52 STAT.] 75TH CONG. , 3D SESS.-CH. 600-JUNE 23, 1938 SEC. 12. Section 502 (d) of such Act is amended (a) by striking Vessels cons on Pacific Coa~ out "construction subsidy" and inserting in lieu thereof constru- 49Stat.l 97. tion-differential subsidy', and (b) by adding at the end thereof a new sentence to read as follows: "Nothing in this section shall be Construction construed as authorizing the Commission to approve a construction- differential in excess of 50 per centum of the construction cost of the vessel paid by the Commission." SEC. 13. Section 502 of such Act is amended by adding at the end 49 Stat. 1997. thereof a new subsection to read as follows: "(f) If at any time the Commission shall find that the existing strltionr ship yards, including the navy yards, do not provide adequate facili- ties to meet necessary requirements for purposes of national defense and national emergency, with special regard to providing facilities for the national defense at strategic points, the Commission, after taking into consideration the benefits accruing from standardized construction, the conditions of unemployment, and the needs and reasonable requirements of all ship yards, may, with the approval of the President, allocate construction work under this title and under title VII to such yards in such manner as it may determine to be 49Stat.2008. fair, just, and reasonable to all sections of the country, subject to the m6, §§ ii1-12 provisions of this subsection. In the allocation of construction work Competitive terms and con to such yards as herein provided, the Commission may, after first of contracts. obtaining competitive bids for such work in compliance with the provisions of this Act, negotiate with the bidders and with other shipbuilders concerning the terms and conditions of any contract for such work, and is authorized to enter into such contract at a price deemed by the Commission to be fair and reasonable. Any contract entered into by the Commission under the provisions of this subsection shall be subject to all of the terms and conditions of this Act, excepting those pertaining to the awarding of contracts to the lowest bidder which are inconsistent with the provisions of this sub- section. In the event that a contract is made providing for a price lo nrepionse in excess of the lowest responsible bid which otherwise would be accepted, such excess shall be paid by the Commission as a part of the cost of national defense, and shall not be considered as a part of the construction-differential subsidy. In the event that a contract lowstrespo is made providing for a price lower than the lowest responsible bid which otherwise would be accepted, the construction-differential subsidy shall be computed on the contract price in lieu of such bid." SEC. 14 . Section 502 of such Act is amended by adding at the end 49stat. 197. thereof a new subsection to read as follows: "(g) Upon the agreement of an applicant under this title to pur- qSo of ves chase any vessel acquired by the Commission under the provisions of sion. section 215, the Commission is authorized to sell such vessel to the Ant, p. 954. applicant for the fair and reasonable value thereof, but at not less than the cost thereof to the Commission, less depreciation based on a twenty-year life expectancy from the date of completion, excluding the cost of national-defense features added by the Commission, less the equivalent of any applicable construction-differential subsidy as provided by subsection (b), such sale to be in accordance with all the provisions of this title. Such vessel shall thereupon be eligible for an operating-differential subsidy under title VI of this Act, notwith- 49 stat 200 1 standing the provisions of section 601 (a) (1), and section 610 (1), or any other provision of law." SEC. 15. Section 503 of such Act is amended to read as follows: 49 Stat. 197. "SEC. 503. Upon completion of the construction of any vessel in Documentati respect to which a construction-differential subsidy is to be allowed under this title and its delivery by the shipbuilder to the Commission, the vessel shall be documented under the laws of the United States, 957 tructed it. a-differ- )n. of con- Supp. 4. i bids; ditions cess of ble bid. than ble bid. els ac- 111111is- 2007. on of
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