[Federal Register Volume 61, Number 4 (Friday, January 5, 1996)]
[Rules and Regulations]
[Pages 440-510]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-31577]
[[Page 439]]
_______________________________________________________________________
Part II
Department of Commerce
_______________________________________________________________________
National Oceanic and Atmospheric Administration
_______________________________________________________________________
15 CFR Part 990
Natural Resource Damage Assessments; Final Rule
Federal Register / Vol. 61, No. 4 / Friday, January 5, 1996 / Rules
and Regulations
[[Page 440]]
DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric Administration
15 CFR Part 990
[950718181-5276-02]
RIN 0648-AE13
Natural Resource Damage Assessments
AGENCY: National Oceanic and Atmospheric Administration (NOAA),
Commerce.
ACTION: Final rule.
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SUMMARY: Section 1006(e)(1) of the Oil Pollution Act of 1990 requires
the President, acting through the Under Secretary of Commerce for
Oceans and Atmosphere, to promulgate regulations for the assessment of
natural resource damages resulting from a discharge or substantial
threat of a discharge of oil. This final rule is for the use of
authorized federal, state, Indian tribe, and foreign officials,
referred to as ``trustees.'' Natural resource damage assessments are
not identical to response or remedial actions addressed by the larger
statutory scheme of the Oil Pollution Act of 1990. Assessments are not
intended to replace response actions, which have as their primary
purpose the protection of human health, but to supplement them, by
providing a process for restoring natural resources and services
injured as a result of an incident involving oil.
EFFECTIVE DATE: The effective date of the final rule is February 5,
1996.
ADDRESSES: Linda Burlington or Eli Reinharz, c/o NOAA/GCNR, 1315 East-
West Highway, SSMC #3, Room 15132, Silver Spring, MD 20910.
FOR FURTHER INFORMATION CONTACT: Linda Burlington (telephone (301) 713-
1217) or Eli Reinharz (telephone (301) 713-3038, ext. 193), Office of
General Counsel Natural Resources, FAX (301) 713-1229.
SUPPLEMENTARY INFORMATION: The Oil Pollution Act of 1990 (OPA), 33
U.S.C. 2701 et seq., provides for the prevention of, liability for,
removal of, and compensation for the discharge, or substantial threat
of discharge, of oil (hereinafter referred to as ``incident'') into or
upon the navigable waters of the United States, adjoining shorelines,
or the Exclusive Economic Zone. Section 1006(b) of OPA (33 U.S.C.
2706(b)) provides for the designation of federal, state, Indian tribe,
and foreign natural resource trustees to determine if injury to,
destruction of, loss of, or loss of use of natural resources and
services has resulted from an incident, assess natural resource damages
for those injuries, present a claim for damages (including the
reasonable costs of assessing damages), recover damages, and develop
and implement a plan for the restoration, rehabilitation, replacement,
or acquisition of the equivalent of the injured natural resources and
services under their trusteeship. Section 1006(e)(1) of OPA (33 U.S.C.
2706(e)(1)) requires the President, acting through the Under Secretary
of Commerce for Oceans and Atmosphere, to promulgate regulations for
the assessment of natural resource damages resulting from incidents.
Background
Prior to issuing this final rule, NOAA published eleven Federal
Register Notices requesting information and comments on approaches to
developing natural resource damage assessment procedures. 55 FR 53478
(December 28, 1990), 56 FR 8307 (February 28, 1991), 57 FR 8964 (March
13, 1992), 57 FR 14524 (April 21, 1992), 57 FR 23067 (June 1, 1992), 57
FR 44347 (September 25, 1992), 57 FR 56292 (November 27, 1992), 58 FR
4601 (January 15, 1993), 59 FR 1061 (January 7, 1994), 60 FR 39804
(August 3, 1995), and 60 FR 43574 (August 22, 1995). NOAA conducted a
public meeting on March 20, 1991, and held four regional workshops
during 1991 in Rockville, Maryland; Houston, Texas; San Francisco,
California; and Chicago, Illinois, to learn of regional concerns in
assessing injury and restoration for coastal and inland waters. One
workshop held in Alexandria, Virginia, in November 1991, provided a
forum for early discussions of various economic issues likely to be
raised during the rulemaking process. In addition, on August 12, 1992,
NOAA held a public hearing on the issue of whether constructed market
methodologies, including contingent valuation, (CV), can be used to
calculate reliably passive use values for natural resources, and if so,
under what circumstances and under what guidance. On January 15, 1993,
NOAA published in full the report of a panel commissioned to evaluate
the reliability of CV. 58 FR 4601.
NOAA published the proposed OPA rule on January 7, 1994 (59 FR
1061). The proposed rule contained a statement requesting specific
consideration of certain issues. Immediately after publishing the
proposed rule, NOAA held six regional meetings in January and February
of 1994. A seventh workshop was held in March 1994 in Washington, D.C.
NOAA then published an informational notice to summarize the concerns
raised in these workshops on June 22, 1994 (59 FR 32148).
Based upon comments received in response to the proposed rule and
regional meetings, NOAA reproposed the rule on August 3, 1995 (60 FR
39804). Immediately after publishing the proposed rule, NOAA held two
conferences in August and September of 1995 to discuss the 1995
proposed rule.
This final rule draws from the public issue-discussion process and
comments received to provide a natural resource damage assessment
process intended to meet OPA's goal of expeditious, cost-effective, and
feasible restoration of natural resources and services injured by
incidents involving oil.
This preamble is organized as follows: the Introduction gives an
overview of the rule and is followed by a discussion of each of the
subparts of the rule. Subpart A provides a general introduction,
subpart B describes trustee authorities, subpart C gives definitions
pertinent to this rule, subpart D describes the Preassessment Phase,
subpart E describes the Restoration Planning Phase, and subpart F
describes the Restoration Implementation Phase. Finally, the preamble
provides a general summary of and responses to the comments on the
proposed rule.
INTRODUCTION
I. Goal of OPA: Focus on Restoration
The goal of the Oil Pollution Act of 1990 (OPA) is to make the
environment and public whole for injuries to natural resources and
natural resource services resulting from an incident involving a
discharge or substantial threat of a discharge of oil (incident). This
goal is achieved through returning injured natural resources and
services to baseline and compensating for interim losses of such
natural resources and services through the restoration, rehabilitation,
replacement or acquisition of equivalent natural resources and/or
services. The purpose of this rule is to provide a framework for
conducting sound natural resource damage assessments that achieve
restoration under OPA.
Under the rule, restoration plans developed with input from the
public and responsible parties form the basis of a claim for natural
resource damages. Final restoration plans are presented to responsible
parties for funding. In addition, the rule allows responsible parties
to implement trustee-approved and monitored restoration plans. Because
assessments will be conducted in the open, and responsible parties and
the public will have opportunities to be
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involved in the planning process, it is expected that restoration will
be achieved more quickly, transaction costs will decrease, and
litigation will be avoided.
NOAA believes that an assessment that focuses on evaluating
injuries relevant to feasible restoration alternatives and soliciting
public input in restoration planning will accomplish three major goals:
validating trustee determinations regarding those actions that will
make the environment and public whole; ensuring that appropriate
assessment procedures for determining restoration actions for a given
incident are followed; and reducing transaction costs. The rule
provides for the use of a range of appropriate and cost-effective
procedures for an assessment. Procedures to be used within the rule
must meet certain standards: they must be capable of providing
information of use in determining the type and scale of restoration
appropriate for a particular injury; the additional cost of a more
complex procedure must be reasonably related to the expected increase
in the quality and/or quantity of information provided by the more
complex procedure; and they must be reliable and valid for the
particular incident. Trustees must select the most cost-effective of
two or more equally appropriate assessment procedures.
Restoration planning by federal trustee agencies is subject to the
requirements of the National Environmental Policy Act (NEPA) (42 U.S.C.
4321 et seq.), except when a categorical exclusion or other exception
to NEPA applies. The process identified in the rule mirrors the
decisionmaking process embodied in NEPA, without requiring
significantly different steps or products than those envisioned in OPA.
Recognizing that NEPA compliance requirements will vary among federal
agencies, and that state trustees may not be subject to NEPA, the rule
describes the general processes and products required under NEPA, and
provides guidance for integrating NEPA compliance into the assessment.
Finally, NOAA has developed guidance documents on various aspects
of the assessment. These guidance documents are available in draft on:
preassessment, injury assessment, restoration, compensation formulas,
and NEPA compliance (citations for the documents are included in the
Bibliography at the end of this preamble). These draft documents are
available from the address at the front of this preamble. The guidance
documents are being prepared in conjunction with this rulemaking to
provide additional technical information to those performing
assessments under OPA and other interested members of the public. These
documents will not constitute regulatory guidance, nor will they have
to be followed for an assessment to be conducted in accordance with
this rule. The documents, in their final form, will be made available
through a public information distribution service, and will be
announced in a future Federal Register notice.
II. Overview of the Restoration Planning Process Under the Rule
The natural resource damage assessment process in the rule includes
three phases as outlined below: (1) Preassessment; (2) restoration
planning; and (3) restoration implementation.
Preassessment Phase
When notified by response agencies of an incident involving oil,
trustees must first determine threshold criteria that provide their
authority to begin the natural resource damage assessment, such as
applicability of OPA and risks to natural resources under their
trusteeship. Based on early available information, trustees make a
preliminary determination whether natural resources or services have
been injured. Through coordination with response agencies, trustees
next determine whether response actions will eliminate the threat of
ongoing injury. If injuries are expected to continue, and feasible
restoration alternatives exist to address such injuries, trustees may
proceed with the assessment.
Restoration Planning Phase
The purpose of the Restoration Planning Phase is to evaluate
potential injuries to natural resources and services, and use that
information to determine the need for and scale of restoration actions.
The Restoration Planning Phase provides the link between injury and
restoration. The Restoration Planning Phase has two basic components:
injury assessment and restoration selection.
Injury Assessment
The goal of injury assessment is to determine the nature and extent
of injuries to natural resources and services, thus providing a
technical basis for evaluating the need for, type of, and scale of
restoration actions. Under the rule, injury is defined as an observable
or measurable adverse change in a natural resource or impairment of a
natural resource service. Trustees must determine that there is: (1)
Exposure, a pathway, and an adverse change to a natural resource or
service as a result of an actual discharge; or (2) an injury to a
natural resource or impairment of a natural resource service as a
result of response actions or a substantial threat of a discharge.
Trustees must also quantify the degree, and spatial and temporal extent
of injuries. Injuries are quantified by comparing the condition of the
injured natural resources or services to baseline, where necessary.
Restoration Selection
Once injury assessment is complete, trustees must develop a plan
for restoring the injured natural resources and services. Under the
rule, trustees must identify a reasonable range of restoration
alternatives, evaluate and select the preferred alternative(s), and
develop a Draft and Final Restoration Plan, that considers public
comments. Acceptable restoration actions include any of the actions
authorized under OPA (restoration, rehabilitation, replacement, or
acquisition of the equivalent), or some combination of those actions.
Restoration actions under the rule are either primary or
compensatory. Each restoration alternative considered will contain
primary and/or compensatory restoration actions that address one or
more specific injuries associated with the incident. Primary
restoration refers to actions taken to return the injured natural
resources and services to baseline on an accelerated time frame.
Natural recovery also must be considered under primary restoration, in
which no human intervention is taken to directly restore injured
natural resources and/or services to baseline. Alternative primary
restoration actions can range from natural recovery, to actions that
prevent interference with natural recovery, to more intensive actions
expected to return injured natural resources and services to baseline
faster or with greater certainty than natural recovery.
Compensatory restoration includes actions to compensate for interim
losses of natural resources and/or services pending recovery. The type
and scale of compensatory restoration may depend on the nature of the
primary restoration action, and the level and rate of recovery of the
injured natural resources and/or services given the primary restoration
action.
When identifying the compensatory restoration components of the
restoration alternatives, trustees must first consider compensatory
restoration actions that provide services of the same type and quality,
and of comparable value as those lost. If compensatory
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actions of the same type and quality and comparable value cannot
provide a reasonable range of alternatives, trustees may consider other
compensatory restoration actions among the alternatives, so long as the
actions, in the judgment of the trustees, will provide services of at
least comparable type and quality as those lost.
To ensure that a restoration action appropriately addresses the
injuries resulting from an incident, trustees must scale the action.
The approaches that may be used to determine the appropriate scale of a
restoration action include the resource-to-resource or service-to-
service approach, and the valuation approach. The possible use of
contingent valuation (CV) and other stated-preference methods of
valuation to determine what scale of compensatory restoration provides
an equivalent value to the lost services avoids many problems
identified by commenters regarding the use of CV to calculate a dollar
value for the damages as included in the 1994 proposal.
Under the resource-to-resource or service-to-service approach to
scaling, trustees determine the appropriate quantity of replacement
natural resources and/or services to compensate for the amount of
injured natural resources or services. Trustees must consider using the
resource-to-resource or service-to-service approach for actions that
provide natural resources and/or services of the same type, quality,
and value as those lost.
In situations where trustees must consider actions that provide
natural resources and/or services that are of a different type,
quality, or value than the injured natural resources and/or services,
or where use of resource-to-resource or service-to-service scaling is
inappropriate, trustees may use the valuation approach to scaling. To
evaluate actions that provide services of a different type or quality,
trustees need a common measure to compare services lost and services
provided, such as the value per unit of service. Trustees first
calculate the value of the lost services and then determine the value
gained from different scales of the restoration action. Trustees then
select the scale of the restoration action under consideration that
would provide value equal to the value lost. Responsible parties are
liable for the cost of implementing the restoration action that would
generate the equivalent value, not for the calculated interim loss in
value.
Selection of a Preferred Alternative
The identified restoration alternatives are evaluated based on a
number of factors that include: (i) cost to carry out the alternative;
(ii) extent to which each alternative is expected to meet the trustees'
goals and objectives in returning the injured natural resources and
services to baseline and/or compensate for interim losses; (iii)
likelihood of success of each alternative; (iv) extent to which each
alternative will prevent future injury as a result of the incident, and
avoid collateral injury as a result of implementing the alternative;
(v) extent to which each alternative benefits more than one natural
resource and/or service; and (vi) effect of each alternative on public
health and safety. Trustees must select the most cost-effective of two
or more equally preferable alternatives.
A Draft Restoration Plan will be made available for review and
comment by the public, including appropriate members of the scientific
community where possible. Public review and comment of the plan will
depend on the nature of the incident, and any applicable federal
trustee NEPA requirements. The Draft Restoration Plan will describe the
trustees' preassessment activities, as well as injury assessment
activities and results, evaluate restoration alternatives, and identify
the preferred restoration alternative(s). After reviewing public
comments on the Draft Restoration Plan, trustees must develop a Final
Restoration Plan. The Final Restoration Plan will become the basis of
claims for damages.
Restoration Implementation Phase
The Final Restoration Plan is presented to responsible parties to
implement or to fund the trustees' costs of implementing the plan, thus
providing the opportunity for settlement of damages claims without
litigation. Should responsible parties decline to settle a claim, OPA
authorizes trustees to bring a civil action for damages in federal
court or seek an appropriation from the Oil Spill Liability Trust Fund
for such damages.
DISCUSSION
Subpart A--Introduction
I. Purpose
The goal of the Oil Pollution Act of 1990 (OPA), 33 U.S.C. 2701 et
seq., is to make the environment and public whole for injuries to
natural resources and services resulting from an incident involving a
discharge or substantial threat of a discharge of oil (incident). This
goal is achieved through returning the injured natural resources and
services to baseline and through compensation for interim losses of
those natural resources and services from the date of the incident
until recovery.
The purpose of this rule is to promote expeditious and cost-
effective restoration of natural resources and services injured as a
result of an incident. To fulfill this purpose, the rule provides a
natural resource damage assessment process for developing a plan for
restoration of the injured natural resources and services and pursuing
implementation or funding of the plan by responsible parties. The rule
also provides an administrative process for involving interested
parties in the assessment, a range of assessment procedures for
identifying and evaluating injuries to natural resources and services,
and a means for selecting appropriate restoration actions from a
reasonable range of alternatives.
II. Scope
This rule may be used by designated federal, state, tribal, and
foreign natural resource trustees to determine appropriate actions to
restore natural resources and/or services injured by a discharge, or
substantial threat of a discharge, of oil into or upon navigable waters
or adjoining shorelines or the Exclusive Economic Zone of the United
States.
The Secretaries of the Interior, Commerce, Agriculture, Defense,
and Energy are the primary federal natural resources trustees, although
in some circumstances, the heads of other federal agencies may act as
trustees of natural resources (see 40 CFR 300.600). The roles and
responsibilities of the various federal trustees regarding an
assessment vary according to their natural resource management
responsibilities and the susceptibility of various natural resources
and/or services to injury. Designation of federal trustees and broad
guidelines describing trustee functions are addressed in subpart G of
the National Oil and Hazardous Substances Pollution Contingency Plan
(NCP), 40 CFR part 300.600. For state trustees, most governors have
delegated trustee responsibilities to specific state or local agencies,
as provided under OPA.
The process described in the rule is not intended to affect the
recoverability of natural resource damages when recoveries are sought
other than in accordance with this rule.
III. Overview
The rule describes three phases of a natural resource damage
assessment. The Preassessment Phase, during which trustees determine
whether to pursue restoration, is described in subpart D of the rule.
The Restoration Planning
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Phase, during which trustees evaluate information on potential injuries
and use that information to determine the need for, type of, and scale
of restoration, is described in subpart E of the rule. The Restoration
Implementation Phase, during which trustees ensure implementation of
restoration, is described in subpart F of the rule.
IV. Rebuttable Presumption
Assessments performed by federal, state, or tribal trustees in
accordance with this rule receive the evidentiary status of a
rebuttable presumption provided by section 1006(e)(2) of OPA (33 U.S.C.
2706(e)(2)). NOAA interprets this presumption to mean that the
responsible parties have the burdens of presenting alternative evidence
on damages and of persuading the fact finder that the damages presented
by the trustees are not an appropriate measure of damages. This
presumption applies to all assessment procedures conducted in
accordance with this rule. However, where trustees use procedures that
are determined not to be in accordance with this rule, trustees will
not obtain a rebuttable presumption for that portion of the assessment.
Assessments performed by foreign trustees in accordance with this rule
are not entitled to a rebuttable presumption, as provided in section
1006(c)(1) of OPA (33 U.S.C. 2706(e)(1)).
V. Coordination
A. General
Coordination among all parties affected by an incident is crucial
to an efficient and effective assessment. Coordination, in pre-incident
planning and throughout the assessment, can reduce time until
restoration is implemented and ensure that assessment costs are
reasonable. More detailed discussion of some aspects of coordination
appears in Appendix A at the end of this preamble.
B. Coordination Among Trustees
This rule encourages trustees with shared or overlapping
trusteeship to coordinate their assessment activities, including
coordination in pre-incident planning. Coordination among trustees will
avoid duplicative claims for damages, address shared trust natural
resource concerns, and result in more effective funding of assessment
work. When conducting joint assessments, trustees must designate a Lead
Administrative Trustee (LAT). The LAT should be selected by mutual
agreement of the trustees. The LAT's duties and responsibilities are
mainly administrative, unless all trustees agree otherwise. Depending
upon the circumstances of the incident, there may be co-LATs or
sequential LATs for different stages of the process. This rule
encourages trustees to consider using agreements, such as memoranda of
understanding (MOUs), to structure both pre-incident and incident-
specific activities. Trustees may act independently when there is a
reasonable basis for dividing assessment responsibilities, so long as
there is no double recovery of damages. However, independent
assessments may not achieve prompt restoration of injured natural
resources and services and may not be in the best interests of the
parties involved.
C. Coordination With Response Agencies
Trustees must coordinate their activities conducted concurrently
with response operations with response agencies consistent with the NCP
and any pre-incident plans or MOUs. Coordination among trustees and
response agencies can result in reducing or eliminating natural
resource and/or service injuries residual to the cleanup. ``Response''
refers to those actions taken under the NCP to protect public health
and welfare or the environment when there is a discharge or a
substantial threat of a discharge of oil, including actions to contain
or remove discharged oil from water and shorelines.
D. Coordination With Responsible Parties
Active and early involvement of responsible parties may eliminate
some of the problems trustees have encountered immediately following an
incident, such as lack of funding, personnel and equipment. In
addition, a joint trustee-responsible party assessment may be more
cost-effective and avoid duplicate studies. Thus, the rule requires the
trustees to invite the responsible parties to participate in the
assessment.
The rule leaves determination of the timing and extent of
responsible party participation to the judgment of the trustees on an
incident-specific basis. While active responsible party involvement is
the preferred means of conducting assessments, it may not be
appropriate for trustees to delay assessment activities while
negotiating the terms of responsible party involvement.
Trustees should extend the invitation to participate to known
responsible parties as soon as practicable, but not later than the
delivery of the Notice of Intent to Conduct Restoration Planning,
described in Sec. 990.44 of the rule. The invitation to participate
must be in writing, and a written response by the responsible parties
is required to confirm the desire to participate. Trustees and
responsible parties should consider entering into binding agreements to
facilitate their interactions and resolve any disputes during the
assessment. To maximize cost-effectiveness and cooperation, trustees
and responsible parties should attempt to develop a set of agreed-upon
facts concerning the incident and/or assessment. For example,
stipulated facts might concern the types of natural resources and
services injured, extent of injury or most appropriate assessment
procedures to determine injury and/or restoration needs, and how the
results of the procedures used will be interpreted.
The scope of the participation by responsible parties must be
determined by the trustees The rule provides a number of factors that
may assist trustees in making this determination. These factors
include, for identified responsible parties, the willingness of
responsible parties to participate in the assessment and provide
funding for assessment activities, the ability of responsible parties
to conduct assessment activities in a technically sound and timely
manner and to be bound by the results of jointly agreed upon studies,
the degree of cooperation in response activities, and the actions of
the responsible parties in prior assessments. However, the rule
provides for a minimum level of responsible party participation that
consists of notice of trustee determinations required by the rule, and
notice and opportunity to comment on documents or plans that
significantly affect the nature and extent of the assessment. Increased
levels of participation by responsible parties may be developed at the
mutual agreement of the trustees and responsible parties; however,
final authority to make determinations regarding injury and restoration
rests solely with the trustees. Submissions by responsible parties will
be included in the administrative record. Trustees may end
participation by responsible parties who, during the conduct of the
assessment, interfere with the trustees' capability to fulfill their
responsibilities under OPA and this rule.
The rule also provides that participating responsible parties may
formally request use of assessment procedures other than those that
have been selected by trustees as the most appropriate for the incident
and injury of concern. Responsible parties must identify specific
alternate procedures, and demonstrate that they meet the
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requirements for acceptable assessment procedures provided in
Sec. 990.27 of the rule. In addition, because trustees will already
have made a determination that a different procedure is appropriate,
responsible parties must agree not to challenge the results of the
requested alternate procedure and agree to fund the alternate
procedure. Trustees may deny the request for alternate procedures on
the grounds that they are not technically feasible or scientifically
sound, are inconsistent with Sec. 990.27 of the rule, or could not be
completed in a reasonable time frame. Trustees must document the
request and their response in the administrative record.
Trustees must document in the administrative record and Restoration
Plan the invitation for participation by the responsible parties,
briefly describe the nature and extent of the responsible parties'
participation, and briefly describe, if applicable, why the responsible
parties' participation was terminated.
E. Coordination With the Public
A major goal of OPA is to involve the public in the restoration
planning process. At a minimum, the rule requires that trustees provide
opportunities for public involvement after the trustees decide to
develop a restoration plan. The rule further encourages that trustees
involve the public in the assessment at any time earlier, if such
involvement is expected to enhance trustees' decisionmaking or
facilitate the restoration process.
Depending on the nature of the incident and expected assessment
actions, public comment may be solicited at various stages to ensure
the best information base is available to the trustees. In highly
complex incidents, or those incidents that are expected to involve
multi-year efforts, trustees may have an opportunity to set up one or a
series of public meetings to ensure opportunity for public input.
Attendance should be encouraged by all parties that are involved,
participating, or interested in the incident.
To the fullest extent practicable, trustees should involve the
public to:
(i) Encourage a broad understanding of restoration and build trust,
thus allowing for quicker recognition and support of the restoration
process overall;
(ii) Provide opportunities for joint fact-finding, improving the
collection of quality data; and
(iii) Incorporate public concern, providing for more effective
restoration planning.
VI. Considerations for Facilitating Restoration
A. General
Pre-incident planning and regional restoration plan development are
tools trustees should consider as means to enhance successful
restoration planning and implementation. These actions are not required
actions under the rule. More extensive discussion on these topics is
included in Appendix A at the end of this preamble.
B. Pre-Incident Planning
NOAA believes that commitment of time, funding, and personnel to
planning prior to an incident will help ensure that the assessment
results in technically sound and cost-effective restoration. Pre-
incident planning activities may identify natural resource damage
assessment teams, establish trustee notification systems, identify
support services, identify natural resources and/or services at risk,
identify and develop working relationships with area and regional
response agencies and officials, identify available baseline
information, establish data management systems, and identify assessment
funding issues and options. Potentially responsible parties, cleanup
agencies, representatives of local natural resource management
agencies, and representatives of local environmental groups should be
included in pre-incident planning to the fullest extent practicable.
C. Regional Restoration Planning
OPA intends that restoration actions make the environment and
public whole for natural resource and/or service injuries resulting
from an incident. Where practicable, development of restoration plans
on an incident-by-incident basis is the preferred alternative to
accomplish this goal. However, for many incidents, including smaller
incidents, such incident-specific plan development may be impractical
and costly. Yet, the impact of small incidents may still represent a
significant concern for trustees, particularly where small incidents
may have cumulative impacts. Thus, to achieve OPA's mandate to restore
injured natural resources and services regardless of the type and scale
of those injuries, trustees are encouraged to identify existing
Regional Restoration Plans or other existing restoration projects that
may be applicable in the event of an incident. Regional restoration
planning may consist of compiling databases that identify existing,
planned, or proposed restoration projects that may provide appropriate
restoration alternatives for consideration in the context of specific
incidents. Plans or projects developed on a regional basis (e.g.,
ecosystem, landscape, watershed, or any other basis) appropriate so
long as natural resources and/or services comparable to those expected
to be injured by an incident are addressed in the plans. In no event
may the use of a regional restoration plan or other existing proposed
restoration project violate OPA's limitation that natural resource
damages must be used solely to restore, rehabilitate, replace, or
acquire the equivalent of natural resources and services injured by an
incident.
Subpart B--Authorities
I. Relationship to the CERCLA Natural Resource Damage Assessment
Regulations
The Department of the Interior (DOI) has developed regulations for
assessing natural resource damages resulting from hazardous substance
releases under the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980 (CERCLA) (42 U.S.C. 9601 et seq.), and the
Federal Water Pollution Control Act (Clean Water Act) (33 U.S.C. 1321
et seq.). The CERCLA regulations are codified at 43 CFR part 11. The
CERCLA regulations originally applied to natural resource damages
resulting from oil discharges as well as hazardous substance releases.
This rule supersedes 43 CFR part 11 with regard to incidents covered by
OPA. Trustees who began assessments under the CERCLA regulations before
the effective date of this rule may complete those assessments in
compliance with the CERCLA regulations or they may elect to use this
rule to obtain the rebuttable presumption.
If natural resources and/or services are injured by a discharge or
release of a mixture of oil and hazardous substances, trustees must use
43 CFR part 11 in order to obtain a rebuttable presumption.
II. Relationship to the NCP
This rule provides procedures by which trustees may determine
appropriate restoration of injured natural resources and services,
where such injuries are not fully addressed by response actions.
Response actions and coordination with damage assessment activities are
conducted pursuant to the National Oil and Hazardous Substances
Pollution Contingency Plan (NCP), 40 CFR part 300.
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III. Prohibition on Double Recovery
Trustees are subject to a prohibition on double recovery of damages
in section 1006(d)(3) of OPA (33 U.S.C. 2706(d)(3)). This rule
encourages trustee coordination as a means to avoid double recovery. In
general, the losses that trustees may estimate without the risk of
double recovery are:
(i) The value of losses to all public uses of natural resources as
measured by changes in:
(a) Monetized measures of utility or consumer surplus;
(b) Fees or other payments collectable by the government or a tribe
for use of the natural resource by a private party; and
(c) Any economic rent accruing to a private party because the
government or tribe does not charge a fee or price for the use of the
natural resource, provided such economic rent is not recovered under a
private cause of action; and
(ii) In instances where the trustee(s) is the majority operator or
controller of a for-profit or not-for-profit enterprise, and the injury
to the natural resource results in a reduction of net income to such an
enterprise, that portion of the lost net income due the trustee(s) from
this enterprise resulting directly or indirectly from the injury to the
natural resource.
Trustee claims for damages under this rule should not include:
(i) Losses to the government for forgone taxes, because these are
transfer payments from individuals to the government; or
(ii) Wages and other income lost by private individuals, except for
that portion of income that represents uncollected economic rent, where
these values may be the subject of lawsuits brought by the individuals
suffering the loss.
Where restoration actions are scaled using the resource-to-resource
or service-to-service scaling approach, trustees should ascertain the
extent to which the restoration actions also compensate for losses
typically scaled with a valuation approach.
IV. Compliance With NEPA and the CEQ Regulations
Under this rule, the National Environmental Policy Act (NEPA)
applies to restoration actions taken by federal trustees, generally
becoming applicable when the trustees begin the process of developing a
Draft Restoration Plan under subpart E of this rule, except where a
categorical exclusion or other exceptions to NEPA apply. Thus, when a
federal trustee proposes to take restoration actions under this rule,
it must integrate this rule with NEPA, the Council on Environmental
Quality (CEQ) regulations on NEPA, and any NEPA regulations promulgated
by that federal trustee agency. In conducting the NEPA process
concurrently rather than consecutively with the assessment, federal
trustees are more likely to make the environment and public whole,
avoid delays in restoration, and reduce transaction costs.
Likewise, certain state trustees may also have equivalent NEPA
requirements, usually referred to as State Environmental Policy Acts
(SEPA). Thus, where a SEPA applies to state trustees, they must
consider the extent to which this rule can be integrated with their
SEPA requirements. Although other trustees may not be bound by NEPA or
NEPA-equivalent requirements, the trustees may still find the
procedural planning process as defined under NEPA (or SEPA) useful in
facilitating restoration.
The provisions of Sec. 990.23 of this rule strictly relate to NEPA
and federal trustees. The rule provides a brief description of the
general procedures and products that may be expected if a restoration
action is subject to a federal trustee's NEPA compliance requirements.
Federal trustees should refer to the CEQ regulations and their own
agency(ies) NEPA regulations for specific guidance regarding NEPA
requirements.
D. Restoration Plans
1. Purpose
After selecting a restoration alternative, trustees must prepare a
Draft Restoration Plan. Development of a Draft Restoration Plan
provides a vehicle for informing the affected and interested public of
the results of the trustees' analyses and decisions, and encouraging
public review. Public review can also supplement expert peer review
when comments are solicited from various professional communities or
other knowledgeable persons.
2. Draft Restoration Plan
A Draft Restoration Plan should include:
(i) A summary of injury assessment procedures used;
(ii) A description of the nature, degree, and spatial and temporal
extent of injuries resulting from the incident;
(iii) The goals and objectives of restoration;
(iv) The range of restoration alternatives considered, and a
discussion of how such alternatives were developed and evaluated under
this rule;
(v) Identification of the trustees' tentative preferred
alternative(s);
(vi) A description of past and proposed involvement of the
responsible parties in the assessment; and
(vii) A description of monitoring for documenting restoration
effectiveness, including performance criteria that will be used to
determine the success of restoration and need for interim corrective
action.
When developing the Draft Restoration Plan, trustees must clearly
define plan objectives that specify the desired outcome to be
accomplished, and the performance criteria by which successful
restoration will be judged. Trustees should, at a minimum, determine
what criteria will constitute success such that responsible parties are
relieved of responsibility for further restoration actions or
necessitate corrective actions in order to comply with the terms of a
restoration or settlement agreement.
Performance criteria include structural, functional, temporal, and/
or other demonstrable goals that the trustees should determine with
respect to all restoration actions. For example, an agreement to create
new intertidal marsh habitat as compensation for a marsh injured by oil
could be described by performance criteria including the number of
acres to be created, location, elevation of new habitat, species to be
planted and details for planting such as density, and time frame in
which identifiable stages of the project should be completed.
The types of parameters that should be addressed in monitoring
include duration and frequency of monitoring needed to gauge progress
and success, the level of sampling needed to detect success or the need
for corrective action, and whether monitoring of a reference or control
site is needed to determine progress and success. Reasonable monitoring
and oversight costs cover those activities necessary to gauge the
progress, performance, and success of the restoration actions developed
under the plan.
3. Public Review and Comment
Public review and comment of both Draft and Final Restoration Plans
will depend on the nature of the incident and any applicable federal
trustee NEPA requirements, as described in Secs. 990.14(d) and 990.23
of the rule, but must be sufficient to satisfy OPA's requirement for
public involvement in planning restoration. Thus, trustees should
consider such factors as the form of the involvement (e.g., a hearing,
notice, or solicited comments), extent of
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public involvement (e.g., timing and frequency), and the forum for
communicating with the public (e.g., local papers, the Federal
Register, direct contacts to known interested parties).
4. Final Restoration Plan
After reviewing public comments on the Draft Restoration Plan,
trustees must develop a Final Restoration Plan. As part of the Final
Restoration Plan, trustees must consider comments on the Draft
Restoration Plan. In response to the comments, the trustees may need to
modify the restoration alternatives being considered, develop and
evaluate alternatives that have not been given serious consideration by
the trustees, supplement, improve, or modify the analyses, make factual
corrections, or explain why the comments do not warrant further trustee
response, citing the reasons to support the trustee position, and
possibly indicate the circumstances that would trigger reappraisal or
further response.
In the Final Restoration Plan, trustees indicate the restoration
alternatives that will be implemented and include the information in
the Draft Restoration Plan. The format of the Final Restoration Plan,
which essentially follows that of the Draft Restoration Plan, should
clearly indicate any changes to the Draft Restoration Plan.
V. Compliance With Other Applicable Laws and Regulations
When taking actions under this rule or while response actions are
on-going, trustee field activities must comply with any applicable
worker health and safety considerations specified in the NCP for
response actions. Where an incident implicates trustees' statutory or
regulatory requirements in addition to those under OPA and this rule,
trustees should comply with those requirements. This requirement also
relates to all legally applicable state, local or tribal procedural
requirements. Compliance with any applicable laws, regulations, and
associated permits will help to minimize duplicative and conflicting
efforts. When following procedural requirements other than those
specified by OPA and this rule, trustees should identify those
requirements in the restoration plan. Applicable federal requirements
that may need to be considered include, but are not limited to: the
Endangered Species Act; the Coastal Zone Management Act; the Migratory
Bird Treaty Act; the National Marine Sanctuaries Act; the National
Historic Preservation Act; the Marine Mammal Protection Act; and the
Archaeological Resources Protection Act. The use of NEPA as a planning
process may facilitate compliance with other federal requirements.
VI. Settlement
Trustees may settle claims for natural resource damages under this
rule at any time, provided that the settlement is adequate in the
judgment of the trustees to satisfy the goal of OPA and is fair,
reasonable, and in the public interest, with particular consideration
of the adequacy of the settlement to restore, replace, rehabilitate, or
acquire the equivalent of the injured natural resources and services.
Settlements by federal trustees will generally be subject to approval
by the U.S. Department of Justice. Sums recovered in settlement of such
claims, other than reimbursement of trustee costs, may only be expended
in accordance with a restoration plan, which may be set forth in whole
or in part in a consent decree or other settlement agreement, that is
made available for public review.
In determining the sufficiency of settlements to meet the public
interest test under other statutes, reviewing courts have afforded
broad deference to the judgment of federal agencies recommending such
settlements. Courts have looked to whether the agencies have considered
such factors as the benefits of early settlement as opposed to delayed
recovery through litigation, litigation risk, certainty in the claim,
and attitude of the parties toward the settlement, among other factors.
VII. Emergency Restoration
Emergency restoration actions should be considered in situations
where immediate action is necessary to minimize continuing or prevent
additional injury. Although emergency restoration actions may be
considered and implemented by trustees at any time throughout the
assessment, typically trustees begin evaluating the need for emergency
restoration during response. If response actions are still underway,
trustees, through their Regional Response Team member or designee, must
coordinate with the On-Scene Coordinator (OSC) before taking any
emergency restoration actions. Any emergency restoration actions
proposed by trustees should not interfere with on-going response
actions. Trustees must explain to response agencies through the OSC
prior to implementation of emergency restoration actions their reasons
for believing that proposed emergency restoration actions will not
interfere with on-going response actions.
Trustees must provide notice to identified responsible parties of
any emergency restoration actions and, to the extent time permits,
invite their participation in the conduct of those actions, consistent
with the provisions of Sec. 990.14(c) of the rule. Trustees must also
provide notice to the public, to the extent practicable, of these
planned emergency restoration actions. The rule allows trustees to take
emergency restoration action only if such action is feasible, likely to
minimize continuing or prevent additional injury, and can be conducted
at a cost that is not unreasonable. Trustees must also notify the
public of the justification for, the nature and extent of, and the
results of emergency restoration actions within a reasonable time
following the actions. The means by which this notice is provided to
the public is left to the discretion of the trustees.
The costs associated with evaluating, planning, and implementing
emergency restoration are recoverable costs.
VIII. Use of Assessment Procedures
A. Standards for Assessment Procedures
The rule addresses OPA's goal of efficient, cost-effective, and
feasible restoration by requiring that assessment procedures be
tailored to the circumstances of a particular incident and the
information needed to determine appropriate restoration for that
incident. The rule requires trustees to determine that the most
appropriate procedures for an incident be implemented by specifying a
set of standards for acceptable procedures. These standards are
applicable to every assessment procedure used under the rule. To be
considered in accordance with this rule, assessment procedures must
meet all of the following standards:
(i) The procedures provide assessment information of use in
determining the type and scale of restoration appropriate for a
particular injury;
(ii) The additional cost of a more complex procedure is reasonably
related to the expected increase in the quantity and/or quality of
relevant information provided by the more complex procedure; and
(iii) The procedures are reliable and valid for the particular
incident.
B. Assessment Procedures Available
This rule provides the use of a range of assessment procedures,
from field or laboratory procedures, to model- or literature-based
procedures, to a combination thereof. When practicable, assessment
procedures must be chosen that provide information of use in
determining the most appropriate alternative for restoring the injury
resulting from the incident. In addition,
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when selecting assessment procedures, trustees should consider factors
such as the time and cost to implement the procedure, nature, and
spatial and temporal extent of injury and information needed to
determine and quantify injury, possible restoration actions for
expected injuries, and information needed to determine appropriate
restoration. If more than one procedure providing the same type and
quality of information is available, the most cost-effective procedure
must be used. A further discussion of procedures is given in Appendix B
to this preamble.
Subpart C--Definitions
Relevant definitions in OPA are repeated in the rule as a matter of
reference. Important terms and concepts that are either not explicitly
defined or described in OPA or that require further clarification are
discussed below.
Baseline
Baseline refers to the condition of natural resources and services
that would have existed had the incident not occurred. Although injury
quantification requires comparison to a baseline condition, site-
specific baseline information that accounts for natural variability and
confounding factors prior to the incident may not be required. In many
cases, injuries can be quantified in terms of incremental changes,
rather than in terms of absolute changes relative to a known baseline.
For example, some procedures do not require site-specific baseline
information to quantify injury. Rather, the injury is quantified in
terms of incremental adverse changes resulting from the incident.
Counts of oiled bird carcasses can be used as a basis for quantifying
incremental bird mortality resulting from an incident.
The rule does not distinguish between baseline, historical,
reference, or control data in terms of value and utility in determining
the degree and spatial and temporal extent of injuries. To the extent
that historical data, reference data, or control data can provide valid
information on which to base a determination of the conditions of the
natural resource and service in the absence of the incident, these
forms of data may effectively serve as baseline information.
Types of information that may be useful in evaluating baseline
include:
(i) Information collected on a regular basis and for a period of
time from and prior to the incident;
(ii) Information identifying historical patterns or trends on the
area of the incident and injured natural resources and services;
(iii) Information from areas unaffected by the incident, that are
judged sufficiently similar to the area of the incident with respect to
the parameter being measured; or
(iv) Information from the area of the incident after a particular
natural resources or services have been judged to have recovered.
Incident
An incident is any occurrence or series of occurrences having the
same origin, involving one or more vessels, facilities, or any
combination thereof, resulting in the discharge or substantial threat
of discharge of oil into or upon navigable waters or adjoining
shorelines or the Exclusive Economic Zone. When a discharge of oil
occurs, natural resources and/or services may be injured by the actual
discharge of oil or response activities related to the discharge. When
there is a substantial threat of a discharge of oil, natural resources
and/or services may also be injured by the threat or response actions
related to the threat.
Injury
OPA authorizes trustees to recover damages for ``injury to,
destruction of, loss of, or loss of use of'' natural resources (section
1002(b)(2)(A) of OPA, 33 U.S.C. 2702(b)(2)(A)). Trustees must establish
that injury has resulted from an incident. Under this rule, injury is
defined as an observable (i.e., qualitative) or measurable (i.e.,
quantitative) adverse change in a natural resource or impairment of a
natural resource service.
There are two general bases for determining injury under this rule.
Trustees must either determine that:
(i) The natural resource was exposed, there is a pathway connecting
the incident with the natural resource, and an adverse change to the
natural resource and/or service has occurred; or
(ii) For injuries resulting from response actions or from a
substantial threat of a discharge of oil, an injury to a natural
resource or an impairment of use of a natural resource service has
occurred as a result thereof. Thus, under this rule, injury may result
from direct or indirect exposure to oil, as well as from response-
related activities, and loss of services is explicitly included in the
definition of injury.
Oil
Under section 1001(23) of OPA (33 U.S.C. 2701(23)), the term
``oil'' includes oil of any kind or in any form, including, but not
limited to, petroleum, fuel oil, sludge, oil refuse, and oil mixed with
wastes other than dredged spoil, but does not include petroleum,
including crude oil or any fraction thereof, which is specifically
listed or designated as a hazardous substance under subparagraphs (A)
through (F) of section 101(14) of CERCLA and which is subject to the
provisions of that Act.
On July 9, 1975, the U.S. Environmental Protection Agency published
a Federal Register notice to affirm that non-petroleum oils, such as
fats and oils from animal and vegetable sources, are subject to oil
spill reporting, civil penalties, cleanup costs, and oil spill
prevention plan preparation and implementation under 40 CFR part 112
and other requirements of section 311 of the Federal Water Pollution
Control Act (33 U.S.C. 1321 et seq.). The U.S. Environmental Protection
Agency and U.S. Coast Guard have interpreted and administered section
311 as applicable to incidents of non-petroleum oils. While the
mechanism of injuries by non-petroleum oils may be different than that
of petroleum oils, it is evident, based on current literature, that the
nature of such injuries is similar (e.g., death) for both types of
oils. However, the rule provides guidance to allow consideration of
differences in the physical, chemical, biological, and other
properties, and in the environmental effects of such oils in
determining whether injuries result from an incident involving non-
petroleum oils.
Pathway
Pathway is the medium, mechanism, or route by which the incident
has resulted in an injury. For discharges of oil, a pathway is the
sequence of events by which:
(i) The oil travelled through various components of an ecosystem
and contacted the natural resource of concern; or
(ii) Exposure to oil in one part of an ecosystem was transmitted to
the natural resource of concern, without the oil directly contacting
the natural resource.
Reasonable Assessment Costs
Reasonable assessment costs are costs that trustees incurred in
performing assessments in accordance with this rule. Trustees may
recover the reasonable assessment costs they incur under this rule even
if they ultimately determine not to pursue restoration, provided that
they have determined that actions undertaken were premised on the
likelihood of injury and need for restoration. Under the rule,
reasonable assessment costs also include administrative, legal, and
enforcement costs necessary to carry out this part, monitoring and
oversight costs, and
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costs associated with public participation and indirect costs.
Recovery
Recovery is the return of injured natural resources and services to
baseline. This concept encompasses the inherent tendency for natural
resource and service attributes to vary over space and time.
Projecting recovery involves determining the likelihood and rate at
which natural resources and/or services will return to baseline. The
availability and quality of baseline information can influence recovery
projections. Trustees should use the best available baseline
information that can be gathered relative to the incident and
associated injuries.
Restoration
Restoration is any action (or an alternative), or a combination of
actions (or alternatives), to restore, rehabilitate, replace, or
acquire the equivalent of injured natural resources and services.
This rule includes the concepts of primary and compensatory
restoration. Primary restoration is any action (whether on-site, off-
site, in-kind, out-of-kind) that returns injured natural resources and
services to baseline, while compensatory restoration is any action (or
an alternative) taken to compensate for the interim loss of natural
resources or services that occur from the date of the incident until
such natural resources and services have recovered to their baseline
condition. Trustees must consider, within the primary restoration
component, natural recovery, in which no human intervention is taken to
directly restore the injured natural resources and services. Depending
on the injury of concern, primary restoration actions may include
actions to actively accelerate recovery or simply to remove conditions
that would make recovery unlikely. The rule discusses types of primary
restoration actions that trustees may want to consider.
For some injuries, the need for and scale of compensatory
restoration actions may depend on the range of feasible primary
restoration actions, but trustees should evaluate the need to seek
compensatory restoration for all demonstrable service losses that occur
from the onset of the incident. The rule requires that trustees
preferentially evaluate compensatory restoration actions that provide
the same type, quality, and value of natural resources or services as
those lost. Actions that provide services of comparable type, quality,
and value may be considered if required to generate a range of feasible
restoration alternatives for evaluation.
