to such fund (exclusive of such repayments) equal to $250,000,000.

(b) When $250,000,000 has been credited to such fund (whether by the board under authority of law or from appropriations authorized by this section, but exclusive of repayments on loans from the fund) then no further sums (except such repayments) shall be credited by the board to such fund.

(c) The construction loan fund shall continue to be a revolving fund. Repayments on loans from the fund shall be credited to the fund, but interest on such loans shall be covered into the Treasury as miscellaneous receipts.

Title IV-Ocean Mail Service.

Sec. 401. All mails of the United States carried on vessels between ports (exclusive of ports in the Dominion of Canada other than ports in Nova Scotia) between which it is lawful under the navigation laws for a vessel not documented under the laws of the United States to carry merchandise shall, if practicable, be carried on vessels in respect of which a contract is made under this title.

Sec. 402. As soon as practicable after the enactment of this Act, and from time to time thereafter, it shall be the duty of the Postmaster-General to certify to the United States Shipping Board what ocean mail routes, in his opinion, should be established and/or operated for the carrying of mails of the United States between ports (exclusive of ports in the Dominion of Canada other than ports in Nova Scotia) between which it is lawful under the navigation laws for a vessel not documented under the laws of the United States to carry merchandise, distributed so as equitably to serve the Atlantic, Mexican Gulf, and Pacific coast ports, the volume of mail then moving over such routes and the estimated volume thereof during the next five years, the time deemed by him advisable for the departure of the vessels carrying such mails, and other requirements necessary to provide an adequate postal service between such ports.

Sec. 403. The board shall, as soon as practicable after receipt of such certification from the Postmaster-General, determine and certify to him the type, size, speed, and other

characteristics of the vessels which should be employed on each such route, the frequency and regularity of their sailings, and all other facts which bear upon the capacity of the vessels to meet the requirements of the service stated by the Postmaster-General. The board in making its determination shall take into consideration the desirability of having the mail service performed by vessels constructed in accordance with the latest and most approved types, with modern improvements and appliances.

Sec. 404. The Postmaster-General is authorized to enter into contracts with citizens of the United States whose bids are accepted, for the carrying of mails between ports (exclusive of ports in the Dominion of Canada other than ports in Nova Scotia) between which it is lawful under the navigation laws for a vessel not documented under the laws of the United States to carry merchandise. He shall include in such contracts such requirements and conditions as in his best judgment will insure the full and efficient performance thereof and the protection of the interests of the Government. Performance under any such contract shall begin not more than three years after the contract is let, and the term of the contract shall not exceed ten years.

Sec. 405. (a) The vessels employed in ocean mail service under a contract made under this title shall be steel vessels, shall be steam or motor vessels, and shall be either (1) American-built and registered under the laws of the United States during the entire time of such employment, or (2) registered under the laws of the United States not later than February 1, 1928, and so registered during the entire time of such employment, or (3) actually ordered and under construction for the account of citizens of the United States prior to February 1, 1928, and registered under the laws of the United States during the entire time of such employment.

(b) A vessel for the services of which a contract is entered into under authority of this title, and the construction of which is hereafter begun, shall be either (1) a vessel constructed, according to plans and specifications approved by the Secretary of the Navy, with particular reference to economical conversion into an auxiliary naval vessel, or (2)

a vessel which will be otherwise useful to the United States in time of national emergency.

(c) From and after the enactment of this Act, all licensed officers of vessels documented under the laws of the United States, as now required by law, shall be citizens of the United States; from and after the enactment of this Act and for a period of four years, upon each departure from the United States of a vessel employed in ocean mail service under this title, one-half of the crew (crew including all employees of the ship other than officers) shall be citizens of the United States and, thereafter, two-thirds of the crew as above defined shall be citizens of the United States.

Sec. 406. Before making any contract for carrying ocean mails under this title the Postmaster-General shall give public notice by advertisement once a week for three weeks in such daily newspapers as he shall select in each of the cities of Boston, New York, Philadelphia, Baltimore, New Orleans, Charleston, Norfolk, Savannah, Jacksonville, Galveston, Houston, and Mobile, calling for bids for carrying of such ocean mails; or when the proposed service is to be on the Pacific Ocean then in Los Angeles, San Francisco, Portland, Tacoma, and Seattle. Such notice shall describe the proposed route, the time when such contract will be made, the number of trips a year, the schedule required, the time when the service shall commence, the character of the vessels required, and all other information deemed by the Postmaster-General to be necessary to inform prospective bidders as to the character of the service to be required.

