About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline
LOG IN
LOG IN

B-169094 1 (1970-05-18)

handle is hein.gao/gaobabkey0001 and id is 1 raw text is: B- 169094 May 18, 1970 RLAE RESHRTFD Nt o P rcla-d vf~d te enRLEAE Dear Mr. Whitehurst: Your letter of February 13, 1970, requested this Office to look into the total cost involved in a decision by the Maritime Administra- tion, Department of Commerce, to offer foreign ship dismantlers an opportunity to bid on the sale of surplus vessels. We understand that your concern is with the total cost to the U.S. economy resulting from this decision. Accompanying your request was a letter dated Janu- ary 30, 1970, to you from the Peck Iron and Metal Company, Inc., Portsmouth, Virginia, suggesting that this Office determine (1) the value of surplus Liberty ships in the James River where the scrapping of these ships is restricted to U S. citizens within the continental United States and (2) the foreign sales price that would have to be es- tablished to equal the overall economic benefit to the U.S. economy if the vessels were sold domestically. A fair price for a surplus vessel can sometimes be determined by competitive bidding. This price, however, may be influenced by such factors as the dismantler's demand for vessels and the number of vessels which Maritime decides to offer in any given period. Although the supply of surplus vessels is currently very large, the number of domestic vessel dismantlers is limited and their demand for surplus vessels is relatively small. Therefore, although competitive bidding is usually considered an appropriate method of establishing fair market prices, it does not appear that competitive bidding is necessarily a valid method under these circumstances. Another method of determining a fair price of a vessel to be sold for scrapping is the end product method whereby an estimate of the quantity and quality of scrap metal which can be derived from scrapping the vessel is made and a value based on the market price of such scrap metal is established. To this would be added the value of any equipment and machinery which could be sold separately rather than scrapped. This value is then reduced by the dismantler's average cost of opera- tions attributable to ship-dismantling opez ations and a reasonable profit This method is probably not precise and would entail obtaining engineering estimates and having access to the books and records of a representative group of dismantlers.

What Is HeinOnline?

HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.



Contact us for annual subscription options:

Contact Us

Already a HeinOnline Subscriber?

Log In

profiles profiles most