Panama Canal Modernization Act

Panama Canal Modernization Act - Authorizes the Secretary of the Army to oversee the work necessary to increase the capacity and improve the operations of the Panama Canal through the adaptation of the Third Locks project. States the dimensions of the locks. Authorizes $1,250,000,000 to be appropriated for such project, limiting the initial appropriation for fiscal year 1978 to $50,000,000.

States that the Governor of the Canal Zone may act and exercise his authority as President of the Panama Canal Company and may utilize the services and facilities of that company.

Establishes the Panama Canal Advisory and Inspection Board, to be composed of five members appointed by the President with the advice of the Senate. Specifies groups, including the Army Corps of Engineers and the United States Navy, from which the members shall be chosen. Authorizes the Board to study and review all plans and designs for the Third Locks project, to make on-site studies and inspections, and to obtain current information on all phases of planning and construction with respect to such project. Requires the Board to report to the Governor of the Canal Zone the results of its studies and reviews of all plans and designs which have been submitted by the Governor with its approval or disapproval, or its recommendations for modifications.

Requires the Board to submit to the President and to the Congress an annual report covering its activities and functions under this Act.

States that the provisions of this Act shall remain in effect only so long as all the sovereign rights, power, and authority granted in perpetuity to the United States by the Republic of Panama remain unaltered.