Sec. 407. Each contract for the carrying of ocean mails under this title shall be awarded to the lowest bidder who, in the judgment of the Postmaster-General, possesses such qualifications as to insure proper performance of the mail service under the contract.

Sec. 408. (a) The vessels employed in ocean mail service under this title shall be divided into classes as follows:

Class 7. Vessels capable of maintaining a speed of 10 knots at sea in ordinary weather, and of a gross registered tonnage of not less than 2,500 tons.

Class 6. Vessels capable of maintaining a speed of 10 knots at sea in ordinary weather, and of a gross registered tonnage of not less than 4,000 tons.

Class 5. Vessels capable of maintaining a speed of 13 knots at sea in ordinary weather, and of a gross registered tonnage of not less than 8,000 tons.

Class 4. Vessels capable of maintaining a speed of 16 knots at sea in ordinary weather, and of a gross registered tonnage of not less than 10,000 tons.

Class 3. Vessels capable of maintaining a speed of 18 knots at sea in ordinary weather, and of a gross registered tonnage of not less than 12,000 tons.

Class 2. Vessels capable of maintaining a speed of 20 knots at sea in ordinary weather, and of a gross registered tonnage of not less than 16,000 tons.

Class 1. Vessels capable of maintaining a speed of 24 knots at sea in ordinary weather, and of a gross registered tonnage of not less than 20,000 tons.

(b) The classification of a vessel may be based upon its speed without regard to its tonnage if the Postmaster-General is of opinion that speed is especially important on the particular route on which the vessel is to be employed, and that a suitable vessel documented under the laws of the United States of a higher classification is not available on reasonable terms and conditions, or, on account of the character of the ports served or for other reasons, cannot be safely or economically employed, on such route.

Sec. 409. (a) The rate of compensation to be paid under this title for ocean-mail service shall be fixed in the contract. Such rate shall not exceed: For vessels of Class 7, $1.50 per nautical mile; for vessels of Class 6, $2.50 per nautical mile; for vessels of Class 5, $4 per nautical mile; for vessels of Class 4, $6 per nautical mile; for vessels of Class 3, $8 per nautical mile; for vessels of Class 2, $10 per nautical mile; and for vessels of Class 1, $12 per nautical mile. As used in this section the term "nautical mile" means 6,080 feet.

(b) When the Postmaster-General is of opinion that the interests of the postal service will be served thereby, he may,

in the case of a vessel of Class 1 capable of maintaining a speed in excess of 24 knots at sea in ordinary weather, contract for the payment of compensation in excess of the maximum compensation authorized in subsection (a), but the compensation per nautical mile authorized by this subsection shall not be greater than an amount which bears the same ratio to $12 as the speed which such vessel is capable of maintaining at sea in ordinary weather bears to 24 knots.

(c) If the Postmaster-General is of opinion that to expedite and maintain satisfactory service under a contract made under this title, airplanes or airships are required to be used in conjunction with vessels, he may allow additional compensation, in amounts to be determined by him, on account of the use of such airplanes or airships. Such airplanes or airships shall be American-built and owned, officered, and manned by citizens of the United States.

(d) The Postmaster-General shall determine the number of nautical miles by the shortest practicable route between the ports involved and payments under any contract made under this title shall be made for such number of miles on each. outward voyage regardless of the actual mileage traveled.

Sec. 410. In the case of failure of a vessel from any cause to perform any regular voyage required by a contract made under this title, a pro rata deduction shall be made from the contract price on account of such omitted voyage; and suitable deductions, to be determined by the Postmaster-General, may be made from the compensation payable under the contract for delays, failures to properly safeguard the mails, or other irregularities in the performance of the contract. Deductions so determined upon shall be deducted by the Postmaster-General from the payments otherwise due and payable under the terms of the contract. The Postmaster-General may, in case of emergency, permit the substitution for a particular voyage of a vessel not within the provisions of the contract, even though not conforming to the requirements of Section 405.

Sec. 411. Any vessel operating under a contract made under this title may carry passengers and their baggage, and freight and express, and may do all ordinary business done by similar vessels.