Services
Natural resource services are all functions that a natural resource
provides for another natural resource(s) or for the public. Natural
resource services may be classified as follows:
(i) Ecological services--the physical, chemical, or biological
functions that one natural resource provides for another. Examples
include provision of food, protection from predation, and nesting
habitat, among others; and
(ii) Public services--the public uses of natural resources or
functions of natural resources that provide value to the public.
Examples include fishing, hunting, nature photography, and education,
among others.
Value
Value can be measured in units of natural resource services or
dollar amounts. An individual's value of a good or service is
represented by the maximum amount of goods, services, or money that the
individual is willing to give up to obtain a specific good or service,
or the minimum amount of goods, services, or money that an individual
is willing to accept to forgo a specific good or service. The total
value of a natural resource or service includes the value individuals
derive from direct use of the natural resource, for example, swimming,
boating, hunting, or birdwatching, as well as the value individuals
derive from knowing a natural resource will be available for future
generations. In many contexts, particularly in markets, value is
represented in terms of units of money. However, value can be measured
using other measures, including units of a natural resource service.
Subpart D--Preassessment Phase
I. Purpose
During the Preassessment Phase, trustees make critical
determinations that shape the remainder of the natural resource damage
assessment. Trustees determine, based on the circumstances of a given
incident, whether actions under OPA are justified and make preliminary
determinations regarding the type of injury assessment and restoration
actions that may be pursued.
Other matters considered during the Preassessment Phase include
funding, data collection, opening the administrative record, and
inviting responsible parties' participation. Trustees may also consider
the applicability of the defenses to liability provided in section 1002
of OPA (33 U.S.C. 2702).
II. Determinations
A. Determination of Jurisdiction
In order for trustees to proceed with any assessment activities
under OPA, certain conditions must be met:
(i) An ``incident'' under OPA must have occurred (i.e., there has
been a discharge or substantial threat of a discharge of oil);
(ii) The incident does not fall within exclusionary conditions set
forth in section 1002(c) of OPA (33 U.S.C. 2702(c)) (e.g., the
discharge was not permitted by federal permit); and
(iii) Natural resources or services under the trusteeship of the
trustee may have been, or are likely to be, injured as a result of the
incident.
Frequently, the first two conditions are determined by the response
agency. The U.S. Coast Guard, U.S. Environmental Protection Agency, or
a state response agency may have already made the determination that
OPA applies to the incident before notifying trustees. The third
condition, however, is necessarily determined by each trustee.
If all of the conditions listed above are met, trustees may proceed
with preassessment actions. If any one of the conditions is not met,
trustees may not take additional action under this rule, except action
to finalize this determination. Trustees may recover all reasonable
assessment costs incurred up to this point provided that the first two
conditions above were met and actions were taken with the reasonable
belief that natural resources or services under their trusteeship might
have been injured as a result of the incident.
A determination that OPA applies and that a trustee has
jurisdiction to act under OPA may trigger initiation of the natural
resource damage assessment process.
B. Determination to Conduct Restoration Planning
1. General
The determination to be made by trustees in the Preassessment Phase
is whether it appears that restoration actions should be pursued by the
trustees. This determination depends on the following conditions:
(i) Injuries have resulted, or are likely to result, from the
incident;
(ii) Response actions have not adequately addressed, or are not
expected to address, the injuries resulting from the incident; and
(iii) Feasible primary and/or compensatory restoration actions
exist to address the potential injuries.
If all the conditions listed above are met, trustees may proceed
with
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preassessment actions. If the trustees decide to proceed with the
natural resource damage assessment, the trustees must issue a Notice of
Intent to Conduct Restoration Planning, which is described below. If
any one of the conditions is not met, trustees may not take additional
action under this rule, except action to finalize this determination.
However, trustees may recover all reasonable assessment costs incurred
up to this point.
2. Identifying Natural Resources and Services at Risk
Determining whether natural resources and services are, or are
likely to be, injured requires that trustees consider the:
(i) Circumstances of the incident. Factors to consider include
geographic location, condition of the vessel or facility, environmental
conditions;
(ii) Characteristics of the discharge or substantial threat of the
discharge. Factors to consider include the type of oil, which may be
described by its physical and chemical parameters, source, time and
duration, and volume of the discharge;
(iii) Characteristics of the natural resources. Factors to consider
include the natural resources in the area of the incident, the services
they provide, habitat and species types, seasonal implications on
sensitive life stages, and unique ecological components; and
(iv) Potential for injury. Factors to consider include potential
for exposure, pathways, causal mechanisms, and availability of
assessment procedures and data to analyze these factors.
Trustees must consider injuries resulting from the incident as well
as from actions taken to respond to the incident.
3. Effectiveness of Response Actions in Eliminating Injury
Once trustees determine that natural resources and/or services are,
or may be expected to be, injured as a result of the incident, trustees
must then determine whether these injuries are likely to be adequately
addressed through response actions. This analysis should also consider
whether restoration is required for injuries that occurred at the time
of the incident, even if injured natural resources and services are
expected to return to baseline as a result of response actions. If
response actions will not alleviate residual natural resource and/or
service injuries, trustees must determine whether there is a need and
potential for restoration actions to address initial or residual
injuries, and begin identifying these actions, to facilitate the
Restoration Planning Phase of the assessment.
4. Early Identification of Potential Restoration Actions
Potential restoration actions need to be identified as early in the
assessment as practicable. Such identification is needed to help
justify the decision to proceed with an assessment that will lead to
effective restoration actions, and provide the focus for designing
injury assessment studies that will produce useful information on the
type and scale of restoration needed. Considerations important to the
early identification of restoration actions include:
(i) Potential nature, degree, and spatial and temporal extent of
injury, with or without restoration;
(ii) Need and potential for restoration given the types of
injuries;
(iii) Potential type and scale of restoration;
(iv) Extent to which information relevant to determining
restoration needs is known;
(v) Time, money, and personnel required and available to obtain
missing or additional information relevant to restoration; and
(vi) Requirements imposed by other applicable laws, regulations,
and permits that would affect restoration.
III. Data Collection During Preassessment Phase
This rule allows trustees to conduct data collection and analysis
during the Preassessment Phase if such activities are reasonably
related to making the determinations required during this phase. The
purpose of data collection and analysis at this stage is to facilitate
the determination of whether natural resources and/or services have
been injured by the incident and may require some form of restoration.
Ephemeral information (i.e., information that may be lost if not
collected immediately) may also be collected during the Preassessment
Phase if the information is necessary for any stage of the restoration
planning process. In addition, information needed to design and
implement anticipated assessment procedures may be collected during
this phase. Data collection and analysis during this phase must be
coordinated with response actions, such that the collection and
analyses do not interfere with response actions.
IV. Notice of Intent to Conduct Restoration Planning
If the trustees determine that there is a reasonable likelihood
that injury has occurred as a result of the incident and feasible
restoration actions exist that would address these injuries, the
trustees may proceed with the assessment. If trustees decide to
proceed, they must prepare a Notice of Intent to Conduct Restoration
Planning, which documents the trustees' preassessment activities and
the basis for the decision to proceed. Depending on information
available at this early stage of the assessment, the notice may also
include a description of the trustees' proposed strategy to assess
injury and determine the type and scale of restoration. The contents of
the notice may vary, but will typically discuss:
(i) The facts of the incident;
(ii) Trustee authority to proceed with the assessment;
(iii) Natural resources and services that are, or are likely to be,
injured as a result of the incident;
(iv) Potential restoration actions relevant to the expected
injuries; and
(v) If determined at the time, potential assessment procedures to
evaluate the injuries and define the appropriate type and scale of
restoration for the injured natural resources and services.
The notice must be made publicly available. The means by which the
notice is made publicly available and whether public comments are
solicited on the notice is left to the discretion of the trustee.
Trustees must also provide a copy of the notice to the known
responsible parties and invite their participation in the conduct of
restoration planning. As provided under Sec. 990.14(c) of the rule, the
determination of the timing, nature, and extent of responsible party
participation will be determined by the trustees on an incident-
specific basis.
V. Administrative Record
An administrative record facilitates the restoration process by
providing a central repository for all materials relied upon by
trustees in making final determinations about restoration actions
appropriate for an incident. Thus, as administrative record should be
opened after trustees decide to proceed with restoration planning, and
concurrently with the development of the Notice of Intent to Conduct
Restoration Planning.
The administrative record must contain sufficient information to
support review of the trustees' decisionmaking process. Depending on
the nature and extent of the incident, assessment, and restoration
planning process, the administrative record should include information
relied upon during the assessment, and required by this rule. Thus, the
administrative record should ordinarily include the Notice of Intent to
Conduct Restoration Planning, draft and final restoration
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plans, and public comments; any relevant data, investigation reports,
scientific studies, work plans, quality assurance plans, and
literature; and any agreements not otherwise privileged among the
participating trustees or with the responsible parties.
Federal trustees should maintain the administrative record in a
manner consistent with the Administrative Procedure Act, 5 U.S.C. 551-
59, 701-06. The administrative record should be limited to final
documents when possible. Where no final document is available at the
time of selection of restoration actions, draft documents may be
included in the administrative record if they contain information not
found in other documents in the record, but which is considered by the
trustees in selecting a restoration action. Pre-decisional,
deliberative internal agency memoranda should be treated like draft
documents (and be excluded from the record) unless relied upon in
choosing restoration actions.
Although this rule is silent on the standard of judicial review for
an assessment conducted in accordance with this rule, NOAA expects that
the administrative record will serve as the foundation for any judicial
review of such assessment.
Subpart E--Restoration Planning Phase
I. Purpose
The purpose of the Restoration Planning Phase is to evaluate and
quantify information on potential injuries to natural resources and/or
services (injury assessment), and use that information to determine the
need for and scale of restoration actions (restoration selection). The
assessment is essentially a restoration scoping exercise, and the
various studies and analyses conducted during this phase should be
viewed from the restoration perspective. Potential assessment
activities should be examined carefully to ensure that the results will
be useful and relevant to restoration.
Development of a conceptual linkage between injury and restoration
early in the natural resource damage assessment process should
facilitate and minimize the costs of the assessment by assisting the
trustees in focusing on the most relevant injuries to be included in
the assessment, designing studies that are relevant to restoration, and
planning appropriate restoration actions. The rule provides that
trustees may use a range of possible assessment procedures for injury
assessment and restoration planning (see the discussion of Sec. 990.27,
``Use of Assessment Procedures'').
II. Injury Assessment
A. Purpose
The goal of injury assessment, which includes determination and
quantification of injury, is to evaluate the nature, degree, and
spatial and temporal extent of injuries to natural resources and/or
services, thus providing a technical basis for evaluating the need for
and scale of restoration. While the basic steps discussed below are
applicable to all assessments, selection of approaches for
demonstrating exposure, pathway, and injury will be incident-specific.
To determine injury under this rule, trustees must determine if:
(i) The definition of ``injury'' is met; and
(ii) (a) An injured natural resource has been exposed to the
discharged oil, and a pathway can be established from the discharge to
the exposed natural resource; and/or
(b) Any injury to or impairment of a natural resource service has
occurred as a result of response actions or a substantial threat of a
discharge of oil. These steps for determining injury and related
concepts are described in more detail below.
B. Injury Determination
1. Definition of Injury
Under this rule, trustees must determine if the definition of
``injury'' has been met. ``Injury'' is defined as an observable or
measurable adverse change in a natural resource or impairment of a
service.
Injury includes adverse changes in the chemical or physical quality
or viability of a natural resource. The simplest example is death of an
organism, but indirect, delayed, or sublethal effects may also
constitute injury. Potential categories of injuries include adverse
changes in: survival, growth, and reproduction; health, physiology and
biological condition; behavior; community composition; ecological
processes and functions; physical and chemical habitat quality or
structure; and services to the public.
Although injury is often thought of in terms of adverse changes in
biota, the definition of injury under this rule is broader. Injuries to
non-living natural resources (e.g., oiled sand on a recreational beach)
as well as injuries to natural resource services (e.g., lost use
associated with a fisheries closure to prevent harvest of tainted fish,
even though the fish themselves may not be injured) may be considered.
This list of potential adverse changes is not intended to be
inclusive of all injuries that trustees may evaluate.
2. Exposure
The purpose of the exposure portion of an injury assessment is to
establish whether natural resources came into contact with the oil from
the incident. Early consideration of exposure should help to focus the
assessment on those natural resources and/or services that are most
likely to be injured by an incident.
Trustees must establish whether the natural resource came into
contact, either directly or indirectly, with the oil discharged from
the incident. Under the rule, exposure is broadly defined to include
not only direct physical exposure to oil, but also indirect exposure
(e.g., injury to an organism as a result of disruption of its food
web). Documenting exposure is a prerequisite to determining injury,
except for response-related injuries and injuries resulting from
substantial threats of discharges. However, evidence of exposure alone
may be insufficient to conclude that injury to a natural resource has
occurred (e.g., the presence of petroleum hydrocarbons in oyster
tissues may not, in itself, constitute an injury).
Exposure can be established with either quantitative or qualitative
procedures. As with other elements of the assessment, selection of
procedures for establishing oil exposure will depend on the type and
volume of discharged oil, natural resources at risk, and nature of the
receiving environment. A combination of assessment procedures may be
necessary to determine exposure. For example, chemical analysis of oil
in sediments, alone, may not be adequate to conclude that a benthic
organism was otherwise exposed to the oil. Likewise, the presence of
petroleum in fish tissue, alone, may not be adequate to link the
exposure to the discharge because metabolism of the oil may blur its
chemical characterization. The combination of the two procedures may,
however, add to the weight of evidence establishing exposure.
Trustees must determine the most appropriate procedures to evaluate
exposure on an incident-specific basis. For some types of incidents,
visual observation in the field and/or modeling may be adequate to
document exposure. For other incidents, more involved site-specific
sampling, including chemical analysis and biological data collection
and analysis, may be more appropriate.
3. Pathways
To determine whether an injury resulted from a specific incident, a
pathway linking the incident to the
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injury must be established. As with exposure, establishing a pathway is
a prerequisite to determining injury, except for response-related
injuries and injuries resulting from a substantial threat of a
discharge. However, evidence of a pathway, alone, is not sufficient to
conclude that injury has occurred (e.g., demonstrating that prey
species are oiled can be used to document that a pathway to a predator
species exists; however, such data do not, in themselves, establish
that the predator species is injured).
Pathway determination may include, but is not limited to an
evaluation of the sequence of events by which the discharged oil was
transported from the incident and either:
(i) Came into direct physical contact with the exposed natural
resource (e.g., oil transported from an incident by ocean currents,
wind, and wave action to directly oil shellfish); or
(ii) Caused an indirect injury to a natural resource and/or service
(e.g., oil transported from an incident by ocean currents, wind, and
wave action cause reduced populations of bait fish, which in turn
results in starvation of a fish-eating bird; or, oil transported from
an incident by currents, wind, and wave action causes the closure of a
fishery to prevent potentially tainted fish from being marketed).
Pathway determination does not require that injured natural
resources and/or services be directly exposed to oil. In the example
provided above, fish-eating birds are injured as a result of decreases
in food availability. However, trustees must always determine the
existence of a pathway relating the incident to the injured natural
resource and/or service, if the injury is caused by direct exposure to
oil.
Pathways may include, but are not limited to, movement/exposure
through the water surface, water column, sediments, soil, groundwater,
air, or biota.
As with exposure determination, trustees must determine the most
appropriate procedures to evaluate whether a pathway exists on an
incident-specific basis.
Understanding the potential pathways will also help to narrow the
scope of the assessment, and may be important in deciding which
assessment procedures to use. For example, if a particular procedure
does not address injuries that occur through air or terrestrial
pathways, it would not be appropriate to use that procedure in cases
where such pathways are predominant.
4. Selection of Injuries to Include in the Assessment
During the Preassessment Phase, trustees may collect information on
a wide range of potential injuries. As a result, a long inventory of
potential injuries resulting from the incident is often developed.
Because the collection of information on injury must be related to the
incident and consistent with restoration planning, developing
scientific knowledge for its own sake is not part of an assessment
under this rule.
To compile an inventory of potential injuries to include in the
assessment, trustees should determine the extent to which the following
information is known or can be obtained for each injury:
(i) Natural resources and services of concern;
(ii) Kinds of procedures available to evaluate and quantify injury,
and associated time and cost requirements;
(iii) Evidence indicating exposure;
(iv) Pathway from the incident to the natural resource and/or
service of concern;
(v) Adverse change or impairment that constitutes injury;
(vi) Evidence indicating injury;
(vii) Mechanism by which injury occurred;
(viii) Potential degree, and spatial and temporal extent of the
injury;
(ix) Potential natural recovery period; and
(x) Kinds of primary and/or compensatory restoration actions that
are feasible.
Analysis of the factors above should produce a list of injuries
appropriate to evaluate in the assessment.
C. Injury Quantification
Injury quantification is the process by which trustees determine
the degree, and spatial and temporal extent of injuries relative to
baseline. Thus, injury quantification typically provides information on
the scale of restoration that may be necessary.
1. Injury Quantification Information Needs
A variety of procedures for injury quantification may be available
to trustees. However, because the ultimate purpose of injury
quantification is ideally to facilitate the design and scale of
restoration actions, injury quantification should, at a minimum,
evaluate the following factors:
(i) Degree of the injury. Degree may be expressed in terms such as
percent mortality, proportion of a population, species, community, or
habitat affected, extent of oiling, and availability of substitute
services.
(ii) Spatial extent of the injury. Spatial extent may include
quantification of the total area or volume of injury.
(iii) Temporal extent of the injury. Duration of injury may be
expressed as the total length of time that the natural resource and/or
service is adversely affected, starting at the time of the incident and
continuing until the natural resources and services return to baseline.
In order to scale restoration actions, trustees may find it useful
to develop an estimate of the total quantity of injury that integrates
the degree, and spatial and temporal extent of injury. For example,
quantification of the total losses of wetland habitat injured by oil
could be obtained by estimating the total number of acres of severely
oiled wetland in which vegetation is totally killed, the natural
recovery time for severely oiled wetland, the total number of acres of
moderately oiled wetland in which vegetation is not completely killed
but the wetland has lower levels of productivity, and the natural
recovery time for moderately oiled wetland. This information could be
combined to quantify the total number of ``acre-years'' of wetland
injury to scale restoration actions.
2. Conceptual Approaches to Quantification
Trustees may pursue several different conceptual approaches to
injury quantification. Under these approaches, injury may be quantified
in terms of:
(i) The degree, and spatial and temporal extent of injury to a
natural resource;
(ii) The degree, and spatial and temporal extent of injury to a
natural resource, with subsequent translation of that adverse change to
a reduction in services provided by the natural resource; or
(iii) The amount of services lost as a result of the incident.
Examples of the first approach include quantifying the number of
fish or seabird mortalities caused by a discharge of oil. Examples of
the second approach include quantifying reductions in fish populations
with subsequent estimation of the reduction in the value of a
recreational fishing day lost, given the injury, or quantifying the
amount of lost spawning habitat as a result of oiling with subsequent
estimation of the number of fish that would have been produced by that
habitat. An example of the third approach includes direct measurement
of the number of beach user days lost as a result of a beach closure.
For a
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particular injury, trustees should use whichever approach is most
appropriate to the circumstances of the incident.
D. Analysis of Natural Recovery
Natural recovery is a restoration alternative whereby injured
natural resources and services are allowed to return to conditions
prior to the incident without human intervention, following any
response actions. Under this rule, trustees must estimate the time for
natural recovery in order to quantify injury. Analysis of recovery
times may include such factors as:
(i) The nature, degree, and spatial and temporal extent of injury;
(ii) The sensitivity and vulnerability of the injured natural
resource and/or service;
(iii) The reproductive and recruitment potential;
(iv) The resistance and resilience (stability) of the affected
environment;
(v) The natural variability; and
(vi) The physical/chemical processes of the affected environment.
Although it is desirable to account for these factors and produce a
rigorous quantitative natural recovery estimate for a particular
natural resource, this may not be practicable for many injuries. As
with any assessment procedure used under the rule, the most appropriate
procedure that meets the standards for acceptable procedures in
Sec. 990.27 of the rule must be used for estimating natural recovery.
Thus, under this rule, where quantitative procedures are lacking,
inadequate, or unnecessarily costly to precisely estimate natural
recovery times, trustees may use appropriate qualitative procedures to
develop estimates where needed.
III. Restoration Selection
A. Purpose
Once injury assessment is completed, trustees must develop a plan
for restoring the injured natural resources and services. Under this
rule, trustees must identify a reasonable range of restoration
alternatives, evaluate those alternatives, select an alternative,
develop a Draft Restoration Plan, and produce a Final Restoration Plan.
If the information on injury determination and quantification and
its relevance to restoration justify restoration, trustees may proceed
with restoration planning. Otherwise, trustees may not take additional
assessment actions. However, trustees may recover all reasonable
assessment costs incurred up to this point.
B. Developing a Reasonable Range of Alternatives
1. General
Trustees must identify a reasonable range of restoration
alternatives for consideration. Each alternative is comprised of
primary and/or compensatory restoration components that address one or
more specific injuries associated with the incident. Primary
restoration refers to any actions taken to return the injured natural
resources and services to baseline on an accelerated time frame.
Natural recovery, in which no human intervention is taken to accelerate
recovery of the injured natural resource and service, is included under
the primary restoration component. Compensatory restoration refers to
any actions taken to compensate for the interim losses of natural
resources and services, from the time of the incident until recovery is
achieved.
Each alternative must be designed so that, as a package of one or
more actions, the alternative would satisfy OPA's goal to make the
environment and public whole for injuries resulting from an incident.
Only those alternatives considered technically feasible and in
accordance with applicable laws, regulations, or permits may be
considered further under this rule. Acceptable restoration alternatives
include any of the actions authorized under OPA (restoration,
rehabilitation, replacement, or acquisition of the equivalent), or any
combination of those actions.
2. Primary Restoration
Trustees must consider primary restoration actions, including a
natural recovery alternative. Alternative primary restoration actions
can range from natural recovery with no human intervention, to actions
that prevent interference with natural recovery, to more intensive
actions expected to return injured natural resources and services to
baseline faster or with greater certainty than natural recovery.
When identifying primary restoration actions to be considered,
trustees should consider whether activities exist that would prevent or
limit the effectiveness of restoration actions (e.g., residual sources
of contamination). Trustees should also consider whether any primary
restoration actions are necessary to return the physical, chemical, and
biological conditions necessary to allow recovery or restoration of the
injured natural resources (e.g., replacement of sand or vegetation, or
modifying hydrologic conditions). Finally, trustees should consider
whether restoration actions focusing on certain natural resources and
services would be an effective approach to achieving baseline
conditions (e.g., replacing essential species, habitats, or public
services that would facilitate the replacement of other, dependent
natural resource and service components).
3. Compensatory Restoration
In addition to primary restoration, trustees must consider
compensatory restoration actions in some or all of the restoration
alternatives. The extent of interim natural resource or service losses
that must be addressed by a particular restoration alternative may vary
depending on the level and speed of recovery generated by the primary
restoration component of the restoration alternative.
To the extent practicable, when identifying the compensatory
restoration components of the restoration alternatives, trustees should
consider compensatory restoration actions that provide services of the
same type and quality, and of comparable value as those injured. This
is the preferred approach to identifying compensatory restoration
actions. If such actions do not provide a reasonable range of
alternatives, trustees should identify actions that, in the judgment of
the trustees, will provide services of at least comparable type and
quality as those injured. Where the injured and replacement natural
resources and services are not of comparable value, the scaling process
will involve valuation of injured and replacement services.
In general, both primary and compensatory restoration of services
must be accomplished through actions to restore natural resources or to
preserve or enhance the amount, quality, and/or availability of natural
resources that provide the same or similar services. This may include
actions to improve access to natural resources, although in selecting
such actions, the trustees must carefully evaluate the direct and
indirect impacts of the improved access on natural resource quality and
productivity. In the natural resource damages context, a service may
not be viewed as an abstract economic unit or activity that may be
restored independently of the natural resources from which the service
flows.
4. Scaling Restoration Actions
To ensure that a restoration action will appropriately address the
injuries resulting from an incident, trustees must scale the action.
For primary restoration, scaling as described in the rule
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generally applies to acquisition and/or replacement actions, whereas
the amount of direct restoration or rehabilitation to undertake may be
determined based on such factors as area of habitat contaminated at
unacceptable levels, or the volume of removed sand that should be re-
supplied. The approaches that may be used to assess the appropriate
scale of a restoration action to compensate for public losses include
resource-to-resource or service-to-service approaches, or valuation
approaches. Trustees should be careful to avoid double-counting, which
could result from developing multiple restoration actions that
compensate for ecological and direct human services losses over time.
For example, when determining the need for compensatory restoration
actions that directly address lost human services, trustees should take
into account any compensation for those lost human services provided by
other actions intended to compensate for lost ecological services.
a. Resource-to-Resource and Service-to-Service Scaling Approaches
Under the resource-to-resource and service-to-service approaches to
scaling, the appropriate quantity of replacement natural resources and/
or services is determined by obtaining equivalency between the injured
and replacement natural resources and/or services, after appropriately
discounting for differences in the timing of the injury and the
replacement. Trustees must consider use of the resource-to-resource or
service-to-service approach for actions that provide natural resources
and/or services of the same type and quality, and comparable value to
those injured.
Under the resource-to-resource or service-to-service approach, NOAA
recommends use of habitat equivalency analysis, or comparable
procedures, when injured natural resources and/or services are
primarily of indirect human use (e.g., species habitat or biological
natural resources for which human uses are primarily off-site). (See
Appendix B at the end of this preamble for a description of habitat
equivalency analysis.) If injured services are human uses (e.g.,
recreational services), then a behavioral model of human use may be
used to determine the scale of the restoration action necessary to
provide the appropriate level of human uses. For example, if the
interim lost services are lost recreational beach days, then the
restoration action may be designed to provide the requisite number of
recreational beach days by, for example, improving access to existing
public beaches.
b. Valuation Approach
Where trustees have determined that resource-to-resource or
service-to-service scaling is not appropriate, trustees may use the
valuation approach to scaling. The valuation approach requires that
trustees determine the amount of natural resources and/or services that
must be provided to produce comparable value to the public as the loss
in public value resulting from the injuries. The approach relies on the
concept that lost value can be determined using one of a variety of
possible units of exchange, including units of natural resource
services or dollars. The valuation approach requires that the value of
injured natural resources and/or services be measured explicitly, and
that a restoration action provide natural resources and/or services of
equivalent value to the public. To properly scale a restoration action,
trustees might have to measure the values of varying sizes of the
restoration action to determine the size of an action that will replace
the value of injured natural resources and/or services. For proper
comparison, all values lost or provided over time should be converted
into present value terms by discounting.
The valuation approach may be implemented with separate
calculations of losses and gains. A variety of valuation procedures is
available for this purpose, including the travel cost method, factor
income approach, hedonic price models, models of market supply and
demand, contingent valuation, and conjoint analysis. (See Appendix B at
the end of this preamble for descriptions of these procedures.)
Where feasible, trustees should use the same or similar valuation
procedures for measuring the value of the injured services and the
value of the services provided by the restoration actions. Trustees
must ensure that bias is not introduced into the scaling calculations
via the separate calculations of losses and gains, particularly when
different valuation procedures are used.
Alternatively, it may be possible to implement the valuation
approach with a single survey eliciting the direct resource-to-resource
trade-offs between the injured natural resources and potential
compensatory natural resources. Conjoint analysis, or contingent choice
analysis, may provide suitable procedures for these measurements.
Trustees may use any reliable procedure suitable for scaling
compensatory restoration that meets the standards for acceptable
procedures in Sec. 990.27 of the rule. Where the circumstances are such
that a site-specific application of a valuation procedure does not meet
the reasonable cost criterion, the trustees may consider using benefits
transfer. The choice of approaches in a particular context will depend
upon the types of injuries and the type of services provided by the
restoration action.
If valuation of the natural resources and/or services provided by a
compensatory restoration action could not, in the judgment of the
trustees, be performed within a reasonable time frame or at a
reasonable cost consistent with Sec. 990.27(a) of the rule, the
trustees may calculate the monetary value of the injured natural
resources and/or services, and then select the scale of a restoration
action that has a cost equivalent to the lost monetary value. However,
the responsible parties may request that trustees value the natural
resources and services provided by the restoration action, following
the process outlined in Sec. 990.14(c) of the rule.
c. Treatment of Uncertainty and Discounting
When scaling a restoration action, trustees should address the
uncertainties associated with the predicted consequences of both the
primary and compensatory restoration actions that will affect the level
and duration of losses from the injury and gains from the compensatory
restoration action. In addition, trustees must take account of the
value of time in the scaling calculations by discounting to the present
the interim lost services or the value of interim lost services due to
the injury, as well as the gain in services or service value from the
restoration action. The reference date for the discounting calculation
is the date at which the demand is presented.
NOAA recommends that, where feasible, the trustees should use risk-
adjusted measures of losses and gains, in conjunction with a riskless
rate of discount reflecting the social rate of time preference for
natural resources (i.e., the rate society is willing to substitute
between present and future consumption of natural resources with
certainty). Risk-adjusted measures of losses and gains take account of
the fact that people tend to be risk averse, and must be compensated
for bearing uncertainty. For example, it may be possible to compensate
for uncertainty in outcomes from compensatory restoration actions with
a larger scale action. Because of the difficulty in determining the
rate of time preference
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for goods (such as natural resources) that are not generally sold in a
market, a real rate of three percent (3%) is recommended as a riskless
rate, unless justification is presented for a rate more appropriate for
the specific context. Alternatively, if the streams of losses and gains
cannot be adequately adjusted for risks, then NOAA recommends use of a
discount rate that incorporates a suitable risk adjustment to the
riskless rate.
Existing economic literature suggests that three percent (3%) is a
reasonable choice for the social rate of time preference, given that it
is the middle of the range of values for the subjective rate of time
preference implied by long-run growth models of the U.S. economy.
Further, 3% is at the lower end of the range of the financial
opportunity costs of consumption, which are relatively low for
individuals who are net savers, and much higher for individuals who are
net borrowers. The long-term average real after tax rate of return on
3-month Treasury bills, a proxy for a riskless savings asset, is around
one percent (1%), though more recent rates are substantially higher
(around 2% during the 1983-1994 period). Consumer borrowing rates
depend upon the source of financing, but may exceed ten percent (10%)
in real terms for many credit cards. Because consumers' use of natural
resources does not occur primarily through market transactions,
consumers do not necessarily adjust their inter-temporal consumption of
natural resources in response to the relevant intertemporal financial
trade-offs available to them; nonetheless, the financial opportunity
costs provide an additional reference point.
The analysis should be conducted in real terms (e.g., in units of
services, or in dollars of a specified base year). By definition, an
analysis conducted in units of natural resources or services is in real
terms. If the analysis is conducted in money value terms, then all
money values should be specified in terms of the dollars of a specified
base year. To adjust the measures of monetary losses or gains to
dollars of the specified base year, the Consumer Price Index is most
appropriate when the measure of losses is consumer surplus.
Alternatively, for more generalized measures of losses or for future
projections of inflation, trustees may use the Gross Domestic Product
price index, for which the Administration predicts a time-series of
future deflators every year. Sources of information for discounting are
identified in the preamble discussion of discounting in the
Implementation Phase.
C. Evaluation of Restoration Alternatives
1. General
Once trustees have developed a reasonable range of restoration
alternatives, they must evaluate those alternatives. This evaluation is
based, at a minimum, on:
(i) The cost to carry out the alternative;
(ii) The extent to which each alternative is expected to meet the
trustees' goals and objectives in returning the injured natural
resources and services to baseline and/or compensate for interim
losses;
(iii) The likelihood of success of each alternative;
(iv) The extent to which each alternative will prevent future
injury as a result of the incident, and avoid collateral injury as a
result of implementing the alternative;
(v) The extent to which each alternative benefits more than one
natural resource and/or service; and
(vi) The effect of each alternative on public health and safety.
Based on an evaluation of these factors, trustees must select a
preferred restoration alternative(s). If the trustees conclude that two
or more alternatives are equivalent based on the above factors, the
trustees must select the most cost-effective alternative.
When selecting a restoration alternative, trustees should consider
the relationship between costs and benefits. However, reducing the
selection process to a strict comparison of restoration costs to
monetized natural resource values is not required and may not be
appropriate. Instead, the rule requires trustees to evaluate each
alternative according to the factors listed above and identify a
preferred alternative. NOAA believes this approach provides adequate
protection against selection of an inappropriately costly alternative.
2. Pilot Restoration Projects
If the range of restoration alternatives under consideration is
limited or poorly developed, or if a promising restoration action
cannot be adequately evaluated without testing, trustees may implement
pilot projects. Pilot projects should only be undertaken when, in the
judgment of the trustees, these projects are likely to successfully
provide information for the evaluation factors specified above at a
reasonable cost and in a reasonable time frame. Examples of situations
where pilot projects may be appropriate include application of a proven
technology in a different habitat type, or using different species than
those used in previous applications.
D. Restoration Plans
1. Purpose
After selecting a restoration alternative, trustees must prepare a
Draft Restoration Plan. Development of a Draft Restoration Plan
provides a vehicle for informing the affected and interested public of
the results of the trustees' analyses and decisions, and encouraging
public review. Public review can also supplement expert peer review
when comments are solicited from various professional communities or
other knowledgeable persons.
2. Draft Restoration Plan
A Draft Restoration Plan must include:
(i) A summary of injury assessment procedures used;
(ii) A description of the nature, degree, and spatial and temporal
extent of injuries resulting from the incident;
(iii) The goals and objectives of restoration;
(iv) The range of restoration alternatives considered, and a
discussion of how such alternatives were developed and evaluated under
this rule;
(v) Identification of the trustees' tentative preferred
alternative(s);
(vi) A description of past and proposed involvement of the
responsible parties in the assessment; and
(vii) A description of monitoring for documenting restoration
effectiveness, including performance criteria that will be used to
determine the success of restoration and need for interim corrective
action.
When developing the Draft Restoration Plan, trustees must clearly
define plan objectives that specify the desired outcome to be
accomplished, and the performance criteria by which successful
restoration will be judged. Trustees must, at a minimum, determine what
criteria will constitute success such that responsible parties are
relieved of responsibility for further restoration actions or
necessitate corrective actions in order to comply with the terms of a
restoration or settlement agreement.
Performance criteria include structural, functional, temporal, and/
or other demonstrable goals that the trustees should determine with
respect to all restoration actions. For example, an agreement to create
new intertidal marsh habitat as compensation for a marsh injured by oil
could be described by performance criteria including the number of
acres to be created, location, elevation of new habitat, species to be
planted and details for planting such as
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density, and time frame in which identifiable stages of the restoration
action should be completed.
The types of parameters that should be addressed in monitoring
include duration and frequency of monitoring needed to gauge progress
and success, the level of sampling needed to detect success or the need
for corrective action, and whether monitoring of a reference or control
site is needed to determine progress and success. Reasonable monitoring
and oversight costs cover those activities necessary to gauge the
progress, performance, and success of the restoration actions developed
under the plan.
3. Public Review and Comment
Public review and comment of both Draft and Final Restoration Plans
will depend on the nature of the incident and any applicable federal
trustee NEPA requirements, as described in Secs. 990.14(d) and 990.23
of the rule, but must be sufficient to satisfy OPA's requirement for
public involvement in planning restoration. Thus, trustees should
consider such factors as the form of the involvement (e.g., a hearing,
notice, or solicited comments), extent of public involvement (e.g.,
timing and frequency), and the forum for communicating with the public
(e.g., local papers, the Federal Register, direct contacts to known
interested parties).
4. Final Restoration Plan
After reviewing public comments on the Draft Restoration Plan,
trustees must develop a Final Restoration Plan. As part of the Final
Restoration Plan, trustees must consider comments on the Draft
Restoration Plan. In response to the comments, the trustees may need to
modify the restoration alternatives being considered, develop and
evaluate alternatives that have not been given serious consideration by
the trustees, supplement, improve, or modify the analyses, make factual
corrections, or explain why the comments do not warrant further trustee
response, citing the reasons to support the trustee position, and
possibly indicate the circumstances that would trigger reappraisal or
further response.
In the Final Restoration Plan, trustees indicate the restoration
alternatives that will be implemented and include the information in
the Draft Restoration Plan. The format of the Final Restoration Plan,
which essentially follows that of the Draft Restoration Plan, should
clearly indicate all significant changes to the Draft Restoration Plan.
E. Use of a Regional Restoration Plan or Existing Restoration Project
The rule allows trustees to consider all or part of an existing
Regional Restoration Plan or other existing, planned, or proposed
environmental restoration project as one of the range of restoration
alternatives, including natural recovery, evaluated to restore injuries
resulting from a particular incident. Like any other restoration
alternative considered, Regional Restoration Plans and existing
restoration projects must be consistent with OPA's requirement that
damages recovered be used solely to restore, replace, rehabilitate, or
acquire the equivalent of injured natural resources and/or services.
Regional Restoration Plans or other existing restoration projects meet
this requirement if the plan or project will return injured natural
resources and/or services to baseline and/or compensate for interim
losses. Use of an existing plan or project may be considered as either
a primary or compensatory restoration action under the rule, depending
on the circumstances of the incident, injuries, and natural resources
or services provided by the plan or project.
Under the rule, selection of an existing plan or project as the
preferred restoration alternative requires that the plan or project had
been developed with public review and comment, or is subject to public
review and comment in accordance with the rule. The existing plan or
project must also be demonstrated to provide a sufficient link to the
incident in terms of the type and scale of natural resources and
services provided by the plan or project.
The rule also allows trustees to recover partial funding of
existing plans or projects from responsible parties, where a plan or
project that represents the preferred primary or compensatory
restoration for an incident will provide significantly greater levels
of natural resources and/or services than those lost as a result of the
incident. In these instances, trustees may request the scale of the
restoration determined to be appropriate for the incident of concern.
Trustees may pool such partial recoveries until adequate funding is
available to implement the existing plan or project. Trustees must make
diligent efforts to ensure that the selected project is implemented in
a reasonable time following initial recovery of partial funding.
Subpart F--Restoration Implementation Phase
I. Introduction
After the completion of the Restoration Planning Phase, the
trustees must: (i) close the administrative record that incorporates
the Restoration Planning Phase and open a new administrative record for
the Restoration Implementation Phase; (ii) present a demand for
implementation or for damages to the responsible parties; (iii)
establish an account to receive any payments from the responsible
parties; and (iv) implement restoration. Additional actions that could
occur during the Restoration Implementation Phase include filing an
action for damages where the responsible parties refuse to implement or
pay for restoration on receipt of the trustees' demand, or seeking an
appropriation from to the Oil Spill Liability Trust Fund, so that
restoration can be implemented.
II. Administrative Record
Within a reasonable time after completing restoration planning
under subpart E of the rule, the administrative record of the
Restoration Planning Phase must be closed. Except as noted below, no
additional documents will be placed in the record. The closed record
will constitute the body of information supporting the trustees'
decisions through restoration planning.
Once the record is closed, trustees may, as a general matter, only
add documents that:
(i) Are offered by any interested party that did not receive actual
or constructive notice of the Draft Restoration Plan and the
opportunity to comment on the Plan;
(ii) Do not duplicate information already contained in the
administrative record; and
(iii) Raise significant issues regarding the Final Restoration
Plan.
For practical reasons, it is likely that trustees will need to open
and maintain an additional administrative record to document
implementation of restoration. This record should document, at a
minimum, all Restoration Implementation Phase decisions, actions, and
expenditures, including any modifications made to the Final Restoration
Plan. This record is necessary to keep the public informed and for
potential use in any enforcement actions, such as seeking additional
work from the responsible parties to comply with the restoration plan
and implementing agreements. The record will also ensure an accurate
and complete accounting of all actions and
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costs associated with implementing the Final Restoration Plan.
The administrative record for restoration implementation should
follow the same guidance for opening and maintaining the previous
record, and for its availability as discussed in Sec. 990.45 of the
rule. The costs of maintaining the administrative record and making it
available to the public are part of the costs of restoration.
III. Presenting a Demand for Damages to the Responsible Parties
If the trustees and responsible parties have successfully
implemented cooperative restoration planning, the responsible parties
will have thorough knowledge of the trustees' preferred restoration
alternative(s) and associated costs. In the best circumstances, the
responsible parties will already have entered into an enforceable
agreement to either pay assessment costs and the costs associated with
implementing the Final Restoration Plan, or to implement the Plan
according to trustee performance criteria and with trustee oversight
and reimburse trustees for assessment and oversight costs. Any such
existing agreements with the responsible parties should be described in
the Draft and Final Restoration Plans.
However, where such an agreement with responsible parties has not
been achieved, the trustees must follow some specific statutory
requirements to recover natural resource damages, as described below.
After completion of restoration planning under subpart E of the
rule, the trustees must present a demand in writing asking the
responsible parties either to:
(i) Implement the Final Restoration Plan or component of a Regional
Restoration Plan or existing restoration project, subject to trustee
oversight, and reimburse the trustees for their assessment and
oversight costs; or
(ii) Advance to the trustees a specified sum representing
assessment costs and the trustees' estimate of all direct and indirect
costs associated with developing and implementing the Final Restoration
Plan or some component of a Regional Restoration Plan or an existing
restoration project, discounted as provided in Sec. 990.63 of the rule.
When the trustees use a Regional Restoration Plan, as provided in
Sec. 990.56 of the rule, the demand will invite the responsible parties
to implement a component of a Regional Restoration Plan or existing
restoration project or advance the trustees' estimate of damages based
on the scale of the restoration determined to be appropriate for the
incident of concern. To avoid litigation, the responsible parties must
respond within ninety (90) calendar days in writing by paying or
providing binding assurance they will reimburse trustees' assessment
costs and implement the plan or pay assessment costs and the trustees'
estimate of the costs of implementation.
The demand must also include: identification of the incident from
which the claim arises; identification of the trustees asserting the
claim and a statement of the statutory basis for their trusteeship; a
brief description of the injuries for which the claim is being brought;
the index to the administrative record; the Final Restoration Plan or
Notice of Intent to Use a Regional Restoration Plan or Existing
Restoration Project; and a request for reimbursement of reasonable
assessment costs, as defined in Sec. 990.30 of the rule and discounted
as provided in Sec. 990.63(b) of the rule; the cost, if any, of
conducting emergency restoration under Sec. 990.26 of the rule,
discounted as provided in Sec. 990.63(b) of the rule; and interest on
the amounts recoverable, as provided in section 1005 of OPA (33 U.S.C.
2705), which allows for prejudgment and post-judgment interest to be
paid at a commercial paper rate, starting from thirty (30) calendar
days from the date a demand is presented until the date the claim is
paid.
IV. Discounting and Compounding Components of the Claim
A. General
Discounting is necessary for the trustees to be able to present a
claim for a ``sum certain,'' as required by section 1001(3) of OPA (33
U.S.C. 2701(3)). The reference date for the discounting calculations is
the date at which the demand is presented. Trustees must discount
future restoration costs back to the present and compound assessment
and emergency restoration costs already incurred forward to the
present. The use of discounting in scaling restoration actions is
discussed separately in subpart E of the rule.
NOAA recommends that trustees use the U.S. Treasury borrowing rate
on marketable securities of comparable maturity to the period of
analysis for both calculations, with some qualifications noted below.
Alternatively, for state or tribal claims for past damage assessment
and restoration costs, the state or Indian tribe may use the state or
tribal borrowing rate on marketable securities. The analysis should be
conducted either in terms of nominal values (denominated in dollars of
the year in which the losses or gains are incurred) or in constant
dollars of a specified base year. For compounding past emergency
restoration and assessment costs, trustees should use U.S. Treasury
rate as the discount rate and represent the costs in nominal terms,
since the nominal interest is observed and past costs are likely to be
denominated in nominal terms. Anticipated inflation can be incorporated
in estimates of future restoration costs with an appropriate inflation
index.
B. Estimated Future Restoration Costs
Most restoration actions will be carried out over a period of
years. If funds are insufficient to cover the full costs of
restoration, including post-implementation maintenance and monitoring
operations, natural resource and service recovery will be incomplete,
and the public will be deprived of full compensation for the injuries.
NOAA recommends that, for discounting future restoration costs,
trustees specify future restoration costs in nominal terms (i.e., in
terms of dollars of the year in which the costs will be incurred) and
then discount the nominal costs using the nominal U.S. Treasury rate
for marketable securities of comparable maturity to the period of
analysis, when this rate of return is available to the trustees for
investment of settlement monies. To specify the future restoration
costs in nominal terms, the trustees should employ the indices of
projected inflation appropriate to the major components of the
restoration costs (e.g., construction price indices for construction
costs; the federal employee wage index for trustee monitoring costs).
If component-specific inflation indices are unavailable, the Gross
Domestic Product price index may be used.
If legal and/or institutional constraints prevent investment of
settlement monies yielding the U.S. Treasury rate for marketable
securities of comparable maturity to the period of analysis, trustees
should structure the claim to ensure that sufficient funds will be
available to fund the entire selected restoration alternative. One
option is to calculate the discounted value of this component of the
claim using an alternative discount rate that represents the yield on
settlement monies available to the trustees. An alternative option is
to structure a multi-year schedule for claim payments to ensure it
provides the cash flow for each year required for planned expenditures.
If the settlement is structured so that the responsible parties
carry out the restoration actions, the trustee restoration costs to be
discounted will be substantially reduced, but they will
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not be eliminated because trustee monitoring and oversight costs will
still be included in the claim.
