Each American vessel engaged in foreign trade and each foreign vessel shall employ a licensed pilot to pilot the vessel when it is underway on the navigable waters of the State, including when the vessel is towing or being towed by another vessel. In this subsection, “recreational vessel” means a vessel manufactured or operated for the pleasure of the user or that is leased, rented, or chartered to another for the pleasure of the lessor, renter, or charterer, as set forth in 46 U.S.C. § 2101. A recreational vessel may not be required to employ a licensed pilot to pilot the vessel when underway on the navigable waters of the State if the vessel: is both less than 200 feet in overall length and has less than a 12–foot draft; except for pleasure use charters, is not engaged in a commercial service, as defined in 46 U.S.C. § 2101; is not carrying a passenger for hire, as defined in 46 U.S.C. § 2101; and possesses a cruising license issued in accordance with 19 C.F.R. § 4.94. A vessel that is not required to employ a licensed pilot under subsection (a) of this section may voluntarily employ a licensed pilot when the vessel is underway on the navigable waters of the State.

The Public Service Commission shall establish pilotage fees in accordance with § 4–303 of the Public Utilities Article. Regardless of whether the employment is required under § 11–501(a) of this subtitle or voluntary under § 11–501(c) of this subtitle, a vessel that employs a licensed pilot to provide pilotage shall pay the licensed pilot the full pilotage fee. Regardless of whether the vessel uses the services of the pilot for the entire pilotage, a vessel that employs a licensed pilot to provide pilotage shall pay the licensed pilot the full pilotage fee. Notwithstanding any contract between a licensed pilot who has provided pilotage for a vessel and the master, owner, charterer, or agent of the vessel or any other party, the vessel, its tackle, apparel, and furniture, and the master, owner, charterer, and agent of the vessel shall be jointly and severally liable for payment of the pilotage fee to the licensed pilot. A licensed pilot who has provided pilotage for a vessel shall have a lien for the amount of the pilotage fee due, enforceable in a court of competent jurisdiction, on the vessel and its tackle, apparel, and furniture. If a vessel fails to employ a licensed pilot to provide pilotage as required under § 11–501(a) of this subtitle, the vessel and its master, owner, charterer, and agent shall be jointly and severally liable for payment of the full pilotage fee as if a licensed pilot had been employed.

Pilotage fees due shall be paid to the Association as collection agent for its members.

A pilot is eligible for payments as an inactive pilot under § 11-505 of this subtitle if the pilot: chooses to be placed on the list of inactive pilots maintained by the Association; and has been, for at least 25 years: a member in good standing of the Association; and licensed by the Board to provide pilotage for vessels of unlimited draft; or has been certified by two physicians chosen by the Board to be permanently incapable of providing pilotage; or has had a federal or State pilot’s license revoked for physical disability; and before becoming permanently disabled, the pilot was: a member in good standing of the Association; and licensed by the Board to provide pilotage for vessels of any draft. A pilot is eligible for reduced payments as an inactive pilot under § 11-505 of this subtitle if the pilot: chooses to be placed on the list of inactive pilots maintained by the Association; and has been, for at least 20 years: a member in good standing of the Association; and licensed by the Board to provide pilotage for vessels of unlimited draft. Eligibility for payments as an inactive pilot shall cease if: a pilot who was declared permanently incapable of providing pilotage becomes capable of providing pilotage; or a pilot who had a federal or State pilot’s license revoked for physical disability has the license reissued. Time of service as a licensed docking master on or before September 30, 2004, shall be included in determining a pilot’s eligibility for payment as an inactive pilot. A pilot who held an unlimited docking master license on October 1, 2000, is eligible for reduced payments as an inactive pilot under § 11-505 of this subtitle if the pilot: chooses to be placed on the list of inactive pilots maintained by the Association; and has been, for at least 5 years: a member in good standing of the Association or of the Association of Maryland Docking Pilots; and licensed by the Board to provide pilotage for vessels of unlimited draft.

Each month, the Association shall distribute the pilotage fees that the Association collects in the following order: within 10 days after the close of each month, the Association shall: account to the Board for that month for the amount determined under subsections (b) and (c) of this section for distribution to the pilots who, at the beginning of that month, were eligible for payments as inactive pilots; and distribute that money on behalf of the Board; and the balance of the pilotage fees collected shall be: first, used by the Association to pay its expenses; second, paid to the Maintenance and Replacement Fund under § 11–506 of this subtitle; and finally, in accordance with the bylaws of the Association, paid to the regularly working licensed pilots who are members in good standing of the Association. The amount to be distributed by the Association on behalf of the Board to eligible inactive pilots described under § 11–504(a) of this subtitle shall be computed by: determining the greater of: $200; or 40% of the share payable under this subtitle for the month for which the payment is to be made to a regularly working licensed pilot; and multiplying the figure determined under item (1) of this subsection by the number of pilots in the Association who, at the beginning of the month for which the payment is to be made, were eligible for payments as inactive pilots under this subsection. The amount to be distributed by the Association on behalf of the Board to eligible inactive pilots described under § 11–504(b) of this subtitle shall be computed as follows: for each pilot determining the greater of: $200; or 32% of the share payable under this subtitle for the month for which the payment is to be made to a regularly working licensed pilot; and 6% of the share payable under this subtitle for the month for which the payment is to be made to a regularly working licensed pilot in addition for each year of service in excess of 20 years and up to 25 years; and totaling the sums determined under item (1) of this subsection for each pilot in the Association who, at the beginning of the month for which the payment is to be made, was eligible for payment as an inactive pilot under this subsection. The amount to be distributed by the Association on behalf of the Board to eligible inactive pilots described under § 11–504(e) of this subtitle shall be 1.6% of the share payable under this subtitle for the month for which the payment is to be made to a regularly working licensed pilot for each full year of service following October 1, 2000.

The Board of Supervisors of the Association shall maintain a Maintenance and Replacement Fund for the replacement and repair of the major equipment of the Association. The State Board of Pilots shall determine a percentage of the pilotage fees collected by the Association to be set aside in the Fund. The Board of Supervisors of the Association shall obtain written approval from the State Board of Pilots for any expenditures from the Fund. Except as provided in paragraph (2) of this subsection, the balance in the Fund shall remain at or above $500,000. The balance of the Fund may fall below $500,000 for expenditures authorized by the Board. The balance of the Fund may not remain below $500,000 for more than 10 consecutive years. At no time shall the balance of the Fund fall below $100,000. The Board of Supervisors of the Association shall deposit the money authorized under subsection (b) of this section into the Maintenance and Replacement Fund. The Board of Supervisors of the Association shall hold the Maintenance and Replacement Fund in trust. The Association: may invest or hold the Fund in any manner that the Association finds desirable, in light of the nature and purpose of the Fund; may place control and management of the Fund, or a part of the Fund, with a bank or trust company that is subject to State or federal regulation; and is not limited to investments in property that has been designated, under any law of the State, as strictly suitable for investment of a trust fund. Assets held in trust under this section are not subject to attachment or execution.

If an individual who is not a licensed pilot assists a vessel in distress and then turns the vessel over to a licensed pilot as provided in § 11-401(b) of this title, the Association shall pay the individual 50% of any pilotage fee received for the pilotage of the vessel.

The Association shall submit to the Board: an annual financial audit of payments to pilots under § 11-505 of this subtitle; and an annual financial audit of the Maintenance and Replacement Fund under § 11-506 of this subtitle. The Board shall keep copies of the financial audits received under subsection (a) of this section.