BENICIA, Calif. (AP) -- From afar, the ghostly warships recall a fierce phalanx ready for battle. A closer look, though, shows the rust and rot of ships unfit for duty or even dismantling, a quandary that is costing taxpayers millions of dollars and could cause environmental misery that will cost millions more.

This is the Suisun Bay Reserve Fleet, a collection of once-valiant troop transports, tankers and other vessels dating back to World War II, Korea and Vietnam.

Before they can be scrapped and sold, Coast Guard regulations require the removal of the barnacles and other sea creatures clinging to their hulls. That process causes toxic paint to flake off into the water, and fear of contamination has brought ship disposal to a halt in California, and delayed it in the country's other ''mothball fleets'' in Texas and Virginia.

''The fleet has devolved from these historic and wonderful vessels into basically a floating junkyard,'' said Saul Bloom of Arc Ecology, a San Francisco environmental group working to make the ghost ships disappear. ''While they're sitting there, they continue to pollute.''

After World War II, the military designated several sites for ships withdrawn from active military service, among then Suisun Bay, a shallow, brackish body of water east of San Francisco Bay.

For several decades, many stood ready to be called back into duty on short notice. But over time, most of the vessels in the fleet have become too decrepit to justify the cost of repairs.

On the troop ship General Edwin D. Patrick, the wooden deck has turned black with rot, and grass grows through the cracks. Sea birds roost where soldiers once waited anxiously to go to war, and peeling paint exposes vast expanses of rust from bow to stern.

''There's really very little you can do to maintain a ship like this,'' said Sean T. Connaughton, head of the U.S. Maritime Administration during a recent tour of the fleet.

As a result, the Patrick and 53 other ships of the 74 in the Suisun Bay fleet are slated to be chopped up for scrap. About 140 out of the 190 in all three fleets are destined for disposal.

The Maritime Administration sets aside about $1.2 million per ship for the dismantling program, though some if not all of that can be recovered by selling the scrap metal on the robust international steel market.

By comparison, the federal government spends about $20 million a year to maintain the three reserve fleets. But agency officials say the potential cost of environmental damage caused by aging ships crumbling and sinking into the bay could dwarf the expense of the dismantling program.

Under a congressional order, the Maritime Administration had a 2006 deadline to dismantle ships in reserve fleets classified as no longer useful.

That hasn't happened. Maritime officials blame a lack of funding and a shortage of facilities able to perform the messy task of taking the massive ships apart. But recently, the more vexing environmental problem has also emerged.

Owing to a lack of proper facilities on the West Coast, California ships headed for the scrap heap must first be towed through the Panama Canal to Brownsville, Texas, center of shipbreaking operations in the U.S.

But on these towering hulks, mounted with guns stilled long ago and propellers nearly rusted through, thriving ecosystems cluster beneath the waterline. Millions of microscopic invertebrates in moss-like colonies several inches thick shelter barnacles, clams and tiny crustaceans.

Some of these organisms have already devastated native San Francisco Bay species that lacked the defenses against the sudden introduction of invaders unwittingly transported from overseas. Hauling the uncleaned ships to Texas could spread these ecologically hazardous creatures even farther.

Last year, divers using devices resembling floor buffers ''scamped'' several Suisun Bay ships to clean off the unwanted organisms, but tests of samples taken around the ships showed it was leaving toxic paint in the water.

Until federal officials figure out how to keep the paint from contaminating the bay, California regulators have warned them to stop the cleaning or risk running afoul of state water laws.

The conflicting regulations halted the scrapping not only of California's mothball fleet but also the country's two other reserve fleets in Beaumont, Texas, and James River, Va. The discovery of the paint in Suisun Bay had led the Maritime Administration to place a moratorium on ship disposal in all three reserve fleets, though agreements with Virginia and Texas have paved the way for cleaning to resume.

But regulators in California, along with environmentalists and members of the state's congressional delegation still find the risk unacceptable.

''We don't want to see these kinds of things going into the bay,'' said Keith Lichten, a senior engineer with the San Francisco Bay Regional Water Quality Control Board.

They also cite a February study suggesting paint is flaking off the ships on its own and dumping more than 21 tons of copper, lead, zinc and other metals into the ecologically sensitive estuary.

Still, Connaughton has promised that by this time next year the environmental quandary will be solved and 15 crumbling ships will be gone from Suisun Bay.

And Maritime Administration officials play down the environmental threat, arguing that heavy metals are found in sediments throughout the bay. The hulls of even the most rickety vessels are secure, according to fleet managers, with none likely to sink anytime soon.

''We're trying to remove these vessels as quickly and safely as possible,'' Connaughton said. ''This has been a very difficult issue for all of us.''

If any ships do go down, they would leave not only paint but PCBs, fuel oil and other pollutants into wildlife-rich waters.

For sailors who served on them, the possible legacy of pollution adds further distress to the sorrow of seeing their cherished vessels cut up and destroyed.

''I don't think anyone is going to remember them except for the guys that served on them,'' said Chris Plum, a hull technician in the 1980s on the USS Cimarron, a tanker slated for disposal. ''Nobody cares. There's more money in scrap.''

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On the Net:

Arc Ecology: http://www.arcecology.org/

U.S. Maritime Administration: http://www.marad.dot.gov/

Seems a catch 22 situation as is.