C. Past Assessment and Emergency Restoration Costs
Past assessment and emergency restoration costs may accrue from the
time of the incident to the date of the demand. To calculate the
present value of these costs at the time the demand is presented to the
responsible parties, the trustees will compound forward the costs
already incurred. Because the rate of interest employed as the compound
rate for past costs incurred should reflect the opportunity cost of the
money spent, NOAA recommends that the trustees use the actual U.S.
Treasury rate for marketable securities of comparable maturity to the
period of analysis for discounting this component of the claim. NOAA
acknowledges that, at the discretion of the trustees, a state or tribal
borrowing rate may be used to compound the state or tribal component of
past costs. Where the costs are denominated in dollars of the year in
which they were incurred (i.e., in nominal terms), the nominal interest
rate should be employed.
D. Sources of Data
U.S. Treasury bill and bond rates may be found in the Federal
Reserve Bulletin, issued monthly, or the Treasury Bulletin, issued
quarterly. The Gross Domestic Product fixed-weighted price index and
the Consumer Price Index may be found in the Survey of Current
Business, issued monthly, and the Economic Report of the President,
issued annually. The Administration prediction for future Gross
Domestic Product deflators is updated twice annually at the time the
budget is published in January or February and at the time of the Mid-
Session Review of the Budget in July. The current Treasury rates and
inflation adjustment assumptions, as well as guidance in calculation
procedures, are reported in regular updates of Appendix C of Circular
No. A-94, available from the OMB Publications Office (202-395-7332).
V. Unsatisfied Demands
If the responsible parties deny all liability for the claim or fail
to settle the claim embodied in the demand within ninety (90) calendar
days after they are presented with the demand, trustees may elect to
commence an action in court against the responsible parties or
guarantors, or to seek an appropriation from the Oil Spill Liability
Trust Fund. Thus, delivery of the demand should be made in a manner
that establishes the date of receipt by the responsible parties.
Judicial actions and claims must be filed within three (3) years
after the Final Restoration Plan or Notice of Intent To Use a Regional
Restoration Plan or Existing Restoration Project is made publicly
available, in accordance with the statute of limitations for natural
resource damages under OPA (33 U.S.C. 2717(f)(1)(B) and 2712(h)(2)).
VI. Opening an Account for Recovered Damages
Section 1006(f) of OPA (33 U.S.C. 2706(f)) requires that sums
recovered by trustees in satisfaction of a natural resource damage
claim be retained, without further appropriation, in a revolving trust
account. Sums recovered for past assessment costs and emergency
restoration costs may be used to reimburse the trustees. All other sums
must be used to implement the Final Restoration Plan, implement all or
an appropriate component of a Regional Restoration Plan or existing
restoration project.
Where multiple trustees are involved in a recovery, trustees may
wish to establish a joint account. One acceptable mechanism would be an
account under the registry of the applicable federal court when there
is a joint recovery involving federal and non-federal trustees. The
joint account should be managed by the trustees through an enforceable
written agreement that specifies the parties authorized to endorse
expenditures out of the account, and the agreed-upon procedures and
criteria for such expenditures.
Although a joint account may be the preferred approach, trustees
also have the option of dividing the recoveries and depositing their
respective amounts in their own separate accounts, if such action would
be consistent with the terms and objectives of the restoration plan.
These accounts should be interest-bearing, revolving trust accounts.
Trustees may establish escrow accounts or any other investment
accounts, if otherwise authorized by law. Funds in such accounts must
only be used as specified in section 1006(f) of OPA (33 U.S.C.
2703(f)).
Trustees must maintain appropriate accounting and reporting
procedures to keep track of the use of sums recovered. Brief reports on
the status of the sums recovered and expenditures for particular
incidents should be made part of the administrative record for the
Restoration Implementation Phase.
Any sums remaining in an account established under this section
that are not used either to reimburse trustees for past assessment and
emergency restoration costs or to implement restoration must be
deposited in the Oil Spill Liability Trust Fund, as provided in section
1006(f) of OPA (33 U.S.C. 2706(f)).
VII. Additional Considerations
A. General
As discussed throughout the rule, the Final Restoration Plan may be
implemented by the trustees, or by the responsible parties with trustee
oversight. In either case, several common steps may characterize the
Restoration Implementation Phase, including establishment of a trustee
committee and/or Memoranda of Understanding, development of more
detailed workplans for the conduct of restoration actions, monitoring
and oversight, and evaluation of restoration success or need for
corrective actions.
B. Trustee Committee and/or Memorandum of Understanding
In many instances, it is likely that a trustee committee and/or a
Memorandum of Understanding or other agreements will have governed
trustee involvement through the Restoration Planning Phase. However, it
is critical that these agreements extend through the Restoration
Implementation Phase, or that new agreements or committees are formed
for the restoration implementation. At a minimum, representatives of
each participating trustee agency should be appointed to an oversight
committee. Functions of such a committee may include authorizing
expenditures from a joint account, participating in monitoring and
oversight of restoration actions, evaluating performance criteria for
restoration actions, and making the determination that the goals and
objectives of the Final Restoration Plan have been achieved or
determining the type of corrective actions that need to be pursued, and
ensuring that these actions are implemented.
C. Detailed Workplans
Depending on the incident and the restoration alternative(s),
detailed workplans for accomplishing restoration goals and objectives
may have been developed during the Restoration Planning Phase. Clearly,
as many details outlining the restoration expectations, performance
criteria, timelines, criteria for success, etc., should be included in
the Final Restoration Plan and in agreements with the responsible
parties as are practicable to determine prior to presenting the demand
or settling a claim.
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D. Monitoring and Oversight
Reasonable monitoring and oversight costs are included in
recoverable damages. A well-designed and executed monitoring and
oversight plan is required to assess progress toward the stated goals
and objectives of a restoration plan. Reasonable monitoring and
oversight costs are limited to those costs necessary to determine
restoration success, or the need for, type of, and scale of corrective
actions. Monitoring should be designed around performance criteria that
will indicate success of restoration.
E. Restoration Success and Corrective Actions
Restoration plans, particularly those including agreements for
responsible parties to implement restoration, must identify criteria
against which success and completion of restoration actions will be
judged.
In some cases, pilot projects will lessen the need for corrective
measures. In other cases, settlement agreements can include reopeners
to deal with specific points of uncertainty, for instance, for
significant injuries that could not be determined and/or quantified at
the time of a settlement. Another possibility is for the responsible
parties to deposit an agreed-upon amount of money in an escrow account
to cover future contingencies that could not be fully anticipated at
the time of the settlement. These funds would then be used for future
actions, or revert to the responsible parties if not needed. In most
cases, trustees should consider including a mechanism to deliberate the
need for and type of corrective actions in a settlement agreement where
the types of contingencies that suggest the need for corrective actions
cannot be completely foreseen.
In all cases, the type and scale of corrective actions must be
determined relative to the restoration goals and objectives set out in
the Final Restoration Plan. In addition, trustees must recognize that
circumstances well beyond the control of any of the parties may not be
the basis of requiring corrective actions, such as natural occurrences
that would meet an ``Act of God'' standard.
TREATMENT OF COMMENTS
Extension of Comment Period
Comment: Several commenters requested a 60-day extension in the
public comment period. These commenters stated that an extension was
required to strike the proper balance between the time allotted for the
public's review and comment, and the time needed for a thorough
analysis of comments on the proposed rule. According to some
commenters, the public's interest in having an adequate opportunity to
review and comment on regulatory initiatives under the Administrative
Procedure Act (5 U.S.C. 551-59, 701-06) should not be compromised by
the establishment of arbitrary deadlines. One commenter requested that
the comment period be extended for at least 60 days after the last of
the guidance documents is made available for public review, as a
thorough understanding and review of the guidance documents are
essential to adequately present comments on the proposed rule.
Response: NOAA has made every effort to consider all comments
submitted on the 1994 proposal, the August 3, 1995, proposed rule, and
comments expressed during the conferences held in August and September
of 1995. NOAA believes that the rule describes the assessment process
in sufficient detail, including listing of decision points,
determinations, decision criteria, and standards for selection of
procedures such that the guidance documents are truly complementary,
and not required to understand how to plan assessments in accordance
with this rule.
Subpart A
Section 990.10--Purpose
Comment: Many commenters supported the scope and direction of the
new proposal. Some of these commenters specifically noted that the
focus on restoration is a positive change. One of these commenters
stated that this approach will provide increased flexibility and
improve cooperation among trustees and responsible parties in achieving
restoration. Other commenters noted that this proposal is simpler and
more straightforward. Several of these commenters in particular
supported the move away from the use of claims based upon monetization
of natural resource values.
Response: NOAA notes and appreciates the support from the
commenters for the scope and direction of the rule.
Comment: While supportive of the new direction of the rule, one
commenter pointed out that, as a federal agency, NOAA should recognize
its fiduciary duty to Indian tribes and tribal natural resources, and
take care not to impinge upon the ability of the tribes to recover
damages.
Response: NOAA believes the rule's restoration focus will better
facilitate recovery of damages, while still allowing trustees,
including tribes, the discretion to apply whatever assessment approach
is most appropriate to the particular natural resources and services
injured by a given incident.
Comment: Another commenter suggested that NOAA should consider
reserving troublesome sections of the rule for future development,
perhaps through one or more Federal Advisory Committee Act (5 U.S.C.
App. 2) groups.
Response: NOAA does not believe that any provisions of the rule are
so wholly problematic to warrant the treatment suggested by the
reviewer. NOAA believes that the process embodied in the rule will
facilitate development of appropriate solutions to some questions that
can only be answered on an incident-by-incident basis.
Comment: One commenter stated that the new approach is an untried
theory, thus it is unclear whether this approach would be better or
worse than the approach under the CERCLA rule. Another commenter
suggested that the provisions in the proposed rule are vague, that
critical terms are undefined, and insufficient guidance is provided for
implementation of the approach. Another commenter noted that the
proposed rule fell short of providing trustees with a balance of
discretion and constraint needed to apply the still-developing science
of natural resource damage assessment within the dictates of the law.
Response: NOAA notes that the approach embodied in the rule is far
from untried, rather it embodies the approaches taken in some of the
most successful cooperative settlements reached to date. Trustees,
responsible parties, and interested members of the public must be
afforded the ability to respond to injuries resulting from incidents
that can vary greatly from incident-to-incident; in this respect,
natural resource damage assessment will never be a static field. NOAA
has defined more terms in the final rule. The rule provides technical
and legal boundaries within which assessments must fall to be in
compliance with OPA. For instance, restoration must be necessary and
linked to the injuries from an incident under the rule. Finally,
assessment procedures must be technically appropriate for the
circumstances of an incident while providing information of use in
determining restoration needs.
Comment: Some commenters argued that the excessive and arbitrary
assessments anticipated, given the rule's unlimited grant of discretion
to trustees, will result in unnecessary financial
[[Page 459]]
burdens that cannot be borne by the maritime industries. Some
commenters suggested that the effect of the rule will be to rid from
U.S. waters all forms of water craft, as well as to freeze businesses
potentially liable under the rule. Another commenter suggested that the
potential large recoveries allowed by the rule could threaten the
ability of private individuals and businesses who suffer quantifiable
economic losses as a result of incidents to obtain full and fair
compensation for their losses.
In contrast, several commenters argued that the new proposal is
significantly weaker than the 1994 proposal, with no justification
except industry pressure for an untested restoration-based approach
instead of the well-tested and supported economic valuation procedures.
The commenters suggested that this approach will lead to greater delays
in prosecuting and settling cases and that, to conform with the intent
of Congress, the rule must allow trustees greater discretion in
choosing assessment procedures or restoration options.
Response: The intent of the rule is solely to ensure that natural
resources and their services that are injured, destroyed, or lost as a
result of an incident will be restored where there is a need to do so,
and where feasible and cost-effective means to accomplish restoration
are available. The rule's focus on restoration will eliminate unneeded
assessment studies and prevent unnecessary adversarial conflicts over
misunderstood goals of trustees. This rule invites responsible parties
to act cooperatively and responsibly to seek expeditious and cost-
effective restoration, while clearly constraining trustees' actions to
those necessary to achieve OPA's restoration goals. Thus, costs and
damages will not be excessive or unpredictable. The rule has no
relation to private party claims that may be brought against
responsible parties under OPA, but the cost savings expected under the
rule from cooperation alone should alleviate fears that some third
parties will go uncompensated. In any event, uncompensated third party
claims may be presented to the Oil Spill Liability Trust Fund.
Section 990.11--Scope
Comment: One commenter requested that the rule clarify that its
provisions apply only to assessments being conducted under this rule,
not other causes of actions, for example causes under federal admiralty
or maritime law.
Response: NOAA has explicitly stated in the rule that the various
provisions of this rule would apply only to assessments being conducted
under this rule for purposes of bringing a natural resource damages
claim pursuant to OPA and thus do not affect claims brought under other
authorities.
Comment: One commenter stated that the rule should provide guidance
on how to distinguish trustee claims on behalf of the public from
private causes of action, particularly when natural resource injuries
are caused indirectly by an incident on private property.
Response: It is not possible for NOAA to describe all instances
where trustee and private party claims may appear to be duplicative.
NOAA notes that the rule requires that trustees determine their
jurisdiction to proceed under the rule, which includes a determination
that the trustees have relevant responsibility over natural resources,
as defined under OPA, that are expected to be injured by an incident.
However, the preamble now includes guidance in the discussion of
Sec. 990.22 for trustees to avoid double recovery of damages with
private parties.
Comment: A number of commenters remarked on NOAA's inconsistent
reference to what may be assessed and what may be restored under the
rule, by interchangeably using the terms ``natural resources and/or
services,'' and ``natural resources or services.'' Similarly, the
commenters suggested that the proposed rule inconsistently referred to
OPA's goal as making the ``environment and public whole,'' or simply
making ``the public whole.''
Response: The rule has been clarified to reflect OPA's intent to
make the environment and public whole for injuries resulting from an
incident. This intent is clear in OPA's reference to natural resources
themselves as the focus of restoration, and in the distinction between
restoration costs and diminution in value as elements of a claim for
damages. Complete and expeditious restoration may be the best way to
make both the environment and public whole.
Section 990.13--Effect of Rule
Comment: One commenter questioned why, if a foreign entity is a
trustee under OPA, such entity cannot receive the rebuttable
presumption.
Response: OPA does not, by its terms in section 1006(c)(1) (33
U.S.C. 2706(c)(1), grant the rebuttable presumption to foreign
trustees.
Comment: Some commenters noted that the preamble description of the
meaning of the rebuttable presumption, i.e., that the responsible party
has the burden of proving that the trustees' claim and determinations
are incorrect, is wrong. Instead, the commenters stated that the
rebuttable presumption is overcome when the preponderance of the
evidence indicates a different result. Similarly, other commenters
argued that section 1006(e)(2) of OPA (33 U.S.C. 2706(e)(2)) describes
the rebuttable presumption as applying only to the determination or
assessment of damages, therefore it is only the final amount of
damages, not the particular steps taken to reach that result that
receive the rebuttable presumption.
Response: NOAA has revised the rule to incorporate the statutory
language describing the provision of a rebuttable presumption for
assessments. In response to the comment regarding the meaning of such a
provision, NOAA interprets this presumption to mean that the
responsible parties have the burdens of presenting alternative evidence
on damages and of persuading the fact finder that the damage assessment
presented by the trustee(s) is not an appropriate measure of damages.
Comment: Several commenters expressed strong support for the
provision found in Sec. 990.20(b) of the proposed rule extending the
rebuttable presumption to state, local, and tribal assessment
procedures. Some of these commenters noted that this will promote
consistency by providing an incentive for the development and use of
state and tribal procedures that are consistent with the federal
approach, thus benefiting responsible parties who deal with trustees
from different regions of the country. One commenter noted that the
five listed requirements for consistency with the proposed OPA rule are
straightforward and should aid state, local, and tribal trustees in
efficient implementation of the rule. Other commenters supported the
provision, but suggested that the rule explicitly include compensation
schedules, models, and procedures that estimate expected injuries in
the language of this section. One commenter was concerned that it is
unrealistic to expect any given procedure will not conflict in some way
with the proposed OPA rule.
In contrast, several other commenters strongly objected to
extending the rebuttable presumption to state, local, or tribal
assessment procedures as being contrary to OPA. These commenters stated
that the criteria provided in the rule are far too general to
constitute substantive standards for the performance of assessments.
The commenters argued that NOAA has no authority to define the scope of
the rebuttable presumption since it is not a regulatory issue
implicating the assessment of damages, but is within the exclusive
province of the federal courts
[[Page 460]]
to address. The commenters stated that Congress intended the rebuttable
presumption to attach only to assessments performed under section
1006(d) of OPA (33 U.S.C. 2706(d)), and only according to substantive
standards promulgated by NOAA, and that NOAA may not delegate this
authority. One other commenter argued that it would be unfair to allow
the rebuttable presumption for the plethora of assessment procedures
now available.
Response: NOAA has revised Sec. 900.20 of the rule and removed the
explicit reference to state, local or tribal assessment procedures.
NOAA agrees that determining the scope of application of the rebuttable
presumption is not a necessary task in promulgating this rule. However,
NOAA notes that existing procedures that may be applicable to assessing
natural resource injuries and restoration needs may be used for
assessments under this rule, regardless whether those procedures were
promulgated under state laws respecting natural resource damage
assessment, developed through private scientific research, or developed
or adapted by the parties assessing the injuries of a particular
incident. It is not feasible to identify all assessment procedures, nor
the varied ways of applying such procedures, that will constitute
reliable and valid technical application for all potential incidents.
Thus, this rule specifies standards, in Sec. 990.27, that must be met
in order for any particular procedure to be used and deemed in
accordance with this part.
Comment: One commenter stated that the rule does not provide
sufficient guidance to determine whether trustees' discretionary
actions are cost-effective, technically feasible, or in accordance with
generally accepted scientific practices. Therefore, assessments
conducted pursuant to this rule should not be granted a rebuttable
presumption. Another commenter, also arguing that it would be unfair to
grant a presumption to procedures that are speculative and unproven,
suggested that implementation of the rebuttable presumption be delayed
until there is more experience with restoration and valuation
procedures.
Response: NOAA believes that the rule does provide the appropriate
constraints and standards for fashioning assessments that will be
technically sound, cost-effective, and reliable. The assessment focuses
on determining only the types and amounts of restoration required given
the particular injuries resulting from individual incidents. A
requirement to use ``generally accepted scientific practices'' would
result in overly-costly assessments in most instances, as the goals of
research science may be different than the goals of science for
purposes of natural resource damage assessment and restoration.
Finally, procedures cannot be deemed to be reliable or unreliable out
of context; the merits of different procedures will vary depending on
how they are proposed to be used in a given incident scenario. This
judgment will be made by trustees, in an open record atmosphere, with
input from responsible parties and the public.
Use of Other Assessment Procedures, and the Scope of the Rebuttable
Presumption
Comment: Several commenters took issue with the provision in the
proposed rule that allowed the rebuttable presumption to apply to other
procedures in lieu of or in addition to the process described in this
rule so long as the other process is ``in accordance with this part.''
The commenters stated that Congress intended the assessment to function
as an integrated unit with each step in the process leading logically
to the next. The commenters also cited the Ohio decision (Ohio, et al.,
v. U.S. Department of the Interior, 880 F.2d 432 (D.C. Cir. 1989)) as
specifically emphasizing that the rebuttable presumption is
particularly appropriate given adherence to all of the regulatory
procedures that, in their totality, result in a logical, disciplined,
efficient, and cost-effective assessment. Several commenters argued
that such a provision is contrary to the statutory goal of cost-
effectiveness. Some commenters also found the language of the provision
both confusing and internally inconsistent because it would be
impossible for ``another'' process, which is a process other than one
included in the rule, to still be a process that is ``in accordance
with'' the rule.
Response: To eliminate confusion, NOAA has deleted the section
referring to other procedures from the final rule. The rule provides
procedural and substantive standards in Sec. 990.27 that must be
complied with in order for an assessment to be judged ``in accordance''
with this rule. Trustees must demonstrate that their assessments are in
accordance with this rule on an incident-by-incident basis in order to
obtain the rebuttable presumption.
Section 990.14--Coordination
Coordination Among Trustees
Comment: Several commenters argued that the rule should require,
and that OPA mandates, trustee coordination during assessments to avoid
an adversarial and litigation-charged atmosphere among trustees and
prevent double recovery of damages. Another commenter suggested that
the rule limit the number of trustees to those who have clear
restoration concerns for a particular incident. Some commenters
suggested that the rule deny the rebuttable presumption to trustees who
do not coordinate, while others suggested that an affirmative proof
burden of certifying a lack of double recovery should be placed on non-
coordinating trustees. Some commenters requested that model MOUs for
trustee coordination be included in the rule, while others who support
trustee coordination and incident-specific coordination agreements,
applauded the omission of any model agreements.
Response: Changes to the rule state that trustees should coordinate
their assessments in order to ensure there is no double recovery of
damages. NOAA believes that any claimant that files what appears to be
a duplicative claim for natural resource damages against a responsible
party will face a substantial burden of proof to demonstrate that the
claim has not already been satisfied. NOAA notes, however, that it is
conceivable that claims for distinct natural resource injuries
resulting from an incident could be effectively processed independently
by trustees without double recovery of damages. Finally, NOAA strongly
supports development of agreements among trustees, but realizes from
experience that it is not feasible to specify a single workable model
for all trustees, locales, and incidents.
Comment: Several commenters supported the designation of a Lead
Administrative Trustee (LAT), so long as the rule provides flexibility
in this designation. These commenters suggested that the rule allow for
co-LATs or sequential LATs, recognizing that one trustee may be the
lead for restoration planning while another trustee might be the lead
for the implementation phase. One of these commenters stated that
designation of an LAT should not be mandatory. Another commenter
suggested that, in cases where an incident affects multiple trustees,
the state trustee should be the LAT because of superior knowledge of
``local'' natural resources. Still other commenters argued that the
rule should vest arbitration authority in a lead trustee, citing the
Ohio decision as stating that such a provision is ``entirely
reasonable.'' The commenters stated that arbitration authority would be
essential to settling disputes among trustees, which might disrupt
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cooperative efforts among trustees and responsible parties.
Response: It has been NOAA's experience that an LAT is essential to
efficiently and cost-effectively manage most assessments. Executive
Order 12,777, section 1 (56 FR 54757, October 22, 1991), requires
Federal trustees to designate one trustee to act as Lead Administrative
Trustee for incidents at which more than one federal trustee is
involved. NOAA has amended the rule to allow for co-LATs or sequential
LATs. NOAA does not believe it is necessary, advisable, or within legal
authority to mandate that state trustees always serve as LATs. Finally,
NOAA believes it is unnecessary to provide for arbitration or veto
authority in a single trustee, given the experience that demonstrates
trustees have been successful in a consensus decisionmaking approach to
assessments.
Comment: One commenter specifically asked that the rule address the
issues associated with a trustee agency who might also be a responsible
party at an incident. The commenter suggested that the trustee/
responsible party would want to work closely with co-trustees to
develop a restoration strategy, but recognizes that, in doing so, would
open itself up to the risk of shared information being used against it
as a responsible party. The commenter also asked if the co-trustees
could exclude the trustee/responsible party from the assessment if the
trustee/responsible party could not afford to fund the assessment
activities. Other commenters stated that the rule should specifically
preclude a trustee agency that is also a responsible party for a
particular incident from being eligible to be an LAT for that incident.
The commenters suggested that such a provision would avert conflicts of
interest, minimize problems of public perception, and help the trustee/
responsible party fulfill its dual obligations.
Response: NOAA notes that the rule cannot exclude participation by
any trustee. Where a trustee is also a responsible party, all of the
co-trustees may want to determine among themselves the nature and
extent of involvement by any given trustee. Generally, participation
should not be denied unless it would impede the assessment or be an
inherent conflict of interest.
Coordination With Response Agencies
Comment: One commenter suggested that the rule explicitly state
that restoration actions by trustees are intended to supplement the
initial response and cleanup activities of response agencies. Another
commenter suggested that the rule require that response agencies
coordinate with trustees.
Response: NOAA agrees that restoration actions by trustees are
intended to supplement the initial response and cleanup activities of
response agencies. NOAA believes that response agencies and trustees
should coordinate during the response phase to prevent or minimize
residual injuries to natural resources that would require restoration.
However, OPA does not grant NOAA authority to place requirements on
response agencies.
Coordination With Responsible Party
Comment: Several commenters stated that early and substantial
involvement of the responsible party in the assessment would
significantly reduce the threat of litigation and facilitate cost-
effective, feasible restoration. Some of these commenters, however,
stated that the rule language is somewhat ambiguous and vague as to the
timing and extent of that participation, as well as the extent of the
trustees' discretion in excluding or refusing to continue responsible
party participation. These commenters suggested that the rule should
provide for mandatory participation by the responsible party, unless
the trustee can demonstrate that such participation will interfere with
trustees' fulfilling their responsibilities under the rule and OPA. One
of these commenters suggested that the rule provide that the parties
seek mediation if reasonable disagreements develop, to prevent trustees
unfairly characterizing the responsible party as interfering. Another
commenter stated that the responsible party should be involved in the
entire process as soon as trustees arrive on site and that the trustees
should not be allowed to exclude a responsible party unless there is
clearly documented evidence that the responsible party is intentionally
undermining the process. Another commenter suggested that the rule
encourage the parties to enter into an agreement respecting the
coordination of responsible party participation, with trustees
prohibited from imposing conditions that are not directly related to
the efficient coordination of the process.
Other commenters expressed concerns with participation by the
responsible party. These commenters argued that the rule should ensure
that trustees have the discretion as to whether, when, and how the
responsible parties are permitted to participate and when the trustees
will be able to dismiss a responsible party that is interfering with
the process. One commenter also suggested that the decision to exclude
a responsible party from the process should not be reviewable, so that
trustees would not have to divert time and resources in defending that
decision. Several commenters stated that the rule needs to be
consistent among sections in the provisions for responsible party
participation. Some commenters pointed out that the responsible party's
role is unique from that of the public represented by the trustees, in
that the responsible party has an interest in protecting the investment
of its owners and stock holders, and that this natural conflict of
interest should be acknowledged by the rule.
Some commenters suggested additional or alternative considerations
for responsible party participation, including the level of cooperation
provided by a particular responsible party in prior incidents and the
willingness of the responsible party to defer to the trustees' final
decisions. Other commenters stated that the responsible party should be
subject to the same administrative record rules as the trustees and,
therefore, be precluded from assembling experts and data outside the
public process. One commenter noted that a need for funding should not
be a determining factor in involving the responsible party in the
assessment, while another commenter stated that the rule should require
that the responsible party fund the assessment, requiring that the
responsible party place the trustees' estimate of costs in escrow.
Response: NOAA believes that open and cooperative assessments
performed by trustees and responsible parties can result in the most
expeditious and cost-effective assessments and restoration. NOAA has
clarified the rule to require trustees to invite identified responsible
parties to participate in the assessment as early as practicable, but
no later than issuing the Notice of Intent to Conduct Restoration
Planning. NOAA has also clarified the rule to indicate that it is
within trustees' authority to determine to what extent responsible
parties may participate, and that trustees can terminate or limit
responsible party participation if it interferes with trustees
fulfilling their statutory obligations. The rule specifies that the
minimum level of participation that will be afforded to responsible
parties is notification of all determinations required by trustees
under the rule, and notice and comment opportunity on all documents
that may significantly affect the direction or outcome of assessment
decisions. In no
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event may trustees delegate essential statutory decisionmaking powers
to responsible parties. The rule also now includes guidance, such as
that suggested by the commenters, to determining the nature and extent
of responsible party participation. Responsible party funding is not a
pre-condition to their participation. The rule also strongly encourages
formal agreements between trustees and responsible parties so as to
ensure cooperation and cost-effectiveness. The parties are encouraged
to reach agreement on a list of facts, such as the natural resources
injured, the extent of injury, the most appropriate assessment
procedures to determine injury and/or restoration needs, and how the
results of the procedures will be interpreted.
Public Involvement
Comment: Several commenters noted that public involvement should be
clearly designed so as not to detract from the primary goal of
restoration in a timely manner. One commenter suggested a graded
approach to public involvement. Some commenters noted the potential
expenses of public involvement. One of these commenters stated that
increased costs of public outreach efforts should be explicitly
included in recoverable assessment costs or trustees will be unable to
comply with these requirements. Another commenter stated that trustees
should be required to give notice to the responsible party regarding
the stages at which opportunities for public involvement will be
provided. One commenter, however, stated that the rule should expand
the provisions for public involvement and allow such involvement in
several stages of the process.
Response: Public involvement is required by OPA in development of
restoration plans. NOAA considers that this requirement will be
fulfilled by allowing, at a minimum, opportunities for public
involvement in development of draft and final restoration plans that
will form the basis of any claim for damages. However, NOAA notes that
it may be advantageous or necessary to seek broader public input,
depending on the circumstances of a particular incident, particularly
when that input can be obtained from members of the public that may
have particular expertise concerning the affected environment or
proposed assessment or restoration approaches. NOAA is mindful that
restoration decisions made by trustees are made on behalf of the
public, so public involvement should augment the decisionmaking
process. Involving the public does not need to be excessively costly if
it is well-planned and tailored to the incident. The costs of public
involvement required by OPA are recoverable assessment costs. Finally,
as a member of the affected public, responsible parties will be
notified when trustees seek public input.
Section 990.15--Facilitation of Restoration
Comment: Several commenters expressed strong support for pre-
incident planning, some stating that such exercises should be required
by the rule. Some of these commenters pointed out that the rule should
encourage involvement of response agencies, natural resource managers,
and area industry representatives in the planning process. The
commenters also requested that the rule clarify how these plans might
be coordinated with or included in Area Contingency Plans or U.S. Fish
and Wildlife Service Recovery Plans and Habitat Conservation Plans. One
commenter specifically suggested that the rule add consideration of
pre-incident baseline and injury data-collection procedures and
protocols to the list of possible pre-incident planning activities. One
commenter asked for clarification as to whether pre-incident planning
would be subject to NEPA.
Response: NOAA has clarified the rule to indicate that potentially
responsible parties, appropriate response personnel, local governmental
natural resource management entities, and local environmental groups or
representatives should be included in any pre-incident planning. NOAA
does not believe it has the authority to mandate pre-incident planning
under this rule, but does note that Area Contingency Plans or U.S. Fish
and Wildlife Service Recovery Plans and Habitat Conservation Plans may
provide an efficient focal point for structuring pre-incident damage
assessment planning. Finally, NOAA does not believe that pre-incident
planning is subject to NEPA, except where Regional Restoration Plans
serve as, or become part of, a programmatic Environmental Impact
Statement process.
Comment: One commenter supported further development of Regional
Restoration Plans with extensive federal and state natural resource
agency coordination. The commenter noted, however, that funding for
such planning activities is in question and asked for any information
on available funding sources for such plans, other than recovered
damages.
Response: NOAA believes that activities such as identifying
planned, proposed, or desired environmental restoration projects,
particularly for areas expected to be injured often or severely by
incidents, can provide a highly cost-effective means to identify
appropriate restoration alternatives for particular incidents. NOAA
suggests that development of these project databases can be a useful
addition to pre-incident planning activities. Funding for these
activities may come from a variety of sources such as joint funding by
trustees and those parties potentially liable under OPA for
restoration. Regional restoration planning in some areas is already
being performed pursuant to other authorities, such as the National
Estuary Program Plans.
Section 990.16--Review of Rule
Comment: Some commenters expressed support for NOAA's commitment to
review and revise this rule every five years, especially with the need
to keep the OPA rule consistent with the CERCLA rule, which is reviewed
every two years.
Response: NOAA has determined that the specific five-year review
provision is unnecessary. NOAA is committed to maintaining the accuracy
and relevance of the assessment process described in the rule and will
make every effort to keep it current.
Subpart B
Section 990.20--Relation to CERCLA Rules
Comment: Several commenters spoke of the need for consistency
between the OPA and CERCLA rules, with one reviewer stating that the
proposed OPA rule does not seem to be coordinated with the CERCLA rule.
Another commenter asked, given that the OPA rule is substantially
different from the CERCLA rule, whether DOI will incorporate OPA rule
changes into its regulation so that it is effective for incidents
inland and in the Great Lakes areas, or whether trustees and
responsible parties have to operate within two separate processes.
Another commenter suggested that the OPA rule is confusing in its
discussion about where the OPA rule will supersede 43 CFR part 11.
Response: The Department of the Interior participated in the
interagency working group that drafted and reviewed the OPA rule. Thus,
NOAA and DOI took advantage of the experience gained in applying the
CERCLA rules. The rule was also formulated in recognition of the
differences between oil and hazardous substances, and the different
nature of
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the incidents involving these two types of products. NOAA has referred
questions regarding incorporation of OPA rule provisions into the
CERCLA rule to DOI. However, it should be noted that the OPA rule does
apply to incidents in all navigable waters, which would include inland
incidents and incidents in the Great Lakes. NOAA has clarified the rule
to incorporate statutory language regarding where the OPA rule
supersedes 43 CFR part 11.
Comment: One commenter questioned whether coal tar and other coal-
derived chemicals are more appropriately classified as hazardous
substances, and covered by CERCLA rule, rather than the OPA rule.
Response: NOAA notes that whether coal tar and other coal-related
chemicals are oils or hazardous substances is an on-going issue that is
being evaluated by the federal agencies implementing OPA.
Section 990.22--Prohibition on Double Recovery
Comment: One commenter suggested that requiring consideration of
independent actions of other trustees may not be possible if trustees
are acting separately rather than together.
Response: Trustees must diligently avoid double recovery of
damages. In NOAA's experience, the identity of other trustees with
interests in incidents has always been ascertainable early in the
process, thus facilitating efforts to coordinate assessment objectives
and activities.
Section 990.23--Compliance With NEPA and the CEQ Regulations
Comment: Some commenters noted that rigid compliance with NEPA
notice requirements may not be desirable or necessary for incidents
involving non-federal trustees, and that these notice activities should
be optional at trustees' discretion. The commenters also suggested the
rule should explicitly state that the provisions of the rule fulfill
the public notice requirements of NEPA, even without providing the
Notice of Intent to Conduct Restoration Planning.
Response: The rule has been amended to indicate that NEPA
compliance is solely a federal trustee requirement, and that the
procedures entailed in compliance will vary depending on the identity
of federal trustees involved and their regulations governing their own
NEPA conduct. The notice requirements contained in various sections of
the final rule are not related solely to NEPA compliance, but are
important elements to facilitate the open and cooperative process
envisioned in this rule and OPA.
Section 990.25--Settlement
Comment: Some commenters were concerned that the U.S. Department of
Justice (DOJ) will impede settlements, that state trustees can restore
natural resources in a more efficient manner through administrative
agreements, and that the rule should provide guidance for the scope and
timing of DOJ participation. One of these commenters suggested that DOJ
taking 3% of settlement sums for participation is unwarranted and,
perhaps, an improper use of restoration money.
Response: Except where explicitly provided by statute, only the
Department of Justice has the authority to compromise claims of the
United States. One of these exceptions, applicable to some federal
trustees operating under OPA, is a provision allowing executive
agencies to compromise claims within their authority when such claims
do not exceed $100,000, or such other amounts as the Attorney General
may from time to time prescribe (33 U.S.C. 3711). The Department of
Justice plays a vital role in ensuring that the laws of the United
States are applied similarly by different federal agencies. The costs
to the Department of Justice of collecting recoveries for claims of the
United States in civil litigation, as authorized by H.R. 2519 (November
16, 1993), should be included in the estimated costs of the assessment
so that restoration money is not impacted.
Comment: Several commenters disagreed with the rule's provisions
concerning terms of settlements. One commenter argued that the decision
to accept such a settlement should be within the discretion of a
trustee, so long as it is reasonable and justified. Some commenters
stated that this provision could be read as establishing substantive
standards to govern adequacy of a settlement, which would be
inappropriate and outside NOAA's authority. Several of these commenters
suggested that the rule simply provide that settlement sums may only be
expended in accordance with a restoration plan that is made available
for public review.
Response: NOAA has revised the settlement provision, now
Sec. 900.25, to reflect the standard of review that federal courts have
used in reviewing natural resource damage assessment settlements under
other laws, and settlements by federal agencies in general. Federal
courts will look favorably upon the determination by an agency
entrusted with authority to prosecute laws that a settlement of a claim
is in the public interest--that it is fair, reasonable, adequate, and
consistent with the purposes of the governing statute. With respect to
OPA, NOAA expects that a court will look to see that a trustee has made
a determination of the adequacy of the settlement to restore,
rehabilitate, replace, or acquire the equivalent of the injured natural
resources and services. NOAA recognizes that in reviewing an agency's
action in accepting a settlement a court will also look to such factors
as litigation risk, time and expense to litigate, and advantages to
obtaining an immediate recovery through settlement, rather than through
litigation.
Section 990.26--Emergency Restoration
Comment: One commenter argued that the On-Scene Coordinator (OSC)
must authorize emergency restoration and that trustees act in a
consultative role during the removal phase. Another commenter suggested
that any emergency restoration action had to be tied into the National
Response System to alleviate any potential contradictory actions or
interference with the OSC's actions. One commenter suggested that
trustees do not have independent authority to act or intervene in
response activities during that phase. This same commenter noted,
however, that the requirement that responsible parties and the public
be notified of emergency restoration actions, with the responsible
parties additionally being invited to participate, will tend to foster
cooperation and trust. Another commenter asserted responsible parties
should be invited to participate at first notice of an emergency, not
within a ``reasonable time frame.'' Several commenters supported
allowing responsible parties to implement emergency restoration.
Another commenter suggested that notice to the public or responsible
parties should be discretionary due to the time-sensitive nature of
such actions.
Response: NOAA fully agrees that any actions conducted during the
response phase should not interfere with nor be independent of the
OSC's activity. The rule is clear that the OSC must be notified prior
to implementation of emergency restoration actions by trustees, and
that emergency restoration may not interfere with response actions.
Further, the rule requires that any emergency restoration actions must
be coordinated through the trustee Regional Response Team (RRT) member
or designee, since the RRT is a part of the National Response System,
and that this member must work through the OSC to ensure adequate
coordination. In addition, the National Oil and
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Hazardous Substances Pollution Contingency Plan (NCP), 40 CFR part 300,
is clear on the types of and procedures for coordination between the
trustees and the OSC, who retains overall responsibility for activities
during response. However, only trustees, not response entities, have
the authority to assess injuries and collect restoration costs under
OPA. NOAA has clarified the rule to indicate that known responsible
parties must be notified and invited to participate in emergency
restoration actions, to the extent time permits. Notice to the public
is provided to the public, to the extent practicable, of these planned
emergency restoration actions.
Comment: Another commenter noted that the requirement that
emergency restoration costs should not be unreasonable appears to
appropriately suggest that trustees must affirmatively demonstrate the
reasonableness of such costs, without any entitlement to the rebuttable
presumption.
Response: If trustees responsibly make a determination that
emergency restoration is needed to prevent or minimize natural resource
injury, that the action is feasible and likely to succeed, and that the
costs of such action are not on their face excessive compared to the
expected benefits in limiting injury, then emergency restoration
actions and costs are reasonable, and entitled to a rebuttable
presumption.
Comment: Another commenter questioned whether there are any
exclusions for liability for damages resulting from any additional
injuries caused by the emergency restoration or response actions.
Response: Liability for natural resource damages extends to
injuries that result from reasonable and necessary response and
emergency restoration actions taken in response to an actual or
threatened discharge of oil.
Section 990.27--Use of Assessment Procedures
Criteria for Selecting Assessment Procedures--General
Comment: One commenter noted that the greater flexibility in
assessment procedures provided by the proposed rule is likely to result
in greater likelihood of litigation. Another commenter suggested that
such flexibility may result in trustees applying numerous procedures,
charging the responsible party with these costs, then basing their
claim on the procedures that yield the highest damage figure. Another
commenter stated that the trustees should be required to document the
decision as to why a particular assessment procedure was chosen.
Other commenters, however, agreed with the rule listing criteria
that assessment procedures should meet, rather than specifying
acceptable procedures themselves. Some commenters suggested that
trustees must be provided flexibility to select the most efficient
procedure to assess injuries, based upon factors such as reasonable
cost, validity, reliability, and incident-specific considerations,
however, one of these commenters suggested that the rule should simply
require that procedures be reliable, valid, and cost-effective as
minimum criteria and that other incident-specific factors should be
considered in selection of procedures.
Response: In eliminating categories of assessment procedures, and
providing instead a list of standards to guide selection of the most
appropriate assessment procedure for the injury and incident at hand,
the rule will make assessments less rigid and more cost-effective, and
NOAA expects this will reduce litigation by fostering cooperative
settlements. The rule expressly prohibits the approach suggested by the
commenter in which trustees may apply a suite of procedures to produce
the highest damages estimate, and charge for all of the procedures
used. This approach would clearly violate provisions of Sec. 990.27 and
the definition of reasonable assessment costs. Finally, standards for
selecting assessment procedures, and the types of assessment procedures
available, are now included in Sec. 990.27.
Comment: Most commenters applauded the approach taken in subpart E
of the proposed rule to provide generic standards for possible
assessment procedures, given the universe of procedures available and
possible injuries likely to result from incidents. However, several
commenters were concerned that some of the proposed criteria might be
mutually exclusive and difficult to meet for all incidents. For
instance, one commenter noted that procedures that meet the criterion
that procedures must provide information useful in determining and
quantifying restoration needs, might not be the most cost-effective
procedures. The commenter also noted that procedures that provide
information required for restoration determinations may entail
additional costs with no assessment benefit, violating the requirement
for consideration of cost. Some commenters suggested that none of these
criteria be mandatory, or that only the ``cost-effectiveness'' and
``valid and reliable'' criteria might be appropriately mandatory.
Response: The standards for acceptable procedures were moved from
subpart E of the proposed rule into a new section, Sec. 990.27, to
emphasize that these standards apply to any and all procedures used in
performing assessments under this rule. Procedures must meet the
standards in order to be deemed part of an assessment in accordance
with this rule. The concerns that one standard may be contrary to
another have been resolved. The standards now provided in Sec. 990.27
must all be met, but the criterion concerning restoration information
has been changed to a recommendation, rather than a requirement, in
recognition that procedures that provide information useful in
restoration scaling are not always available, nor are they always cost-
effective.
Comment: Some commenters were concerned that the criteria requiring
cost-effectiveness and weighing benefits of a procedure against its
costs might be interpreted to require strict cost-benefit analyses of
all possible procedures, inappropriately diverting trustee efforts from
assessment work, and needlessly driving up costs. A few other
commenters suggested that strict cost-benefit analyses should be
required. One commenter suggested that the balance should more
appropriately weigh expected assessment costs against overall expected
damages, because assessment costs cannot be meaningfully scrutinized
relative to expected informational benefits from an assessment
procedure.
Response: The various standards for procedures were never intended
to require a strict cost-benefit analysis. The rule language has been
revised to indicate that additional costs of more complex procedures
must be reasonably related to the expected increase in information
provided by those procedures. The standards are intended to guide
trustees in selecting individual assessment procedures and discourage
trustees from using procedures that do not provide information
beneficial for restoration planning purposes.
Comment: Some commenters suggested that the terms ``reliable'' and
``valid'' should be expressly defined. Various definitions were offered
by the commenters.
Response: The technical definitions of the terms ``reliable'' and
``valid'' vary in usages of the terms across various disciplines. In
general, under this rule, these terms refer to technical judgments by
experts in a particular field that a procedure is consistent with best
technical practices for the measure
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being investigated under the circumstances.
Specific Procedures
Comment: Many of the commenters' discussion on assessment
procedures focused on how specific procedures might relate to the
standards provided in the rule. Some commenters were concerned that the
listing of procedures in the appendix to the preamble might be
interpreted as an endorsement of those procedures. The commenters
requested that the rule state that procedures that do not meet the
criteria are not entitled to the rebuttable presumption. The commenters
noted that, if specific procedures are listed in the preamble, NOAA has
a duty to provide additional standards relating to the use of such
procedures, either in the rule or in guidance documents. Other
commenters stated that the rule should clarify that reliable and valid
procedures are not limited to those specifically listed in the preamble
and should not necessarily be excluded from use under the rule.
Response: Assessment procedures must meet the standards in the rule
in order to be deemed part of an assessment conducted in accordance
with this rule. No explicit or implicit endorsement, nor lack of
endorsement, is intended to be given to the specific identification or
omission of any particular procedure in either the preamble or rule. It
is not feasible for the rule to identify all acceptable procedures, nor
the acceptable applications of those procedures, for all possible
circumstances of all incidents. Procedures and their applications must
be evaluated on a case-by-case basis.
Comment: A number of commenters stated that NOAA should not
establish requirements for use of procedures and strongly supported
NOAA's decision to remove specific guidance on the application of
certain procedures (e.g., contingent valuation, benefits transfer). The
commenters suggested that discussion on how to apply specific
procedures should be placed in guidance documents. One commenter
suggested that the rule should allow trustees to use any criteria that
are generally accepted by the scientific community. One commenter
stated that the four criteria listed in the rule are still
insufficient, and could be strengthened by distilling the most
important guidelines in the guidance documents into rule language so
that they will be binding upon trustees.
Response: NOAA believes that discussion on the appropriateness and
use of specific assessment procedures is more suited to guidance
documents. The commenters should refer to these guidance documents as
well as the literature for support along this line.
Comment: Another commenter asked that the rule clarify that
trustees may use models or extrapolate from literature when it is more
appropriate and cost-effective than gathering site-specific data.
Response: The rule, in Sec. 990.27, provides that such procedures
as models or literature extrapolation that meet the standards for
acceptable procedures are available for use in accordance with the
rule.
