A bill to authorize the establishment of a Military Auxiliary Revolving Fund within the Treasury of the United States, and for other purposes.

Amends the Merchant Marine Act, 1936 to add to such Act a new title, "Title XIV-Build and Charter," which establishes in the Treasury the Military Auxiliary Revolving Fund (the Fund). Provides that the Fund shall consist of: (1) all moneys appropriated to the Fund; (2) all moneys received form the charter or sale of merchant vessels constructed under this Act; (3) all moneys received from repayment of construction differential subsidies; and (4) any other moneys made available for the Fund.

Directs that the Fund be administered by the Secretary of the Navy, and that moneys in the Fund shall be used only for the construction in private U.S. shipyards of merchant vessels capable of serving as naval and military auxiliaries in time of war or national emergency.

Prohibits the making of any contract for the construction of a vessel under this Act with a private shipbuilder, except after due advertisement and upon sealed competitive bids.

Authorizes the Secretary to charter or sell any naval vessel constructed under this Act to a citizen of the United States for operation in the foreign commerce, after due advertisement and upon competitive bids. Outlines information regarding the price to be charged by the Secretary for the sale or charter of such vessels.

Provides that a citizen who charters or purchases a vessel under this Act shall not be eligible to receive an operating differential subsidy for the operation of any such vessel.

Prohibits the Secretary from chartering the Department of the Navy's vessels to private operators except upon competitive sealed bids after due public advertisement. Outlines information to be included in advertisements for bids. Allows the Secretary to reject any or all bids received, provided that reasons for such rejections are given in writing. Outlines factors to be considered by the Secretary in the awarding of charters, such as financial resources, credit standing, and practical experience of the bidders. Provides circumstances under which the Secretary may reject a bid. Authorizes the Secretary to implement regulations to carry out this provision.

Provides that every charter made by the Secretary under this Act shall contain a profit-sharing clause whereby the charterer of such vessel pays (in addition to the charter price) to the Secretary one-half of all net profits in excess of ten percent per year. Requires certain chartering terms of art to be defined in every charter, with such definitions having been approved by the Secretary and published in the advertisement for bids.

Requires every vessel charterer under this Act to deposit with the Secretary certain security for the faithful performance of all the charter conditions.

Outlines other provisions to be included in every charter, concerning: (1) the maintaining of proper insurance; (2) proper upkeep of vessels during charter periods; and (3) termination of such charter at any time for national security reasons.

Prohibits the Secretary from chartering or selling any vessel constructed under this Act for operation in the trans-Pacific or trans-Atlantic general dry cargo service for the ten-year period after the construction of such vessel unless the Secretary makes certain findings concerning the need for such vessel. Prohibits the charter or sale of such vessel for operation in the coastwise or intercoastal trade unless the Secretary of Defense directs a waiver of compliance for such vessel in the national defense.

Directs the Administrator of the Maritime Administration to conduct a certain study concerning the costs of vessels engaged in the coastwise trade, their future costs, and the differential between such vessels and those built in foreign shipyards. Directs the Administrator to submit such study to the Congress by January 1, 1987.

Authorizes appropriations to the Fund.