RESEARCH AND DEVELOPMENT

Our requested appropriation for this item for fiscal year 1968 is $7,625,000, which is an increase of $125,000 over the amount appropriated for fiscal year 1967.

The research and development projects of the Maritime Adminis-. tration are designed to imprve the competitive position of the American merchant marine while reducing the Government's share of the cost of its construction, operation, and maintenance. In carrying out this program we expect to work closely with industry groups who share in the benefits, and with related Government agencies such as the Navy Department, in order to secure maximum results and utilitization of successful research and development projects while avoiding overlapping costs and benefits. To this end, a new research and development advisory group, composed of representatives of labor, industry, and academic institutions has been appointed to review proposed research and development, advise, and suggest improvements and assist in gaining acceptance of results. In addition, a joint Navy-Marad program has been established to study the feasibility of adapting the new surface effect ship concept to ocean transportation. The privately owned merchant marine must be a part of our research efforts in order that the developments in ship construction, shipping, and shipping systems will receive acceptance and assurance of payoff. We believe that such committees and joint efforts will provide such a means.

During the past several years, we have had a directed research program aimed at the reduction of ship construction, ship operations, port and transportation system costs. Most of the effort of this program has been directed toward a more competitive merchant marine utilizing, insofar as possible, the adaption and incorporation in ships of the known technology in other related fields. The requested increase of $575,000 in this area is for projects which are aimed at the achievement of more immediate results.

Examples include research and development into high efficiency propulsion systems, ships maintenance and reliability, resistance and propulsion, and seakeeping, which will result in faster and more powerful future ships.

The second major program under research and development covers the area of new concepts in transportation, ships, and systems. Here, we are dealing with areas outside of the present state of the art and we are getting into the adaption of the surface effect ship to ocean transportation, the possible development of submersible vehicles, the use of air-lubricated hulls which eliminate hull friction, as well as other advanced concepts. The surface effect ship program will be carried out with the Navy and with joint financing over the next several years.

These increases in program will be financed largely by funds saved through withdrawal of the Savannah, nearly $2 million. In August 1967 the Savannah will have completed 2 years of experimental commercial operation. This commercial operation has been carried out under bareboat charter with a subsidiary of American Export Isbrandtsen Lines.

This experimental operation of the Savannah over the past 2 years has served to test the feasibility of a nuclear-powered vessel in com

mercial operation. In an operational sense, as distinct from financial, our experiment with the Savannah has been successful in providing useful information.

The cost of operating the Savannah has significantly exceeded revenues, requiring more than $3 million per year in Government operating subsidy, and for this reason our budget for fiscal year 1968 is based on withdrawing the Savannah from operation and placing it in layup

status.

The Savannah has not been and cannot be for the foreseeable future operated so as to show a profit or merely to break even. You will recall that the Savannah is a combination passenger-cargo vessel. In practical financial terms, the fact that a significant portion of the space on this cannot be utilized to haul cargo makes fosses larger than they would otherwise be, if the vessel was designed for all-cargo operations. Experimental operation of the Savannah, under commercial conditions, will have been sufficient to establish-without need for further commercial operations at a significant financial loss-the feasibiilty of a nuclear-powered merchant ship. We do not believe that the continued experimental operation of the Savannah is needed or will produce additional research value sufficient to offset the continuing heavy operating deficit. For this reason, we do not propose to continue it in operation beyond this August.

MARITIME TRAINING

The appropriation for maritime training in fiscal year 1967 was $4,470,000. The request for fiscal 1968 is $4,620,000.

This program provides for the training of cadets as officers of the merchant marine at the Merchant Marine Academy, Kings Point, N.Y. A 4-year training course is provided, including 1 year of sea training. The fiscal 1968 budget estimate covers the cost of operating and maintaining the Academy.