Option of Responsible Party to Request Alternative Procedures
Comment: Some commenters argued that trustees should be required to
use an incident-specific procedure when the conditions in the rule are
met. However, the commenters stated that the conditions currently in
the rule are contrary to OPA because they force the responsible party
to waive the right to challenge the reasonableness of the assessment
costs. The commenters argued that this would force responsible parties
to choose between using a procedure that may assess non-existent
damages and waiving their statutory right to expect reasonable
assessment costs. Another commenter noted that the responsible party
should not have to advance the assessment costs if the responsible
party can demonstrate that an incident-specific assessment is really
appropriate and warranted. Some commenters also suggested that the rule
specify a time frame for the responsible party request, such as 21 days
from the time of the incident, rather than the ambiguous ``acceptable
time frame'' currently in the rule.
One commenter pointed out that responsible parties would want to do
expanded assessments in any case in order to assist in the defense of
third party claims.
Some commenters noted that detailed field studies may be expensive
and in those instances where the likelihood of injury is so high as to
not require extensive study, trustees and responsible parties may agree
that non-field-based procedures may be used.
Other commenters argued that the ultimate decision on assessment
procedures should always be left to the trustees. The commenters
suggested that, if trustees determine that procedures selected by a
responsible party are technically unsound or would inadequately address
natural resource injuries, then the trustees should have the ability to
modify or reject the request. Some commenters also noted that the rule
should be clarified to state that the responsible party must advance
the trustee's estimate of the costs of conducting the incident-specific
assessment.
Response: The final rule has clarified, in Sec. 990.14(c), the
conditions for the responsible party option to request a different
procedure than that selected by the trustees. The option will be
provided to responsible parties who have accepted the trustees'
invitation to participate in an assessment, and who are doing so
cooperatively. Alternative procedures proposed by the responsible party
must meet the standards for acceptable procedures provided in
Sec. 990.27. The rule allows trustees to reject the responsible party's
request if the alternate procedure, in the judgment of trustees, is not
technically feasible, not technically or scientifically sound, and
could not be completed within a reasonable time frame. Because
participating responsible parties will have already been afforded
opportunity to review and comment on proposed procedures that trustees
have selected in accordance with Sec. 990.27, the responsible party
option is really a mechanism to resolve disputes between trustees and
responsible parties as to the most appropriate procedure for the injury
and incident at hand. Responsible parties should be willing to fund
alternative procedures they feel strongly about, given that trustees
will have already made a determination that other procedures are
appropriate, and they should agree not to challenge the results of
procedures that they request be used. The rule has removed the
requirement that responsible parties agree not to challenge the costs
of those requested procedures.
Simplified Procedures--General
Comment: Several commenters raised objections to the use of
simplified assessment procedures. Several commenters argued that all
existing simplified procedures, federal and state, are flawed and
unreliable. The commenters argued that these procedures should not be
used without any field verification. Several of these commenters stated
that any procedure that generates average values is by definition not
incident-specific as required by OPA, basic requirements for proof of
injury and causation in tort, and recent case law on causation
requirements.
Several commenters argued that there are strong statutory arguments
against simplified procedures under OPA. Some of these commenters
stated that the wording of the various sections of OPA that set forth
the natural resource damage provisions and describe liability
[[Page 466]]
under OPA all explicitly speak to direct impacts ``resulting from'' a
particular incident, not some speculative concept of what might have
resulted from the incident. The commenters cite section 1002(b)(2)(A)
of OPA (33 U.S.C. 2706(b)(2)(A)), ``damages . . . that result from such
incident,'' and section 1006(e)(1) of OPA (33 U.S.C. 2706(e)(1))
calling for rules to assess damages ``resulting from the discharge of
oil.'' These commenters also noted legislative history associated with
these provisions in OPA. A House Committee Report (H. Rep. No. 241,
Part 1, 101st Cong., 1st Sess. at 34(Sept. 13, 1989)) is quoted
supporting recovery for ``the natural resources that were injured.''
Also quoted was the Committee of Conference Report (H.R. (Conf.) Rep.
No. 101-653, 101st Cong., 2d Sess. (1990) at 103) which refers to
damages ``resulting from an incident.'' These commenters also argued
that Congress rejected simplified procedures under OPA because an early
draft of a Senate bill (S. 686, 101st Cong., 1st Sess.,
Sec. 102(d)(3)(A)(1989)) calling for simplified assessments was not
incorporated into the final bill. The commenters stated that Congress
could have adopted the type A model, which was in existence during the
development of OPA, but didn't. In fact, the commenters noted that the
Conference Report (at 109) explicitly states that the OPA rule, not the
CERCLA rule, which contains the type A model, would apply to
assessments under OPA.
Some commenters referred to the procedures and requirements
promulgated by the U.S. Department of Transportation concerning claims
against the Oil Spill Liability Trust Fund (57 FR 36314 (Aug. 12,
1992)) and suggested that such a claim would be rejected if based upon
simplified procedures because such claims would not be based upon
evidence of damages. These commenters argued that trustees must show
evidence of actual exposure and actual injury at all levels of
biological organization, not use models or literature to extrapolate
upon evidence of exposure of some natural resources or lower-level
biota to predict indirect exposure and a pathway to other, higher-
level, biota. The commenters argued that models and literature-based
procedures are unreliable and tend to overstate injury and cannot take
into account the various incident-specific factors that affect the
outcome of incidents.
Several commenters argued that these procedures may result in
double recoveries for the same natural resources when one or more
trustees and private claimants make claims based on the same natural
resources, with a few commenters suggesting that these procedures
promote uncoordinated actions by trustees.
Some commenters stated that simplified assessment procedures,
including models, need to incorporate uncertainty by, perhaps, giving a
range of possible results rather than one definitive answer. Other
commenters requested that any and all simplified procedures that might
be included in the rule should be final procedures, submitted for
public and industry review. Some commenters requested that the rule
should provide sufficient standards and guidelines for the use of
simplified procedures, including threshold levels for the use of those
approaches.
One commenter suggested an alternative to the simplified procedures
listed in the rule. The commenter suggested that NOAA should develop a
decision tree-based simplified procedure that would enable trustees to
collect limited field samples and/or make minimal field observations
and then, based on a process outlined in the rule, make a determination
in cooperation with the responsible party of what, if any, restoration
alternatives should be pursued.
Other commenters stated that NOAA has unquestionable statutory
authority to promulgate rules that include models and formulas. The
commenters argued that the legislative history of OPA demonstrates
Congress's desire to simplify assessment procedures and, therefore, it
is NOAA's responsibility to accurately and cost-effectively promulgate
the necessary procedures to make the public whole for injuries it has
sustained. These commenters argued that it would be a waste of public
and private resources to require trustees to conduct incident-specific
assessments of injury when experience, models, and the literature are
adequate to predict injury. The commenters pointed out that an
assessment that incorporates the extensive preexisting body of
knowledge is reliable, valid and on solid scientific standing.
Some commenters expressed surprise over the depth of concern
regarding the use of the simplified assessments, since they should
reduce the costs of determining restoration alternatives and provide
consistency to the process. These commenters indicated that the data
and the ``bugs'' in the simplified procedures should be the concern,
rather than the use of the procedures per se.
The commenters stated that the argument that computer models fail
to provide an incident-specific damage assessment is without merit. The
commenters pointed out that model-based assessments may not be exact,
but the same can be said for physical sampling or any scientific
process in which averages are employed to approximate the true
conditions. The commenters noted that computer analysis is simply
another tool to be used in damage assessment and that, if responsible
parties are concerned that liability for damages will be inaccurately
determined using models or compensation formulas, they can simply opt
to have a full-scale field research operation.
Other commenters pointed out that the proposed rule listed only two
types of simplified procedures, which could easily be misinterpreted to
mean that these are the only two simplified assessment procedures
usable under this section. To correct this problem, the commenters
suggested that additional language is needed in the rule to provide
flexibility and efficiency in the use of simplified procedures. The
commenters requested that NOAA expand the description of ``simplified
procedures'' by specifically referencing other procedures such as state
formulas, or procedures such as habitat equivalency analysis. These
commenters stated that the use of simplified procedures is the only way
to determine restoration costs for the thousands of small incidents
that occur annually, since trustees lack the personnel, time and
financial resources to conduct in-depth, incident-specific assessments
for each and every incident. Some commenters argued that, without
procedures to address the vast majority of incidents, NOAA is failing
to implement the intent of Congress to provide regulations that allow
trustees to efficiently, reliably, and cost-effectively address the
injuries to public natural resources from incidents.
Other commenters argued that, since most incidents are less than
1000 gallons, NOAA should make it a priority to include in the rule a
credible simplified tool. The commenters suggested that the lack of
such a procedure will result in a rule that does not fully meet the
intent of OPA, since, at this time, the options listed in the rule are
not available to trustees, nor is there any guarantee that they will
ever become available. The commenters stated that provisions should be
included in the rule that would allow for the development and use of
other simplified procedures. Other commenters specifically suggested
that passive values should be incorporated into these simplified
procedures.
[[Page 467]]
Response: NOAA agrees that OPA intends that responsible parties be
held liable only for restoration needed to redress the injuries caused
by specific incidents. NOAA does not believe that simplified
procedures, such the type A model per se, contravene the OPA liability
limitations to actual injuries caused by specific incidents. However,
the rule does not suggest, state, or imply that these procedures are
acceptable procedures in all instances. Like any assessment procedure
proposed for use under the rule, simplified procedures must meet the
criteria for acceptable procedures listed in new Sec. 990.27. If a tool
is not appropriate for the circumstances of an incident, it cannot be
used and still receive a rebuttable presumption for assessments
performed in accordance with this rule. The final rule, however, does
not explicitly reference ``simplified'' procedures as a distinct
category of assessment procedures, and does not identify any particular
procedure(s) as appropriate for particular circumstances. This
determination must be made by trustees on an incident-by-incident
basis.
NOAA places no significance on the omission of reference to
simplified procedures in the final language of OPA. Congress merely
chose not to tie NOAA's hands in promulgating these rules. The same
conference committee report relied upon by many commenters to disavow
simplified procedures states that these regulations should be designed
to simplify the trustees' task of assessing and recovering the full
measure of damages resulting from an incident. NOAA believes that
Congress clearly intended that the rule should facilitate prompt, cost-
effective restoration, by providing a technical framework focused on
restoration, not on needless scientific experimentation.
While simplified procedures may be used as a stand-alone assessment
procedure for small incidents, these procedures are rarely, if ever,
used for larger incidents without some level of field assessment. In
these instances, simplified procedures are used to quantify the extent
of injury and scale restoration actions only after field investigations
have determined that natural resources have been exposed, injuries have
been demonstrated, or lost use has occurred.
Type A Model
Comment: Several commenters argued that there are serious
shortcomings in DOI's proposed type A models, and that NOAA should not
allow use of these models in their current form under any conditions.
Some of these commenters argued that NOAA should reserve this section
until the models are made reliable. The commenters raised specific
objections to certain provisions of the proposed type A models (e.g.,
cleanup and containment of oil, use of dispersants, bird oiling
probabilities, boating and fishing closures, potentially grossly
disproportionate restoration costs, possibly arbitrary and speculative
mitigation costs). Many of these commenters argued that these
unexplained problems make the proposed models unusable. Other
commenters suggested that NOAA should continue to review and revise the
models and subject them to further public comment.
Some of these commenters stated that NOAA has not undertaken any
review of the type A models that could constitute an independent
finding of reliability. One of these commenters raised several
procedural arguments regarding the rule's adoption of the type A
models, particularly that adopting the proposed type A models would
violate the Administrative Procedure Act principles of notice and
opportunity for comment because the public cannot, at present, know
what the final type A rule would be in the future. The commenter argued
that, if NOAA wishes to use type A procedures, it must develop and
propose its own version and subject it to public comment. Other
commenters stated that the rule's criteria for the use of the type A
model are too vague in simply requiring conditions ``sufficiently
similar'' to those required under the CERCLA rule. Another commenter
requested that NOAA revise the rule to specify that the type A models
should not be used when the services provided in an area differ from
those contained in the models, or when field observations clearly
contradict model results.
Some commenters disagreed with the use of models to assess injury
because of the potential for determining damages where no injury
exists. The commenters also argued that the lack of actual data in
these procedures makes it impossible for trustees to evaluate
restoration alternatives in the manner required by the rule. One
commenter, although supporting the concept of a simplified procedure,
urged NOAA not to adopt the type A models until they can be corrected
to prevent occasionally arbitrary and unreasonable results and to focus
on restoration, consistent with OPA. One commenter noted that
predictions made through the use of models should not be allowed since
these assume that an adverse change will always occur, whereas the
evidence of past incidents shows that injury is not inevitable.
One commenter noted that, if NOAA incorporates simplified
procedures developed by DOI, NOAA would be engaged in a redelegation of
its statutory authority under OPA.
Response: First, NOAA was not tasked with promulgating any specific
type of assessment procedure, thus there was no such duty that was
inappropriately re-delegated to DOI. Further, as discussed above, DOI's
type A models are not incorporated per se into the rule. Trustees
desiring to use the models must evaluate whether these tools meet the
acceptable procedures standards listed in Sec. 990.27, and if they are
not met, trustees must determine whether use of the tools outweighs the
loss of the rebuttable presumption, or whether another procedure exists
that does meet the acceptable procedures standards. In addition, even
if trustees have selected a procedure in accordance with the standards
in Sec. 990.27, such as the type A model, participating parties who
disagree with this decision can identify valid and reliable alternate
procedures and request that trustees implement the alternate procedure,
as provided in Sec. 990.14(c)(6) of the rule. Trustees must consider
this request and determine whether to accept or reject the request
based upon such factors as feasibility, validity, relevance, and
timeliness of the suggested procedure. The various technical concerns
raised by commenters may only be valid if a model is applied in certain
circumstances, thus it would be inappropriate to bar use of the models
completely under this rule.
Compensation Formulas
Comment: Many comments received on the compensation formula
proposed in 1994 deal with such issues as: utility for small incidents;
understating or overstating damages; questions regarding factual
underpinnings of the formulas; assumptions of injury built into the
formulas; lack of authority to promulgate non-site-specific assessment
procedures; predicted detrimental impacts on the oil industry;
conclusive nature of formulas; size of incidents appropriate for
application of formulas; relationship to state formulas; generation of
formulas from the type A models; as well as several comments about
specific technical or factual aspects. Several commenters on the 1995
proposed rule supported NOAA's decision to reserve the compensation
formulas and strongly urged NOAA to withdraw the formulas from the
final rule. Some commenters noted that the formulas were based on the
earlier versions of the proposed type A models and, therefore, did not
benefit from later
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improvements and corrections made to those models. The commenters,
however, suggested that the development of the compensation formula
guidance document seems to confer a regulatory or legal status to a
tool that should be limited to an informal aid to settlement
discussions.
Many commenters were concerned about the withdrawal or reservation
of the compensation formulas. The commenters argued that, without these
tools, trustees are unlikely to be able to fulfill their responsibility
to make the environment and public whole. The commenters noted that the
procedures for incident-specific assessments are too rigorous and
costly for most small incidents so that these small incidents will not
be adequately addressed, with the losses being absorbed by the public
in the form of lost natural resources and services.
Several commenters pointed out that, by promulgating a compensation
formula, NOAA has the opportunity to provide an alternative to
individual state models and promote some consistency in the assessment
of damages resulting from smaller incidents. These commenters suggested
that NOAA should either recalculate the compensation formulas with the
most current version of the type A models and publish the formulas in
an interim final rule, or include the original formulas, which could
then be withdrawn when new formulas are published using the final type
A models.
On the issue of the use of the formulas in an actual assessment,
some commenters specifically requested that NOAA establish that only
the data inputs into the formulas are contestable, but that the
algorithms of the formulas are not, similar to the standard for the
Social Security disability regulations and Medicare regulations, where
the diagnosis of a malady is contestable but the costs of treating the
malady are not.
Response: The proposed rule of 1995 reserved the compensation
formula primarily due to revisions being made in the type A models on
which the formulas were based. The final rule, however, does not
incorporate compensation formulas as acceptable procedures per se; like
any other proposed assessment procedures, compensation formulas must
meet the criteria for acceptable procedures in Sec. 990.27 of the rule
in order to be in accordance with the rule. NOAA still supports the
concept of such simplified procedures as compensation formulas. NOAA
developed a guidance document in 1995 on how one might recreate
scenarios contained in the 1994 compensation formulas using the revised
type A models. This guidance document is still available for use. When
the type A models under development are promulgated by DOI as final
rules, NOAA intends to generate the compensation formulas again.
Types of Assessment Procedures Available
Comment: Several commenters argued that, because trustees would be
allowed to use the four listed procedures alone or in any combination,
trustees could recover damages that are not based on proof that the
incident actually and proximately caused an actual natural resource
injury, in conflict with OPA. Some commenters requested that the rule
require that the procedures be appropriate for the types of incidents
to which they will be applied. These commenters argued that the
proposed procedures lack adequate rigor and that some of the procedures
result in far more persuasive scientific evidence than other, abstract
procedures.
Several of these commenters argued that literature-based procedures
are not defined and are not allowed under the CERCLA rule. The
commenter stated that this procedure will allow an injury determination
based solely on the reporting of an injury in the literature, without
considering the conditions existing at the incident of concern, which
are determinative of the effects. Other commenters argued that even
laboratory studies alone are insufficient to demonstrate injury in the
field and cannot take account of incident-specific compensatory
mechanisms that may be at work in an actual population of biota. The
commenters stated, therefore, that laboratory evidence must be combined
with field verification that an injury has actually occurred.
One commenter argued that the guidance provided in the rule on
incident-specific procedures fails to meet basic requirements for proof
of injury and causation. The commenter stated that the listed
procedures can only, at best, suggest that injury may have occurred
and, therefore, should not be allowed without field verification. Some
commenters stated that the rule should provide explicit acceptance
criteria for the use of procedures to ensure that actual injury and
causation are established, based on scientifically valid and reliable
evidence that the natural resource was in fact exposed, directly or
indirectly, to the discharged oil (with an exception for substantial
threat), that the natural resource has in fact experienced injury, and
that exposure to oil is known to cause such injury in the field. These
commenters note that the rule should provide that these criteria may be
waived, in whole or in part, only with the concurrence of the
responsible party.
Another commenter noted that trustees have broad discretion under
the rule to decline to use the DOI type A models, and thereby employ
costly incident-specific studies and analyses whose costs could equal
or exceed damages. The commenter recommended that the rule should
require trustees to use the DOI type A models whenever the criteria for
applying such procedures listed at 43 CFR 11.33 may be satisfied.
Response: The rule adopts a general approach, that a range of
assessment procedures, from simplified to more detailed, should be
available to the trustees so that assessments can be appropriately
tailored to incidents. Procedures for documenting and quantifying any
particular injury must be selected by considering a variety of factors,
all focused on making the determination of necessary restoration
actions, while ensuring that assessments are technically valid and
cost-effective. Procedures selected must be capable of determining
injury pursuant to subpart E of the rule.
Scaling Procedures Listed in Appendix B of the Preamble
Habitat Equivalency Analysis
Comment: Several commenters stated that HEA is a new and unproven
procedure and has limited application for assessments. Some commenters
argued that the procedure is inconsistent with economic theory since
there is no direct relationship between the cost of replacement and the
value of the natural resource. Commenters noted that HEA is based on
many assumptions, such as: strict proportionality between unit of
measure and value; substituting cost for value yields social gain;
marginal natural resource values assumed constant over time; and
service flows assumed constant and additive across time. The commenters
noted that fulfilling the assumption of equal unit value is difficult
and that the chosen metric may not reflect the unique characteristics
that define the flow of services from the habitat. Commenters suggested
that: HEA does not address fundamental assessment issues, such as: the
concept of baseline, making it difficult to estimate percent of
baseline services lost; in a complex release in which different natural
resource services are injured to different extents, there is no obvious
way short of economic valuation of the services to combine the
[[Page 469]]
different levels of impairment into a single index which would allow
all the impaired natural resources to be expressed in terms of a single
unit; HEA is not useful for habitats that are not replaceable or
reproducible; and that problems occur in incorporating unit values of
indigenous habitat when restoration converts one habitat type to
another. The commenters noted that it is problematic to use HEA to
address lost use services, because changes that may occur in the unit
value of currently offered services at the improved site need to be
considered (e.g. effects of congestion). Also, the commenters noted
that physical natural resource measures do not reflect quality, and
thus do not reflect appropriate consumer surplus values. The commenters
suggested that HEA does not measure benefits of compensatory
replacement, increasing the chances of selecting restoration actions
for which the costs are disproportionate to the value of the lost
services. Also, other commenters noted that substitutes must be taken
into account when measuring service reductions.
Other commenters, however, supported the use of HEA, stating that
the procedure is appropriate, cost-efficient, and effective. One
commenter suggested that HEA not be limited in use to ecological
services. The commenter stated that the description of the procedure
should clarify that the metrics used are simply indicators of overall
environmental quality, not complete measures of damages.
Commenters suggested that, when using HEA, trustees should provide
evidence that the unit values of the lost and replacement services are
likely to be equivalent. The commenters stated that HEA should
explicitly account for baseline service quantification issues. The
commenters also argued that, because the components of HEA embody
substantial uncertainty, the trustees should undertake explicit
sensitivity analysis as part of HEA. The commenters suggested that HEA
should focus on overall habitat or ecosystem services and not on
individual organisms or specific ecosystem components not of
significance to overall functioning of a system. Some commenters stated
that HEA models should be used for biological/ecological services, not
human use services. The commenters also argued that the habitat or
species replacement cost procedure should be specifically excluded by
the rule, except where natural resources and/or services are actually
restored.
Travel Cost Method
Comment: Some commenters suggested that trustees should use multi-
site random utility models instead of single-site analyses in
conducting travel cost studies. The commenters noted that the travel
cost studies should clearly show the linkage between the injuries and a
reduction in services, as well as allowing for unrestricted
substitution between recreation opportunities. Finally, the commenters
suggested that the sample of users should be representative of the
population being studied and the travel costs should be measured
accurately to reflect the true costs to the recreators.
Factor Income Method
Comment: Some commenters noted that the factor income method is an
unreliable procedure for calculating values when natural resources vary
in abundance over time. Other commenters stated that the factor income
approach measures private economic losses, not losses to the public,
and is inappropriate for use in assessments under OPA.
Hedonic Price Model
Comment: Commenters suggested that the hedonic price model is
generally inappropriate for assessments, due to major difficulties with
potential double recovery for public and private losses. Other
commenters suggested that the hedonic pricing method should not be used
for incidents because of the brief and temporary nature of incidents
and their impacts.
Market Models of Demand and Supply
Comment: Several commenters stated that the market models of demand
and supply are poorly specified in the rule, and that the rule should
specify their use and some standards for that use.
Contingent Valuation
Comment: Many of the commenters argued that CV should not be used
in scaling. The commenters argued that CV has not been proven reliable,
that it should not be used for transitory effects, and would generate
overstated damage claims. Some of these commenters noted that CV is a
highly controversial procedure, and has not survived rigorous peer
review within an atmosphere of impartial scientific research.
Some commenters argued that the inherent upward bias in CV would
drive up the cost of restoration. However, other commenters noted that
concerns about CV may be satisfied if it were used in ``both sides'' of
the scaling calculation (i.e., to calculate both the losses from the
injury and the gains from the replacement action). This way, the
overall scale of the selected restoration alternative would likely not
be affected.
Many commenters stated that the rule should allow for the use of
CV. Some commenters noted that CV is reliable if performed properly.
These commenters noted that CV has already been endorsed by the Ohio
court. Other commenters stated that test-retest CV experiments show
that CV can be reliable. Several commenters pointed out that CV is
essential for obtaining damages for lost passive values. Commenters
also argued that CV should be used in scaling. The commenters argued
that trustees should retain as broad a spectrum of valuation procedures
as possible.
One commenter indicated that survey procedures can elicit what the
public needs for compensation by presenting different restoration
choices and, therefore, gaining information on the scale of restoration
actions needed. Another commenter suggested that mail-out surveys could
be used to assess relative values, even though the Blue Ribbon Panel
recommended in-person surveys for dollar determinations. Other
commenters noted the particular utility of parts of CV, such as focus
groups and survey procedures, in planning restoration.
Many commenters argued that CV should not be included in the final
rule; however, that if it is included, the rule should contain specific
standards for its use, and it should not be accorded the rebuttable
presumption. Several of the commenters stated that the rule should
include the Blue Ribbon Panel's recommendations on study design,
implementation and verification. Other commenters argued that damages
considered by respondents in CV surveys should reflect only injuries
that have been established in injury determination and quantification.
These commenters also stated that CV scenarios should not be based on
willingness to pay to prevent incidents. The commenters stated that the
rule should provide for scope tests that: show substantial variation
with the size of the commodity; focus only on natural resource damages;
and exclude no respondents when carried out. The commenters also
recommended that, for response rates: standards must be developed for
calculating response rates and zero value should be attributed to
survey nonrespondents as a conservative approach to handling
nonresponse bias. The commenters suggested that CV should not be
employed in cases where nonuse values
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are expected to be small and that additivity tests should be required.
The commenter also stated that a zero value should be attributed to
individuals unaware of the injury before the survey was administered.
Conjoint Analysis
Comment: Several commenters stated that conjoint analysis is an
unproven procedure for natural resource applications, and is not
reliable. Some of the commenters noted that conjoint analysis may be
better than CV, but it raises similar difficulties. Some commenters
noted the importance of realistic descriptions. The commenters also
suggested the procedure is subject to the potential for protest
valuation. The commenters suggested that, when using the procedure,
trustees need to define a relevant population for sampling and for use
in the scaling calculations. The commenters suggested that the results
of the analysis can be very sensitive to design decisions,
implementation, and interpretation decisions. The commenters pointed
out that preferences are still expressed under hypothetical conditions.
The commenters also suggested that respondents are unlikely to be
familiar with the different attributes and levels of habitat services
and are inexperienced in evaluating their relative merits, that some
respondents may feel the answers are the purview of scientific experts
rather than the general public, and that answers to early questions may
be of lower quality due to learning effects during course of survey.
The commenters stated that respondents may experience fatigue in
evaluating numerous options. The commenters also stated that the
experimental design can easily become burdensome. The commenters noted
the problem of environmentally correlated attributes when using the
procedure. The commenter noted that a component-wise valuation would be
useful in calculating compensatory damages for partially injured
natural resources. The commenters argued that, because of a close
relationship between conjoint analysis and CV, all the issues raised by
the NOAA Blue Ribbon Panel may need to be considered.
However, some of these commenters noted that the procedure need not
be limited to evaluating restoration alternatives that provide services
of the same type and quality and subject to comparable scarcity and
demand conditions as interim lost services. The commenters suggested
that the procedure could reduce assessment costs, since a single
conjoint questionnaire could evaluate the lost interim services, as
well as the services from several different restoration alternatives.
The commenters argued that conjoint analysis should not be used to
estimate passive use values. The commenters also suggested that the
population of survey respondents should be familiar with the goods
involved, the survey should present the choices in terms that are
concrete and realistic as possible, and the investigators should test
for and present evidence that the results are not sensitive to
extraneous design decisions. The commenters stated that the elicitation
format should be designed to prevent interviewer bias and protest
valuation. Some of these commenters stated that the experimental design
should be consistent with accepted design standards. The commenter
noted that the applications should include at least two different
elicitation formats, and should perform sensitivity analysis on the
effects of format choice. The commenters suggested that the attributes
used in the survey should reflect: characteristics of the natural
resource that are salient to the responder, temporal nature of lost
services, and restoration alternatives that are technically feasible.
The commenters also stated that the estimation of results should be
consistent with utility theoretic principles. The commenter noted that
the study should include a description of commodities that serve as
substitutes for the lost and replacement services and that the relevant
population to be sampled should be limited to users of the same type of
services or to individuals sufficiently familiar with the natural
resource to be able to form preferences for the relevant services.
Commenters also stated that, if the conjoint analysis includes a price
term, the following standards should be added: the conjoint analysis
should not be used to measure nonuse values; trustees should
empirically demonstrate that respondents have considered their budget
constraints; the survey should use a payment vehicle that is
appropriate for the type of value to be measured, is credible,
incentive-compatible, avoids implied value cuing, and distributes
burden of payment equitably; the survey should include design points
that test for ``warm glow'' effects; trustees should demonstrate
empirically that results are sensitive to scope of lost services; and
trustees should determine the extent of the relevant population whose
values are to be included and document and justify that determination.
Benefits Transfer
Comment: Several commenters stated that the responsible party must
be allowed to challenge the merits of valuation studies conducted by
the trustees, rather than allowing the trustee to use values derived
from some other study.
Some commenters pointed out that the benefits transfer approach
should not be accepted uncritically. Other commenters, however, argued
for more flexibility in the use of the procedure.
Several commenters stated that studies to be used in the benefits
transfer approach should address natural resources and services similar
to those injured by the incident, should be scientifically sound,
should use reliable valuation procedures, and should not attempt to
measure passive use values, since no reliable studies have been
conducted to date.
Response: NOAA believes that the standards set forth in Sec. 990.27
are sufficient to allow trustees and responsible parties to determine
the acceptability of a particular assessment procedure for a given
incident. NOAA supports the use of all of the procedures discussed in
Appendix B of the preamble as reliable and valid within the appropriate
context and when performed in accordance with accepted professional
practices. NOAA does not believe that the rule should set forth
specific standards regarding the implementation of individual
procedures, as it is not feasible to prescribe all valid uses of these
procedures. The validity and reliability of procedures will depend on
the circumstances of particular incidents. However, NOAA is considering
the development of a separate guidance document addressing issues
pertaining to the use of the procedures discussed above to scale
restoration actions under the resource-to-resource or service-to-
service and valuation scaling approaches.
Thus, NOAA believes that most of the comments received, which
relate to potential problems with certain applications of these
procedures, will be dealt with in the context of specific incidents. If
procedures do not meet the standards listed in the rule they are not
acceptable procedures to use pursuant to this rule. In addition,
responsible parties have the option to request alternative procedures
that meet the requirements of the rule, if they do not accept the
trustees' judgment that a procedure is reliable for the circumstances
of an incident.
In response to some common concerns expressed relative to all
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procedures, NOAA offers the following: (1) Trustees must make a
determination that procedures are reliable and valid for the
circumstances of an incident; (2) there must be no double recovery of
damages for the same injury or loss; (3) only public losses are
recoverable by trustees under this rule; (4) primary restoration only
recovers to baseline or comparable conditions or levels; and (5) the
rule requires that the most cost-effective of equally appropriate
procedures be used.
Subpart C--Definitions
Section 990.30--Definitions
General
NOAA has revised certain definitions in the rule to ensure that
these definitions conform with those that are explicitly defined in
OPA.
Comment: Many commenters made reference to various terms used in
the proposed rule considered to be vague and likely to hamper
expeditious restoration if they are not defined. These terms include:
``observable;'' ``measurable;'' ``adverse;'' ``impairment;'' ``nexus;''
``reliable;'' ``valid;'' ``comparable;'' ``equivalent;'' ``same;''
``similar;'' ``scarcity;'' ``demand;'' ``scale;'' ``scaling;'' and
``substantial threat.''
Response: NOAA intends that the majority of these terms have their
ordinary and customary meaning for purposes of this rule, but offers
the following clarification. ``Reliable'' and ``valid'' refer to
technical judgments by experts in a particular field that a procedure
is consistent with best practices for the measure being investigated
under the circumstances. ``Equivalent'' and ``comparable,'' as applied
to acquiring natural resources or services other than those injured or
lost, have the meaning used in the legislative history of OPA-natural
resources that can enhance the recovery, productivity, and survival of
the ecosystem affected by a discharge, preferably in proximity to the
affected area. (H.R. (Conf.) Rep. No. 101-653, 101st Cong., 2d Sess. at
109 (1990).) ``Demand'' has the meaning used in section 1013 of OPA (33
U.S.C. 2712), encompassing presenting a claim for damages, based upon a
plan for restoration of injured natural resources and services, to a
responsible party for payment or implementation. ``Substantial threat''
will be determined by response entities on a case-by-case basis.
Finally, ``scale'' and ``scaling'' refer to the size or extent, and
procedures to determine appropriate size, of injuries or restoration
actions.
Comment: Many other commenters felt that NOAA should reinsert some
of the terms, which were included in the January 1994 proposed rule but
were left out in the current proposed rule, or add new terms. These
terms include: ``damages;'' ``emergency restoration;'' ``interim
restoration;'' ``ecological services or natural resources of special
importance;'' ``passive use;'' ``commercial and productive services;''
``recreational services;'' ``services of natural resources of special
significance'' ; and ``Regional Restoration Plan.''
Response: NOAA has incorporated the statutory definition of
``damages'' into the rule and has expanded the discussion of emergency
restoration and Regional Restoration Plans in the preamble. NOAA has
also expanded the discussion of ``services'' and ``value'' and does not
believe that detailed discussion of various specific types of natural
resource services is necessary.
Baseline
Comment: A few commenters stated that the definition of
``baseline'' is too restrictive, while others felt that the definition
is too flexible. Commenters on both sides stated that NOAA should
provide additional clarification. Some commenters argued that
``baseline'' should not be so strictly applied as to prohibit use of
information collected reliably but on an intermittent or short-term
basis, if it provides a valuable comparison. These commenters suggested
that trustees should be allowed to make comparisons against reference,
historical, or control conditions. Another commenter stated that
baseline data must provide a reliable estimate of variability in the
natural resources and services of interest, and that historical or
reference data may not be adequate. The commenter pointed out that, in
the absence of reliable data on variability, there cannot be a
``baseline,'' however, there can be a ``basepoint'' or ``reference
point.''
Response: Baseline under this rule is used to determine the extent
of natural resource injury such that the appropriate scale of
restoration actions can be determined. NOAA has simplified the
definition of ``baseline'' to encompass the use of ``control,''
``historical'' and ``reference'' data. Trustees and responsible parties
may use any data, so long as that data are reliable (e.g.,
appropriately collected) and relevant (e.g., collected sufficiently
recently) to the incident such that a ``baseline'' can be determined.
In terms of assessing baseline, procedures should be chosen to meet the
standards contained in the rule, including expected costs and expected
increases in the quality of the estimate of baseline conditions.
Comment: One commenter suggested that NOAA change the definition of
``baseline'' to read: ``Baseline means the condition of the natural
resource and/or service that would exist had the incident not
occurred.'' The commenter noted that, since baseline is not static over
time, defining the term in past tense could be misleading or
misinterpreted.
Response: Natural resources or services may only be restored to
their expected current condition or level had the incident not
occurred. It may not be appropriate to interpret baseline solely with
reference to the condition of the natural resources at the time of the
incident for all injuries or losses, although that condition may well
be valuable evidence of the baseline.
Comment: Several commenters insisted that baseline, like injury and
restoration, may only be assessed with respect to natural resource
services, and more specifically, services used directly by the public,
as opposed to the condition of the natural resources themselves.
Response: OPA is very clear that injury and restoration apply to
natural resources themselves. Further, restoration of injured natural
resources is one element of a claim for damages, distinct from the
diminution in value of injured natural resources suffered by the public
from the time of an injury until recovery.
Contributing Factor
Comment: One commenter expressed concern that the term
``contributing factor,'' present in the 1994 proposed rule, is absent
in the reproposed rule. Other commenters supported omission of a
discussion of this concept from the rule, although these commenters
differed in their view as to whether a more or a less rigorous standard
should be applied by reviewing courts.
Response: Under the new structure of the rule, NOAA does not
believe that a discussion of this concept is needed.
Cost-effective
Comment: A number of commenters emphasized that Congress intended
that assessments be cost-effective, but suggested there are no
meaningful restraints on the number, extent, or cost of damage
assessment activities that trustees may implement under the rule.
Response: NOAA agrees that assessments, as well as restoration,
must be cost-effective, and believes the definition indicates that the
least costly of several procedures accomplishing the same goals with
outcomes of similar
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quality must be selected by trustees. NOAA suggests that the extent of
assessment actions and costs are appropriately limited under both OPA
and this rule through the reasonable cost requirement, the standards
for acceptable procedures in Sec. 990.27 of the rule, and the pervasive
requirement to focus activities on determining needed restoration.
Discharge
Comment: Some commenters requested clarification of the definition
of ``discharge.''
Response: In response to comments, NOAA has replaced the previous
definition of ``discharge'' with the statutory definition.
Exposure
Comment: One commenter suggested that exposure should be defined to
mean the presence of any detectable amount of the discharged oil,
including oil sheen. Several other commenters recommended that exposure
be defined as in 43 CFR Sec. 11.14(q), when natural resources ``may
be'' in contact with oil, rather than requiring actual evidence of
exposure.
Response: For the purposes of this rule, exposure refers to direct
or indirect contact with oil. A sheen does indicate that the surface
water natural resource has been exposed, which may affect services
provided, such as boating.
Incident
Comment: Some commenters suggested that the definition of
``incident'' should be replaced with the statutory definition.
Response: NOAA has replaced the previous definition of ``incident''
with the statutory definition.
Injury
Comment: A number of commenters noted that the definition of injury
is an improvement from that of the January 1994 proposed rule and that
of the CERCLA rule's definition, in that it is simpler, easier to
apply, and includes adverse impacts that might be excluded under the
CERCLA rule delimiting specific categories of injury.
In contrast, other commenters argued that the definition of injury
is insufficient because it applies to natural resources themselves,
rather than strictly to services provided by natural resources, and
does not incorporate the concept of baseline. Some of these commenters
suggested that the definition allows the mere presence of a contaminant
in water to be an injury. These commenters suggested that NOAA redefine
injury as ``(a) an observable or measurable adverse change in a natural
resource that produces a quantifiable reduction in the level of
services provided by that natural resource, or (b) an observable or
measurable impairment of a natural resource service,'' further
specifying that ``such change and/or impairment must be measured
relative to baseline.''
According to these commenters, although the physical, chemical, and
biological characteristics of a natural resource contribute to the type
and level of services it offers, the public does not value those
characteristics in and of themselves, it values only the services the
natural resource provides. Thus, the commenters argued that, if a
change in a natural resource does not affect such services, it cannot
constitute a compensable injury. The commenters stated that, to the
extent that trustees obtain compensation for harm to the environment as
something separate from the services provided to the public, society
would be overcompensated for its loss. Further, these commenters
suggested that compensable natural resource service losses be
restricted to those of ``measurable ecological significance'' (effects
are manifested at the population, community or ecosystem level) and/or
those used directly by the public.
In addition, the commenters suggested that failure to include
reference to baseline in the definition of injury will allow trustees
to measure adverse changes relative to pristine, pre-industrial levels.
Response: NOAA believes that OPA clearly intends that injuries to
natural resources themselves form the primary focus of trustees'
restoration actions. This intent is evident in the definition of
liability under the statute (``injury to, destruction of, loss of, or
loss of use of natural resources''), as well as the measure of damages
under the statute which provides an explicit distinction between
liability for injuries to natural resources (costs to restore) and
liability for interim lost services (diminution in value). Adoption of
the commenters' approach to assessment and restoration would severely
undercompensate the public for injuries suffered as a result of an
incident and would result in a needless sacrifice of natural resources
that could otherwise be cost-effectively restored. The only way to
ensure that all valuable present and future services of natural
resources are available to the public is to restore the injured natural
resources to their pre-incident condition. The rule requires trustees
to quantify injuries relative to baseline, which is defined as the
without-the-incident condition of the natural resources. This
requirement clearly prevents assumption of a ``pre-industrial''
baseline. NOAA does not believe that the concept of baseline has useful
meaning in defining injury, as opposed to quantifying injury. Finally,
because the rule requires a measurable or observable adverse change in
a natural resource or service be documented in addition to exposure,
the ``mere presence'' of oil will not constitute an injury under the
rule.
Comment: One commenter suggested that an existing state regulatory
definition of injury be adopted to allow for consistent natural
resource damage assessment within the state.
Response: NOAA believes that the definition of injury in the rule
is consistent with the intent of OPA to facilitate expeditious,
necessary, and cost-effective restoration.
Comment: Some commenters suggested the terms ``measurable'' and
``observable'' inappropriately allow injury to be determined using
simplified procedures, notably the type A model or compensation
formulas, which assume that injury always occurs from the presence of
oil in the environment. Other commenters suggested that NOAA clarify
that models that predict expected injuries based on past data are
encompassed within the definition of injury.
Response: The commenters are referred to the procedures for
determining injury in Sec. 900.51 of the rule. The definition of injury
must be met, and exposure and a pathway must be documented to determine
injury. Any procedure used to document injury, exposure, and pathway
must meet the standards enumerated in new Sec. 990.27 of the rule,
which seeks to ensure that the most technically appropriate procedure
for the circumstances of an incident and an injury be used to make
injury determinations, including those for exposure and pathway.
Comment: One commenter suggested that the injury definition be
broadened to include habitat degradation.
Response: NOAA believes that OPA and the rule do apply to habitat
degradation caused by incidents, so long as the requirements of the
rule for determining injury are met.
Oil
Comment: A few commenters agreed that animal fats and vegetable
oils are covered by OPA's definition of oil, but asserted that their
limited capacity to cause harm in the environment should exempt them
from coverage by this rule, or provide for a separate assessment
process specifically tailored to these
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different products. The commenters argued that Executive Order No.
12,866 on Regulatory Planning and Review requires that differential
treatment be afforded these products. Other commenters similarly
requested clarification as to whether natural or synthetic gas
products, or coal tar and other coal-derived chemicals are classified
as oil for purposes of the rule.
Response: NOAA notes that the commenters do recognize the capacity
for animal fats and vegetable oils to cause natural resource injury if
they are released in significant quantities. These products are
included in the definition of oil under the NCP. NOAA believes that the
rule's Preassessment Phase requirement that trustees assess the
likelihood of natural resource injuries resulting from a discharge,
along with the requirement that injury actually be determined prior to
quantification, will provide appropriate safeguards for nonharmful
products discharged into the environment. The preamble advises trustees
that the nature of the product discharged (e.g., differences in
physical, chemical, biological, and other properties, and environmental
effects) should be evaluated in the trustee's Preassessment Phase. As
to synthetic gas and coal-derived chemicals, substances that have been
classified as hazardous substances are clearly not covered by this
rule, but by the CERCLA rule.
Pathway
Comment: One commenter stated that the definition of ``pathway'' is
somewhat vague in the use of the term ``nexus.''
Response: NOAA has replaced the term ``nexus'' with ``link,'' to
refer to the required connection between an incident and a natural
resource or service of concern.
Person
Comment: Several commenters suggested that the definition of
``person'' should be modified to include agencies of the federal
government.
Response: NOAA notes that the rule definition is consistent with
the statutory definition.
Reasonable Assessment Costs
Comment: One commenter noted that the costs of conducting
assessments represent unanticipated financial burdens on trustee
agencies, so the rule should include provisions that require
responsible parties to reimburse trustees for all legitimate expenses
associated with incidents covered by the rule. Several commenters
suggested that oversight costs for responsible party participation and/
or implementation of any assessment activities should be explicitly
recoverable. While several commenters supported inclusion of
administrative, legal, and enforcement costs in the definition, others
strongly opposed this as outside NOAA's statutory authority. These
commenters pointed to rulings prohibiting recovery of court costs in
CERCLA cost recovery actions, and suggested that damage assessment
costs necessarily cease at the point monetary damages are determined
for a claim. Some commenters stated that duplicate assessment costs
incurred as a result of trustees' failure to coordinate their efforts
should be explicitly excluded from recovery.
Response: OPA defines damages as the costs of restoration, plus the
reasonable cost of assessing those damages. Thus, damages encompasses
whatever actions are reasonable and lawful under OPA to implement
restoration, clearly including administrative, legal, and enforcement
costs, as well as monitoring and oversight costs. OPA's requirement for
public involvement in developing a restoration plan to form the basis
of a claim for damages presented to a responsible party likewise makes
the reasonable costs of facilitating public participation recoverable.
OPA prohibits double recovery of damages, including assessment costs.
However, NOAA does not believe that an inference of double assessment
costs should be drawn solely from the fact that two or more trustees
are assessing damages independently. The reasonableness of damage
assessment costs must be evaluated relative to the specific injury for
which a restoration action is being considered.
Comment: With respect to incremental costs and benefits, one
commenter suggested that the phrase ``reasonably related'' is vague and
subjective and should be modified. Another commenter stated that
reasonable costs should include ``expected'' before ``incremental
cost'' and ``incremental increase.'' Some commenters interpreted the
proposed rule to require a strict cost-benefit analysis in selecting
any assessment procedures. One commenter suggested that the definition
of ``reasonable assessment costs'' should not use word ``reasonably''
to define ``reasonable.'' One commenter suggested that the reasonable
cost definition should return to the 1994 proposed language of
``reasonable under the circumstances, but only if in accordance with
the rule.''
Response: NOAA agrees that the 1995 proposed definition of
reasonable costs was somewhat vague. NOAA also believes that the
element of the reasonable cost definition in the proposed rule,
requiring incremental costs and benefits to be evaluated, is
duplicative of the analysis trustees must make in selecting all
assessment procedures used under this rule, as provided in the new
Sec. 990.27. Thus, this element has been deleted from the definition.
The new provision in Sec. 990.27 of the rule does not require a strict
cost-benefit analysis of assessment procedures, as this would result in
unreasonable assessment costs. Rather the costs and benefits analysis
is intended to constrain the scope and scale of assessments to fit the
circumstances of individual incidents and injuries.
