272.23 Examples of ineligible expenses.§ 272.23 Examples of ineligible expenses.
Expenses ineligible for M&R subsidy participation include, but are not limited to, the following examples:
(a) Specialized improvements. Any expenditure or Improvement required to alter, outfit or otherwise equip a vessel for its intended subsidized service which MARAD determines should have been performed before the initial entry of the vessel into subsidized service;
(b) Convenience items. Any expenditure for items that the Region Director determines to be aboard a ship only for the convenience of the Operator or crew members, and which are not considered integral parts of the vessel and are not required for seaworthiness, navigation or the health or well-being of the crew or passengers.
(c) Unsupported expenses. Any expense item which the Operator fails to substantiate adequately with documentation, as required by § 272.24.
(d) Untimely requests for review. Any disallowed expense item for which the Operator fails to make a timely request for review, as required by § 272.43.
(e) Untimely appeals. Any expense item disallowed in the final determination by the Director, Office of Ship Operations, for which the Operator fails to make a timely appeal to the Board, pursuant to § 272.43.
(f) Absence of notice of multi-repair period Improvements. Any expenses for an Improvement extending over more than one repair period in which the Operator did not notify the Director, Office of Ship Operations, as required by § 272.22(c).
(g) Cargo expenses. Any expense of special cargo fittings of a temporary nature, dunnage, ceiling, battens, the cleaning of cargo holds and tanks for cargo, the reading and certification of temperatures for refrigerated cargoes, and similar expenses.
(h) Stevedore damage. Any expense or any damage to the vessels or cargo gear directly attributable to a stevedore.
(i) Rented equipment. Any expense for the rental of Permanent or Expendable Equipment, such as compressors, paint floats, and other similar items for use by shore gangs or ship's crew on repair or other work, radar, radio telephones, and other similar items for use by ship's crew in ship operations.
(j) Special requirements for trade routes. Any expense for the initial installation of equipment necessary for the vessel's particular trade route, such as Suez Canal davits, which should have been installed before the entry of the vessel into the particular subsidized service.
(k) General operating expenses. Any expense for the loading of stores, the landing and sorting of laundry, pilot service, tug charges, removing surplus equipment to warehouses, and other similar expenses which do not involve actual maintenance and repair.
(l) Items attributable to unsubsidized operations. Any item of maintenance or repair that is clearly attributable to unsubsidized operation, including expenses noted in on-subsidy surveys for repairs which clearly should have been made before departure from the last United States port on the first voyage:
(1) In subsidized service, or
(2) Upon resumption of subsidized operation following temporary withdrawal.
(m) Overdue classification and inspection requirements. Any expenses for work required by a classification society or an agency of the Federal Government, which was due (irrespective of any grace period granted) and not completed before the first voyage:
(1) In subsidized service, or
(2) Upon resumption of subsidized operation following temporary withdrawal, except when such work is attributable to prior subsidized service.
(n) Foreign maintenance and repairs. Any expense for any item of M&R, including insurance repairs, that is not of Domestic Origin.
(o) Marine or other loss. Any part of an expense or a repair which is recovered or recoverable from an insurer or another party.
(p) Consumables, expendables. Any procurement expense for consumables, expendables, and Expendable Equipment, when used or installed by ship's crew or furnished for inclusion in ship's inventory, and any expense for maintenance, repair, or replacement of Expendable Equipment.
(q) Excessive costs. Costs for M&R which MARAD considers excessive, after allowing the Operator an opportunity to present all relevant facts pertinent to such costs.
(r) Overhead costs. Any expense included in shore gang labor charges which is an overhead item, as prescribed by 46 CFR part 232 - Uniform Financial Reporting Requirements.
(s) Guarantee items. Any expense for an item adjudged or noted as being a guarantee item of a construction or repair contractor.[55 FR 34919, Aug. 27, 1990, as amended at 57 FR 34690, Aug. 6, 1992]