[URL]http://www.lasdrop.com/[/URL]

Don't think that was Catalina OEM, most people seem to use PSS or old school Buck/Algonquin. But perhaps someone has one.

I'm not familiar with that system either, but I'm guessing that the tube coming off the unit is from your raw water cooling system to lubricate and cool the shaft when its turning.
Sam

Sam is correct. Last Drop, PSS, etc are technically rotary-seal systems. A rubber bellows is connected to your shaft log. The forward face of the bellows contains a plastic doughnut (bearing surface). The shaft passes through the doughnut and there's a metal doughnut (bearing surface) attached to the shaft in front of the bellows. Once the shaft is mated with the transmission flange, the metal doughnut is slid back (on o-rings) so that it slightly compresses the rubber bellows, creating a light metal-to-plastic seal. When running, the plastic doughnut attached to the bellows does not rotate; the metal doughnut since it's affixed to the shaft does rotate. On a sailboat, enough water travels through the stern tube to lubricate the two bearing surfaces, even at cruising speeds. Where this same assembly is used on a high-speed boat where shaft log cavitation can occur, an alternative means of getting water to the bearings must be provided. This is where the plastic tube comes in and would be attached to the raw water cooling circuit to deliver water to the bearing.

Just a note on the plastic tube. On the PSS seal, that plastic tube is there to provide a place for air to escape from the shaft tube. This will otherwise starve the seal of water and result in overheating, shuddering and other unpleasantries. I had an early version that did NOT have the vent and would run into this problem after a day of hard, high speed sailing. That version is no longer made. Evidently enough air bubbles would get into the shaft log to fill it with air, and the next time I ran the engine, the seal would overheat and make a racket. PSS sold me the stainless doughnut with the vent tube at cost. The tube gets routed so it's as high above the water line as possible, so no water comes in; mine ends just under the engine cover in the aft cabin and has never leaked water. Since I have the vent tube installed, I've never had a problem since (about 3 years).

Yup. I just read the current PSS manual. The tube does double duty. On a high-speed boat it's used to inject water into the bearing. On a sailboat, it's used to vent the shaft log. So like Gary said, route above the waterline and don't plug it.