Comment: Several commenters suggested that assessment costs should
be strictly proportional to damages, with some suggesting that costs
must not exceed damages to be reasonable, consistent with the CERCLA
rule. Another commenter stated that assessment costs should be
proportionate to the value of the restoration action, rather than the
cost of that action. Other commenters suggested that reasonable costs
must be related to the severity of an incident. Several commenters were
troubled by allowing recovery of assessment costs where restoration is
not pursued.
Response: NOAA agrees that trustees should determine an appropriate
relationship between assessment costs and the costs of restoration and
compensation sought as a result of the incident. However, NOAA does not
believe that a strict proportion, or a cost ceiling equal to total
damages or total value, is appropriate for all cases. There may be
instances where assessment costs to determine appropriate restoration
are necessarily high due to unique sampling or testing requirements,
yet high costs would be justifiable given the importance of undertaking
restoration--for instance, where an endangered species population has
been injured. The rule places strict limits on instances where trustees
can recover assessment costs if they do not pursue restoration.
Trustees must have made, in good faith, all determinations required in
the rule and proceeded in the assessment with a reasonable expectation
that injury had occurred and restoration was needed.
Comment: One commenter stated that reasonable assessment costs
should only include those costs associated with an assessment made at
the site of the incident, not any assessment costs incurred at regional
restoration sites. Other commenters argued that trustee costs of NEPA
compliance and production of an administrative record
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should not be recoverable, pointing to the CERCLA rule's omission of
these procedural requirements.
Response: Reasonable assessment costs include costs associated with
evaluating restoration alternatives and selecting an equally preferred
approach for an incident. Costs associated with identifying and
evaluating existing regional restoration plans or other existing
proposed restoration projects among a range of alternatives to restore
injuries resulting from an incident are reasonable costs under the
rule. In addition, NOAA believes that maintenance of an administrative
record will be a cost-effective mechanism of keeping the public and
responsible parties informed of the progress and results of an
assessment, and judges these costs to be reasonable costs of
assessment. Similarly, because NEPA compliance is an existing statutory
requirement applicable to restoration actions by federal trustees,
these compliance costs are recoverable, just as any permitting
requirements would be recoverable in implementing restoration under
OPA.
Recovery
Comment: Several commenters argued that a focus on recovery of
natural resources themselves, as opposed to services is counter to
OPA's mandate. Other commenters suggested that baseline be explicitly
incorporated within the definition of recovery, to ensure that the
proper focus is the ``without an incident'' condition.
Response: As discussed under the definition of injury above, the
condition of natural resources themselves may lawfully be assessed in
identifying and quantifying injuries. NOAA does not believe that
baseline needs to be redefined in the definition of recovery, but
agrees that recovery refers to the condition the natural resources and
services would have been had the incident not occurred.
Responsible Party
Comment: Some commenters requested revisions to the 1994 proposal's
definition of ``responsible party'' to conform with the statutory
definition.
Response: NOAA has replaced the definition of responsible party
with the statutory definition.
Restoration
Comment: Most commenters were satisfied with the definition of
restoration as encompassing all authorized actions under the statute
(restoration, rehabilitation, replacement, acquisition of the
equivalent), without setting a preference for any of the statutory
alternatives. Other commenters, however, felt that the rule limited
trustee discretion in requiring consideration of restoration measures
over acquisition measures.
Response: The rule does not require that restoration,
rehabilitation, or replacement be considered before acquisition of
equivalent natural resources. Acquisition of the equivalent is a viable
option and includes actions that would enhance the recovery,
productivity, and survival of the ecosystem affected by a discharge,
preferably in proximity to the affected area.
Comment: Several commenters suggested that the distinction between
``primary'' and ``compensatory'' restoration needs clarification. Some
of the commenters suggested that primary restoration should include any
action, whether on-site, off-site, in-kind, or out-of-kind, that will
return natural resource and/or service levels back to baseline
condition. These commenters supported defining compensatory restoration
as actions to make the environment and public whole for interim losses
resulting from the incident.
Some commenters stated that the proposed rule could be interpreted
to limit primary restoration to actions focused on the injured natural
resources themselves. These commenters stated that relegating
replacement or acquisition alternatives that use other natural
resources solely to compensatory restoration is inconsistent with
section 1006(d)(1)(A) of OPA (33 U.S.C. 2706(d)(1)(A)), which
prescribes replacement and acquisition of the equivalent as measures of
``primary restoration.''
Response: NOAA intends that primary restoration actions encompass
all actions authorized under section 1006(d)(1)(A) of OPA (33 U.S.C.
2706(d)(1)(A)), while compensatory restoration includes actions to
compensate for the diminution in value of injured natural resources or
services pending their recovery (section 1006(d)(1)(B) of OPA (33
U.S.C. 2706(d)(1)(B)). NOAA does not believe that OPA contains any
explicit preference for a specific type of restoration, or whether it
be accomplished on or off-site and has revised the rule. Because
damages recovered for diminution in value must be spent solely to
restore, rehabilitate, replace, or acquire the equivalent of the
interim natural resource injuries, trustees should assess damages for
diminution in value in terms of these types of actions. NOAA has
amended the rule to reflect these considerations.
Comment: Several commenters asserted that NOAA has improperly
broadened potential recovery for diminution in value by dressing it up
as compensatory restoration, and defining these actions as those to
make the environment whole, in addition to making the public whole.
These commenters argued that compensatory restoration may only replace
interim lost service flows to the public.
Response: The diminution in value of natural resources may be
measured by a number of metrics, such as dollars or quanta of services
lost. If no restoration actions are taken, or recovery with active
restoration may still require a number of years, many types of services
may be lost or diminished in the interim period, including ecological
services, and OPA does not intend that only certain types of lost
services be compensated. Diminution in value under the rule still
appropriately encompasses interim lost services pending recovery and
has not been broadened. The rule requires that trustees determine
restoration actions to compensate for these losses rather than monetize
the claim.
Comment: A number of commenters asked for or offered additional
clarification on the distinction between ``natural recovery'' and ``no
action.'' Several commenters requested that NOAA delete the no action
alternative. Several commenters strongly disagreed with classifying
natural recovery as restoration, while several others appreciated the
explicit requirement to consider natural recovery, which they expect
will often provide the most cost-effective mechanism to return natural
resources to baseline. One of the commenters noted that there should be
a requirement that restoration only be undertaken if it significantly
accelerates natural recovery. Finally, some commenters remarked on the
difficulty and expense likely to be incurred to estimate the time
required for natural recovery.
Response: NOAA has deleted the ``no action'' alternative from the
final rule, as it was confusing in the context of evaluating
restoration alternatives at the stage that injury and the need for
restoration have been determined. The final rule will continue to
require that natural recovery be evaluated as one of a range of primary
restoration actions--actions intended to return injured natural
resources and services to baseline conditions. The rule already
requires trustees to assess the relative capability of each restoration
alternative to accelerate recovery, so it is not necessary to add a
requirement that a restoration alternative significantly
[[Page 475]]
accelerate recovery relative to natural recovery. Finally, the rule
requires that procedures to estimate natural recovery be evaluated
according to the standards governing acceptability of any other
assessment procedure, including the cost of alternative procedures
relative to expected informational benefits for the circumstances of a
particular incident. Thus, the rule allows that natural recovery may be
estimated qualitatively or quantitatively. The rule also provides a
number of factors as guidance in estimating natural recovery timelines.
Services
Comment: Many comments on the definition of services discussed the
distinctions between ``ecological'' and ``human'' services. One
commenter stated that the definition appropriately encompasses both
concepts, but that the term ``public services'' is overly restrictive.
By using the term ``public'' services, the commenter suggested that
NOAA may inadvertently preclude recovery for lost services that benefit
many individuals but not the general public. To address this problem,
the commenter urged NOAA to use the term ``human services'' rather than
``public services'' throughout its final rule.
A number of commenters argued that the proposed definition of
compensable services is faulty in including functions performed by one
natural resource for another. These commenters suggested that
ecological services are only compensable to the extent they provide
services of value to the public, because ecosystem functions do not
have economic value unless they help to support service flows to
people.
These commenters further suggested that the proposed definition
exceeds the scope of NOAA's authority since OPA does not authorize
trustees to assess damages on behalf of non-human things or beings. The
commenters noted that the measure of damages under OPA refers to losses
to the public, since it is only people who have values for natural
resource services. The commenters pointed out that the legislative
history of OPA also makes it clear that ``diminution in value'' refers
to the lost use value standard for measuring natural resource damages
used in the Ohio decision (880 F.2d at 462-480)(H.R. (Conf.) Rep. No.
101-653, 101st Cong., 2d Sess. 108 (1990)), which made it apparent that
the lost use value standard related to lost values to the public.
Further, the commenters stated that the CERCLA rule on remand from Ohio
specifies that compensable value means the value of ``services lost to
the public.'' 43 CFR 11.80(b).
Response: Humans and other species in the ecosystem are
inextricably linked; consequently, ecological services are generally
linked to human services. Trustees may not double-count public losses
attributable to injured natural resources by seeking compensation both
for human losses and for the ecological services that will return the
same direct human services. However, in some cases it may be much more
cost-effective to focus on the ecological services that occur on-site
rather than the human services that occur off-site as a result of these
ecological interactions. For example, a wetland habitat may provide on-
site ecological services such as faunal food and shelter, sediment
stabilization, nutrient cycling, and primary productivity. Off-site
human services may include commercial and recreational fishing, bird
watching along the flyway, water quality improvements for drinking
water supply or the aesthetics of nearby residential property, and
storm protection for on-shore properties due to the creation of wave
breaks.
Consequently, the inclusion of ecosystem services is consistent
with OPA. However, trustees must ensure that they do not seek
compensation both for human losses and for the ecological services that
will return the same direct human services, which would create a double
recovery.
Comment: Many commenters asserted that the concept of baseline
should be built into the definition of compensable services. These
commenters suggested that baseline measures of use services should
incorporate relevant site-specific factors that influence demand for
the services and should reflect established committed uses rather than
speculative levels of use. The commenters stated that NOAA should
include the CERCLA's rule definition and requirement of ``committed
use'' in its rule, which is defined as either ``a current public use;
or a planned public use for which there is a documented legal,
administrative, budgetary, or financial commitment before the discharge
of oil or release of a hazardous substance'' (43 CFR 11.14).
Response: NOAA does not believe that baseline must be incorporated
into the definition of services, given the requirement to quantify
services injuries relative to baseline. NOAA agrees with the commenters
that speculative future uses of natural resources are not compensable
under OPA and that this limitation is inherent in the requirement that
trustees determine the existence of injury or service injuries before
quantifying restoration requirements.
Comment: Several commenters suggested that the definition of
``services'' should explicitly include both ``direct and passive
uses.'' Some of these commenters also requested that NOAA include
examples of passive services in the definition.
Response: NOAA agrees that compensable services include both direct
and passive uses, and that the rule provides for recovery of both.
Value
Comment: A number of commenters supported the definition of
``value'' as proposed. However, other commenters suggested that this
definition is vague, and needs to be refined. One commenter suggested
that the definition of ``total values'' in the rule and the discussion
in the preamble are not consistent. Another commenter did not
understand what the ``units'' represent in the definition, with another
commenter suggesting that OPA restricts compensation to dollars. A few
commenters indicated that NOAA should replace the word ``good'' with
goods or services, as people value both goods and services. One
commenter suggested that NOAA change the last sentence to read: ``The
total value of a natural resource and/or service is equal to the sum of
all values held by an individual across all individuals.''
Finally, a few commenters argued that passive values should be
excluded because they cannot be reliably measured. The commenters
suggested that NOAA's silence results in an equal treatment of use and
nonuse values; implicitly allowing for the calculation of nonuse values
using contingent valuation without any specific standards.
Response: NOAA does not believe that OPA restricts measuring lost
value solely in terms of dollars, and has amended the rule to allow for
computation in terms of goods, services, or money.
Subpart D--Preassessment Phase
Section 990.40--Purpose
Comment: Several commenters felt that the proposed new language on
preassessment is a significant improvement over the January 1994
proposal. These commenters stated that the new Preassessment Phase
achieves the necessary goals of this early stage of an assessment,
which is to cost-effectively and timely determine whether injuries to
natural resources have likely occurred such that further trustee action
on behalf of the public is warranted.
A few general concerns, however, were expressed by one commenter.
This
[[Page 476]]
commenter was under the impression that preassessment activities
require identification (as reflected by the qualifier ``observable'')
and quantification (as reflected by the qualifier ``measurable'') of
injury. The commenter noted that observing adverse changes is typically
less difficult than measuring actual or approximate losses, suggesting
that this portion of the rule not be so narrow as to require precise
measurement of degradation in situations where a loss has been
observed. To facilitate more effective mitigative strategies, the
commenter suggested preassessment activities be segregated into
analyses of impacts to aquatic organisms and habitat.
The same commenter further stated that the costs of conducting
preassessment activities may represent unanticipated financial burdens
on trustees. The commenter suggested the rule include provisions that
require responsible parties to reimburse trustees for all legitimate
expenses associated with incidents covered by the rule.
Response: The purpose of Preassessment Phase activities is to
determine whether it is legitimate for trustees to take action under
this rule for purposes of OPA, and whether it is reasonable to do so,
given their responsibilities to act on behalf of the public to see that
injured natural resources and services are restored. At this stage of
an assessment, actual determination and quantification of injury are
not required. Costs should not necessarily be great at this phase of an
assessment, depending on the circumstances of an incident and resulting
injuries, and trustees are encouraged to contain costs by limiting the
amount of data collection and analysis conducted, and to coordinate
early with response agencies and responsible parties to prevent
duplicative efforts.
Section 990.41--Determination of Jurisdiction
Comment: One commenter stated that the notification language is too
weak and that the OSC or lead response agency should be required to
notify natural resource trustees. This commenter indicated that the OSC
or lead response agency should not only consult with the affected
trustees concerning removal actions, but should also consult with
affected trustees concerning protection strategies.
Response: NOAA notes that coordination between the OSC and trustees
is covered in section 1011 of OPA (33 U.S.C. 2711) and in the NCP. The
duties of the OSC, including coordination, are covered by other
rulemakings, not this rule.
Excluded Discharges
Comment: One commenter suggested that the language in this part
should be modified to exclude only those discharges that are in
compliance with a permit under federal, state or local law. The
commenter pointed out that discharges that exceed permitted limits
should not receive an exemption from natural resource damages liability
simply because they emanate from a permitted discharge point.
Another commenter remarked that tribal permits should also be
included within this language.
Response: The language of the rule copies the statutory language on
excluded discharges, including the reference to permits under local
law. NOAA interprets the phrase ``permitted by a permit'' to mean that
only discharges that are authorized by, and thus in compliance with,
the terms of a permit are eligible for the exclusion.
Comment: One commenter noted that public vessels are used as an
example of exclusion from liability and suggested it would be helpful
for the preamble to reiterate that exclusion in addition to the
permitted discharge exclusion. Another commenter questioned why onshore
facilities subject to the Trans-Alaska Pipeline Authority Act (TAAPA),
43 U.S.C. 1651 et seq., are exempt from liability.
Response: NOAA has amended the preamble to include the citation to
the OPA sections providing for the excluded discharges and notes that
the TAAPA facility exclusion is provided by OPA.
Comment: Another commenter noted that the Oil Spill Liability Trust
Fund cannot be accessed to initiate assessments for incidents
originating from a federal facility. The commenter asked what
mechanisms exist that would allow for restoration given this situation.
Response: NOAA notes that trustee agencies may be called upon to
carry out restoration out of agency budgets where there are no other
funding sources available.
Injured Natural Resources or Services
Comment: Several commenters stated that the rule necessitates
identification and notification of all trustees in order to determine
whose trust natural resources may be injured, which is crucial to
coordination among trustees.
One commenter indicated that the rule should clearly state that all
physical, on-site trustee activities, including data collection and
analysis, occurring concurrently with removal efforts are subject to
the approval and overall direction of the OSC. The commenter stated
that the rule should also require effective coordination between
natural resource trustees and participants in the incident response,
consistent with the NCP (40 C.F.R. Sec. 300.305(e), 50 FR 47384, 47445
(Sept. 15, 1994)).
Response: NOAA agrees that coordination among all affected trustees
is extremely important, especially during Preassessment Phase
activities. The requirements for coordination are enumerated in
Sec. 900.14 of the rule rather than in individual subparts, to
emphasize that the duty to coordinate is applicable to the entire
assessment. NOAA does not believe that an explicit requirement to
identify and contact other trustees should be included in the rule.
Trustees need maximum flexibility during the often hectic response
phase to ensure that, among other things, ephemeral data is collected.
NOAA notes that identification and contact among trustees virtually
always occurs during the response phase, if for no other reason than
requests for initiation funding from the Oil Spill Liability Trust Fund
require such coordination.
The requirement to coordinate with the OSC is also included in
Sec. 990.14. Although NOAA agrees and the rule reflects that trustees
activities may not interfere with response activities, NOAA disagrees
that any requirement exists, nor should it exist, that the OSC must
approve all trustee activities. Many of these activities are far
outside the realm of authority or interest of the OSCs.
Decision to Proceed
Comment: One commenter indicated that injury determination should
be a precondition to trustee jurisdiction. The commenter pointed out
that restoration under OPA is, by definition, wholly retrospective, and
does not extend to measures designed to prevent or contain ``threatened
discharges.'' The commenter stated that the injury determination in
Sec. 990.51 should be satisfied in the Preassessment Phase before the
restoration planning process begins.
Response: NOAA disagrees with the comment. Injury determination is
properly part of the formal assessment, and is not required during the
Preassessment Phase. Determination of injury at this point may result
in unreasonable assessment costs without some sort of screening process
provided in this phase.
[[Page 477]]
Section 990.42--Determination to Conduct Restoration Planning.
Considerations
Comment: One commenter suggested that the conditions in this part
are subjective and require more specific guidance. However, another
commenter was concerned about being required to complete some of the
determinations at such an early stage in the process when it may be
particularly difficult to determine whether response actions will
adequately address injuries.
Response: There is necessarily a subjective component in trustees
applying their best professional judgment to existing or readily
available information in order to make the determinations in this
section. NOAA believes that this balance of judgment and data analysis
is most appropriate and cost-effective at this stage of an incident.
Comment: A number of commenters indicated that the responsible
parties should be included (and officially notified) in the
determination to conduct restoration planning. The commenters
questioned whether the administrative record will be open during this
stage, and whether all data used to make a determination to conduct
restoration planning will be made available to responsible parties.
Response: The rule provides that identified responsible parties be
notified and invited to participate in the assessment as soon as
practicable, but no later than the point that trustees decide to
conduct restoration planning and prepare a public notice to that
effect. Participating responsible parties will be provided documents
detailing the determinations that are required under the rule. The rule
also indicates that the administrative record should be opened
concurrently with issuing the Notice of Intent to Conduct Restoration
Planning. The record is available to responsible parties as well as any
other member of the public.
Comment: Another commenter noted that the need for restoration is
based on an evaluation of whether response actions will alleviate the
residual injuries. The commenter suggested that the rule should clarify
that both residual injuries and direct, initial injuries are to be
considered at this point.
Another commenter suggested that it may also be difficult to
determine whether feasible restoration alternatives exist when the
trustees do not yet know the full extent of the injuries. A number of
commenters were concerned that the notion of ``feasible'' might be
narrowly interpreted to mean ``on-site/in-kind,'' in which case
restoration may not be possible. One of these commenters suggested that
the rule allow both primary and/or compensatory restoration actions
that might be considered.
Response: NOAA agrees that all injuries occurring from the time of
the initial or threatened discharge should be considered in evaluating
the efficacy of response actions in alleviating the need for
restoration. Response actions may be effective in restoring some
injuries caused by the initial incident, for instance by removing oil
from a sandy beach so that the beach can be reopened. While this
response action may restore a natural resource service to baseline, it
would not compensate for the interim lost use that occurred during the
closure period. The rule has also been amended to indicate that
feasible primary or compensatory restoration actions should be assessed
in making the determination to proceed with restoration planning.
Decision to Proceed
Comment: Several commenters supported the provision authorizing
trustees to recover reasonable assessment costs incurred up to the
point that preassessment determinations are made. However, one
commenter notes that it is thus incumbent upon the trustees to limit
their assessment costs. The commenter suggested that prompt decisions
by the trustees on jurisdiction and the need for restoration will
ensure that costs are contained, and eliminate the possibility for
responsible parties to delay completion of response measures until such
trustee determinations are made. The commenter thus recommended
trustees be required to make both determinations within ninety (90)
days of an incident.
Response: The rule provides that all reasonable costs of assessment
are recoverable, including those costs incurred up to the point
trustees decide not to pursue restoration. Costs must meet the rule's
definition of ``reasonable assessment costs'' to be recoverable. NOAA
disagrees with the need for or utility of a ninety-day limit on making
the determination to conduct restoration planning, and doubts that fear
of this determination will cause responsible parties to drag out costly
response activities. NOAA believes that any time limit would be
arbitrary, given the great variability in the progress and timing of
cleanup activities from incident to incident.
Section 990.43--Data Collection
Comment: One commenter questioned how the determinations in
Sec. 990.42 are to be made based upon ``readily available
information.'' The commenter suggested this limitation is acceptable if
it includes all the sources listed in this section. One commenter also
suggested the term ``limited'' in the proposed rule may imply that if
trustees went too far in data collection, they might not be entitled to
the rebuttable presumption and/or costs for that data collection
because they might not be considered ``reasonable.'' A few commenters
stated that, so long as the data to be collected is reasonably related
to the assessment, no other restrictions should be placed on its
collection. In contrast, one commenter noted that there are no controls
specified in this part over the expense or timing of preassessment data
collection activities.
Response: The rule has been amended to specify that data collection
and analysis that are reasonably related to the purposes of the
Preassessment Phase may be conducted in accordance with the rule. The
rule provides guidance on the types of information that may be useful
in making Preassessment Phase determinations. The term ``limited'' has
been removed from the rule, but was originally intended to suggest that
data collection should be related to the determinations required to be
made at this stage, and thus to the nature of the incident and its
injuries, and the relevance and utility of available information.
Comment: Another commenter suggested that trustees should be able
to use models or extrapolations from scientific literature when it is
more appropriate and cost effective than gathering site-specific data.
Response: NOAA notes that the type of analysis suggested by the
commenter is exactly the type of reliance upon existing information
that this section intends to be available to trustees, if such
information is relevant to the incident.
Section 990.44--Notice of Intent to Conduct Restoration Planning
Comment: Several commenters suggested that the rule should
explicitly acknowledge the need for flexibility in completing the
Preassessment Phase. The commenters noted that, since incidents vary
greatly in scope, the effort invested by trustees should be
proportional to the magnitude of the incident, therefore, the rule
should allow the public notice and participation steps to be
compressed, when appropriate. Other commenters pointed out that the
proposed language requires trustees to prepare a public notice, even if
they have declined to proceed with an assessment. Another commenter
suggested that trustees
[[Page 478]]
should be required to provide the specific authority for which the
trustees are asserting a potential claim in the Notice.
Response: NOAA believes that the rule does direct trustees to
tailor their preassessment activities to the nature and extent of an
incident, given the determinations that this section requires trustees
to make. Section 990.14(d) has been amended to explicitly provide that
the degree, extent, and timing of public participation prior to
development of a draft restoration plan is within the discretion of the
trustees. The final rule also indicates that the manner of making the
Notice of Intent to Conduct Restoration Planning publicly available
will depend on the nature and extent of the incident. The final rule
also explicitly requires that the notice reference the specific
authority under which trustees are pursuing a claim for restoration of
their trust natural resources.
Comment: One commenter suggested that notice requirements to the
responsible party, and required contents of the notice, are unclear.
Another commenter noted the requirements to prepare a notice and open
the administrative record should be moved to a later point in the
assessment, so that such requirements will not hamper necessary
trustees activities.
Response: NOAA has amended the rule to indicate that a written copy
of the notice must be sent to identified responsible parties, and the
rule at Sec. 990.44 now specifies information for inclusion in the
notice. The rule provides trustees the flexibility to conduct essential
Preassessment Phase activities that will allow them to make the
requisite determination that they should proceed with restoration prior
to turning their efforts to preparing a Notice of Intent to Perform
Restoration Planning and opening an administrative record.
Section 990.45--Administrative Record
Review on the Record
Comment: Several commenters argued that the rule should not be
silent on the standard of review for assessments, but should
emphatically, specifically, and clearly state that the standard of
review applicable to trustee decisions, based upon an administrative
record, is like that of any other ``final agency action'' contemplated
under the Administrative Procedure Act (5 U.S.C. 551-59, 701-06), or
applicable State or tribal counterparts. Some of these commenters
suggested that because OPA authorizes NOAA to provide for the
administrative adjudication of damages (33 U.S.C. 2706 (c)-(e)), the
promulgation of a rule providing for such administrative adjudication
would ensure that OPA's restoration goals are met. These commenters
also objected to NOAA's failure to provide for procedures to
administratively adjudicate natural resource damages that should, in
particular, provide for a hearing to be held by a neutral arbitrator
when requested as the statute requires.
Several commenters noted that, if NOAA is wrong about the effect of
the rule, then following the rule will severely prejudice the trustees.
The commenters stated that, if responsible parties are successful in
conducting ``shadow'' assessments and convincing courts that they are
entitled to trials de novo, then the public will be ill-served by
trustees complying with the rule. The commenters pointed out that,
unlike the responsible parties, trustees will be forced to reveal their
claim, data, procedures, and analyses in an open process and losing any
litigation privileges on their scientific information, which will put
trustees at a distinct disadvantage in litigation compared to
responsible parties. The commenters also noted that protections are
necessary so that a breakdown of a cooperative process, in which
information has been shared, does not undermine the ability of trustees
to make recoveries and complete restoration.
Several commenters described the expected benefits of review on the
administrative record process, including greatly reduced amounts of
litigation, and associated transaction costs, greater public
participation in damage assessment and restoration decisions, and
enabling trustee agencies to make decisions on natural resource damage
assessments and restoration plans within their areas of expertise,
instead of having courts decide extremely complex technical,
scientific, and economic determinations. Other commenters stated that
record review would be beneficial to the responsible party, who will be
able to contest any trustee decisions from a neutral, common body of
data which they may help to develop.
Other commenters argued that the Seventh Amendment to the U.S.
Constitution, which guarantees a jury trial in suits at common law,
does not preclude record review of the damage determination, stating
that the Supreme Court has interpreted this language as applying to
actions analogous to those brought in 18th-century English courts of
law as opposed to courts of equity or admiralty. The commenters argued
that a claim for damages to natural resources is much more analogous to
an equitable action than a legal one. Some commenters stated that
record review is also mandated by the rebuttable presumption since it
would make no sense for there to be such a presumption absent record
review. The commenter noted that the rebuttable presumption is based on
the existence of a full record and careful administrative decisions.
Other commenters addressed other statutory processes that grant
record review to comparable regulatory processes, such as NEPA. The
commenters pointed out that, although the cases are not directly on
point, a few courts have applied a deferential standard of review to
decisions of state or local agencies made pursuant to NEPA. One
commenter specifically stated that NOAA should not try to imply that
NEPA compliance is intended to or construed as an indirect means of
attaining deferential review on record.
Some commenters suggested that the rule now creates a negative
inference regarding applicability of record review by retreating from
its earlier, wholly defensible position. The commenters stated that
NOAA need not make the standard of review mandatory in the rule, but
should express its legal opinion in the preamble regarding record
review based on the ``arbitrary and capricious'' standard.
Several commenters endorsed the decision not to expressly address
in the rule a standard of judicial review, but the commenters argued
that legal and policy considerations dictate that NOAA should not imply
such a standard either. The commenters noted that simply changing
``compensable values'' to ``compensatory restoration'' is not enough to
bring such components under a presumed preferential standard of review.
The commenters argued that, since this element remains based on the
same statutory provision for ``diminution in value,'' it would still be
subject to de novo review.
One commenter noted that the rule provides so little meaningful
restraint on trustee discretion, the unfairness of a record review
approach is patent.
Response: NOAA agrees that damage assessment determinations made
pursuant to OPA constitute final agency actions typically subject to
review on the record by federal courts, and fully expects that this is
the standard of review that will be applied. NOAA agrees with the
benefits and rationales discussed in support of record review, and also
agrees that the rebuttable presumption is not inconsistent with review
on the record. NOAA does not agree that diminution in value
[[Page 479]]
necessarily provides for de novo review by a court, given that this is
but one element of a claim for damages, all of which must be applied to
restoration. NOAA does not believe that many responsible parties are
interested in conducting ``shadow'' assessments.
However, NOAA does not believe that it is within the scope of
responsibility tasked to NOAA to promulgate natural resource damage
assessment regulations to specify reviewing court procedures and
protocols. No negative inference should be drawn from lack of
declaration within the rule that review on the record is the expected
standard of review.
Comment: Some commenters noted that preparation of an
administrative record need not significantly delay the assessment or
``overwhelm'' trustees in conducting assessments. The commenter stated
that it is usually rather simple and straightforward for the trustee
contemporaneously to organize all documentation supporting its
decisions into an administrative record, and that such preparation will
save tremendous time and resources in preparing for a record review
trial, although not necessarily for a trial de novo.
Some commenters stated that the responsible party should be
required to meet the same public disclosure standards as the trustees,
to whatever extent they are involved in the assessment. These
commenters noted that public involvement is made more meaningful and
restoration plans are more properly suited to the injury as more data
is available, and the availability of data also removes the uncertainty
of litigation as well. One commenter expressed concern that the use of
the record will compromise trustees' litigation, with no corresponding
risk for the responsible party. Some commenters noted that sharing
information may be an enticement to responsible parties to join
trustees in an assessment; this incentive would not exist if the
trustee is required to reveal information in the record in any case.
Response: NOAA agrees that preparation of an administrative record
need not delay the assessment. Past experience has indicated that
secretive assessments are not in the best interests of the public or
the natural resources. It is in all parties' interests to openly and
cooperatively determine what restoration actions are needed as a result
of an incident, so that restoration can be implemented quickly. NOAA
believes that delayed restoration defeats the purposes of OPA. NOAA
does not believe that responsible parties are likely to gain any
advantage by not participating equally and openly in preparation of the
administrative record, and expects a reviewing court would view with
disfavor the withholding of information to spring upon the trustees at
the eve of trial.
Contents of the Record
Comment: One commenter asked for clarification as to what types of
documents should be included in the administrative record.
Response: NOAA points out that federal trustees should maintain the
administrative record, including what documents might be included in
administrative record, in manner consistent with the Administrative
Procedure Act. Trustees should be guided by an understanding that all
documents relied upon in making ultimate determinations about
restoration should be included in the record.
Comment: Some commenters expressed concern that third party
litigants would use the information in the record to advance private
claims. One commenter suggested that attempts by third parties to
obtain information from the record would delay the restoration process.
Another commenter noted that the kind of information in the record,
focused on restoration, may not be particularly helpful to third party
litigants.
Response: It is not uncommon that private parties use publicly
available information obtained from governments to support their
private claims. Information gathered during an assessment on behalf of
the public should not be withheld from the public. NOAA does not expect
that allowing public access to an administrative record will result in
delays in restoration.
Subpart E--Restoration Planning Phase
Section 990.51--Injury assessment
Causation
Comment: Some commenters stated that the proposed rule does not
clearly require trustees to use sound and reliable science, or provide
specific requirements to be met in the various steps of the injury
assessment. Several commenters stated that the rule must include
rigorous standards and criteria for determining that an observed injury
was caused by an incident to avoid unsupported, unnecessary, and
unreasonable claims. One commenter noted that if the damage assessment
is used for evidence collection, the question of how the data will be
used raises a question of the level of confidence.
Response: The treatment of injury determination within the rule
supports the use of sound and reliable science to demonstrate that
injuries identified have resulted from the incident. This treatment
embodies the principles and practices of natural resource damage
assessments developed over the past several years.
Comment: Several commenters raised concerns regarding demonstrating
causation for injuries resulting from response actions or a substantial
threat of a discharge. These commenters noted that trustees must still
show clear and specific causation for those injuries resulting from the
response or threat, not from some other cause. Other commenters also
stated that the rule should clarify that injury assessment is not
limited solely to addressing injury residual to response actions, but
should include direct, initial injuries.
Response: For injuries resulting from an actual discharge, trustees
must evaluate exposure and pathway and demonstrate that injury resulted
from the incident. For injuries resulting from a response action or a
substantial threat of a discharge, trustees must also demonstrate that
the injury occurred because of the incident. Under this rule,
assessments are not limited solely to addressing injuries residual to
response actions, but include the direct, initial injuries. Evidence
supporting the linkage between the incident and injury must be
established to demonstrate injury. The rule's requirement to quantify
injuries relative to baseline may provide the proof of causation.
Comment: One commenter requested that the rule state that an
incident should be deemed the cause of an injury if the incident was a
contributing factor to an indivisible injury, as provided in the 1994
proposal.
Response: NOAA does not believe it is appropriate to advocate legal
standards of causation in the rule. Injuries must be determined to have
occurred, then quantified relative to baseline, to be in accordance
with the rule.
Injury Determination
General
Comment: Several commenters stated that the exceedance of some
threshold or criterion by itself should not constitute an injury unless
it can be shown to be relevant to each phase of injury determination,
have population, habitat, or ecosystem level effects, or directly
affect the human population. The commenters noted that the rule
[[Page 480]]
should require injury determination and quantification for such
injuries unless there are special circumstances such as threatened or
endangered species.
Response: NOAA disagrees that the suggested limitations on the
definition of injury are appropriate or warranted given OPA's mandate
to make the environment and public whole. If an injury resulting from
an incident can be cost-effectively and reliably determined and
quantified, and feasible, cost-effective, environmentally-beneficial
restoration actions can be identified, then restoration should be
pursued. However, NOAA does not suggest that each and every injury,
regardless of its nature and scale, should be pursued in an assessment.
Trustees proceed with an assessment when the information on injury is
adequate to justify restoration.
Comment: Some commenters suggested that the acceptance criteria in
the CERCLA rule for injuries should be adopted in this rule. Other
commenters did not understand the need for acceptance criteria, which
were viewed as too restrictive and narrow. Another commenter
specifically asked that the rule make the assessment consistent with
the Archaeological Resources Protection Act (ARPA), 16 U.S.C. 1361 et
seq., or at least incorporate the ARPA criteria.
Response: The rule does not list specific acceptance criteria for
injuries per se. The rule does, however, include factors aimed at
achieving meaningful restoration. NOAA believes that the rule is
adaptable and will allow trustees to select the injuries and assessment
procedures that will provide reliable and valid information to
determining appropriate restoration. Thus, the assessment process
described in the rule should be flexible enough to incorporate the
concerns and goals of ARPA.
Demonstrating Exposure and Pathway
Comment: Several commenters argued that allowing demonstration of
exposure and pathway by procedures other than field procedures would
allow trustees to claim injury without leaving their desks. The
commenters stated that the rule should require trustees to show
evidence of actual exposure and a pathway. Another commenter, however,
suggested that trustees might use procedures other than those used in
the field to demonstrate exposure and a pathway, if environmental
conditions or other assumptions are comparable between the proposed
procedures and the actual field conditions. Some commenters suggested
that the phrase ``plausible pathway'' be changed to ``reasonably likely
pathway.''
Response: Like any other assessment procedure used under this rule,
procedures to determine exposure and pathway must meet the standards
for acceptable procedures in Sec. 990.27. Thus, the most appropriate
procedure for the circumstances will be selected by trustees, and NOAA
does not believe that any of the suggested limitations or qualifiers
are necessary in the rule.
Focus on Services
Comment: Many commenters argued that injury assessment should focus
on the services provided by a natural resource rather than simply the
natural resource's physical, chemical, or biological properties. The
commenters noted that, given that ecosystems need some level of
disturbance to maintain biological diversity, and the difficulty in
determining recoverability of natural resources since natural resource
stability does not exist, adverse effects to natural resources that
cannot be linked to services provided to the public or the overall
functioning of the population, community, or ecosystem ought not be
considered under the rule.
Response: OPA states that trustees ``shall assess natural resource
damages'' (section 1006(c)) and that these damages are ``for injury to,
destruction of, loss of, or loss of use of, natural resources''
(section 1002(b)(2)(A)). The language of OPA clearly does not indicate
a preference for services over natural resources.
On a practical basis, the determination of recovery is possible, as
demonstrated by the wealth of information on this topic in the
literature and summarized on NOAA's restoration guidance document,
listed in the Bibliography at the end of the preamble. Ecological
concepts such as stability, although not static, can also be reasonably
determined and thus used to define recovery. This is also supported by
the literature. Thus, contrary to the commenter's position, NOAA
maintains that recovery of natural resources, as a practical matter,
can and must be considered in order to fulfill OPA's goal of making the
environment and public whole.
Panel of Experts
Comment: Some commenters suggested that NOAA establish a team of
experts in ecology to provide a better scientific basis for determining
and quantifying injury to natural resources. These commenters also had
specific concerns with the use of certain procedures, e.g., biomarkers,
and the manner of accounting for indirect effects.
Response: NOAA does not believe it is necessary at this time to
convene a panel of experts. Instead, the standards for procedures
provided in Sec. 990.27 should address the concerns about certain
procedures on a case-by-case basis.
Types of Injuries
Comment: Several commenters suggested that the rule include a list
of pre-accepted biological and non-biological injuries and parameters
such as reproductive success and juvenile or adult survival. The
commenters stated that the rule should also provide a mechanism to
modify the list of accepted injuries as new information becomes
available. These same commenters stated that, whether or not such a
list is finalized, the rule should allow an injury to be determined
based on a discharge, known concentrations, and literature
documentation that such substances in such amounts injure certain
natural resources. One commenter suggested the rule implies that
trustees will assess injuries that do not meet some unarticulated
threshold. The commenter stated that the decision to select injuries
for assessment should be left to the discretion of the trustees.
Response: The rule does provide that it is within the discretion of
trustees to select subsets or representative injuries and parameters
from the suite of injuries and parameters to include in the injury
assessment and restoration planning. Rather than specify discrete
categories for limiting this scope, e.g., recreational importance, the
rule encourages a focus on accomplishing meaningful restoration by
identifying factors to consider in selecting injuries to include in the
assessment. The guidance document on injury provides information on the
types of injuries that may result from incidents involving oil.
Framework for Assessment
Comment: One commenter indicated that the rule should provide a
framework that is interpretable to all trustees. The commenter
suggested that the ecological risk assessment procedure would greatly
facilitate the assessment.
Response: NOAA believes that the rule does provide a
comprehensible, logical, and straightforward assessment procedural
framework. The general logic of ecological risk assessment is reflected
in the assessment process in the rule. However, NOAA does not believe
that the approach typically involved in risk assessment is appropriate
for all, or even most, incidents.
[[Page 481]]
Injury Procedures
Comment: One commenter stated that the rule should more clearly
state that both quantitative and qualitative procedures may be used in
an injury assessment.
Response: Both quantitative and qualitative procedures are
available to trustees under this rule. This flexibility is made clear
in the discussion of the standards for acceptable procedures in
Sec. 990.27 and in the definition of injury in Sec. 990.30.
Proceeding With the Assessment
Comment: One commenter stated that the rule requires that all of
the listed criteria for determining injury must be met before trustees
may proceed with an assessment. The commenter noted that it might not
be feasible to have documented all the criteria at this point, thus the
rule should simply require that trustees ``consider'' these criteria
before proceeding with restoration planning.
Response: The conditions in the rule are intended to encourage a
focus on necessary and meaningful restoration. Therefore, proceeding
with an assessment at this stage is contingent upon demonstrating
injury.
Public Involvement
Comment: Some commenters argued that there should be greater public
involvement in the injury determination, quantification, and
restoration process so that the public will be allowed to participate
in the selection of injuries to be included in the assessment. The
commenter noted that the public may be aware of injuries of which the
responsible party and trustees are unaware. The commenters stated that,
if the public input is to be meaningful and comply with OPA, the public
must be given a formal means of involvement throughout the process.
Response: The rule acknowledges the value of involving the public
in the assessment, and requires that trustees provide opportunities for
public involvement after making the decision to develop restoration
plans. Additional opportunities may be provided at any time prior to
this decision if such involvement facilitates the decisionmaking
process or helps to avoid delays in restoration.
Section 990.52--Quantification
Baseline
Comment: Some commenters stated that the rule does not require
quantification relative to baseline. Commenters noted a number of
difficulties associated with determining baseline for quantification
purposes including the use of historical data that may not reflect
current conditions at the site of the assessment and the need to
account for natural variability or confounding influences to adequately
compensate for injuries without overestimating the injuries. The
commenters also pointed out that non-equilibrium systems are the rule,
so baseline may be difficult to define, let alone achieve. Finally, the
commenters also noted that funding is rarely if ever available for
establishing baseline.
Some commenters argued that quantification should focus on services
rather than natural resources, therefore baseline should be defined as
the flow of services to the public that would have existed in the
absence of the incident.
Response: The approach for quantification does relate injury to
baseline. The rule acknowledges the inherent difficulties in collecting
traditional baseline data and has been expanded to encompass other
appropriate types of data for comparison. Broadening the concept of
baseline will allow trustees to more appropriately adapt the
quantification approaches to the circumstances of an incident. NOAA
also notes that strict reliance on services is neither explicitly
stated nor implied under OPA. Thus, the definition of baseline and its
application to quantification is retained in the rule.
Quantification Approaches
Comment: A number of commenters argued that the rule should require
quantification of the reduction in services resulting from the
incident, as required in the CERCLA rule. Some of the commenters stated
that the dichotomy of measuring the change in the natural resource
itself, or directly in the services is unnecessary and that only the
measurement of reduced services can serve as a predicate for
compensable natural resource damages. Some commenters argued that NOAA
should adopt acceptance criteria for injury quantification, such as:
service reductions must be linked to the discharge and the natural
resource injury; service reductions must be measured relative to
baseline; service reductions must be measured in terms of functions
provided by the injured natural resources, not the physical quantities
or qualities of the natural resources; and measurements of service
reductions must account for the presence and availability of substitute
services.
Response: The rule allows trustees to assess the injured natural
resources directly and/or directly assess the lost services provided by
injured natural resources. NOAA believes that narrow restrictions on
assessing services to humans will fall far short of fulfilling the
intent of OPA to make the environment and public whole. NOAA believes
that the public does value and benefit from productive, functional, and
healthy natural resources, habitats, and ecosystems. Neglecting OPA's
mandate to restore that which was injured and substituting natural
resources on a narrow cost and human use basis would result in real
degradation of the natural resources. Establishing additional
quantification criteria focusing on human services would be
inappropriate.
Scale of Injury
Comment: One commenter stated that quantification should be limited
to only those injuries necessary, and only to the degree necessary, to
develop appropriate restoration measures. Some commenters pointed out
that a consideration of the extent of injuries should not be restricted
to the physical boundaries of the incident, particularly where natural
resources at risk are highly mobile and seasonal in their
distributions.
Response: Quantification is appropriate where injury has been
determined to have resulted from the incident. Where information on
injury provided by quantification procedures is adequate to justify
restoration, then restoration actions should be pursued. Also, under
the rule, the spatial and temporal extent of injury is not restricted
to the physical boundaries of the incident and trustees may consider
the particular characteristics of a natural resource, including its
mobility, in quantifying injury.
Committed Services
Comment: Some commenters requested that the rule allow reduction in
service flows only for established or ``committed'' services to avoid
speculative recoveries.
Response: The provisions in the rule relating to quantification of
services lost relative to baseline ensure that speculative recoveries
are avoided.
Injury Quantification Procedures
Comment: One commenter stated that the rule should call for field-
based quantification procedures, including a set of general and basic
standards for quantifying reductions in services. Other commenters
requested that the rule provide trustees with the ability to choose one
or any combination of quantification procedures, so long as there is no
double recovery.
Response: NOAA does not believe that the rule should prescribe
limited or
[[Page 482]]
specific procedures for quantifying injury, as it is infeasible to
determine the universe of procedures that would be appropriate for all
incidents. Such a limitation would prevent trustees from using the most
appropriate procedure for the circumstances of the incident, and would
likely prevent use or adaptation of procedures to provide
quantification information that is useful in restoration scaling.
Instead, the rule provides standards in Sec. 990.27 for use in
determining appropriate procedures. The rule does allow trustees to use
a combination of the suggested quantification approaches, but prohibits
trustees from applying injury quantification procedures in a manner
that would result in double recovery.
Substitutes
Comment: One commenter argued that the rule fails to require
consideration of substitutes when injury is defined in terms of a
reduced population as opposed to a broad enough category to incorporate
substitution.
Response: Substitution is not explicitly identified as a factor in
quantifying injuries because it is only relevant to a subset of
injuries or losses--those that relate to value flowing from behavioral
opportunities available to humans.
Natural Recovery
Comment: Several commenters stated that the requirement for
estimating the time for natural recovery may be difficult to meet, and
that the rule should instead call for this estimate when such estimate
is readily available and cost-effective, and when no primary
restoration is likely to be effective.
Response: NOAA acknowledges the difficulty in estimating natural
recovery and has provided the necessary flexibility to trustees. The
rule has been amended to provide that recovery may be estimated
quantitatively or qualitatively, depending on the circumstances of the
incident and procedures available that meet the standards for
procedures under Sec. 990.27.