The cadet training program is designed to graduate 200 merchant marine officers each year. In fiscal 1966, on an experimental basis, 30 cadets of the entering class were introduced to a combined deck-engine curriculum. Of this group, 26 remain in the program and are in their sea-year phase. The goal of this program is to provide graduates with greater flexibility of career choices and the possibility of acquiring a single combined deck-engine license. Advances in ship mechanization must ultimately require officers knowledgeable in the entire operation of a ship, similar in concept to that of a plant manager. The combined deck-engine training course is directed toward that goal. In fiscal 1967 a similar group of 30 of the entering class were selected for the same combined training course. The Academy has and will continue to adjust its curriculum consistent with the needs of the American merchant marine. In 1966 a revised curriculum was introduced to the entering cadet class consistent with recommendations by the accreditation body and has been continued with the entering classes in subsequent years. These changes provide a more effective student-professor contact hour relationship in a number of professional engineering and advanced seagoing license subjects.

The fiscal 1968 appropriation request reflects an increase of $300,000 over the 1967 adjusted requirement. The increase in funds is primarily for 10 additional faculty positions required as a result of the cur

RESEARCH AND DEVELOPMENT

Our requested appropriation for this item for fiscal year 1968 is $7,625,000, which is an increase of $125,000 over the amount appropriated for fiscal year 1967.

The research and development projects of the Maritime Adminis-. tration are designed to imprve the competitive position of the American merchant marine while reducing the Government's share of the cost of its construction, operation, and maintenance. In carrying out this program we expect to work closely with industry groups who share in the benefits, and with related Government agencies such as the Navy Department, in order to secure maximum results and utilitization of successful research and development projects while avoiding overlapping costs and benefits. To this end, a new research and development advisory group, composed of representatives of labor, industry, and academic institutions has been appointed to review proposed research and development, advise, and suggest improvements and assist in gaining acceptance of results. In addition, a joint Navy-Marad program has been established to study the feasibility of adapting the new surface effect ship concept to ocean transportation. The privately owned merchant marine must be a part of our research efforts in order that the developments in ship construction, shipping, and shipping systems will receive acceptance and assurance of payoff. We believe that such committees and joint efforts will provide such a means.

During the past several years, we have had a directed research program aimed at the reduction of ship construction, ship operations, port and transportation system costs. Most of the effort of this program has been directed toward a more competitive merchant marine utilizing, insofar as possible, the adaption and incorporation in ships of the known technology in other related fields. The requested increase of $575,000 in this area is for projects which are aimed at the achievement of more immediate results.

Examples include research and development into high efficiency propulsion systems, ships maintenance and reliability, resistance and propulsion, and seakeeping, which will result in faster and more powerful future ships.

The second major program under research and development covers the area of new concepts in transportation, ships, and systems. Here, we are dealing with areas outside of the present state of the art and we are getting into the adaption of the surface effect ship to ocean transportation, the possible development of submersible vehicles, the use of air-lubricated hulls which eliminate hull friction, as well as other advanced concepts. The surface effect ship program will be carried out with the Navy and with joint financing over the next several years.

These increases in program will be financed largely by funds saved through withdrawal of the Savannah, nearly $2 million. In August 1967 the Savannah will have completed 2 years of experimental commercial operation. This commercial operation has been carried out under bareboat charter with a subsidiary of American Export Isbrandtsen Lines.

This experimental operation of the Savannah over the past 2 years has served to test the feasibility of a nuclear-powered vessel in com

mercial operation. In an operational sense, as distinct from financial, our experiment with the Savannah has been successful in providing useful information.

The cost of operating the Savannah has significantly exceeded revenues, requiring more than $3 million per year in Government operating subsidy, and for this reason our budget for fiscal year 1968 is based on withdrawing the Savannah from operation and placing it in layup

status.

The Savannah has not been and cannot be for the foreseeable future operated so as to show a profit or merely to break even. You will recall that the Savannah is a combination passenger-cargo vessel. In practical financial terms, the fact that a significant portion of the space on this cannot be utilized to haul cargo makes losses larger than they would otherwise be, if the vessel was designed for all-cargo operations. Experimental operation of the Savannah, under commercial conditions, will have been sufficient to establish-without need for further commercial operations at a significant financial loss-the feasibilty of a nuclear-powered merchant ship. We do not believe that the continued experimental operation of the Savannah is needed or will produce additional research value sufficient to offset the continuing heavy operating deficit. For this reason, we do not propose to continue it in operation beyond this August.

