Opinion & Comment:
A WAKE-UP CALL — PROPOSED ALASKA SPILL RESPONSE PLANNING REGULATIONS FOR NONTANK VESSEL OPERATORS
By: Robert T. Miller, Ocean Shipholdings, Inc.
(Published April 2002)On January 30, 2002, the Alaska Department of Environmental Conservation ("DEC") published proposed regulations which will govern spill response plans and capabilities for nontank vessels of 400 grt. and over operating in Alaskan waters. As regulations governing tank vessel planning and response standards have existed for almost a decade, it would appear to be a simple proposition to extend their provisions to nontank vessels with appropriate modifications. Nevertheless, the DEC has introduced some new concepts in the proposed regulations which could turn into pitfalls for the unwary operator. This column will briefly outline spill response plan requirements as set forth in the proposed regulations and the underlying statute. It is by no means an exhaustive treatment of an area of developing regulations which will undoubtedly spawn myriad legal issues. The nontank vessel operator is well advised to become familiar with the proposed regulations in order to effect rule changes which would facilitate industry compliance and to take timely measures to insure operational compliance with the regulations as eventually promulgated.
Overview Of Oil Spill Regulation
On March 24, 1989, the tanker EXXON VALDEZ ran aground on Bligh Reef and spilled an estimated 11 million gallons of crude oil into the waters of Prince William Sound. Although scientists and lawyers are still struggling to understand the spill's impact on the environment, vivid media photographs of oiled wildlife and landscape galvanized the national resolve to minimize, or eliminate, environmental damage caused by spilled oil. Congress passed the Oil Pollution Act of 1990, ("OPA '90"), which requires owners or operators of tank vessels to maintain plans and equipment as well as a guaranteed financial capability to respond to oil spills. Many states, including Alaska, enacted parallel legislation.
This oil spill legislation, both federal and state, is broadly drafted to mandate goals and standards. Actual oversight and compliance details are generally left to a regulatory agency such as the U.S. Coast Guard or, in the state of Alaska, the DEC. These bodies promulgate the regulations which govern the regulated industry's activities in order to achieve the legislative goals or standards.
Having regulated the tanker trade, federal attention turned to other issues such as ballast water and gray water discharges; however, the states never lost sight of oil pollution. Interestingly, several West Coast states, including Alaska, observed that the aggregate amount of oil spilled from nontank vessels exceeded that spilled from tank vessels. In response, the states extended tank vessel responsibilities to nontank vessels.1. The proposed Alaskan regulations are the latest chapter in this history of oil spill regulation.
The New Statute
On April 6, 2001, Governor Tony Knowles signed into law Senate Bill 16 which amended Title 46 of the Alaska Statutes to extend oil spill planning and equipment requirements to nontank vessel operators and railroads. Alaska Statute 46.04.055 prohibits the operation of a nontank vessel within the waters of the state or the transfer of oil to or from a nontank vessel without an approved spill response plan and will become effective 180 days after the DEC adopts regulations implementing the provisions of Alaska Statute 46.04.005.2.
Substantively, the new legislation requires nonvessel spill response plans to contain five elements:3.
- Vessel specific information;
- Notification procedures;
- Certification that the plan applicant is a member of, or is contracted with, an approved primary response active contractor ("PRAC").4.
- Certification that the applicant is in contract with an incident management team; and
- Certification that the nontank vessel complies "with applicable Federal and International Maritime Organization requirements."5.
- For example, Alaska State Senator Drue Pearce (R. Anchorage) cited statistics showing that 5,286 gals. of oil were spilled from tankers in 93 spills occurring between 1995 and 2000 while 285,000 gals. were spilled in 945 incidents from nontank vessels and railroads in the same period. Sponsor statement for SB273 available at http://www.akrepulblicans.org.
- Alaska Statute 46.04.055 (f) (2001).
- Alaskan Statute 46.04.005 (g) (2001).
- Equivalent to Oil Spill Response Organizations ("OSRO's") in federal parlance.
- Alaska Statute 46.04.055 (g)(3) (2001).
Section (h) of Alaska Statute 46.04.055 provides an alternative to certifying PRAC or incident management team contractor certification. The applicant can demonstrate to the DEC that it is maintaining equivalent equipment and personnel to meet response and incident command requirements. In short, nontank vessel operators can contract for spill remediation and management services or they can assume the responsibility themselves.
The legislation's most notable feature is its requirement that plans contain provisions for contracted incident management team services or their equivalent. This requirement is not found in legislation regulating tank vessel plans and marks a significant step further in planning requirements. If history is a guide, this mandate will generate a flurry of new businesses and attract existing spill management contractors in other parts of the country to Alaska.
The Proposed DEC Regulations
The DEC regulations flesh out the statutory plan scheme by listing detailed requirements for each of the two plan types, labeled "streamlined" and "equivalent." Essentially, under the streamlined plan, the plan holder will provide fifteen separate categories of information or certifications focusing on the vessel, its ownership, its characteristics and planned areas of operation, emergency notifications and basic response actions and resources. It also requires a certification under penalty of perjury that the information contained in the plan is correct.