Section 990.53 Restoration Selection--Developing Restoration
Alternatives
General
Comment: Many commenters supported the shift in focus from
monetization of damages to scaling of restoration actions. These
commenters stated that the proposed rule properly places the focus of
the damage assessment on the ultimate goal of OPA to restore injured
natural resources and services, and incorporates best current practices
currently being used by trustees and responsible parties to achieve
this goal in an expeditious manner. However, many other commenters
raised concerns that the scaling approach would lead to delays and
increased assessment costs, since trustees would undertake studies of
lost services and replacement services, and would not substantially
further the goal of reducing transaction costs. Other commenters
suggested that requiring trustees to quantify all damages in terms of
specific restoration actions and costs places trustees in the position
of either settling for compensation for immediately apparent, short-
term losses or delaying the restoration process while waiting for long-
term injuries to become apparent. One commenter noted that the public
will not be served in either case; therefore, trustees should be
allowed to recover damages, then determine the most appropriate
restoration approach over time. Another commenter argued that as
accurate assessment becomes more difficult and costly, less scientific
rigor will be required.
Response: Trustees are required, under section 1006(c) of OPA (33
U.S.C. 2706(c)), to ``develop and implement a plan for the restoration,
rehabilitation, replacement, or acquisition of the equivalent, of the
natural resources under their trusteeship.'' By permitting a variety of
possible restoration activities, this section of OPA leaves to the
trustees' discretion the determination of the most appropriate
activity, recognizing the legislative history's indicated preference
for restoration over acquisition of equivalent natural resources. All
damages recovered must be spent on some restoration activity. Thus, it
makes sense that evaluating potential restoration actions provide the
focus of an assessment. It does not benefit the natural resources or
the public if monies are collected without a view toward how they will
be spent, nor whether sufficient funds have been collected to implement
any meaningful action. OPA is not about collecting money. NOAA believes
that, contrary to some comments, the restoration approach will
generally speed restoration and avoid litigation, by alleviating
distrust that claims for monetary damages are speculative and punitive.
Practical experience in implementing the restoration scaling approach
in past cooperative assessments has led NOAA to the belief that this
approach is effective in significantly expediting the restoration of
injured natural resources and services, and that the benefits to the
environment and public do not come at the expense of increased
assessment costs. While trustees now must assess replacement services
in addition to lost services in most incidents, NOAA believes that, in
general, a net increase in assessment costs will not result, due to
both the cooperative provisions set forth within this rule and the
removal of the requirement that trustees estimate the monetary value of
damages. NOAA also believes that the standards for assessment
procedures set forth in Sec. 990.27(a) of the rule will ensure a
sufficient level of rigor for all assessments.
Range of Alternatives
Comment: Some commenters requested guidance on what might be an
appropriate range of restoration alternatives. Other commenters noted,
however, that the rule should not require the development and
consideration of a predetermined number of potentially unreasonable
alternatives.
Response: NOAA does not agree with the commenters who recommended a
limit on the range of alternatives trustees should consider. Trustees
should consider a range of alternatives that is reasonable for the
incident of concern, and the specific natural resources injured. The
rule requires that only actions that are feasible and legal be
considered. The range of feasible actions may vary greatly, depending
on the types of injuries suffered, or the nature of the environment or
habitat, among other things. Guidance on the types of actions and how
they might be considered is provided in the Restoration Guidance
Document, referenced in the Bibliography at the end of this preamble.
Natural Recovery Alternative
Comment: Some commenters suggested that, when injuries are not
extensive or are short-term, no restoration actions are needed,
therefore, the rule should more strongly require consideration of
natural recovery. Many commenters supported the requirement that
trustees always consider natural recovery as an option. Several
commenters stated that the rule should adopt a preference for natural
recovery.
Other commenters stated that the language regarding the ``no
action'' alternative is confusing. Another commenter suggested that the
confusion over the terms might be a result of the different objectives
of OPA and NEPA.
Several commenters stated that the rule should set out reasonable
[[Page 483]]
expectations for analysis of natural recovery, especially where
injuries are evident from the Preassessment Phase investigations and
feasible restoration alternatives exist. These commenters suggested
either deleting the requirement to evaluate a no action alternative or
making it optional.
Response: The rule requires that natural recovery be evaluated as a
primary restoration action in every case. ``No action'' refers to
alternatives in which trustees take no primary restoration action and
no compensatory restoration actions. Natural recovery, which must be
considered for each incident, is only considered under the primary
restoration component of the alternative and only refers to direct
restoration involving no human intervention. Trustees have the
discretion to choose any combination of primary and/or compensatory
restoration actions, given the circumstances of the incident.
Primary Restoration
Comment: Many commenters requested that the rule clarify the
distinction or relationship between primary and compensatory
restoration. Another commenter, however, suggested that this was a
distinction without any significance. Some commenters interpreted the
regulations to allow only on-site, in-kind actions in primary
restoration. Some commenters noted that, if the rule is interpreted to
limit primary restoration to actions focused on the injured natural
resources themselves, and to relegate replacement or acquisition
actions solely to compensatory restoration, it is inconsistent with
OPA, which authorizes replacement and acquisition of the equivalent as
measures for primary restoration. Other commenters noted that primary
restoration could include any action, whether on-site, off-site, in-
kind, out-of-kind, that returns natural resource and/or service levels
back to baseline condition.
Response: NOAA has sought to clarify the distinction between
primary and compensatory restoration, including specifying explicitly
in the preamble discussion of the definition of ``restoration'' that
primary restoration may include on-site, off-site, in-kind, and/or out-
of-kind restoration actions that return injured natural resources and
services to baseline. Actions to restore, replace, rehabilitate, or
acquire the equivalent of injured natural resources or services may be
considered in evaluating both primary and compensatory restoration
actions.
Comment: Some commenters suggested that primary restoration should
attempt to make the public whole by returning net services to the
public to baseline.
Response: NOAA believes that in most cases, primary restoration
alone will not be sufficient to make the environment and public whole.
When incidents result in interim lost services, an additional
compensatory restoration component will be necessary to fully
compensate for injuries to trust natural resources.
Comment: One commenter stated that the rule should require a
hierarchy of alternatives, such as on-site, in-kind; off-site, in-kind;
and off-site, with substitute natural resources or services with
equivalent economic value.
Response: NOAA does not support the development of such a
hierarchy, since it may prevent the trustees from selecting and
implementing the alternative which best meets the criteria for
evaluation of alternatives presented in Sec. 990.54(a).
Acquisition of the Equivalent
Comment: One commenter contended that acquisition of the equivalent
is inconsistent with the stated aim of compensatory awards and should
not be considered. The commenter questioned how acquiring the
equivalent restores the injured natural resources, since the effects of
most incidents are transient. Some commenters on the 1994 proposal
objected to the ranking of restoration alternatives whereby acquisition
of the equivalent is the option of last resort, especially where
natural resources are subject to development or other pressures (e.g.,
in urban areas). The commenter stated that trustees should be free to
acquire the equivalent even if other restoration alternatives are
possible. Some commenters stated that the goal of restoration is to
make the public whole through whatever alternatives are available under
OPA, which may or may not include returning natural resources to
baseline.
Response: NOAA contends that, in some instances, acquisition of
equivalent natural resources or services may be necessary to adequately
compensate the environment and public. The present rule does not
prevent acquisition of the equivalent even in the presence of other
feasible alternatives.
Restoration of Services
Comment: Several commenters argued that restoration alternatives
must be formulated and evaluated by reference to the services provided
by the injured natural resource, not the natural resource itself.
Therefore, the commenter suggested that NOAA should make every effort
to clarify that the restoration of services of natural resources refers
only to those services or functions provided to society. Commenters
added that the service-focus is needed to select the most cost-
effective, rational, and efficient restoration alternatives. The
commenters argued that allowing trustees to choose full physical
restoration where a less expensive alternative can fully replace the
services provided by the natural resource is contrary to the goal of
cost-effectiveness since the additional expenditure required for full
physical restoration provides no additional benefit to the public.
Other commenters suggested that a natural resource-based approach could
result in overcompensating the public.
Response: The rule focuses all assessment decisions on restoration,
and making the environment and public whole. Primary restoration
focuses on the injured natural resources themselves, as authorized by
OPA's language basing liability and damages on injuries to natural
resources themselves, while compensatory restoration focuses on the
services that are lost as a result of the incident, and which are not
compensated for by implementing the primary restoration action. Both
elements must be considered in designing restoration alternatives.
Because OPA defines damages to include both the cost of restoration and
diminution in value, a focus solely on natural resources or solely on
services risks undercompensating the environment and the public.
Other considerations
Comment: Several commenters suggested that a focus on ``certain key
species or habitats'' may lead to controversy, since terms are not
defined. The commenters noted that there is sufficient guidance in the
quantification section on this issue and that these terms are not
needed. However, the commenters suggested that, if the terms are
retained, the phrase ``key services'' should be added.
One commenter suggested that there is the need to develop
procedures that allow for non-predictable attributes of the ecosystem.
The commenter noted that, for other programs requiring restoration, a
poor job has been done in the past of documenting restoration outcomes
needed to provide data for development of new models.
One commenter stated that the procedures for restoration under OPA
are unlikely to replace injured natural resources because of inadequate
[[Page 484]]
knowledge on critical habitat functions, long-term success and the lack
of procedures to assess impacts due to multiple stressors.
Response: The final rule retains the guidance that primary
restoration actions that return key natural resources or services to
baseline may be an appropriate restoration alternative if, for
instance, such an action would facilitate return or recovery of other
natural resources. The concept of key services has been added to the
rule. NOAA believes that the rule's requirements to determine standards
to gauge the success of restoration actions, and performance criteria
to measure the progress of actions in achieving goals and success, will
provide the types of information through monitoring that the commenters
suggest are needed.
Compensatory Restoration
Mandatory Inclusion
Comment: Some commenters argued that the inclusion of compensatory
restoration should be required in all planning efforts, and not be
discretionary. Some of these commenters stated that if trustees do not
include compensatory restoration actions, they should include a written
justification for compelling reasons of why such actions were not
included.
Response: The rule and preamble have been revised to reflect that
trustees must consider compensatory restoration action and also must
document this decision in the restoration plan.
General
Comment: Many commenters noted that there are too many undefined
terms, e.g., ``scarcity,'' ``comparable,'' ``equivalent,'' used in the
compensatory restoration provisions.
Response: NOAA has amended the rule to require that the relative
value of injured and replacement natural resources and services be
evaluated, rather than scarcity and demand.
Comment: Several commenters suggested that the compensatory
restoration approach seems to have been structured as an attempt to
circumvent the difficulties in accurately measuring interim lost
values. However, the commenters stated that the concepts of
compensatory restoration and scaling do not address the defects of the
1994 proposal and that these concepts are based upon economically and
legally unsound assumptions and, therefore, fail to comply with the
statutory measure of damages.
Response: NOAA has put forth the revised rule with the intent of
expediting restoration of injured natural resources and services. NOAA
believes that the compensatory restoration approach in this rule is
technically and legally sound, and consistent with the language and
intent of the statute, and more appropriate to adequately assess and
compensate for interim losses than previous approaches.
Concept of Compensatory Restoration
Comment: Several commenters argued that the concept of compensatory
restoration creates the potential for exaggerated or excessive damage
awards and will enable excess money to be spent on natural resource
projects without limitations. Some of these commenters argued that this
approach has insufficient constraints on the application of procedures,
which may result in double counting, assessments beyond the scope of
OPA, or damages that are grossly disproportionate to the value of the
natural resources.
Response: NOAA believes that the standards provided in the rule for
acceptable procedures, the prohibition on double recovery, and the
opportunities for public review and input provide constraints
sufficient to avoid the problems suggested by the commenters.
Services Eligible for Compensatory Restoration
Comment: Some commenters suggested that the rule is unclear as to
what types of services would be eligible for compensatory restoration.
The commenters stated that the rule should have an additional section
that would list protocols that would enable trustees and responsible
parties to easily ascertain what service functions were impaired by the
incident, if any, and then make rational decisions about what types of
projects would serve as adequate restoration.
Response: NOAA has developed draft guidance documents, listed in
the Bibliography at the end of the preamble, that directly address
these commenters' concerns. These guidance documents will be finalized
after the rule is final. All quantifiable lost services for which
feasible restoration actions can be identified are compensable under
the rule.
Components Included Under Compensatory Restoration
Comment: Some commenters noted that the rule should clarify that
compensatory restoration is defined as actions to make the environment
and public whole for interim losses. Another commenter noted that
compensatory restoration could also address any additional injury
associated with the incident. On the other hand, another commenter
stated that interim lost values should not be collected by trustees
because that would be double recovery, and that collection of these
damages should be allowed only if there is a mechanism for distributing
those recoveries to the group injured by the incident.
Some commenters noted that the rule should clarify that
compensatory restoration is defined as actions to make the environment
and public whole for interim losses. Another commenter noted that
compensatory restoration could also address any additional injury
associated with the incident.
Response: In order to make the public whole for the resource
injuries, it is not sufficient to ensure that the resources are
returned to baseline condition, the public also must be compensated for
the losses from the time of the injury until full recovery of the
resources. For example, when beaches, parks, or fisheries are closed
and natural resource stocks are injured, people either will lose or
will have impaired opportunities for fishing, hunting, hiking,
birdwatching, and other activities. OPA provides that the measure of
damages includes recovery of the costs of restoring natural resources
and services to baseline, plus compensation for interim losses (and for
assessment costs). These recoveries are not to be distributed to
affected groups or individuals, rather OPA requires that they be used
to restore, rehabilitate, replace, or acquire the equivalent of the
injured natural resources. The recoveries are to be collected and spent
on natural resource restoration actions by the public agencies managing
the natural resources in trust for the public.
Private parties also may have standing to claim for private losses
resulting from a particular incident. Double recovery is not allowed
under statute. Public and private claims are for logically different
categories of losses. Specific provisions are articulated in the rule
in order to avoid double recoveries.
Comment: Some commenters stated that the rule should not allow for
recovery of any private losses because of the potential for double
recovery. These commenters noted that such recoveries would include
economic rent, private recreational losses (consumer surplus), lost
commercial revenue, and government revenues. One commenter stated that
changes in economic rent as a result of an incident are too complicated
to estimate reliably because of changes in factor costs and other
prices. Another commenter argued that trustees should not be able to
collect for economic rent even when private
[[Page 485]]
parties do not make such claims because this recovery by trustees is
not included within the language of OPA.
Some commenters noted that the final rule should include the
``multiplier impact'' from interim losses to estimate the true loss.
These same commenters also stated that the final rule should consider
nationwide, statewide, and regional assessments to account for areas
affected outside the direct impact area.
Another commenter suggested that the final rule should clarify the
factors that may weigh into a natural resource damage assessment
involving subsistence resources, particularly nutritionally and
culturally critical, as well as highly regulated natural resources.
Response: The preamble discussion of Sec. 990.22 has been revised
to provide trustees with detailed guidance in distinguishing between
public and private economic losses in order to avoid double recovery.
Under the valuation scaling approach, trustees are entitled to scale
restoration actions based on the total diminution in value of lost or
diminished services from injured public trust natural resources not
recovered by a private party. One component of this total diminution in
value is the resulting reduction in economic rent, which represents the
income that accrues to a producer as a result of access to an unpriced
natural resource. The procedures identified for calculating economic
rent are well accepted economic procedures. The rule, in Sec. 990.27,
provides standards for a case-by-case determination of reliable
application of any procedures employed by trustees.
In general, private parties can make claims for damages under
common law only when a private proprietary interest has been injured
(with an exception under admiralty that commercial fishermen do not
require an injury to a proprietary interest). These claims are
generally limited to ``economic'' (i.e., financial) losses. This
restriction excludes claims for lost consumer surplus attributable to
impaired recreation. See Alaska Sport Fishing Ass'n v. Exxon Corp., 34
F.3d 769 (9th Cir. 1994) (affirming dismissal of private claims on
behalf of approximately 130,000 recreational anglers seeking
compensation for the Exxon Valdez spill.)
Ambiguities could arise where impaired recreational uses of public
natural resources are linked with uses of private property that is
injured due to an incident. In this case, the trustees would seek full
recovery occur except for those losses being sought by private parties
so that double recovery did not occur.
The loss of government fees attributable to a reduction in
government services as a result of injuries from an incident are
appropriately elements of public claims. On the other hand, the changes
in expenditures captured by the multiplier effect do not represent
public losses. For example, when an incident occurs, tourists may shift
the location of their vacations to other substitute sites. The loss in
hotel and restaurant business at the site of the incident will have a
ripple effect on suppliers of goods and services for those businesses.
The ``multiplier effect'' captures the second- and later-round losses
in expenditures from an incident. However, the shift in tourist
expenditures to hotels and restaurants at substitute sites (and to
substitute activities) will bring comparable gains, with a comparable
positive multiplier effect. The net impact will be zero in markets in
which there is no change in price or direct impairment of productive
capacity as a result of the incident. Consequently, public claims do
not take into account shifts in expenditures as a result of the
incident. Private parties may be able to file claims for such losses.
In addressing claims for subsistence losses the trustees must take
into account all of the services provided by the injured resources,
including nutrition and cultural/spiritual values.
Because evaluation of compensatory restoration actions requires
scaling of the natural resources or services lost and linking them to
appropriate compensatory restoration actions, there will be no double
recovery for services restored under primary restoration actions. This
approach should also ease concerns over speculative injuries being
included in an assessment, as only measurable service losses, and only
public losses, will be included.
Restorable Natural Resources
Comment: Some commenters noted that the rule should not limit
restoration to ``restorable'' natural resources or services since, from
an ecosystem point of view, almost any injury can be redressed at least
in part even if the particular services or site cannot be.
Response: NOAA agrees and believes the rule is sufficiently
flexible to provide compensation for those natural resources or
services that are not directly restorable.
Types of Compensatory Actions
Comment: One commenter stated that the rule should require that
lost services and the replacement services be truly equivalent in type
and quality. Other commenters, however, suggested that trustees may
also consider, when establishing the range of compensatory restoration
actions, actions that provide comparable injured natural resources and/
or services. These commenters noted that the rule is unclear whether
trustees may examine restoration options that provide comparable
services in those cases where there are sufficient options that restore
same-type services. The commenters suggested that this limitation
should be removed and trustees permitted to identify and choose any
restoration options since a limitation to ``same or comparable''
services is too narrow given the complexity of natural ecosystems and
their use (and nonuse) by humans. One commenter stated that the
division between ecological and human services is blurry and that in
planning restoration of lost services, it is often possible to restore
both ecological and human services through the same action. Other
commenters pointed out that the rule does not require that the selected
compensatory restoration actions will have any connection whatever with
the injured natural resources.
Response: The rule states that trustees must consider compensatory
restoration actions that provide services of the same type and quality
and comparable value as those injured. However, if a reasonable range
of actions meeting these criteria is not available, trustees are
afforded the flexibility to consider actions that provide natural
resources and services of comparable type and quality. The rule also
develops a clear linkage between the injured natural resources and
services and the selected compensatory action(s) by requiring that
trustees develop restoration alternatives that provide services of the
same or comparable type and quality.
Scaling
Scaling Primary Restoration Actions
Several commenters suggested that scaling of primary, as well as
compensatory, restoration will be necessary.
Response: The rule has been revised to provide that scaling of
actions generally applies to primary restoration actions that involve
either replacement or acquisition of equivalent natural resources and/
or services.
Scaling Compensatory Restoration Actions
Inclusion of Passive Use Values
Comment: Some commenters stated that the heavy reliance on services
for
[[Page 486]]
scaling may result in passive use services and services flowing from
the unique character of a natural resource being excluded from
recoveries, and that, even if they are included, the direct restoration
approach is unlikely to be successful. Some commenters stated that
passive uses should specifically be used in scaling the restoration
actions.
Some commenters noted that the loss of passive values should be
compensated because such values represent part of the total value,
therefore damages, under OPA. Other commenters noted that the rule
should encourage rather than discourage the recovery of passive values
in order to increase the incentives for actions to avoid and reduce
such damages.
Several other commenters specifically argued that passive use
values should not be included in scaling restoration actions, primarily
because such values cannot be measured reliably. Other commenters
stated that including such values would unreasonably extend the scope
of potential liability for responsible parties; would generate
overstated damage claims, and would be punitive. Some of these
commenters argued that such values are inappropriate for compensation
because they are already incorporated into the legal requirements and
compliance programs of OPA and, therefore, recovery of such values in
natural resource damage cases would result in double recovery. Some
commenters stated that Congress did not expressly provide for the
recovery of passive values in OPA and that such values are overly
inclusive and unrealistic. One commenter suggested that passive value
loss is not meaningful within the statute.
Some commenters stated that, generally, incidents involve short-
term, transitory injuries, therefore recovery for lost passive values
is especially inappropriate because such recoveries would be punitive.
Some commenters noted that future effects from injuries are highly
speculative and, in the case of small injuries, insignificant;
therefore, any passive value determinations should be reduced to real,
near-term losses if they are to be included in a damage claim. Other
commenters pointed out that compensable values should have a maximum
recovery period for the future. One commenter suggested that some
passive values involve behavioral traces, contrary to the proposed rule
definition, and that the rule should encourage the measurement of
observable damages, even for those who do not directly use the natural
resource. Other commenters suggested that such values are not only
speculative, but are not economic in nature.
Response: NOAA believes that the flexibility provided by the range
of available scaling approaches will prevent the public from being
deprived of full compensation. By allowing trustees to consider
restoration actions providing natural resources and services of
comparable type, quality and value, the rule provides a means for
compensating the public for injuries to unique natural resources, even
in cases where direct restoration of these injured natural resources is
either not feasible or fails to bring the injured natural resources
and/or services fully back to baseline.
NOAA notes that there is a general consensus in the economic
community that passive use values exist. Under OPA, and in accordance
with the Ohio decision, passive use values may be used in calculating
the level of compensation necessary to fully compensate the public. The
procedures used to quantify passive use losses are subject to the same
standards for acceptable procedures in Sec. 990.27 as all other
procedures used to scale compensatory restoration actions. NOAA
recognizes that in cases involving temporary injury, individuals may
not experience a significant sense of loss. However, there are cases
where the death of individual members of a species may cause a
significant loss in passive use values even though the species levels
may at some point return to baseline.
Where appropriate, NOAA supports the inclusion of reliably
calculated passive use values in the scaling process. NOAA notes that
some of the commenters' concern about inclusion of passive use losses
may have been addressed by defining compensation for interim losses in
terms of the cost of compensatory restoration actions rather than as
the value of interim losses. Furthermore, in the revised format for
claims, valuation procedures, including stated preference methods, are
used to make relative comparisons between the loss and the compensatory
restoration action gains, rather than to generate absolute dollar
amounts of lost value for a claim. Scaling compensatory restoration
actions may involve a single survey eliciting the direct resource-to-
resource trade-offs between the injured natural resources and potential
compensatory natural resources. In this case it is not necessary to
elicit a monetary value for natural resources.
Alternatively, scaling may involve a two-sided calculation, in
which measures of both loss due to injury and gains from compensatory
restoration actions are estimated separately. Where valuation
procedures are employed, the decision as to the appropriate scale of a
restoration action will require a relative comparison of the loss in
value and the potential gains in value. NOAA recommends that, where
feasible, trustees should use the same or similar valuation procedures
for both sides of the calculation in order to reduce the possibility of
bias in the scaling calculations.
Inclusion of Nonmeasurable Functions
Comment: Some commenters stated that the rule should include
nonmeasurable functions provided by natural resources, allowing for
subjective assessments by trustees in determining the value of such
losses. One of these commenters specifically requested that the rule
acknowledge the spiritual, cultural, and religious nature of services
unique to tribes. Some commenters argued that full consideration must
be given to all of the natural resource services, whether they are of
direct human use or not.
Response: The rule does not limit the range of services to be
included in scaling compensatory restoration actions, except to the
extent that the procedures used to assess service injuries and scale
compensatory restoration meet the standards presented in Sec. 990.27.
Need for Guidelines in Conduct of Scaling
Comment: Many commenters suggested that the rule should contain
guidelines for the scaling approach and procedures in the rule. Several
commenters argued that economic valuation procedures are not
sufficiently accurate or reliable at this time to allow trustees to
make the comparison of services gained to services lost in a reliable
way in many cases. Some commenters noted that detailed guidance is
necessary to expedite damage claims and to avoid lengthy and expensive
litigation.
Some commenters stated that experimental and/or unreliable scaling
procedures should not be accorded the rebuttable presumption under the
rule. Several commenters argued that the absence of standards would
allow the rebuttable presumption for any valuation procedure, no matter
how poorly structured, including unnamed procedures that the trustees
believe are appropriate. Therefore, some of these commenters stated
that the rule should clearly define what ``valid'' and ``reliable''
mean with regard to assessment procedures. The
[[Page 487]]
commenters also suggested that trustees who choose to use new or
unorthodox procedures should be required to demonstrate that these
procedures provide comparable or higher levels of validity and
reliability than the procedures previously recognized by NOAA.
Several other commenters, however, supported the decision to remove
specific guidance on procedures from the rule and place them in
guidance documents. These commenters argued that the rule should not
establish premature or overly prescriptive procedural requirements for
any economic or natural science procedure, since such procedures are
the subject of research and refinement.
Response: NOAA notes that the rule has been revised to provide a
set of standards in Sec. 990.27 with which to judge all procedures
under consideration, as well as factors to consider when selecting
among those procedures. Assessments using procedures that meet these
standards may receive the rebuttable presumption, if they are otherwise
performed in accordance with the rule. In addition, NOAA is considering
the development of a separate guidance document on resource-to-
resource, service-to-service, and valuation scaling procedures.
Choice of Resource-to-Resource and Service-to-Service vs. Valuation
Scaling Approaches
Comment: Many commenters opposed mandating the use of the service-
to-service scaling approach for restoration options providing the
``same type and quality'' of services subject to ``comparable scarcity
and demand conditions.'' These commenters state that this requirement
restricts the flexibility of trustees in an assessment. The commenters
stated that the restriction is unworkable, given the lack of direction
as to what constitutes ``same type and quality'' and ``comparable
scarcity and demand conditions.'' The commenters stated that trustees
should be allowed maximum flexibility in selection of the most
efficient assessment procedure. Some commenters pointed out that the
requirement of service-to-service for any portion of restoration where
in-kind natural resources or services are feasible will in some cases
present difficulty in application of valuation procedures for remaining
portions of a claim due to problems of double counting or indivisible
losses and gains. The commenters argued that the selection of
procedures should be based on factors such as reasonable cost,
validity, reliability and incident specific considerations, which will
not always favor the use of service-to-service scaling over valuation.
The commenters pointed out that OPA defines the measure of damages to
include ``diminution in value'' to the public; therefore, NOAA's
authority to preclude trustees from assessing diminution in value in
monetary terms is questionable. Some of these commenters argued that
the service-to-service approach is not yet well developed, especially
in the areas of human uses. However, the commenters pointed out that
economic procedures have been well developed and frequently relied upon
and should be accorded equal weight in the rule.
Some commenters noted that the rule does not clearly specify when
trustees should use the service-to-service instead of the valuation
scaling approach.
Response: NOAA agrees with the comments recommending elimination of
the requirement to use a resource-to-resource or service-to-service
scaling procedure when determining the scale of a compensatory
restoration action that provides natural resources and/or services that
are of the same type and quality and are subject to comparable natural
resource scarcity and demand conditions as those lost. Consequently,
NOAA has modified the rule to maximize the trustees' flexibility in
choosing the most appropriate scaling approach. The trustees must now
consider, but are not required to implement, a resource-to-resource or
service-to-service approach for actions that provide natural resources
and/or services of the same type and quality, and of comparable value
to those lost. NOAA also has replaced the phrase ``comparable scarcity
and demand'' with ``comparable value.'' The rule requires that the
relative value of injured and replacement natural resources and
services be evaluated.
Use of Public Natural Resources for Restoration Actions
Comment: Some commenters argued that the compensatory restoration
approach would transfer to the polluter for free the consumer surplus
provided by public natural resources. The commenters stated that many
public goods and natural resources provide a public benefit in excess
of the cost of maintaining them. The commenters pointed out that a
restoration-based approach is preferable to industry because it focuses
on the cost of restoring an injury, rather than the value of the
injury; that the difference between these two figures is the surplus
value inherent in the natural resource. Therefore, the commenters
argued that the responsible party pays the ``cost,'' the ``surplus'' is
contributed and the appropriate ``value'' is achieved. The commenters
stated that the rule must be amended to require restoration actions of
a magnitude that create a net benefit (i.e., subtracting the pre-
existing value) equal to the injury.
Response: The rule does require that restoration actions create
comparable benefits to those that were lost due to the injury. NOAA
agrees that trustees should only count the incremental benefits created
by a restoration action. For example, if an action is rehabilitating a
wetland currently functioning at 50% effectiveness, only the
incremental improvements beyond 50% should be taken into account.
Trustees also should carefully consider the opportunity costs
associated with the use of public natural resources for compensatory
restoration actions. For example, if the restoration action is to
transform land currently in upland use into marsh, the opportunity cost
of forgoing the previous upland uses needs to be taken into account.
Consideration of Economic Benefits
Comment: One commenter suggested that scaling should also consider
the economic benefits resulting from the incident.
Response: The economic benefits resulting from incidents will
accrue primarily to individuals and, in most cases, will represent
transfer payments rather than net social benefits. For example, whereas
hotels in the area of an incident may lose tourist business, hotels in
a substitute location may incur gains comparable to the on-site hotel
losses. Just as losses to private parties are not included in the
trustees' claim, neither should private gains be included.
Use of Same Procedure to Measure Injured and Replacement Natural
Resources/Services
Comment: Several commenters argued that the same procedure should
be used to measure the value of losses and value of benefits of
restoration. One commenter pointed out that the use of different
assessment procedures for the same injury or loss would make it
impossible to adjust accurately for bias and that the rule should
require that trustees use procedures that are not subject to upward
bias.
Response: NOAA agrees that, where feasible, use of the same
procedure to measure the value of injuries and benefits is recommended
to reduce the opportunity for introducing bias in the scaling of
compensatory restoration. However, NOAA believes that requiring
trustees to use the same procedures to
[[Page 488]]
measure the value of injuries and benefits is overly restrictive, since
such a requirement may preclude trustees' ability to apply revealed
preference procedures (i.e., procedures based on data on use of natural
resources) in a range of circumstances. Revealed preference methods can
only be used to value natural resources and opportunities to use
natural resources with characteristics that fall within the range of
currently existing natural resources and use opportunities.
Consequently, though it may be feasible to value lost recreational use
of a particular natural resource with a revealed preference method,
such as the travel cost model, it will not be feasible to evaluate the
benefits of a proposed compensatory restoration action if its
attributes are outside of the range of what is currently available. For
example, if there are no dune walkways at regional beaches it will not
be feasible to value a restoration action constructing a dune walkway
with revealed preference methods. NOAA believes that the issue of bias
is addressed by the requirement in Sec. 990.27(a) requiring assessment
procedures to be reliable and valid for the particular context.
Discretion to Use Valuation Procedures
Comment: Several commenters argued that the rule gives virtually
unbounded discretion to the trustees with regard to valuation
procedures. The commenters were concerned that valuation ``sneaks in
the back door'' through the restoration planning process by allowing
the option to value lost services while not valuing the services
gained.
Response: NOAA believes that the conditions under which the
trustees may employ the valuation scaling approach are sufficiently
specified in Sec. 990.53(d). Under the valuation scaling approach,
trustees explicitly or implicitly measure the value of both the natural
resources/services lost and natural resources/services provided by the
selected restoration action(s). The one exception is when the valuation
of the replacement natural resources/services cannot be performed
within a reasonable time frame or at reasonable cost, but the valuation
of natural resources/services lost is practicable.
Comment: Some commenters requested clarification as to what
conditions invoke the ``unreasonable cost'' exception in which trustees
may use the interim loss in value to scale the restoration claim,
rather than scaling the action by demonstrating that an action of the
chosen size will provide benefits equal to the interim losses from the
injury.
Response: Assessment costs are deemed to be unreasonable if
trustees fail to follow the guidance provided in the rule. For example,
the additional costs of a procedure must be related to the information
expected to be gained with that procedure, as provided in Sec. 990.27
of the rule. These standards are intended to avoid excessive costs in
an assessment.
Comment: Several commenters pointed out that the rule does not, but
should, explicitly provide for the use of valuation procedures when a
responsible party challenges the cost of service-to-service restoration
as disproportionate to the value of the damages.
Response: Section 990.14(c)(5) allows responsible parties to
request assessment procedures other than those selected by the
trustees, if they follow the procedures for making the request in
Sec. 990.14(c)(5) and the alternative procedures meet the standards for
acceptable procedures provided in Sec. 990.27.
Comment: Several commenters argued that the responsible party
should not have the unilateral right to require economic valuation of
restoration options. The commenters noted that such an option would
result in the responsible party having more rights than the trustees to
choose assessment procedures, which would be improper and unfair. The
commenters stated that the trustees, in all cases, should have the
right to use valuation procedures.
Another commenter argued that the option for the responsible party
to request a more specific procedure contravenes OPA, which requires
trustees to perform assessments, advance costs, file, and establish
claims for damages.
Response: The rule has been revised to allow the trustees to reject
the responsible parties' proposed alternate assessment procedures if
they do not meet the criteria specified under Sec. 990.14 (c)(5)(iii),
and thus the requirements for acceptable procedures described in
Sec. 990.27.
Discounting and Uncertainty
Addressing Uncertainty
Comment: Several commenters stated that trustees should be required
to address uncertainties in measures of losses and gains as a separate
matter from discounting. Some of these commenters suggested addressing
uncertainties using a Monte Carlo framework. The commenters pointed out
that differences in discount rates are driven by financial risks, which
are unrelated to uncertainties in measuring lost or replacement service
flows. The commenters stated that the use of risk-adjusted discount
rates should be eliminated from the rule.
Other commenters, however, suggested that the language ``must
address the uncertainties associated with the predicted consequences of
the alternative'' should be revised to read ``should address when
possible in a valid manner.''
Response: NOAA agrees that, where feasible, the trustees should use
risk-adjusted measures of losses and gains, in conjunction with a
riskless rate of discount reflecting the social rate of time preference
for natural resources. However, in cases where the streams of losses
and gains cannot be adequately adjusted for risks, trustees should use
a discount rate that incorporates a suitable risk adjustment to the
riskless rate. NOAA agrees that in some cases, Monte Carlo analysis may
be an appropriate approach to addressing uncertainties. The discount
rate employed in a scaling application is to reflect the social rate of
time preference for the injured and replacement natural resources and/
or services. Because of the difficulty in determining the rate of time
preference for goods, such as natural resources, that are not generally
sold in a market, a real rate of 3% is recommended as a riskless rate,
unless justification is presented for a rate more appropriate for the
specific context.
Use of ``Over-Compensation''
Comment: One commenter questioned the amount of ``over-
compensation'' that should be included in the restoration plan as a
contingency for possible lack of restoration action success. The
commenter suggested that such over-compensation could be used to
account for restoration aspects that do not produce the expected
results or fail completely. The commenter suggested that responsible
parties would agree to over-compensation if doing so would provide
absolute closure for the responsible party.
Response: This comment basically restates the requirement in
Sec. 990.53(c)(4) that trustees must evaluate the uncertainties
associated with the projected consequences of the restoration action.
The selected restoration action(s) should be scaled to incorporate the
reasonable range of uncertainty associated with the level of natural
resources/services that will be provided by the action(s).
[[Page 489]]
Bounds on discount rates
Comment: Several commenters suggested that the rule should place
some bounds on an appropriate discount rate for societal time
preference. These and other commenters also requested guidance on risk
and uncertainty.
One commenter suggested that, in the case where services will be
lost or interrupted for a relatively short period of time, trustees
should use the OMB projected rates of return on 20-year U.S. Treasury
bills, rather than a long-term average of past rates. The commenter
noted that a long-term average may be unduly influenced by unusually
high or low past rates arising from past economic circumstances not
applicable to the period in question. The commenter suggested that,
should the final rule mandate a long-term average, trustees should
calculate that average as a moving average to give more weight to
recent rates. The commenter also recommended that, in the event that
the damages must be estimated for an extended period, the most distant
projection available from OMB be used. Finally, the commenter suggested
that the discount rates for HEA should be real, after-tax, riskless
rates.
Some commenters suggested that a discussion should be placed in the
preamble that describes a discount range of 3% to 7% as generally
reasonable for most future benefits associated with restoration
actions, and a range of 0% to 3% for discount rates associated with
natural resource and/or service losses. The commenters stated that it
is appropriate to discount future losses at a very low rate, if at all.
Some commenters suggested that the procedure for determining a
discount rate should reflect the guidelines for water resource projects
since those projects provide a much closer analogy to natural resource
damage assessments than the lease-purchase or benefit/cost and cost-
effectiveness analysis currently in use.
Response: For scaling restoration actions, the appropriate rate of
discount is the social rate of time preference for the injured natural
resources, i.e., the rate at which society is willing to trade off
natural resources during the period of the incident for natural
resources during the period of restoration action. NOAA is recommending
that use a 3% discount rate as a proxy for the social rate of time
preference (unless justification for a more appropriate rate is
presented).
Because the public use of natural resources does not occur
primarily through private market transactions, consumers do not
necessarily adjust their inter-temporal consumption of natural
resources in response to the relevant intertemporal financial trade-
offs available to them, as represented by the U.S. Treasury rates. U.S.
Treasury rates (both realized and projected future rates) have been
relatively volatile over the last few years, even for long-term rates.
There is no particular reason to assume that the volatility of the
observed financial rates carries over to the social rate of time
preference for these non-marketed goods.
NOAA is considering the development of a separate guidance document
on resource-to-resource, service-to-service, and valuation scaling
procedures that would address issues pertaining to discounting, risk,
and uncertainty in greater detail.
Comment: One commenter also stated support for the use of state and
tribal borrowing rates in calculation of present value of assessment
costs. This commenter agreed with the use of discount rates that
represent the yield on recoveries available to the trustees. Several
commenters noted that, when the state is the lead administrative
trustee, the corresponding state borrowing rate should be used as the
discount rate instead of the U.S. Treasury rate.
Response: NOAA supports the use of state or tribal rates where
appropriate. However, designation of the lead administrative trustee is
primarily an administrative decision and should not substantively
affect the choice of an appropriate discount rate, except to the extent
that it affects the yield on recoveries available to trustees.
Discounting and HEA
Some commenters suggested that the rule should clarify the role of
discount rates in HEA. The commenters stated that the rule should
explicitly state the assumptions that the unit dollar value of forgone
services equals the unit dollar value of the restoration services and
these dollar values do not change over time, in order for financial
discount rates to be appropriate in HEA models.
Response: NOAA does not disagree with the substance of these
comments, but believes that such a level of detail regarding specific
procedures is most appropriately included in guidance documents, rather
than the rule itself.
Sensitivity of Scale to Discount Rate Choice
Comment: Some commenters noted that the choice of discount rate is
largely responsible for the resulting size of the compensatory
restoration action.
Response: The sensitivity of the scale of compensatory restoration
action to a given discount rate will depend on the relationships among
a number of factors including, but not limited to, the duration of the
injury, the time necessary for the compensatory restoration action(s)
to provide full service flows, and the lifespan of the compensatory
restoration action(s).
Choice of Appropriate Inflation Index
Comment: One commenter recommended using the Gross Domestic Product
(GDP) deflator when the adjustment is being made to determine the
present value of future restoration costs or when a stream of future
service flows is being discounted, and using the Consumer Price Index
when lost consumer surplus requires discounting. The commenter stated
that when a clear distinction cannot be drawn, the GDP deflator should
be used because it is more general.
Response: NOAA believes that this structure for scaling restoration
actions is generally acceptable and consistent with the rule language.
However, by definition, a quantity of services is already in real
terms. Quantities of services generally will not need adjustment with a
price index because they only appear in the scaling calculation, which
will generally be carried out in real terms (with a real discount
rate). For purposes of calculating restoration costs, more specific
indices, such as construction and employment cost indices, may be used
where appropriate and available.
Section 990.54 Restoration Selection--Evaluation of Alternatives
Selection Criteria for Alternatives
Comment: Many commenters had suggestions for revisions to the
selection criteria for restoration alternatives. These commenters
argued that the selection criteria in the rule provide no overall
standard for selection of alternatives. Some commenters suggested that
without standards for evaluating and selecting restoration
alternatives, there are no meaningful bounds on responsible party
liability.
Other commenters, however, argued that the rule should establish no
specific ``weight'' for any of the selection factors, that such a
requirement would limit the flexibility required for restoration and
could undermine the validity of the whole process. One commenter stated
that the requirement to minimize damages is unnecessary so long as
trustees are required to document the relevant factors and tradeoffs in
selecting a restoration alternative and
[[Page 490]]
explain their selection in response to any public comments prior to the
implementation of the restoration plan.
Response: NOAA believes that the modified criteria for evaluation
of restoration alternatives presented in Sec. 990.54 in the final rule
are sufficient to ensure that selected alternatives are reasonable,
cost-effective, and adequate to compensate the environment and public
for injuries to natural resources and/or services. The selection of
restoration actions that truly make the environment and public whole is
a highly incident-specific analysis, and NOAA believes that prescribing
a rigid hierarchy of selection criteria will not facilitate achieving
OPA's compensatory goal. Trustees must evaluate the numerous selection
criteria listed in the rule, at a minimum, and describe in the draft
restoration plan how each factor played in the selection and
elimination of alternatives.
Comment: Some commenters pointed out that, if all the parties agree
to a restoration solution, the trustees should not have to develop
numerous restoration alternatives.
Response: Under the rule, trustees may settle claims for natural
resource damages at any time, provided that the settlement is adequate
in the judgment of the trustees to satisfy the goal of OPA and is in
the public interest. However, it is expected that even early settlement
will entail an evaluation of available restoration actions in order to
meet the varied interests of all parties.
Cost Effectiveness
Comment: Some commenters argued that the rule should specifically
require cost effectiveness as the major selection criterion. Other
commenters disagreed, stating that a simple requirement to select the
most ``cost-effective'' option is too narrow and should not be
required. These commenters argued that cost-effectiveness alone
disregards distributional differences and ecological integrity, which
may well leave a natural resource seriously impaired. The commenters
suggested that the selection decision should be driven by criteria that
emphasize making the environment and public whole, both in aggregate
and by user group.
Response: NOAA fully supports choosing the least costly restoration
action(s) among equivalent alternatives. However, NOAA believes that
prescribing a rigid hierarchy of selection criteria, including
designating one criterion as always singularly more important than
others, will not facilitate achieving OPA's compensatory goal.
Minimization of Costs/Damages
Comment: A number of commenters stated that, when sufficient data
on costs and benefits are available, trustees should ultimately base
their selection of restoration alternatives on a cost-effective
approach that will minimize total damages or make the public whole at
the least cost. The commenters stated that selection of the alternative
that minimizes damages is consistent with economic theory, OPA's
legislative history, and the decision in Ohio. Many other commenters
opposed any strict requirement to minimize damages as inconsistent with
the statutory language of OPA (section 1106(d)(1)) as well as the
holding in Ohio overturning the approach contained in the 1986 version
of the CERCLA rule that directed trustees to recover the lesser of
restoration cost or diminution in value. The commenters stated that OPA
contains the statutory preference of restoration, and not the
minimization of damages.
Response: NOAA supports the consideration of the relationship
between costs and benefits when selecting a preferred restoration
alternative(s). However, NOAA does not support reducing the selection
process to a strict cost-benefit or cost-minimization decision rule.
The rule requires trustees to identify and consider a reasonable range
of restoration alternatives for a given incident, or for individual
injuries of an incident. The rule further enumerates specific criteria
that must be considered by trustees in selecting preferred restoration
approaches from the range of alternatives. These criteria include
feasibility, likelihood of success, effectiveness, and speed with which
baseline will be returned, benefits to multiple natural resources, and
cost. Consideration of these criteria will constitute a qualitative
cost-benefit analysis that is appropriate to the task at hand--
restoration--and will ensure that cost-effective actions are selected.
Qualitative Assessments
Comment: Some commenters stated that benefits should be required to
be quantified in cases where it is practicable. One commenter suggested
that, for cases where benefits cannot be measured at reasonable cost,
the assessment should be qualitative; however, qualitative assessment
should not be used to justify very costly restoration.
Response: The resource-to-resource, service-to-service, and
valuation scaling approaches all inherently involve the quantification
of benefits of the selected restoration alternative(s), either in terms
of quantifying the level of natural resources/services or the value
provided by the restoration actions. The evaluation standards for
selecting the preferred alternative(s) presented in Sec. 990.54
represent a combination of quantitative and qualitative factors.
Not Grossly Disproportionate
Comment: A number of commenters stated that the trustees should
also be required to compare costs to benefits/value of services, to
determine whether the cost of the alternative being evaluated is
grossly disproportionate to the value of the injured natural resources
or, alternatively, to the benefits of that alternative. Some commenters
requested that NOAA clarify the term ``grossly disproportionate'' and
state whether it has a role in the process, especially in the
compensatory restoration process.
Response: NOAA believes that the evaluation and selection of
restoration alternatives according to the factors provided in the rule
will ensure that preferred actions are commensurate with the value of
natural resource losses.
Reinstatement Costs
Comment: One commenter argued that restoration should be based on
the reasonable cost of reinstatement of the environment under the
international regime.
Response: The international regime allowing recovery of reasonable
reinstatement costs generally incorporates only direct restoration of
natural resources directly injured by an incident, which is more narrow
than actions authorized by OPA and thus would not be appropriate for
this rule.
Violation of Laws and Regulations
Comment: Another commenter argued that the criterion concerning
violation of laws or regulations be taken into account in determining
the viability of a particular alternative, rather than in determining
which restoration alternative(s) is preferred.
Response: NOAA agrees that legality of alternatives is a screening
criterion to eliminate alternatives from consideration, and has amended
Sec. 990.53 of the rule to reflect this.
Effects on Public Health and Safety
Comment: Some commenters noted that any alternative considered
should not exacerbate natural resource injuries or otherwise cause
adverse effects on public health, safety or the environment.
