Voluntary Enrollment Contract (VEC) with the DoD [Military Traffic Management Command (MTMC) and Military Sealift Command (MSC)] which will specify the participant's Stage III commitment for FY 1999. Once the VEC is completed, the applicant completes the DoD contracting process by executing a Drytime Contingency Contract (DCC) with MSC (for Charter Operators) and/or as applicable, a VISA Contingency Contract (VCC) with MTMC (for Liner Operators). Once the DoD contingency contract(s) are completed, the Maritime Administrator will confirm the participant's enrollment/re- enrollment by letter agreement, with a copy to all appropriate parties. FOR ADDITIONAL INFORMATION AND APPLICATIONS CONTACT: Raymond Barberesi, Director, Office of Sealift Support, U.S. Maritime Administration, Room 7307, 400 Seventh Street, SW., Washington, DC 20590. Telephone (202) 366-2323. Fax (202) 493-2180. The full text of this Federal Register Notice and other information about the VISA can be found on MARAD's Internet Web Page at http://www.marad.dot.gov. By Order of the Maritime Administrator. Dated: August 13, 1998. Joel C. Richard, Secretary, Maritime Administration. [FR Doc. 98-22127 Filed 8-14-98; 8:45 am] BILLING CODE 4910-81-P