MARITIME TRAINING

The appropriation for maritime training in fiscal year 1967 was $4,470,000. The request for fiscal 1968 is $4,620,000.

This program provides for the training of cadets as officers of the merchant marine at the Merchant Marine Academy, Kings Point, N.Y. A 4-year training course is provided, including 1 year of sea training. The fiscal 1968 budget estimate covers the cost of operating and maintaining the Academy.

The cadet training program is designed to graduate 200 merchant marine officers each year. In fiscal 1966, on an experimental basis, 30 cadets of the entering class were introduced to a combined deck-engine curriculum. Of this group, 26 remain in the program and are in their sea-year phase. The goal of this program is to provide graduates with greater flexibility of career choices and the possibility of acquiring a single combined deck-engine license. Advances in ship mechanization must ultimately require officers knowledgeable in the entire operation of a ship, similar in concept to that of a plant manager. The combined deck-engine training course is directed toward that goal. In fiscal 1967 a similar group of 30 of the entering class were selected for the same combined training course. The Academy has and will continue to adjust its curriculum consistent with the needs of the American merchant marine. In 1966 a revised curriculum was introduced to the entering cadet class consistent with recommendations by the accreditation body and has been continued with the entering classes in subsequent years. These changes provide a more effective student-professor contact hour relationship in a number of professional engineering and advanced seagoing license subjects.

The fiscal 1968 appropriation request reflects an increase of $300,000 over the 1967 adjusted requirement. The increase in funds is primarily for 10 additional faculty positions required as a result of the cur

riculum changes. Three positions are requested consistent with the increased library functions required to effectively staff the new library building. Two positions are also requested for administrative support functions. An increase is also included for some acceleration in the level of the programs necessary for the proper safeguarding and maintenance of the Academy's property and instructional facilities.

STATE MARINE SCHOOLS

The appropriation for State marine schools for fiscal 1967 was $1,635,000. The request for fiscal 1968 is $1,775,000.

This program provides financial assistance to State marine schools and cadets thereof for training as officers for service in the merchant marine, supplementing the graduate officer output of the Federal Academy at Kings Point. A 4-year course is offered at the New York, Maine, and Texas schools and a 3-year course is offered at the Massachusetts and California State schools.

The appropriation request provides for direct grants of $75,000 to each of the participating State marine schools if matched by State appropriations; uniform, textbook, and subsistence allowances to cadets not to exceed $600 per annum per cadet for an estimated average attendance of 1,500 during fiscal 1968; and $500,000 for maintenance and repair of five Government-loaned training ships used in the training program.

The fiscal year 1968 request includes an increase of $140,000 over the 1967 appropriation. This increase is for the maintenance and repair of the training school ships. These additional funds will be utilized to make needed repairs in addition to normal maintenance and drydocking. The age of the training ships coupled with the increasing shipyard, equipment, and supply costs require that additional funds be made available for this purpose. Repairs such as plating, replacement of major equipment and propulsion components, repairs of decks, and overhaul of essential shipboard systems are required to meet minimum operating and safety standards set by Coast Guard and other regulatory bodies for granting of seaworthy condition certifications. The increase requested to provide $100,000 for each school ship is the minimum amount necessary to assure compliance with operating and safety standards of regulatory bodies.

SALARIES AND EXPENSES

This appropriation for the fiscal year 1967 was $15,790,000 of which $9,962,000 was for administrative expenses, $240,000 for maintenance of shipyard facilities and maintenance of warehouses, and $5,588,000 for reserve fleet expenses.

The request for fiscal 1968 is for $15,947,000 of which $240,000 is for maintenance of shipyard facilities and maintenance of warehouses and $5,440,000 is for reserve fleet expenses.

Funds requested for shipyard and warehouse expenses provide for the care and maintenance of real property in warehouses owned by the Maritime Administration. The warehouses are located at Kearny, N.J., New Orleans, La., and San Francisco, Calif.