[[Page 491]]
Response: NOAA agrees. Section 990.54 of the rule directly states
that these factors must be considered by trustees when evaluating
restoration alternatives.
Pilot Projects
Comment: Several commenters suggested that the provision allowing
pilot projects should be revised, or at least clarified. Some of the
commenters argued that the responsible parties should not be required
to fund pilot projects. Other commenters stated that pilot projects
should only be allowed where they can be shown to be reasonable,
relevant, and linked directly to the incident of concern.
Response: The rule has been clarified to indicate that pilot
projects may only be undertaken when additional information is needed
to identify and evaluate the feasibility or likelihood of success of
restoration alternatives, and where they can be undertaken in a
reasonable time frame and at a reasonable cost.
Section 990.55--Restoration Selection--Preparation of a Draft and Final
Restoration Plan
Comment: One commenter expressed concern about placing injury
determination and quantification information in the Draft Restoration
Plan, making this information available to the public and the
responsible party, all within the context of civil litigation. The
commenter recommends that trustees be granted some litigation privilege
to protect their potential claim.
Response: This information, if relied upon by the trustees in
decisionmaking, is essential to meaningful public involvement.
Comment: Some commenters suggested that the proposed restoration
planning process prior to presenting a demand to responsible parties
places unreasonable expectations on the parties. These commenters
suggested that the rule naively assumes that restoration efforts can be
described in terms of a detailed restoration plan in a short period of
time after completing assessment studies. These commenters, noting the
Exxon Valdez experience, suggested that this will not always be
practicable. The commenters requested that the rule provide trustees
authority to make additions, substitutions, or other modifications to
the restoration plan based on experience and additional information
gained in the implementation phase.
Response: The extent to which trustees can, and need to, develop
specific, detailed workplans to implement restoration actions as part
of draft or final restoration plans will depend on the circumstances of
the incident, the nature of the preferred restoration actions, and
trustees' relationship with responsible parties. It may be possible to
reach binding agreements regarding the nature and scale of actions that
will constitute restoration and compensation, with an agreed upon
timetable for developing the implementation plans for those actions.
Often it will be advantageous to all parties that the responsible
parties or their representatives develop the workplans based on the
trustees' goals and objectives. However, if a cooperative relationship
has not been possible or effective, and trustees expect they may have
to implement restoration themselves or litigate to recover the funds to
implement restoration, it is in the best interests of the public for
trustees to have a plan that provides the most accurate estimate of
required restoration costs possible. Depending on the preferred
alternative, detailed work or implementation plans may have been
developed for prior actions, parts or all of which may be applicable to
the incident at hand.
Comment: Some commenters disagreed with a prescribed minimum public
comment period for all incidents, while others stated that 30 days
should be an absolute requirement, with a corresponding requirement
that trustees respond to public comments in the subsequent 30 days.
Response: NOAA has removed a specific time requirement for a public
notice and comment period, realizing that the circumstances of
individual incidents and localities, and in addition the requirements
for NEPA or other regulatory compliance, are so varied that any one
specified time may be inappropriate.
Comment: A number of commenters stated their belief that
restoration monitoring costs are not recoverable as natural resource
damages. These commenters cite judicial decisions barring oversight
costs as recoverable response costs under CERCLA, and an explicit
reference to ``monitoring'' within OPA, respecting recovery from the
Oil Spill Liability Trust Fund of the costs of monitoring removal
actions. Other commenters agreed that monitoring is essential to the
successful implementation of restoration, and urged that rule language
be more explicit regarding the scope, extent, and purpose of
recoverable monitoring costs. These commenters suggested that
monitoring costs should be related to the value of the natural resource
being restored, that monitoring should only be conducted long enough to
ensure that the action is proceeding as planned, and that the rule
should provide for performance bonds if implementation is conducted by
responsible parties.
Response: NOAA believes that restoration monitoring costs are a
recoverable component of natural resource damages. Monitoring is
essential to ensure that restoration actions accomplish their intended
goals and objectives and do not cause unanticipated harm to the
environment or public health. In addition, monitoring is essential to
determine whether the terms of restoration agreements have been met,
upon which a release from liability is premised. NOAA agrees that the
rule itself should speak to the purposes and scope of monitoring, and
has amended the rule accordingly.
Section 990.56--Use of Regional Restoration Plans or Existing
Restoration Projects
Comment: Several commenters argued that using Regional Restoration
Plans to spend money generated from simplified assessments is contrary
to OPA and traditional tort principles of individualized injury and
causation. Some commenters noted that the legislative history of OPA
demonstrates a rejection of such regional approaches to restoration
(H.R. 1465, 1st Cong., 1st Sess. (1989), a predecessor bill to OPA,
contained a natural resource damage civil penalty section (1006(g)(4))
that allowed funds recovered to go to ``general enhancement of the
ecosystem''). The commenters made the point that common law tort
principles applicable under OPA require damages to be used to restore a
specific injury to a specific natural resource in order to be
compensatory rather than punitive.
Some commenters argued that, for small incidents where incident-
specific plans would be unreasonable, trustees should allow natural
recovery. The commenters stated that there is no OPA mandate to restore
injured natural resources and services regardless of the scope and
scale of those injuries, and that, in such cases, OPA firmly implies
liability for small incidents is de minimis in the absence of actual
evidence of significant natural resource services losses. One commenter
suggested that regional plans could not possibly identify precisely
where discharged oil would go, and in the actual event of an incident,
a regional plan will likely be inapplicable. Other commenters noted
that before a regional plan could be used, a link between the actual
injury and the plan must be established.
Some commenters argued that such plans would be self-fulfilling and
[[Page 492]]
become a proxy for investigating injuries. Several commenters noted
that, under these provisions, trustees could amass large sums of money
to undertake various quasi-public works projects, having no connection
whatsoever to any of the incident sites. These commenters argued that
this provision will allow trustees to essentially do an ``end run''
around the legislative process and to pursue their own ends, which is
clearly not authorized by OPA.
One commenter argued that this provision would be fundamentally
unfair to responsible parties who will have no opportunity to
participate in the development of these regional plans.
Several commenters strongly encouraged the use of Regional
Restoration Plans, stating that trustees must have multiple options
available for redressing injuries. These commenters stated that
Regional Restoration Plans allow trustees to maximize the effectiveness
of a restoration action by combining recoveries from other incidents.
Some of these commenters noted that only Regional Restoration Plans can
provide for an effective response to the cumulative impacts of many
small incidents. These commenters argued that such plans are clearly
within the ambit of OPA and that there is no provision in OPA requiring
that damages collected be spent remediating the specific site injured.
In fact, the commenters noted that contrary intent is evident in
Congress' inclusion of acquisition of equivalent natural resources as a
restoration option.
Several commenters expressed concern that the rule limits use of a
Regional Restoration Plan to situations where a simplified assessment
procedure was used. The commenters argued that whether damages from a
specific incident are best used independently, or to fund part of a
Regional Restoration Plan, is a separate issue that is not related to
the type of assessment procedure used. They stated that, if
implementation of a project plan provides suitable compensation for
injuries that occurred as a result of a discharge, trustees should be
able to use that specific project plan.
Other commenters expressed concern about restrictive language
related to ``commingling'' of simplified assessment recoveries and the
use of newly developed Regional Restoration Plans. These commenters
stated that it would be difficult at best to define ``similar'' natural
resources or services in relation to small incident impacts and that
pooling of small incident damages should not be tied to such a
criterion. The commenters suggested that the only criterion for pooling
of small incident settlements should be the lack of affordable and
efficient restoration alternatives given the size of the damage
recovery.
One commenter requested more guidance in the rule for criteria for
developing and implementing such plans. One commenter said the proposed
rule was unclear about the calculation of appropriate costs for cases
where the formulas or type A models were used and even more confusing
where calculation of such costs are necessary for the implementation of
a regional restoration plan. Another commenter stated that the costs of
developing regional plans is not an appropriate use of recovered
natural resource damages.
Commenters proposed a number of guidelines to permit regional
restoration planning under OPA, when the trustee and the responsible
party agree that it is appropriate, including: (1) There is an
ecological relationship between the injured natural resources and the
objectives of the regional restoration plan; (2) on-site restoration is
either not technically feasible or not cost effective; (3) the level of
services provided by the proposed restoration action is substantially
similar to that provided by the injured natural resources; (4) the
restoration measures will be beneficial given the potential for natural
recovery; (5) the measures are likely to be successful in significantly
accelerating the natural recovery of the injured population or area;
(6) the proposal will not itself result in degradation of the
environment; and (7) the cost of the program is not out of proportion
to the value of the natural resources.
One commenter asked whether NOAA will initiate a regional
restoration planning process and identify areas where regional plans
could be of high priority, or whether it is incumbent upon industry and
state trustees to do so. Another commenter noted that pre-incident
planning may not be achievable in all cases, and recommended NOAA's
rule endorse post-incident development of Regional Restoration Plans,
with public review and comment, for application of subsequent
recoveries.
Some commenters suggested that regional restoration plans identify
areas within the region in need of restoration or acquisition that are
important to various species of fish and wildlife vulnerable to
incidents and prioritize them by cost of restoration. In addition, this
commenter suggested that the trustees be required to make a showing
that it is environmentally ineffective to restore the injured natural
resource and that restoration of another would provide substantially
greater benefit to the ecology injured by the incident.
Some commenters suggested the importance of early public
involvement in the prioritization of areas most heavily injured by
incidents and to ensure that the restored areas serve the same human
populations as those served by the injured natural resources. One
commenter noted that Regional Restoration Plans inappropriately exclude
local participation in restoration planning, as large-scale efforts
would bar smaller attempts.
Response: NOAA agrees that OPA intends that responsible parties be
held liable only for restoration needed to redress the injuries caused
by specific incidents. Injury must be determined under the rule for all
incidents. However, NOAA also views regional restoration planning as
one means to resolve liability for injuries in an expeditious and cost-
effective manner.
The rule has been amended to make it clear that in no event will
the use of a regional restoration plan violate OPA's limitation that
natural resource damages be used solely to restore, replace,
rehabilitate, or acquire the equivalent of the natural resources and/or
services injured by an incident. OPA's legislative history defines
``equivalent'' natural resources as those that will enhance the
recovery, productivity, and survival of the ecosystem affected by a
discharge, preferably in proximity to the affected area (Conference
Report at 109). The requirements in the rule are strict enough to
ensure that regional restoration plans or other existing restoration
projects used in lieu of an incident-specific plan do not violate OPA's
constraints on expenditure of damages. Whether an existing plan or
project represents restoration, rehabilitation, replacement, or
acquisition of the equivalent will depend on the nature of the incident
and the restoration plan or project.
The final rule also requires that use of possible restoration
actions in an existing plan or project be evaluated within the range of
restoration alternatives that trustees are required to consider,
including natural recovery. But the rule recognizes that it may be in
the best interests of all parties not to expend funds developing
incident-specific restoration plans in all instances.
Experience with past incidents has shown that responsible parties
have often identified existing planned or proposed environmental
restoration actions that may have been developed by local governmental
natural resource agencies or environmental groups, and
[[Page 493]]
proposed to fund these actions as compensation for the injuries of an
incident. NOAA intends regional restoration planning to build on this
cost-effective approach to restoration planning, by developing
databases that identify existing or desirable unfunded actions in a
manner that will allow an appropriate linkage between actions and
particular incidents. The geographic scale of a ``regional'' plan
database will likely vary with locality, variability of local
environmental conditions, and expected local impacts from incidents,
but actions can be scrutinized in terms of the type and scale of
natural resources and/or services they are expected to provide. If
projects match the incident in terms of the scale of injuries and the
scale of expected natural resources or services that will be provided,
responsible parties may be given the option to fund or implement the
project. If the scale of the incident and the project do not appear
consistent, trustees may request that responsible parties pay damages
equal to the relative proportion of the total cost of the project that
would compensate for the scale of injuries from the incident. Such
partial recoveries may be pooled until funding is adequate to implement
the project.
The rule has been revised to eliminate restrictions on the type of
assessment procedures that will enable use of a regional restoration
plan or other existing restoration project, and have omitted any
restrictions on how partial recoveries may be pooled or commingled
pending collection of adequate funds to implement a project.
Finally, the rule is clear in providing for responsible party
participation in identification of appropriate existing plans or
projects that will resolve their liability for the injuries from a
particular incident. The rule also provides that potentially
responsible parties be given an opportunity to participate in any pre-
incident development of regional restoration plans or existing
restoration project databases.
Subpart F--Restoration Implementation Phase
Section 990.60--Purpose
Comment: Some commenters noted that the provision requiring Final
Restoration Plans in the context of incident-specific assessments is a
significant improvement over past proposals, since the current proposal
bases the liability claim on projected costs of implementing the Final
Restoration Plan, rather than developing a financial payment for
liability and then deciding what to do with the money. Some of these
commenters had argued that the 1994 proposal, with the Final
Restoration Plan being developed in the Post-Assessment Phase, violated
OPA by allowing trustees to spend recoveries on non-site-specific
restoration actions, i.e., implementing restoration plans other than
those developed by the trustees in the assessment phase and that
supported the damage claim.
Response: NOAA agrees that recoveries will be used to implement the
restoration plans developed through the assessment, except where new
information received after completion of the plan indicates that the
plan needs to be modified to conform to the standards of this rule. Any
such modification must be made by a public process documented in the
administrative record for restoration implementation.
Section 990.61--Administrative Record
Comment: One commenter approved of opening a parallel
administrative record for the implementation phase to ensure that there
is accurate and complete accountability of all activities and costs.
The commenter suggested, however, that the provisions allowing addition
of documents to the record is questionable and should be deleted. The
commenter noted that the trustees should be required to document their
implementation or the responsible party's implementation of the
restoration plan, that the monitoring requirements were adhered to, and
that cost effective or cost beneficial requirements were followed. The
commenter suggested that the rule also should specify the documents
expected to be placed in the administrative record by the trustees.
Response: The final rule restricts augmenting the closed record of
assessment except where new information raises significant issues
regarding final restoration decisions, is not duplicative of
information already in the record, and is offered by an interested
party that did not receive actual or constructive notice of the
availability of the draft plan. NOAA agrees with the commenter's
suggestions to provide some minimum requirements for documents or
determinations to be included in the Implementation Phase record, and
has amended the rule to include this guidance.
Section 990.62--Presenting a Demand
Comment: Several commenters complained that the rule language is
vague in terms of discretion over the form of a demand presented to
responsible party. These commenters noted that restoration actions
involve management of natural resources and numerous laws at federal,
state, tribal, and foreign levels that require that specific agencies
maintain the responsibility for decisions involving management of
natural resources. The commenters argued that NOAA cannot delegate this
responsibility away from trustees to responsible parties. The
commenters stated that the trustee should not be required in every case
to go first to the responsible party for restoration implementation,
but should evaluate, prior to commencing implementation of restoration
actions, the most efficient procedure of implementing the plan. This
evaluation should include consideration of the responsible party's
ability to accomplish effective conduct of the restoration actions.
Several other commenters strongly supported the provisions allowing
the responsible party to either implement the restoration plan or pay
damages. The commenters also stated that linking liability to the
responsible party's implementation of a plan is a significant
improvement over earlier proposals.
Another commenter asked why there are different standards for
allowing a responsible party to implement all or part of an incident-
specific versus a Regional Restoration Plan.
Response: The rule does not delegate any essential trustee
functions or responsibilities to responsible parties, nor does it
create any inalienable rights in responsible parties with respect to
implementation of restoration. This provision in the rule recognizes
that responsible parties or their agents may be far better equipped to
implement restoration promptly and cost-effectively, given certain
constraints on governmental spending and contracting authorities. The
rule also recognizes that trustees must act responsibly in allowing
responsible parties to implement restoration, and this decision
regarding participation should be evaluated according to at least the
same criteria suggested in Sec. 990.14(c) for determining the scope of
responsible party participation in any stage of the assessment. The
rule requires trustees to identify performance criteria to gauge the
success of restoration efforts, and encourages monitoring and oversight
to confirm that restoration actions are carried out as intended in
agreements with the responsible party.
The rule has been amended to remove the unintended differences in
standards for responsible party implementation of incident-specific
versus regional restoration plans.
[[Page 494]]
Prejudgment Interest
Comment: Several commenters suggested that more flexibility must be
added to address those circumstances when a substantial period of time
elapses from the date the demand for payment is made to the date
payment is actually made; in such cases, trustees should be able to use
date of payment as the time to which to discount future costs or
inflate ``present'' cost estimates to present value of the restoration
action.
Response: This rule addresses interest up to the point that the
formal demand is presented to the responsible parties. Section 1005 of
OPA (33 U.S.C. 2705) addresses the payment of pre-judgment interest
from the point the demand is made until the claim is paid.
Comment: Some commenters argued that interest computed on past
costs amounts to prejudgment interest and section 1005 of OPA (33
U.S.C. 2705) provides that such interest runs only from 30 days after
claim is presented and is to be paid at a commercial paper rate.
Therefore, the commenters stated that the rule cannot allow recovery of
interest on periods prior to demand, which would give trustees
prejudgment interest in excess of that which Congress deemed proper.
Response: NOAA notes that interest recovered on past costs
represents lost opportunity costs for the trustees, intended to
encourage prompt payment of claims. Such a recovery is not an
inappropriate recovery of prejudgment interest.
Section 990.64--Unsatisfied Demands
Comment: Several commenters stated that NOAA should clarify that
uncompensated financial damages for compensatory restoration, which is
intended to represent compensation for diminution in value, may not be
sought from the Oil Spill Liability Trust Fund (Fund); only site-
specific plans for primary restoration may be paid from that Fund.
Response: The Oil Spill Liability Trust Fund (Fund) is not
available to federal trustees for payment of uncompensated damages
under section 1012(a)(4) of OPA (33 U.S.C. 2712(a)(4)) (see Matter of
USCG-OSLTF, B-255979, 1995 Comp. Gen. LEXIS 670 (October 30, 1995)).
However, federal trustees may seek an appropriation from the Fund for
implementation of restoration plans. The rule does not provide for
recovery of monetized damages, but does provide for the use of
restoration actions that will restore, replace, rehabilitate, or
acquire equivalent of interim lost services.
Comment: Several commenters suggested that the language allowing
the responsible party to agree to a demand in order to forestall legal
action should be changed to require a responsible party to either pay
the demand or enter into an enforceable agreement within 90 calendar
days after the trustees present the demand to perform services.
Response: NOAA agrees that the suggestion is a useful clarification
of OPA's requirements in light of the rule's allowance for responsible
party implementation of restoration actions.
Comment: One commenter strongly objected to the requirement that
trustees cannot file a civil judicial action until 90 calendar days
after presentation of the demand to the responsible party. This
commenter argued that this provision has no statutory support, would
serve no purpose, and might prove to be a problem for statute of
limitations considerations.
Response: NOAA believes that the contested provision is consistent
with the plain meaning of section 1013(c) of OPA (33 U.S.C. 2713(c)).
Section 990.65--Account
Comment: Some commenters suggested that the rule should specify
that administrative costs associated with setting up a trustee account
are compensable. Some commenters suggested that, if the damage amount
is not placed in an interest-bearing account, the rule should allow
adjustment to the appropriate state rate.
Response: NOAA notes that recovery is provided by OPA for costs
incurred as a result of an incident. Therefore, the costs associated
with setting up accounts are also recoverable. Also, NOAA agrees that
adjustments should be made if damages are not placed in an interest-
bearing account.
Comment: Some commenters expressed support for the idea of creating
separate, interest-bearing accounts to hold recovered sums. One of
these commenters, however, stated that joint trust accounts can be a
problem between state and federal trustees, if the accounts are
required to be registered under a federal court. The commenter
suggested that joint recoveries should be exempt from the requirements
of the Miscellaneous Receipts Act, and that NOAA should explicitly
allow for administration of joint restoration accounts by reputable
non-profit organizations that address restoration/replacement/
acquisition types of activities at local, state, or national levels.
Some of these commenters asked for clarification as to why escrow
accounts could be used. One commenter stated that interest accrued on
these accounts should be required to be used for restoration.
Response: The rule explicitly allows the use of such accounts.
Also, interest earned on recoveries (not including recoveries for past
costs incurred) should be used only for restoration.
Comment: Some commenters strongly encouraged NOAA to provide
guidance on implementing accounting procedures, although there was
concern that rigorous accounting procedures would be expensive for
trustees and thus recovery for accounting costs should be allowed.
Response: In 1986, EPA implemented Financial Management Procedures
for Documenting Superfund Costs. This document is available from the
Office of the Comptroller, Financial Management Division, Superfund
Accounting Branch. These procedures provide guidance to ensure that
documentation of EPA's costs for cleaning up Superfund sites are
complete and accurate and can be furnished if litigation is required.
These procedures are also relevant guidance to trustees on procedures
of recordkeeping that will satisfy the requirement that costs be
appropriate/accurate/reasonable. NOAA recognizes that certain expenses
are inherent in any cost-tracking system. Recovering such costs as part
of the assessment and restoration implementation costs is appropriate
since it enables a trustee to demonstrate when, how and where funds for
natural resource restoration have been expended, therefore theses costs
are recoverable.
Trustees must maintain appropriate accounting and reporting
procedures to keep track of the use of sums recovered. As determined by
the trustee, brief reports on the status of the sums recovered and
expenditures for particular damage assessment or restoration activities
may be reported in the administrative record for the restoration phase.
Comment: One commenter noted that there is no definition of
``excess damages'' in the proposed rule, and requested that the rule
explicitly state that excess damages must not be collected, or, if
collected, must be returned to the responsible party.
[[Page 495]]
Response: NOAA believes that damages will never be ``excessive'' or
in ``excess'' of the costs needed to restore injured natural resources
and/or services if assessments are conducted in accordance with this
rule, and restoration is implemented in a timely manner. However, NOAA
can envision circumstances where unanticipated environmental conditions
require adjustments to restoration actions, conceivably resulting in
surplus damages.
Comment: Several commenters strongly disagreed with the language
that requires all excess restoration funds to be placed in the Oil
Spill Liability Trust Fund. These commenters noted that damages are
generally settled jointly between state and federal trustees and the
responsible party and that any excess funding should first be available
for additional restoration. The commenters suggested that the
responsible party should not expect to recover excess funds unless they
are willing to pay additional funding for the restoration cases that
result in deficits (e.g., a contingency fee), due to factors beyond the
control of the trustees. These commenters recommended, at a minimum,
that remaining funds should be deposited in both federal and state
response trust funds, where states have such a fund.
Response: The rule allows for the recovery of damages required by
OPA, namely: (1) The cost of restoring, rehabilitating, replacing, or
acquiring the equivalent of, the injured natural resources and/or
services pending restoration; (2) the diminution in value of those
natural resources pending restoration; plus (3) the reasonable cost of
assessing those damages. The recovery of those three items is not
excess recovery. Trustees are to use the money to restore,
rehabilitate, replace, or acquire the equivalent of the injured natural
resources and/or services provided by those natural resources and to
reimburse the reasonable costs of conducting the assessment. Any
recoveries that may be left over after implementing the restoration
plan must be deposited in the Oil Spill Liability Trust Fund, in
accordance with the provisions of section 1006(f) of OPA (33 U.S.C.
2706(f)).
Section 990.66--Additional Considerations
Comment: One commenter suggested that the final rule establish
timetables for the development and implementation of restoration plans.
Response: NOAA disagrees that any time table for developing and
implementing restoration plans could have broad enough applicability
for all possible incidents without hampering the process for some
subset of incidents.
Comment: Several commenters indicated the importance of monitoring
and oversight and the need to plan for failure of a restoration plan.
Other commenters argued that monitoring costs are not recoverable
because such costs are not mentioned in section 1002 of OPA and,
therefore, not intended by the statute.
Response: As discussed in response to comments on the definition of
reasonable assessment costs, NOAA believes that monitoring and
oversight costs are recoverable damages. NOAA agrees with the
importance of monitoring and oversight and has amended the rule to
specifically discuss the purpose and scope of monitoring and oversight
activities within the restoration implementation phase.
Comment: One commenter stated that allowing for reopeners within
the rule will make it difficult for businesses to anticipate costs and
create proper reserves. Other commenters questioned the degree to which
a responsible party could be held accountable for a restoration plan
selected by the trustees that did not work, requesting that NOAA
reexamine the propriety of reopeners and raised the question as to who
should bear the risks inherent in implementing a Restoration Plan.
Another commenter suggested that the rule provides no standards for
mid-course corrections, but that such standards are needed. One
commenter questioned whether a responsible party would be subject to
the restoration plan if that responsible party had not been involved in
the development of that plan.
Response: Reopeners may be required to properly ensure that the
environment and public are appropriately made whole for the injuries
from a particular incident. Thus, reopeners should reflect the degree
of certainty in the assessment of the nature and extent of injuries and
losses. NOAA also agrees that reopeners must not be used irresponsibly,
i.e., holding responsible parties accountable for unknowable
consequences for an indeterminate period of time. Trustees must specify
criteria upon which restoration actions will be judged successful, so
that responsible parties may understand the goals and targets for their
actions. Both parties should strive to identify any uncertainties in
successful implementation of a plan such that requests for additional
actions on the part of the responsible party will not likely result.
NOAA has amended the rule to provide some guidance on the nature of
performance criteria that trustees should consider in formulating
agreements with responsible parties.
Comment: One commenter suggested that the selection of a lead
trustee to coordinate implementation of restoration should be
mandatory.
Response: Section 990.14 of the rule advises identification of a
lead administrative trustee, or co-lead administrative trustees, for
all phases of a joint assessment.
Bibliography
NOAA Guidance Documents
All of the following NOAA Guidance Documents are currently in draft
form and are expected to be available as Final Guidance Documents
within a short time following promulgation of this final rule. A Notice
of Availability will be published in the Federal Register as soon as
the Final Guidance Documents are complete.
Michel, J. and E. Reinharz. 1994. Preassessment Phase Guidance
Document. National Oceanic and Atmospheric Administration, Office of
General Counsel Natural Resources, Damage Assessment Regulations
Team, Silver Spring, MD.
NOAA. 1993. Restoration Guidance Document for Natural Resource
Injury Resulting from a Discharge of Oil. National Oceanic and
Atmospheric Administration, Office of General Counsel Natural
Resources, Damage Assessment Regulations Team, Silver Spring, MD.
NOAA. 1995. Specifications for Use of the NRDAM/CME Version 2.2 to
Generate: Compensation Formula for Natural Resource Damage
Assessments under OPA. National Oceanic and Atmospheric
Administration, Office of General Counsel Natural Resources, Damage
Assessment Regulations Team, Silver Spring, MD.
NOAA. 1995. Injury Guidance Document for Natural Resources and
Services under the Oil Pollution Act of 1990. National Oceanic and
Atmospheric Administration, Damage Assessment and Restoration
Program, Silver Spring, MD.
NOAA. 1995. NEPA Compliance in Natural Resource Damage Assessment
Guidance Document. National Oceanic and Atmospheric Administration,
Damage Assessment and Restoration Program, Silver Spring, MD.
[[Page 496]]
Department of the Interior Documents
DOI. 1987. Measuring Damages to Coastal and Marine Natural
Resources: Concepts and Data Relevant to CERCLA Type A Damage
Assessments (NRDAM/CME technical document). U.S. Department of the
Interior, Office of Environmental Policy and Compliance, Washington,
D.C., DOI-14-01-0001-85-C-20, Vol I-II.
DOI. 1993. The CERCLA Type A Natural Resource Damage Assessment
Model for the Great Lakes Environments (NRDAM/GLE). U.S. Department
of the Interior, Office of Environmental Policy and Compliance,
Washington, D.C., Vol I-III.
DOI. 1994. The CERCLA Type A Natural Resource Damage Assessment
Model for Coastal and Marine Environments (NRDAM/CME). U.S.
Department of the Interior, Office of Environmental Policy and
Compliance, Washington, D.C., Vol I-VI.
Appendix A--Considerations To Facilitate the Restoration Process
I. Pre-Incident Planning
General
NOAA believes that commitment of time, funding, and personnel to
up-front planning prior to an incident will help ensure that the
assessment results in appropriate and cost-effective restoration. Thus,
trustees are encouraged to develop pre-incident plans.
Pre-Incident Plan Contents
NOAA suggests that pre-incident plans:
(a) Identify natural resource assessment teams. The restoration
process requires an interdisciplinary approach to ensure the integrated
use of science, economics, and law necessary in planning and
implementing restoration. Trustees are encouraged to identify
appropriately experienced personnel needed for natural resource
assessment teams at the area and regional levels.
Personnel required for natural resource assessment teams should be
appropriate to the scope and scale of the incident and natural
resources and/or services injured. For instance, for incidents with
complicated or long-term ecological injuries, the core team could
include a natural resource trustee coordinator, restoration expert,
natural resource biologist, environmental (petroleum) chemist, natural
resource economist, quality assurance specialist, data manager/sample
custodian, statistician, natural resource attorney, and administrative
support specialist. If at all possible, the team should not be ad hoc;
members should be knowledgeable about relevant statutes and
regulations, and be able to establish a working relationship with the
various parties likely to be involved in incidents.
(b) Establish trustee notification systems. Prompt notification is
essential for efficient and effective initiation of the restoration
process. Response personnel are required under the NCP to notify
trustees whenever natural resources under their jurisdiction or
management have been, or are likely to be, injured as a result of an
incident.
Thus, each trustee should establish emergency notification
protocols so that the process can be initiated on a 24-hour basis.
Notification could be coordinated to minimize the number of calls
response personnel must make to the trustees. Notification protocols
are also needed within trustee agencies so that appropriate regional
and local personnel can be informed of an incident. Area and Regional
Contingency Plans should include contact information for each trustee
and clear, unambiguous criteria for trustee notification (e.g., all
incidents, incidents over a certain size, location, etc.).
(c) Identify likely support services. In many circumstances,
trustees may require specialized contractor support. For example,
research vessels may be necessary for sample collection, or outside
experts may be necessary to design and conduct studies. If, as part of
pre-incident planning, the trustees can identify appropriate support
services and pursue contracting procedures that will expedite incident-
specific hiring of contractors, potentially detrimental delays in the
assessment can be avoided during incidents.
The types of support and expertise expected to be needed, as well
as potential contractor and expert names, should be identified as part
of pre-incident planning. Contracts should be established to allow
rapid acquisition of contractor services. Identified contractors may
even be called on to participate in pre-incident planning so that all
parties are familiar with the specific needs of the restoration
process.
Backup services should also be identified since the needs of both
response and natural resource activities can exceed even regional
capabilities.
(d) Identify natural resources and services at risk. In the NCP,
regional and area planning committees are responsible for the
identification of natural resources under their jurisdiction that are
potentially vulnerable to incidents for given geographic areas such as
wetland habitats near oil terminals or bird rookeries near shipping
routes. If there is an incident, the response teams will focus their
efforts on protection of these natural resources and/or services
considered most vulnerable.
Trustees should actively participate in such planning committees to
identify natural resources and services at risk. Further, trustees
should identify and evaluate possible assessment procedures for these
natural resources and services.
(e) Identify area and regional response agencies and officials. In
order to participate actively in area and regional planning activities,
trustees should identify the response agencies and officials.
Developing a working relationship with these response agencies and
officials will optimize coordination between assessment and response
activities following an incident.
(f) Identify available baseline and other relevant information.
Trustees should identify and catalog sources of baseline information as
part of pre-incident planning, including seeking input on sources of
information. Types of information that may be important include: (i)
Petroleum hydrocarbon contamination in indicator organisms; (ii)
species census and inventory data; (iii) baseline data on species
populations; (iv) recreational use statistics; (v) values for selected
natural resources and services; and (vi) restoration measures
applicable to injured natural resources and services. Familiarity with
the types of baseline information and identification of data gaps and
needs will allow the trustees to formulate better study designs and
restoration approaches.
(g) Establish data management systems. Data management and record
keeping are critical throughout the restoration process. Data
management systems may best be designed during pre-incident planning to
minimize the possibility of losing critical information during an
incident. For small incidents, this may be a relatively simple filing
system, but for large incidents, a centralized computer-based system
may be essential.
Trustees may decide to develop consistent data management formats,
such as field, laboratory and quality assurance forms, to facilitate
data management. At a minimum, data management should address the: (i)
Type and volume of data; (ii) uses and users of the data; (iii)
availability of existing data management structures; (iv) quality
assurance needs; (v) reporting requirements; and (vi) accessibility of
the data. Data management should also include provisions for
distribution of updates for the trustees and others on a timely basis;
and
[[Page 497]]
(h) Identify assessment funding issues and options. Funding of
trustee activities should be addressed during pre-incident planning
because of the need to initiate actions expeditiously after an
incident. Trustees may have several sources of potential funding,
including: (i) Responsible parties; (ii) Oil Spill Liability Trust Fund
(Fund); and (iii) agency funding. Trustees should consult the most up-
to-date guidance available from the U.S. Coast Guard for access to the
Fund and incorporate these procedures into pre-incident planning.
II. Regional Restoration Planning
General
OPA emphasizes making the environment and public whole for injuries
to natural resources and services. Where practicable, incident-specific
restoration plan development is the preferred approach. However, for
many incidents, such incident-specific planning may be impractical
because, for instance, injuries are not extensive or are short-term.
For small incidents, incident-specific planning costs may be high
compared to the estimated damages.
Thus, to achieve OPA's mandate to make the environment and public
whole, trustees are strongly encouraged to use or modify existing
restoration plans, identify other existing restoration projects, or
develop new regional restoration plans. Such regional planning is
appropriate so long as natural resources and services comparable to
those expected to be injured by an incident are addressed in the plans.
Availability of Regional Restoration Plans
Trustees may rely on or adjust existing regional restoration plans,
so long as they have followed or can be modified to meet the planning
requirements under the rule. Lacking existing regional plans, trustees
should seek to develop such plans. The trustees may organize these
plans based on such factors as geography (e.g., ecosystems or
watersheds), injuries anticipated from incidents, or restoration
alternatives.
Regional restoration plans must be developed or annotated in such a
way that trustees are able to justify linking the injuries from a
particular incident or set of incidents with a specific restoration
project or set of projects within the plan. This may be facilitated by
describing the types of injuries anticipated from incidents to specific
natural resources within a region, and describing these injuries in
terms of the types and importance of functions and services, ecological
and human use.
III. Coordination
General
Trustee coordination is crucial to an efficient and effective
assessment and restoration planning process because of the need to
address shared trustee interests in natural resources and services
injured by incidents. OPA prohibits double recovery of damages, which
strongly suggests that, where multiple trustees are involved in an
incident, they actively coordinate their activities as early in the
process as possible.
Incentives for Coordination
Incentives for coordination include:
(a) Access to funding--requests for reimbursement of the costs of
initiating natural resource damage assessment from the Fund require
that trustees attempt to coordinate their assessments and funding
requests;
(b) Conflict resolution--lack of coordination among the trustees or
with the responsible parties will likely produce an adversarial,
litigation-charged atmosphere. A joint trustee-responsible party effort
will help resolve legal, administrative, and technical conflicts; and
(c) Pooling limited resources--a joint trustee-responsible party
effort will allow the pooling of financial and human resources for more
efficient and effective restoration planning and implementation.
Trustees will benefit greatly if coordination procedures can be
established well before an incident occurs. However, cooperative
arrangements allowing for responsible party implementation of
assessment activities are subject to trustee oversight because of the
trustees' fiduciary responsibility to the public.
Agreements
Trustees should consider Memoranda of Understanding (MOUs) to
formalize their co-trustee relationships. The MOU or similar agreements
may be prepared either in anticipation of an incident or shortly after
an incident. It is important that trustee agreements address, at a
minimum: the purpose of the agreement; trustee participants; trustee
organization; trustee responsibilities; and a decisionmaking process.
Lead Administrative Trustee (LAT)
When conducting joint assessments under this rule, trustees must
designate a Lead Administrative Trustee (LAT). The LAT serves as the
contact for trustee interaction with response agencies, responsible
parties and the public, and provides general administrative support to
the restoration process.
The rule does not require that a LAT be a federal agency. However,
when more than one federal trustee(s) is involved, the federal trustees
must select a federal LAT if the trustees wish to access the Fund to
initiate natural resource damage assessment activities. Where
appropriate, the trustees may designate co-LATs, consisting of a
federal LAT and the state, tribal, or foreign trustees. Trustees may
also elect to provide for sequential LATs to cover different stages of
the restoration planning and implementation process.
The LAT should be selected by mutual agreement of the trustees. In
designating a LAT, trustees may want to consider such factors as:
relative extent of jurisdiction over natural resources and services
injured by an incident; capability and willingness to conduct
assessment actions; and sequence and duration of involvement in the
incident or similar incidents. Selection of a LAT should be made as
soon as practicable after notification of an incident.
Co-Trustee Responsibilities
Co-trustees should be prepared to participate fully in the
restoration planning and implementation process by: participating in or
conducting those studies or analyses for which they have special
expertise or management authority; making staff available to
participate in other assessment activities, in particular, to represent
the trustee in decisions requiring co-trustee unanimity; and committing
financial resources. Each trustee may limit this participation based on
the extent of injury to its natural resources as well as legal and
financial constraints.
Coordination With Response Agencies
To the fullest extent practicable without interfering with response
activities, natural resource concerns should be integrated with
response activities before pursuing an assessment; liability for
natural resource damages is limited to damages for injuries residual to
the response phase, plus any injuries related to the response. NOAA
strongly encourages trustees to coordinate natural resource injury
assessment activities, such as gathering ephemeral data related to an
incident, with response actions. Mechanisms to coordinate response and
trustee data gathering needs and processes may also be addressed in
pre-incident planning.
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Coordination With the Responsible Parties
Under OPA, trustees have the responsibility to determine
appropriate actions to restore injured natural resources and services.
However, the rule requires trustees to invite the responsible parties
to be full or partial participants in the assessment and restoration
process, whenever it can be achieved without compromise of the
trustees' statutory obligations to act on behalf of the public trust.
Enforceable Agreements
Trustees and responsible parties should consider entering into
agreements to facilitate their interactions and resolve any disputes
during the assessment. To maximize cost-effectiveness and cooperation,
trustees and responsible parties should attempt to develop a set of
agreed-upon facts concerning the incident, assessment, and/or
restoration. For example, stipulated facts might concern the types of
natural resources and services injured, the extent of injury, or the
most appropriate assessment procedures to determine injury and/or
restoration needs, and how the results of the procedures used will be
interpreted.
Coordination Among the Responsible Parties
While it is obviously not as easy to identify the mix of potential
responsible parties that will participate in a given incident, there
are issues that can be addressed in general terms by the potential
responsible parties in advance, that will enable them to enter the
cooperative restoration process more efficiently and effectively. In an
incident with a single well-identified responsible party, the ability
to assess the situation, identify the appropriate course of action and
most effectively implement a cooperative response will be improved by
pre-incident planning. In an incident with multiple potential
responsible parties, the need for pre-incident planning is more
apparent. In this latter situation, the potential responsible parties
need to consider the efficacy of a cooperative restoration process, and
the terms under which they would consider entering into such a process.
Appendix B--Assessment Procedures
Any procedures used to assess injury and scale restoration actions
(i.e., procedures used throughout the natural resource damage
assessment) must meet all of the standards listed in Sec. 990.27 of the
rule if they are to be in accordance with the rule. The rule allows for
the use of a range of assessment procedures. The scientific and
technical adequacy of these procedures will be judged based on the
circumstances of the incident and associated injuries, and the
information needed to determine restoration actions. If a range of
assessment procedures providing the same type and quality of
information is available, the least costly procedure must be used.
Type A Procedures
The Department of the Interior (DOI) is responsible for developing
``type A'' assessment procedures under CERCLA. These procedures were
originally intended to cover both hazardous substance releases as well
as oil discharges. This rule would allow trustees to use any final type
A procedure incorporated into DOI's regulations that addresses
discharges of oil.
Compensation Formulas
As part of the 1994 proposed regulations, NOAA proposed a
compensation formula that could be used for small incidents in both the
estuarine and marine environments and the Great Lakes (and other inland
waters). The formula was developed using early drafts of type A models
being developed by DOI. The purpose of the formula is to readily
estimate impacts based on the amount of oil discharged and several
simple data inputs. The compensation formula was reserved in the 1995
proposed rule.
DOI is scheduled to issue the final revised type A models in early
1996. When those models are final, NOAA intends to reissue the
compensation formulas. Pending the final promulgation of the models,
NOAA has developed a guidance document to provide an interim tool for
such a purpose.
The compensation formula guidance document is intended to provide
instructions on how to recreate the incident scenarios used to develop
the 1994 proposed estuarine/marine compensation formulas. Using the
data in the guidance document, trustees will have a cost-effective tool
to use in estimating expected impacts of most discharges of oil. This
information may prove to be useful in early decisionmaking in a natural
resource damage assessment or in settlement discussions.
Restoration Scaling Procedures
The following is a list of procedures that are mentioned in this
preamble as potential approaches to scaling restoration actions. The
trustees are not limited to these procedures and may use any procedure
deemed to be appropriate to the particular situation, pursuant to the
guidance given above and in Sec. 990.27 of the final rule.
A. Habitat Equivalency Analysis
This procedure may be used to scale restoration actions that
replace entire habitats that support multiple species or that replace
individual species that provide a variety of natural resource services.
To ensure that the scale of the restoration action does not over- or
under-compensate the public for injuries incurred, the trustees must
establish an equivalency between the present value of the quantity of
lost services and the present value of the quantity of services
provided by the restoration action(s) over time.
B. Travel Cost Method
The travel cost method is principally employed to model demand for
recreational experiences. This measurement procedure evolved from the
insight that the travel costs an individual incurs to visit a site are
like a price for the site visit. In essence, the travel cost method
assesses an individual's willingness to travel further (thereby
incurring higher travel costs) in order to recreate at more highly
valued sites. It is important to take into account the availability and
quality of substitute recreation sites. Multiple-site models of
recreational demand, such as the random utility model, focus attention
on the recreationist's choice among alternative recreational sites.
This version of the travel cost model is particularly appropriate where
many substitutes are available to the individual and/or when the
incident has affected quality at multiple sites. For this reason,
multiple-site models of recreational demand are preferred to single-
site models, unless it is feasible to include in the single-site model
price and quality information about the relevant substitute sites (or
there are no substitute sites). If a literature value from a single-
site model, without full accounting for substitutes, is the only
available estimate, an appropriate adjustment should be made to the
estimate of trip value.
In cases where the change in the quantity or quality of natural
resource services to be analyzed is outside of the range of observed
behavior, trustees may choose to collect contingent behavior data.
Contingent behavior refers to the behavior of users or potential users
of a natural resource service under hypothetical conditions presented
to them in the travel cost survey.
[[Page 499]]
C. Factor Income Approach
This approach can be employed to calculate changes in economic rent
under certain special conditions; in more general cases, the procedure
appropriate for calculating economic rent is market models of supply
and demand. The factor income approach relies upon the production
function model that relates the contribution of inputs to the
production of an output. (Inputs are also referred to as factors of
production.) An incident may decrease the quality and/or quantity of a
natural resource, and thereby effectively increase the cost of
employing a natural resource input in a production process. For
example, contamination of water supplies or of sediments in
navigational waterways may increase the costs of providing drinking
water or of maintaining navigational waterways through dredging. Where
the prices of the final product and of the other factors of production
do not change, the change in economic rent is simply the sum of the
changes in factor costs (or factor income) for the affected inputs.
D. Hedonic Price Model
The hedonic price model relates the price of a marketed commodity
to its various attributes. In the natural resource damage assessment
context, it may be used to determine the change in value of some
nonmarket services from public trust natural resources (for example,
environmental amenities such as water or air quality) where they
function as attributes of private market goods, such as property. For
example, the value of beach front property may be directly related to
the quality and accessibility of the adjacent coastline. The change in
value of the property owners associated with the reduction in the
quality or accessibility, as may occur due to an incident, may be
captured in the value of the property if the effect is large enough.
All else equal, the decrease in property values as a result of a
discharge measures the change in use value of the injured coastline
natural resources accruing to local property owners. This measure of
the reduction in value of coastline natural resources will not capture
any loss in value of the natural resources that may accrue to members
of the public who do not own property in the area.
E. Market Models of Demand and Supply
For those goods and services regularly traded in markets,
economists typically rely upon market transactions to reveal the values
that individuals place on the goods and services and the costs of
producing them. When the quality of the natural resource directly
affects the value individual consumers place on a good or service, the
correct measure of damage is the change in consumer surplus, or
individuals' willingness-to-accept compensation plus the economic rent
component of producer surplus, if any, for the injuries associated with
the discharge.
F. Contingent Valuation
The contingent valuation (CV) method determines the value of goods
and services based on the results of carefully designed surveys. The CV
method obtains an estimate of the total value, including both direct
and passive use values of a good or service by using a questionnaire
designed to objectively collect information about the respondent's
willingness to pay for the good or service. A CV survey contains three
basic elements: (i) A description of the good/service to be valued and
the context in which it will be provided, including the method of
payment; (ii) questions regarding the respondent's willingness to pay
for the good or service; and (iii) questions concerning demographics or
other characteristics of the respondent to interpret and validate
survey responses.
G. Conjoint Analysis
Conjoint analysis is a survey procedure that is used to derive the
values of particular attributes of goods or services. Information is
collected about individuals' choices between different goods that vary
in terms of their attributes or service levels. With this information,
it is possible to derive values for each particular attribute or
service. If price is included as an attribute in the choice scenarios,
values can be derived in terms of dollars which can be used with the
valuation approach.
