Thanks everybody for answering all my other questions so far. Your insight is super helpful. Here’s another question.
How do I repair this? Is it a necessary piece? Thanks in advance.
It’s unclear to me what I’m looking at. Is this made of bronze or fiberglass?
Hi Nicole. This is the stern tube. It should be a solid single piece of FRP tube - not in two pieces like your photo. Did this short piece just “fall off” after all the hull grinding? If so, it may have been constructed differently on your boat. The cutless bearing is mounted in here at the outer end and would likely straddle the loose piece in your hand and the stern tube still glassed into the hull - which is not ideal.
Epoxying this loose piece back in is fraught with challenges and compromises. it needs to be perfectly aligned - so that the cutless bearing will press in properly without deformation. And it needs to be quite strong as its taking perpendicular vibration and other loads from the shaft - and ensuring the cutless bearing stays put and supports/guides the shaft properly.
I hate to say it, but i think you may need to replace the whole sterntube. The approach is to use a long hole saw to cut the original out. The repalcement would go in with a lot of thickened epoxy/resin to take up any play. Use the shaft to position the new sterntube while the resin sets up. Cutting the old one out is not an easy job unfortunately 
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