This format's basic advantage is its relative simplicity. It allows the plan holder to eliminate detailed response planning and equipment inventorying by certifying that the plan holder has contracted with registered PRACs and incident management teams, thereby shifting much of the burden of resource tracking to the contracted entity.
Unfortunately, registered PRACs may not be available in all areas of operation. Because so much of the burden for tracking resources and conducting drills to test resource viability is placed on the PRAC, registering as a nontank vessel PRAC will carry more burden than serving as a tank vessel PRAC. Thus, an organization which currently serves tank vessel operators may be reluctant to enter the nontank vessel arena. Significantly, no incident command contractors are presently registered. In short, the registered contractors necessary to rely on a streamlined plan may not be universally available.
The equivalent plan format contains all of the requirements of the streamlined plan except the certification that the plan holder has contracted with PRACs and incident managers. Instead, the plan holder must detail the actions which it will take in a response and provide details of its incident command structure. The plan will be much more extensive than the streamlined plan and will require spill response knowledge to a depth generally beyond that of the typical operator. It may also require in-house resources far beyond the operator's capability. The proposed regulations are not clear as to whether an equivalent plan holder may contract with nonregistered entities and include those entities in its plan, thus, it may not be feasible for many operators.
In addition to the two plan formats provided for by statute, the proposed DEC regulations create a third plan type, the "generic" plan, which can be in either streamlined or equivalent format. The generic plan is designed for use in conjunction with another DEC created entity, the "response planning facilitator," defined as "a person who is or intends to be obligated under contract to the holder of an approved nontank vessel plan issued under AS 46.04.055 to provide response plan facilitation as defined in 18 AAC 75.990."6. Unfortunately, "response plan facilitation" is not presently defined in section 75.990.
It appears that the concept of a response plan facilitator with a generic plan is an attempt to relieve the burden on the smaller operator or the operator who occasionally calls in Alaskan waters. In theory, the response plan facilitator would have the necessary knowledge base and contractor network to develop an equivalent plan "for hire" to nontank vessel operators. This facility would allow nontank vessel operators access to a detailed plan while essentially providing only that information required in the streamlined plan.
Unfortunately, the regulations do not define the response plan facilitator's duties or ultimate responsibilities. The proposed regulations still require nontank vessel operators to contract directly with registered PRACs and incident command contractors. Further, notwithstanding the response plan facilitator having existing contracts with all parties, the regulations imply that the nontank vessel operator is the plan holder. Thus, the response plan facilitator appears to be little more than a consultant and broker who, nevertheless, needs to be registered.
6. 18 AAC 75.501 (Proposed).
No matter which plan format is used, the nontank vessel operator will be required to have the resources necessary to contain a spill of 15% of its oil carrying capacity on the scene of a spill within 24 hours and the resources to remove the spill on scene within 48 hours. The proposed regulations will allow reduced planning capacities if the vessels covered by the plan feature regulatory specified prevention measures.7.
These proposed regulations will be effective and enforceable 180 days after their publication as final regulations. It is rumored that the DEC would like final publication by June 30, 2002 for entry into force effective on January 1, 2003. Certain transitional measures will likely further delay the date on which access to actual resources is necessary; however, the initial approval process is likely to be long and tedious. Hence, nontank vessel operators should begin acting now.
Each of the above plans has advantages and potential pitfalls. To the extent that each requires entering into contracts with third parties, it cannot be stressed strongly enough that P&I, or other insurer approval should be obtained prior to contracting. As many in the oil industry have learned, Alaskan response organizations often have different organizational structures, goals and needs from those of the traditional, for-profit enterprise, and reflect these differences in their form contracts. Some negotiation, with insurer input, is necessary to secure a contract, the costs of which will be insured if ever called upon.
At this juncture, nontank vessel operators would be well served to obtain a copy of the proposed regulations and read them thoroughly, as this column has only briefly touched on the basic ideas and issues. Operators should also begin exploring their potential areas of operation for resources necessary to meet planning requirements. In many instances, such resources do not presently exist and will need to be developed. The present is not too early to begin addressing these issues as many are novel and all will require some negotiated interpretation.
Helpful Websites
Primary Response Active Contractors ("PRACs"):
Alaska Chadux Corp.
www.chadux.comSoutheast Alaska Petroleum Resource Organization
www.seapro.orgGovernment Regulations & Statutes:
Alaska State Legislature
www.legis.state.ak.us
Licensed to practice law in the State of Texas since 1989, Robert T. Miller serves as Counsel and Secretary to tanker operator Ocean Shipholdings, Inc. Prior to joining Ocean Shipholdings, Inc. in 1993, he was an associate attorney with Eastham, Watson, Dale & Forney. He holds a J.D. from the University of Houston (1986) and a B.A. in History from Spring Hill College. Prior to practicing law he held a variety of agency positions with Stracham Shipping, Eller & Company and Maersk Line Agency.
Mr. Miller would like to thank Mr. Jim Butler, General Counsel of Alaska Chadux Corp., and Linda Jester of Ocean Shipholdings, Inc. for their generous contribution of time, effort and advice with this article.
7. 18 AAC 75.443 (Proposed).