Alternatively, it is possible to value attributes in terms of units
of replacement services. Survey respondents would be presented with
choices between two or more options that may represent restoration
actions with varying levels or types of services. The goal is to obtain
the value of the injured services in terms of alternative natural
resource services so that restoration actions can be scaled directly
using the resource-to-resource or service-to-service approaches or the
valuation approach.
H. Benefits Transfer Approach
Benefits (or valuation) transfer involves the application of
existing value estimates or valuation functions and data that were
developed in one context to address a sufficiently similar natural
resource valuation question in a different context.
Where natural resource values have been developed through an
administrative or legislative process and are relevant and reliable
under the circumstances, the trustees may use these values, as
appropriate, in a benefits transfer context. Other values may be used
so long as three basic issues are considered in determining the
appropriateness of their use: the comparability of the users and of the
natural resource and/or service being valued in the initial studies and
the transfer context; the comparability of the change in quality or
quantity of natural resources and/or services in the initial study and
in the transfer context (where relevant); and the quality of the
studies being transferred.
National Environmental Policy Act, Regulatory Flexibility Act,
Paperwork Reduction Act and Executive Orders 12630, 12778, and 12612
The National Oceanic and Atmospheric Administration has determined
that this rule does not constitute a major federal action significantly
affecting the quality of the human environment. Therefore, no further
analysis pursuant to section 102(2)(C) of the National Environmental
Policy Act of 1969 (42 U.S.C. 4332(2)(C)) has been prepared.
The Assistant General Counsel for Legislation and Regulation, in
accordance with the Regulatory Flexibility Act, certifies to the Chief
Counsel for Advocacy, Small Business Administration, that this rule
will not have a significant economic effect on a substantial number of
small entities. The rule is intended to make more specific, and easier
to apply, the standards set out in OPA for assessing injury to natural
resources and/or services as a result of actual or threatened
discharges of oil. The rule is not intended to change the balance of
legal benefits and responsibilities among any parties or groups, large
or small. To the extent any are affected by the rule, it is anticipated
that all parties will benefit by increased ease of application of law
in this area.
It has been determined that this rule does not contain information
collection requirements that require approval by the Office of
Management and Budget under the Paperwork Reduction Act (44 U.S.C. 3501
et seq.).
The final rule has been reviewed under Executive Order 12,866 and
has been determined to constitute a significant regulatory action.
However, because of the difficulty of evaluating
[[Page 500]]
the effects of alternatives to this rule, the Office of Information and
Regulatory Affairs within the Office of Management and Budget has
waived preparation of the assessments described in sections 6(a)(3)(B)
and 6(a)(3(C) of Executive Order 12,866 for the final rule.
It has been determined that this rule does not have takings
implications under Executive Order 12,630. The Department has certified
to the Office of Management and Budget that this rule meets the
applicable standards provided in sections 2(a) and 2(b)(2) of Executive
Order 12,778. It has been determined that this rule does not have
federalism implications under Executive Order 12,612.
List of Subjects in 15 CFR Part 990
Coastal zone, Endangered and threatened species, Energy,
Environmental protection, Estuaries, Fish, Fisheries, Fishing,
Gasoline, Historic preservation (archeology), Hunting, Incorporation by
reference, Indian lands, Marine pollution, Migratory birds, National
forests, National parks, National Wild and Scenic Rivers System,
Natural resources, Navigable waters, Oil, Oil pollution, Petroleum,
Plants, Public lands, Recreation and recreation areas, Rivers,
Seashores, Shipping, Waterways, Water pollution control, Water
resources, Water supply, Water transportation, Wetlands, Wildlife.
Dated: December 21, 1995.
D. James Baker,
Under Secretary for Oceans and Atmosphere.
Under the authority of the Oil Pollution Act of 1990, and for the
reasons set out in this preamble, title 15 of the Code of Federal
Regulations, chapter IX is amended to add a new Subchapter E--Oil
Pollution Act Regulations and a new part 990 as set forth below.
SUBCHAPTER E--OIL POLLUTION ACT REGULATIONS
PART 990--NATURAL RESOURCE DAMAGE ASSESSMENTS
Subpart A--Introduction
Sec.
990.10 Purpose.
990.11 Scope.
990.12 Overview.
990.13 Rebuttable presumption.
990.14 Coordination.
990.15 Considerations to facilitate restoration.
Subpart B--Authorities
990.20 Relationship to the CERCLA natural resource damage
assessment regulations.
990.21 Relationship to the NCP.
990.22 Prohibition on double recovery.
990.23 Compliance with NEPA and the CEQ regulations.
990.24 Compliance with other applicable laws and regulations.
990.25 Settlement.
990.26 Emergency restoration.
990.27 Use of assessment procedures.
Subpart C--Definitions
990.30 Definitions.
Subpart D--Preassessment Phase
990.40 Purpose.
990.41 Determination of jurisdiction.
990.42 Determination to conduct restoration planning.
990.43 Data collection.
990.44 Notice of Intent to Conduct Restoration Planning.
990.45 Administrative record.
Subpart E--Restoration Planning Phase
990.50 Purpose.
990.51 Injury assessment--injury determination.
990.52 Injury assessment--quantification.
990.53 Restoration selection--developing restoration alternatives.
990.54 Restoration selection--evaluation of alternatives.
990.55 Restoration selection--developing restoration plans.
990.56 Restoration selection--use of a Regional Restoration Plan or
existing restoration project.
Subpart F--Restoration Implementation Phase
990.60 Purpose.
990.61 Administrative record.
990.62 Presenting a demand.
990.63 Discounting and compounding.
990.64 Unsatisfied demands.
990.65 Opening an account for recovered damages.
990.66 Additional considerations.
Authority: 33 U.S.C. 2701 et seq.
Subpart A--Introduction
Sec. 990.10 Purpose.
The goal of the Oil Pollution Act of 1990 (OPA), 33 U.S.C. 2701 et
seq., is to make the environment and public whole for injuries to
natural resources and services resulting from an incident involving a
discharge or substantial threat of a discharge of oil (incident).
This goal is achieved through the return of the injured natural
resources and services to baseline and compensation for interim losses
of such natural resources and services from the date of the incident
until recovery. The purpose of this part is to promote expeditious and
cost-effective restoration of natural resources and services injured as
a result of an incident. To fulfill this purpose, this part provides a
natural resource damage assessment process for developing a plan for
restoration of the injured natural resources and services and pursuing
implementation or funding of the plan by responsible parties. This part
also provides an administrative process for involving interested
parties in the assessment, a range of assessment procedures for
identifying and evaluating injuries to natural resources and services,
and a means for selecting restoration actions from a reasonable range
of alternatives.
Sec. 990.11 Scope.
The Oil Pollution Act of 1990 (OPA), 33 U.S.C. 2701 et seq.,
provides for the designation of federal, state, and, if designated by
the Governor of the state, local officials to act on behalf of the
public as trustees for natural resources and for the designation of
Indian tribe and foreign officials to act as trustees for natural
resources on behalf of, respectively, the tribe or its members and the
foreign government. This part may be used by these officials in
conducting natural resource damage assessments when natural resources
and/or services are injured as a result of an incident involving an
actual or substantial threat of a discharge of oil. This part is not
intended to affect the recoverability of natural resource damages when
recoveries are sought other than in accordance with this part.
Sec. 990.12 Overview.
This part describes three phases of a natural resource damage
assessment. The Preassessment Phase, during which trustees determine
whether to pursue restoration, is described in subpart D of this part.
The Restoration Planning Phase, during which trustees evaluate
information on potential injuries and use that information to determine
the need for, type of, and scale of restoration, is described in
subpart E of this part. The Restoration Implementation Phase, during
which trustees ensure implementation of restoration, is described in
subpart F of this part.
Sec. 990.13 Rebuttable presumption.
Any determination or assessment of damages to natural resources
made by a Federal, State, or Indian trustee in accordance with this
part shall have the force and effect of a rebuttable presumption on
behalf of the trustee in any administrative or judicial proceeding
under OPA.
Sec. 990.14 Coordination.
(a) Trustees. (1) If an incident affects the interests of multiple
trustees, the trustees should act jointly under this part to ensure
that full restoration is achieved without double recovery of damages.
For joint assessments, trustees must designate one or more Lead
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Administrative Trustee(s) to act as coordinators.
(2) If there is a reasonable basis for dividing the natural
resource damage assessment, trustees may act independently under this
part, so long as there is no double recovery of damages.
(3) Trustees may develop pre-incident or incident-specific
memoranda of understanding to coordinate their activities.
(b) Response agencies. Trustees must coordinate their activities
conducted concurrently with response operations with response agencies
consistent with the NCP and any pre-incident plans developed under
Sec. 990.15(a) of this part. Trustees may develop pre-incident
memoranda of understanding to coordinate their activities with response
agencies.
(c) Responsible parties--(1) Invitation. Trustees must invite the
responsible parties to participate in the natural resource damage
assessment described in this part. The invitation to participate should
be in writing, and a written response by the responsible parties is
required to confirm the desire to participate.
(2) Timing. The invitation to participate should be extended to
known responsible parties as soon as practicable, but not later than
the delivery of the ``Notice of Intent to Conduct Restoration
Planning,'' under Sec. 990.44 of this part, to the responsible party.
(3) Agreements. Trustees and responsible parties should consider
entering into binding agreements to facilitate their interactions and
resolve any disputes during the assessment. To maximize cost-
effectiveness and cooperation, trustees and responsible parties should
attempt to develop a set of agreed-upon facts concerning the incident
and/or assessment.
(4) Nature and extent of participation. If the responsible parties
accept the invitation to participate, the scope of that participation
must be determined by the trustees, in light of the considerations in
paragraph (c)(5) of this section. At a minimum, participation will
include notice of trustee determinations required under this part, and
notice and opportunity to comment on documents or plans that
significantly affect the nature and extent of the assessment. Increased
levels of participation by responsible parties may be developed at the
mutual agreement of the trustees and the responsible parties. Trustees
will objectively consider all written comments provided by the
responsible parties, as well as any other recommendations or proposals
that the responsible parties submit in writing to the Lead
Administrative Trustee. Submissions by the responsible parties will be
included in the administrative record. Final authority to make
determinations regarding injury and restoration rest solely with the
trustees. Trustees may end participation by responsible parties who,
during the conduct of the assessment, in the sole judgment of the
trustees, cause interference with the trustees' ability to fulfill
their responsibilities under OPA and this part.
(5) Considerations. In determining the nature and extent of
participation by the responsible parties or their representatives,
trustees may consider such factors as:
(i) Whether the responsible parties have been identified;
(ii) The willingness of responsible parties to participate in the
assessment;
(iii) The willingness of responsible parties to fund assessment
activities;
(iv) The willingness and ability of responsible parties to conduct
assessment activities in a technically sound and timely manner and to
be bound by the results of jointly agreed upon studies;
(v) The degree of cooperation of the responsible parties in the
response to the incident; and
(vi) The actions of the responsible parties in prior assessments.
(6) Request for alternative assessment procedures. (i) The
participating responsible parties may request that trustees use
assessment procedures other than those selected by the trustees if the
responsible parties:
(A) Identify the proposed procedures to be used that meet the
requirements of Sec. 990.27 of this part, and provide reasons
supporting the technical adequacy and appropriateness of such
procedures for the incident and associated injuries;
(B) Advance to the trustees the trustees' reasonable estimate of
the cost of using the proposed procedures; and
(C) Agree not to challenge the results of the proposed procedures.
The request from the responsible parties may be made at any time, but
no later than, fourteen (14) days of being notified of the trustees'
proposed assessment procedures for the incident or the injury.
(ii) Trustees may reject the responsible parties' proposed
assessment procedures if, in the sole judgment of the trustees, the
proposed assessment procedures:
(A) Are not technically feasible;
(B) Are not scientifically or technically sound;
(C) Would inadequately address the natural resources and services
of concern;
(D) Could not be completed within a reasonable time frame; or
(E) Do not meet the requirements of Sec. 990.27 of this part.
(7) Disclosure. Trustees must document in the administrative record
and Restoration Plan the invitation to the responsible parties to
participate, and briefly describe the nature and extent of the
responsible parties' participation. If the responsible parties'
participation is terminated during the assessment, trustees must
provide a brief explanation of this decision in the administrative
record and Restoration Plan.
(d) Public. Trustees must provide opportunities for public
involvement after the trustees' decision to develop restoration plans
or issuance of any notices to that effect, as provided in Sec. 990.55
of this part. Trustees may also provide opportunities for public
involvement at any time prior to this decision if such involvement may
enhance trustees' decisionmaking or avoid delays in restoration.
Sec. 990.15 Considerations to facilitate restoration.
In addition to the procedures provided in subparts D through F of
this part, trustees may take other actions to further the goal of
expediting restoration of injured natural resources and services,
including:
(a) Pre-incident planning. Trustees may engage in pre-incident
planning activities. Pre-incident plans may identify natural resource
damage assessment teams, establish trustee notification systems,
identify support services, identify natural resources and services at
risk, identify area and regional response agencies and officials,
identify available baseline information, establish data management
systems, and identify assessment funding issues and options.
Potentially responsible parties, as well as all other members of the
public interested in and capable of participating in assessments,
should be included in pre-incident planning to the fullest extent
practicable.
(b) Regional Restoration Plans. Where practicable, incident-
specific restoration plan development is preferred, however, trustees
may develop Regional Restoration Plans. These plans may be used to
support a claim under Sec. 990.56 of this part. Regional restoration
planning may consist of compiling databases that identify, on a
regional or watershed basis, or otherwise as appropriate, existing,
planned, or proposed restoration projects that may
[[Page 502]]
provide appropriate restoration alternatives for consideration in the
context of specific incidents.
Subpart B--Authorities
Sec. 990.20 Relationship to the CERCLA natural resource damage
assessment regulations.
(a) General. Regulations for assessing natural resource damages
resulting from hazardous substance releases under the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as
amended (CERCLA), 42 U.S.C. 9601 et seq., and the Federal Water
Pollution Control Act (Clean Water Act), 33 U.S.C. 1321 et seq., are
codified at 43 CFR part 11. The CERCLA regulations originally applied
to natural resource damages resulting from oil discharges as well as
hazardous substance releases. This part supersedes 43 CFR part 11 with
regard to oil discharges covered by OPA.
(b) Assessments commenced before February 5, 1996. If trustees
commenced a natural resource damage assessment for an oil discharge
under 43 CFR part 11 prior to February 5, 1996 they may complete the
assessment in compliance with 43 CFR part 11, or they may elect to use
this part, and obtain a rebuttable presumption.
(c) Oil and hazardous substance mixtures. For natural resource
damages resulting from a discharge or release of a mixture of oil and
hazardous substances, trustees must use 43 CFR part 11 in order to
obtain a rebuttable presumption.
Sec. 990.21 Relationship to the NCP.
This part provides procedures by which trustees may determine
appropriate restoration of injured natural resources and services,
where such injuries are not fully addressed by response actions.
Response actions and the coordination with damage assessment activities
are conducted pursuant to the National Oil and Hazardous Substances
Pollution Contingency Plan (NCP), 40 CFR part 300.
Sec. 990.22 Prohibition on double recovery.
When taking actions under this part, trustees are subject to the
prohibition on double recovery, as provided in 33 U.S.C. 2706(d)(3) of
OPA.
Sec. 990.23 Compliance with NEPA and the CEQ regulations.
(a) General. The National Environmental Policy Act (NEPA), 42
U.S.C. 4321 et seq. and Council on Environmental Quality (CEQ)
regulations implementing NEPA, 40 CFR chapter V, apply to restoration
actions by federal trustees, except where a categorical exclusion or
other exception to NEPA applies. Thus, when a federal trustee proposes
to take restoration actions under this part, it must integrate this
part with NEPA, the CEQ regulations, and NEPA regulations promulgated
by that federal trustee agency. Where state NEPA-equivalent laws may
apply to state trustees, state trustees must consider the extent to
which they must integrate this part with their NEPA-equivalent laws.
The requirements and process described in this section relate only to
NEPA and federal trustees.
(b) NEPA requirements for federal trustees. NEPA becomes applicable
when federal trustees propose to take restoration actions, which begins
with the development of a Draft Restoration Plan under Sec. 990.55 of
this part. Depending upon the circumstances of the incident, federal
trustees may need to consider early involvement of the public in
restoration planning in order to meet their NEPA compliance
requirements.
(c) NEPA process for federal trustees. Although the steps in the
NEPA process may vary among different federal trustees, the process
will generally involve the need to develop restoration plans in the
form of an Environmental Assessment or Environmental Impact Statement,
depending upon the trustee agency's own NEPA regulations.
(1) Environmental Assessment. (i) Purpose. The purpose of an
Environmental Assessment (EA) is to determine whether a proposed
restoration action will have a significant (as defined under NEPA and
Sec. 1508.27 of the CEQ regulations) impact on the quality of the human
environment, in which case an Environmental Impact Statement (EIS)
evaluating the impact is required. In the alternative, where the impact
will not be significant, federal trustees must issue a Finding of No
Significant Impact (FONSI) as part of the restoration plans developed
under this part. If significant impacts to the human environment are
anticipated, the determination to proceed with an EIS may be made as a
result, or in lieu, of the development of the EA.
(ii) General steps. (A) If the trustees decide to pursue an EA, the
trustees may issue a Notice of Intent to Prepare a Draft Restoration
Plan/EA, or proceed directly to developing a Draft Restoration Plan/EA.
(B) The Draft Restoration Plan/EA must be made available for public
review before concluding a FONSI or proceeding with an EIS.
(C) If a FONSI is concluded, the restoration planning process
should be no different than under Sec. 990.55 of this part, except that
the Draft Restoration Plan/EA will include the FONSI analysis.
(D) The time period for public review on the Draft Restoration
Plan/EA must be consistent with the federal trustee agency's NEPA
requirements, but should generally be no less than thirty (30) calendar
days.
(E) The Final Restoration Plan/EA must consider all public comments
on the Draft Restoration Plan/EA and FONSI.
(F) The means by which a federal trustee requests, considers, and
responds to public comments on the Draft Restoration Plan/EA and FONSI
must also be consistent with the federal agency's NEPA requirements.
(2) Environmental Impact Statement. (i) Purpose. The purpose of an
Environmental Impact Statement (EIS) is to involve the public and
facilitate the decisionmaking process in the federal trustees' analysis
of alternative approaches to restoring injured natural resources and
services, where the impacts of such restoration are expected to have
significant impacts on the quality of the human environment.
(ii) General steps. (A) If trustees determine that restoration
actions are likely to have a significant (as defined under NEPA and
Sec. 1508.27 of the CEQ regulations) impact on the environment, they
must issue a Notice of Intent to Prepare a Draft Restoration Plan/EIS.
The notice must be published in the Federal Register.
(B) The notice must be followed by formal public involvement in the
development of the Draft Restoration Plan/EIS.
(C) The Draft Restoration Plan/EIS must be made available for
public review for a minimum of forty-five (45) calendar days. The Draft
Restoration Plan/EIS, or a notice of its availability, must be
published in the Federal Register.
(D) The Final Restoration Plan/EIS must consider all public
comments on the Draft Restoration Plan/EIS, and incorporate any changes
made to the Draft Restoration Plan/EIS in response to public comments.
(E) The Final Restoration Plan/EIS must be made publicly available
for a minimum of thirty (30) calendar days before a decision is made on
the federal trustees' proposed restoration actions (Record of
Decision). The Final Restoration Plan/EIS, or a notice of its
availability, must be published in the Federal Register.
(F) The means by which a federal trustee agency requests,
considers, and responds to public comments on the
[[Page 503]]
Final Restoration Plan/EIS must also be consistent with the federal
agency's NEPA requirements.
(G) After appropriate public review on the Final Restoration Plan/
EIS is completed, a Record of Decision (ROD) is issued. The ROD
summarizes the trustees' decisionmaking process after consideration of
any public comments relative to the proposed restoration actions,
identifies all restoration alternatives (including the preferred
alternative(s)), and their environmental consequences, and states
whether all practicable means to avoid or minimize environmental harm
were adopted (e.g., monitoring and corrective actions). The ROD may be
incorporated with other decision documents prepared by the trustees.
The means by which the ROD is made publicly available must be
consistent with the federal trustee agency's NEPA requirements.
(d) Relationship to Regional Restoration Plans or an existing
restoration project. If a Regional Restoration Plan or existing
restoration project is proposed for use, federal trustees may be able
to tier their NEPA analysis to an existing EIS, as described in
Secs. 1502.20 and 1508.28 of the CEQ regulations.
Sec. 990.24 Compliance with other applicable laws and regulations.
(a) Worker health and safety. When taking actions under this part,
trustees must comply with applicable worker health and safety
considerations specified in the NCP for response actions.
(b) Natural Resources protection. When acting under this part,
trustees must ensure compliance with any applicable consultation,
permitting, or review requirements, including but not limited to: the
Endangered Species Act of 1973, 16 U.S.C. 1531 et seq.; the Coastal
Zone Management Act of 1972, 16 U.S.C. 1451 et seq.; the Migratory Bird
Treaty Act, 16 U.S.C. 703 et seq.; the National Marine Sanctuaries Act,
16 U.S.C. 1431 et seq.; the National Historic Preservation Act, 12
U.S.C. 470 et seq.; the Marine Mammal Protection Act, 16 U.S.C. 1361 et
seq.; and the Archaeological Resources Protection Act, 16 U.S.C. 470 et
seq.
Sec. 990.25 Settlement.
Trustees may settle claims for natural resource damages under this
part at any time, provided that the settlement is adequate in the
judgment of the trustees to satisfy the goal of OPA and is fair,
reasonable, and in the public interest, with particular consideration
of the adequacy of the settlement to restore, replace, rehabilitate, or
acquire the equivalent of the injured natural resources and services.
Sums recovered in settlement of such claims, other than reimbursement
of trustee costs, may only be expended in accordance with a restoration
plan, which may be set forth in whole or in part in a consent decree or
other settlement agreement, which is made available for public review.
Sec. 990.26 Emergency restoration.
(a) Trustees may take emergency restoration action before
completing the process established under this part, provided that:
(1) The action is needed to minimize continuing or prevent
additional injury;
(2) The action is feasible and likely to minimize continuing or
prevent additional injury; and
(3) The costs of the action are not unreasonable.
(b) If response actions are still underway, trustees, through their
Regional Response Team member or designee, must coordinate with the On-
Scene Coordinator (OSC) before taking any emergency restoration
actions. Any emergency restoration actions proposed by trustees should
not interfere with on-going response actions. Trustees must explain to
response agencies through the OSC prior to implementation of emergency
restoration actions their reasons for believing that proposed emergency
restoration actions will not interfere with on-going response actions.
(c) Trustees must provide notice to identified responsible parties
of any emergency restoration actions and, to the extent time permits,
invite their participation in the conduct of those actions as provided
in Sec. 990.14(c) of this part.
(d) Trustees must provide notice to the public, to the extent
practicable, of these planned emergency restoration actions. Trustees
must also provide public notice of the justification for, nature and
extent of, and results of emergency restoration actions within a
reasonable time frame after completion of such actions. The means by
which this notice is provided is left to the discretion of the trustee.
Sec. 990.27 Use of assessment procedures.
(a) Standards for assessment procedures. Any procedures used
pursuant to this part must comply with all of the following standards
if they are to be in accordance with this part:
(1) The procedure must be capable of providing assessment
information of use in determining the type and scale of restoration
appropriate for a particular injury;
(2) The additional cost of a more complex procedure must be
reasonably related to the expected increase in the quantity and/or
quality of relevant information provided by the more complex procedure;
and
(3) The procedure must be reliable and valid for the particular
incident.
(b) Assessment procedures available. (1) The range of assessment
procedures available to trustees includes, but is not limited to:
(i) Procedures conducted in the field;
(ii) Procedures conducted in the laboratory;
(iii) Model-based procedures, including type A procedures
identified in 43 CFR part 11, subpart D, and compensation formulas/
schedules; and
(iv) Literature-based procedures.
(2) Trustees may use the assessment procedures in paragraph (b)(1)
of this section alone, or in any combination, provided that the
standards in paragraph (a) of this section are met, and there is no
double recovery.
(c) Selecting assessment procedures. (1) When selecting assessment
procedures, trustees must consider, at a minimum:
(i) The range of procedures available under paragraph (b) of this
section;
(ii) The time and cost necessary to implement the procedures;
(iii) The potential nature, degree, and spatial and temporal extent
of the injury;
(iv) The potential restoration actions for the injury; and
(v) The relevance and adequacy of information generated by the
procedures to meet information requirements of restoration planning.
(2) If a range of assessment procedures providing the same type and
quality of information is available, the most cost-effective procedure
must be used.
Subpart C--Definitions
Sec. 990.30 Definitions.
For the purpose of this rule, the term:
Baseline means the condition of the natural resources and services
that would have existed had the incident not occurred. Baseline data
may be estimated using historical data, reference data, control data,
or data on incremental changes (e.g., number of dead animals), alone or
in combination, as appropriate.
Cost-effective means the least costly activity among two or more
activities that provide the same or a comparable level of benefits, in
the judgment of the trustees.
CEQ regulations means the Council on Environmental Quality
regulations implementing NEPA, 40 CFR chapter V.
[[Page 504]]
Damages means damages specified in section 1002(b) of OPA (33
U.S.C. 1002(b)), and includes the costs of assessing these damages, as
defined in section 1001(5) of OPA (33 U.S.C. 2701(5)).
Discharge means any emission (other than natural seepage),
intentional or unintentional, and includes, but is not limited to,
spilling, leaking, pumping, pouring, emitting, emptying, or dumping, as
defined in section 1001(7) of OPA (33 U.S.C. 2701(7)).
Exclusive Economic Zone means the zone established by Presidential
Proclamation 5030 of March 10, 1983 (3 CFR, 1984 Comp., p. 22),
including the ocean waters of the areas referred to as ``eastern
special areas'' in Article 3(1) of the Agreement between the United
States of America and the Union of Soviet Socialist Republics on the
Maritime Boundary, signed June 1, 1990, as defined in section 1001(8)
of OPA (33 U.S.C. 2701(8)).
Exposure means direct or indirect contact with the discharged oil.
Facility means any structure, group of structures, equipment, or
device (other than a vessel) which is used for one or more of the
following purposes: exploring for, drilling for, producing, storing,
handling, transferring, processing, or transporting oil. This term
includes any motor vehicle, rolling stock, or pipeline used for one or
more of these purposes, as defined in section 1001(9) of OPA (33 U.S.C.
2701(9)).
Fund means the Oil Spill Liability Trust Fund, established by
section 9509 of the Internal Revenue Code of 1986 (26 U.S.C. 9509), as
defined in section 1001(11) of OPA (33 U.S.C. 2701(11)).
Incident means any occurrence or series of occurrences having the
same origin, involving one or more vessels, facilities, or any
combination thereof, resulting in the discharge or substantial threat
of discharge of oil into or upon navigable waters or adjoining
shorelines or the Exclusive Economic Zone, as defined in section
1001(14) of OPA (33 U.S.C. 2701(14)).
Indian tribe (or tribal) means any Indian tribe, band, nation, or
other organized group or community, but not including any Alaska Native
regional or village corporation, which is recognized as eligible for
the special programs and services provided by the United States to
Indians because of their status as Indians and has governmental
authority over lands belonging to or controlled by the tribe, as
defined in section 1001(15) of OPA (33 U.S.C. 2701(15)).
Injury means an observable or measurable adverse change in a
natural resource or impairment of a natural resource service. Injury
may occur directly or indirectly to a natural resource and/or service.
Injury incorporates the terms ``destruction,'' ``loss,'' and ``loss of
use'' as provided in OPA.
Lead Administrative Trustee(s) (or LAT) means the trustee(s) who is
selected by all participating trustees whose natural resources or
services are injured by an incident, for the purpose of coordinating
natural resource damage assessment activities. The LAT(s) should also
facilitate communication between the OSC and other natural resource
trustees regarding their activities during the response phase.
NCP means the National Oil and Hazardous Substances Pollution
Contingency Plan (National Contingency Plan) codified at 40 CFR part
300, which addresses the identification, investigation, study, and
response to incidents, as defined in section 1001(19) of OPA (33 U.S.C.
2701(19)).
Natural resource damage assessment (or assessment) means the
process of collecting and analyzing information to evaluate the nature
and extent of injuries resulting from an incident, and determine the
restoration actions needed to bring injured natural resources and
services back to baseline and make the environment and public whole for
interim losses.
Natural resources means land, fish, wildlife, biota, air, water,
ground water, drinking water supplies, and other such resources
belonging to, managed by, held in trust by, appertaining to, or
otherwise controlled by the United States (including the resources of
the Exclusive Economic Zone), any state or local government or Indian
tribe, or any foreign government, as defined in section 1001(20) of OPA
(33 U.S.C. 2701(20)).
Navigable waters means the waters of the United States, including
the territorial sea, as defined in section 1001(21) of OPA (33 U.S.C.
2701(21)).
NEPA means the National Environmental Policy Act, 42 U.S.C. 4321 et
seq.
Oil means oil of any kind or in any form, including, but not
limited to, petroleum, fuel oil, sludge, oil refuse, and oil mixed with
wastes other than dredged spoil. However, the term does not include
petroleum, including crude oil or any fraction thereof, that is
specifically listed or designated as a hazardous substance under 42
U.S.C. 9601(14)(A) through (F), as defined in section 1001(23) of OPA
(33 U.S.C. 2701(23)).
On-Scene Coordinator (or OSC) means the official designated by the
U.S. Environmental Protection Agency or the U.S. Coast Guard to
coordinate and direct response actions under the NCP, or the government
official designated by the lead response agency to coordinate and
direct response actions under the NCP.
OPA means the Oil Pollution Act of 1990, 33 U.S.C. 2701 et seq.
Pathway means any link that connects the incident to a natural
resource and/or service, and is associated with an actual discharge of
oil.
Person means an individual, corporation, partnership, association,
state, municipality, commission, or political subdivision of a state,
or any interstate body, as defined in section 1001(27) of OPA (33
U.S.C. 2701(27)).
Public vessel means a vessel owned or bareboat chartered and
operated by the United States, or by a state or political subdivision
thereof, or by a foreign nation, except when the vessel is engaged in
commerce, as defined in section 1001(29) of OPA (33 U.S.C. 2701(29)).
Reasonable assessment costs means, for assessments conducted under
this part, assessment costs that are incurred by trustees in accordance
with this part. In cases where assessment costs are incurred but
trustees do not pursue restoration, trustees may recover their
reasonable assessment costs provided that they have determined that
assessment actions undertaken were premised on the likelihood of injury
and need for restoration. Reasonable assessment costs also include:
administrative, legal, and enforcement costs necessary to carry out
this part; monitoring and oversight costs; and costs associated with
public participation.
Recovery means the return of injured natural resources and services
to baseline.
Response (or remove or removal) means containment and removal of
oil or a hazardous substance from water and shorelines or the taking of
other actions as may be necessary to minimize or mitigate damage to the
public health or welfare, including, but not limited to, fish,
shellfish, wildlife, and public and private property, shorelines, and
beaches, as defined in section 1001(30) of OPA (33 U.S.C. 2701(30)).
Responsible party means:
(a) Vessels. In the case of a vessel, any person owning, operating,
or demise chartering the vessel.
(b) Onshore facilities. In the case of an onshore facility (other
than a pipeline), any person owning or operating the facility, except a
federal agency, state, municipality, commission, or political
subdivision of a state, or any interstate body, that as the owner
transfers
[[Page 505]]
possession and right to use the property to another person by lease,
assignment, or permit.
(c) Offshore facilities. In the case of an offshore facility (other
than a pipeline or a deepwater port licensed under the Deepwater Port
Act of 1974 (33 U.S.C. 1501 et seq.)), the lessee or permittee of the
area in which the facility is located or the holder of a right of use
and easement granted under applicable state law or the Outer
Continental Shelf Lands Act (43 U.S.C. 1301-1356) for the area in which
the facility is located (if the holder is a different person than the
lessee or permittee), except a federal agency, state, municipality,
commission, or political subdivision of a state, or any interstate
body, that as owner transfers possession and right to use the property
to another person by lease, assignment, or permit.
(d) Deepwater ports. In the case of a deepwater port licensed under
the Deepwater Port Act of 1974 (33 U.S.C. 1501-1524), the licensee.
(e) Pipelines. In the case of a pipeline, any person owning or
operating the pipeline.
(f) Abandonment. In the case of an abandoned vessel, onshore
facility, deepwater port, pipeline, or offshore facility, the persons
who would have been responsible parties immediately prior to the
abandonment of the vessel or facility, as defined in section 1001(32)
of OPA (33 U.S.C. 2701(32)).
Restoration means any action (or alternative), or combination of
actions (or alternatives), to restore, rehabilitate, replace, or
acquire the equivalent of injured natural resources and services.
Restoration includes:
(a) Primary restoration, which is any action, including natural
recovery, that returns injured natural resources and services to
baseline; and
(b) Compensatory restoration, which is any action taken to
compensate for interim losses of natural resources and services that
occur from the date of the incident until recovery.
Services (or natural resource services) means the functions
performed by a natural resource for the benefit of another natural
resource and/or the public.
Trustees (or natural resource trustees) means those officials of
the federal and state governments, of Indian tribes, and of foreign
governments, designated under 33 U.S.C. 2706(b) of OPA.
United States and State means the several States of the United
States, the District of Columbia, the Commonwealth of Puerto Rico,
Guam, American Samoa, the United States Virgin Islands, the
Commonwealth of the Northern Marianas, and any other territory or
possession of the United States, as defined in section 1001(36) of OPA
(33 U.S.C. 2701(36)).
Value means the maximum amount of goods, services, or money an
individual is willing to give up to obtain a specific good or service,
or the minimum amount of goods, services, or money an individual is
willing to accept to forgo a specific good or service. The total value
of a natural resource or service includes the value individuals derive
from direct use of the natural resource, for example, swimming,
boating, hunting, or birdwatching, as well as the value individuals
derive from knowing a natural resource will be available for future
generations.
Vessel means every description of watercraft or other artificial
contrivance used, or capable of being used, as a means of
transportation on water, other than a public vessel, as defined in
section 1001(37) of OPA (33 U.S.C. 2701(37)).
Subpart D--Preassessment Phase
Sec. 990.40 Purpose.
The purpose of this subpart is to provide a process by which
trustees determine if they have jurisdiction to pursue restoration
under OPA and, if so, whether it is appropriate to do so.
Sec. 990.41 Determination of jurisdiction.
(a) Determination of jurisdiction. Upon learning of an incident,
trustees must determine whether there is jurisdiction to pursue
restoration under OPA. To make this determination, trustees must decide
if:
(1) An incident has occurred, as defined in Sec. 990.30 of this
part;
(2) The incident is not:
(i) Permitted under a permit issued under federal, state, or local
law; or
(ii) From a public vessel; or
(iii) From an onshore facility subject to the Trans-Alaska Pipeline
Authority Act, 43 U.S.C. 1651, et seq.; and
(3) Natural resources under the trusteeship of the trustee may have
been, or may be, injured as a result of the incident.
(b) Proceeding with preassessment. If the conditions listed in
paragraph (a) of this section are met, trustees may proceed under this
part. If one of the conditions is not met, trustees may not take
additional action under this part, except action to finalize this
determination. Trustees may recover all reasonable assessment costs
incurred up to this point provided that conditions in paragraphs (a)(1)
and (a)(2) of this section were met and actions were taken with the
reasonable belief that natural resources or services under their
trusteeship might have been injured as a result of the incident.
Sec. 990.42 Determination to conduct restoration planning.
(a) Determination on restoration planning. If trustees determine
that there is jurisdiction to pursue restoration under OPA, trustees
must determine whether:
(1) Injuries have resulted, or are likely to result, from the
incident;
(2) Response actions have not adequately addressed, or are not
expected to address, the injuries resulting from the incident; and
(3) Feasible primary and/or compensatory restoration actions exist
to address the potential injuries.
(b) Proceeding with preassessment. If the conditions listed in
paragraph (a) of this section are met, trustees may proceed under
Sec. 990.44 of this part. If one of these conditions is not met,
trustees may not take additional action under this part, except action
to finalize this determination. However, trustees may recover all
reasonable assessment costs incurred up to this point.
Sec. 990.43 Data collection.
Trustees may conduct data collection and analyses that are
reasonably related to Preassessment Phase activities. Data collection
and analysis during the Preassessment Phase must be coordinated with
response actions such that collection and analysis does not interfere
with response actions. Trustees may collect and analyze the following
types of data during the Preassessment Phase:
(a) Data reasonably expected to be necessary to make a
determination of jurisdiction under Sec. 990.41 of this part, or a
determination to conduct restoration planning under Sec. 990.42 of this
part;
(b) Ephemeral data; and
(c) Information needed to design or implement anticipated
assessment procedures under subpart E of this part.
Sec. 990.44 Notice of Intent to Conduct Restoration Planning.
(a) General. If trustees determine that all the conditions under
Sec. 990.42(a) of this part are met and trustees decide to proceed with
the natural resource damage assessment, they must prepare a Notice of
Intent to Conduct Restoration Planning.
(b) Contents of the notice. The Notice of Intent to Conduct
Restoration Planning must include a discussion of the trustees'
analyses under Secs. 990.41 and 990.42 of this part. Depending on
information available at this point, the notice may include the
trustees'
[[Page 506]]
proposed strategy to assess injury and determine the type and scale of
restoration. The contents of a notice may vary, but will typically
discuss:
(1) The facts of the incident;
(2) Trustee authority to proceed with the assessment;
(3) Natural resources and services that are, or are likely to be,
injured as a result of the incident;
(4) Potential restoration actions relevant to the expected
injuries; and
(5) If determined at the time, potential assessment procedures to
evaluate the injuries and define the appropriate type and scale of
restoration for the injured natural resources and services.
(c) Public availability of the notice. Trustees must make a copy of
the Notice of Intent to Conduct Restoration Planning publicly
available. The means by which the notice is made publicly available and
whether public comments are solicited on the notice will depend on the
nature and extent of the incident and various information requirements,
and is left to the discretion of the trustees.
(d) Delivery of the notice to the responsible parties. Trustees
must send a copy of the notice to the responsible parties, to the
extent known, in such a way as will establish the date of receipt, and
invite responsible parties' participation in the conduct of restoration
planning. Consistent with Sec. 990.14(c) of this part, the
determination of the timing, nature, and extent of responsible party
participation will be determined by the trustees on an incident-
specific basis.
Sec. 990.45 Administrative record.
(a) If trustees decide to proceed with restoration planning, they
must open a publicly available administrative record to document the
basis for their decisions pertaining to restoration. The administrative
record should be opened concurrently with the publication of the Notice
of Intent to Conduct Restoration Planning. Depending on the nature and
extent of the incident and assessment, the administrative record should
include documents relied upon during the assessment, such as:
(1) Any notice, draft and final restoration plans, and public
comments;
(2) Any relevant data, investigation reports, scientific studies,
work plans, quality assurance plans, and literature; and
(3) Any agreements, not otherwise privileged, among the
participating trustees or with the responsible parties.
(b) Federal trustees should maintain the administrative record in a
manner consistent with the Administrative Procedure Act, 5 U.S.C. 551-
59, 701-06.
Subpart E--Restoration Planning Phase
Sec. 990.50 Purpose.
The purpose of this subpart is to provide a process by which
trustees evaluate and quantify potential injuries (injury assessment),
and use that information to determine the need for and scale of
restoration actions (restoration selection).
Sec. 990.51 Injury assessment--injury determination.
(a) General. After issuing a Notice of Intent to Conduct
Restoration Planning under Sec. 990.44 of this part, trustees must
determine if injuries to natural resources and/or services have
resulted from the incident.
(b) Determining injury. To make the determination of injury,
trustees must evaluate if:
(1) The definition of injury has been met, as defined in
Sec. 990.30 of this part; and
(2)(i) An injured natural resource has been exposed to the
discharged oil, and a pathway can be established from the discharge to
the exposed natural resource; or
(ii) An injury to a natural resource or impairment of a natural
resource service has occurred as a result of response actions or a
substantial threat of a discharge of oil.
(c) Identifying injury. Trustees must determine whether an injury
has occurred and, if so, identify the nature of the injury. Potential
categories of injury include, but are not limited to, adverse changes
in: survival, growth, and reproduction; health, physiology and
biological condition; behavior; community composition; ecological
processes and functions; physical and chemical habitat quality or
structure; and public services.
(d) Establishing exposure and pathway. Except for injuries
resulting from response actions or incidents involving a substantial
threat of a discharge of oil, trustees must establish whether natural
resources were exposed, either directly or indirectly, to the
discharged oil from the incident, and estimate the amount or
concentration and spatial and temporal extent of the exposure. Trustees
must also determine whether there is a pathway linking the incident to
the injuries. Pathways may include, but are not limited to, the
sequence of events by which the discharged oil was transported from the
incident and either came into direct physical contact with a natural
resource, or caused an indirect injury.
(e) Injuries resulting from response actions or incidents involving
a substantial threat of a discharge. For injuries resulting from
response actions or incidents involving a substantial threat of a
discharge of oil, trustees must determine whether an injury or an
impairment of a natural resource service has occurred as a result of
the incident.
(f) Selection of injuries to include in the assessment. When
selecting potential injuries to assess, trustees should consider
factors such as:
(1) The natural resources and services of concern;
(2) The procedures available to evaluate and quantify injury, and
associated time and cost requirements;
(3) The evidence indicating exposure;
(4) The pathway from the incident to the natural resource and/or
service of concern;
(5) The adverse change or impairment that constitutes injury;
(6) The evidence indicating injury;
(7) The mechanism by which injury occurred;
(8) The potential degree, and spatial and temporal extent of the
injury;
(9) The potential natural recovery period; and
(10) The kinds of primary and/or compensatory restoration actions
that are feasible.
Sec. 990.52 Injury assessment--quantification.
(a) General. In addition to determining whether injuries have
resulted from the incident, trustees must quantify the degree, and
spatial and temporal extent of such injuries relative to baseline.
(b) Quantification approaches. Trustees may quantify injuries in
terms of:
(1) The degree, and spatial and temporal extent of the injury to a
natural resource;
(2) The degree, and spatial and temporal extent of injury to a
natural resource, with subsequent translation of that adverse change to
a reduction in services provided by the natural resource; or
(3) The amount of services lost as a result of the incident.
(c) Natural recovery. To quantify injury, trustees must estimate,
quantitatively or qualitatively, the time for natural recovery without
restoration, but including any response actions. The analysis of
natural recovery may consider such factors as:
(1) The nature, degree, and spatial and temporal extent of injury;
(2) The sensitivity and vulnerability of the injured natural
resource and/or service;
[[Page 507]]
(3) The reproductive and recruitment potential;
(4) The resistance and resilience (stability) of the affected
environment;
(5) The natural variability; and
(6) The physical/chemical processes of the affected environment.
Sec. 990.53 Restoration selection--developing restoration
alternatives.
(a) General. (1) If the information on injury determination and
quantification under Secs. 990.51 and 990.52 of this part and its
relevance to restoration justify restoration, trustees may proceed with
the Restoration Planning Phase. Otherwise, trustees may not take
additional action under this part. However, trustees may recover all
reasonable assessment costs incurred up to this point.
(2) Trustees must consider a reasonable range of restoration
alternatives before selecting their preferred alternative(s). Each
restoration alternative is comprised of primary and/or compensatory
restoration components that address one or more specific injury(ies)
associated with the incident. Each alternative must be designed so
that, as a package of one or more actions, the alternative would make
the environment and public whole. Only those alternatives considered
technically feasible and in accordance with applicable laws,
regulations, or permits may be considered further under this part.
(b) Primary restoration. (1) General. For each alternative,
trustees must consider primary restoration actions, including a natural
recovery alternative.
(2) Natural recovery. Trustees must consider a natural recovery
alternative in which no human intervention would be taken to directly
restore injured natural resources and services to baseline.
(3) Active primary restoration actions. Trustees must consider an
alternative comprised of actions to directly restore the natural
resources and services to baseline on an accelerated time frame. When
identifying such active primary restoration actions, trustees may
consider actions that:
(i) Remove conditions that would prevent or limit the effectiveness
of any restoration action (e.g., residual sources of contamination);
(ii) May be necessary to return the physical, chemical, and/or
biological conditions necessary to allow recovery or restoration of the
injured natural resources (e.g., replacing substrate or vegetation, or
modifying hydrologic conditions); or
(iii) Return key natural resources and services, and would be an
effective approach to achieving or accelerating a return to baseline
(e.g., replacing essential species, habitats, or public services that
would facilitate the replacement of other, dependent natural resource
or service components).
(c) Compensatory restoration. (1) General. For each alternative,
trustees must also consider compensatory restoration actions to
compensate for the interim loss of natural resources and services
pending recovery.
(2) Compensatory restoration actions. To the extent practicable,
when evaluating compensatory restoration actions, trustees must
consider compensatory restoration actions that provide services of the
same type and quality, and of comparable value as those injured. If, in
the judgment of the trustees, compensatory actions of the same type and
quality and comparable value cannot provide a reasonable range of
alternatives, trustees should identify actions that provide natural
resources and services of comparable type and quality as those provided
by the injured natural resources. Where the injured and replacement
natural resources and services are not of comparable value, the scaling
process will involve valuation of lost and replacement services.
(d) Scaling restoration actions. (1) General. After trustees have
identified the types of restoration actions that will be considered,
they must determine the scale of those actions that will make the
environment and public whole. For primary restoration actions, scaling
generally applies to actions involving replacement and/or acquisition
of equivalent of natural resources and/or services.
(2) Resource-to-resource and service-to-service scaling approaches.
When determining the scale of restoration actions that provide natural
resources and/or services of the same type and quality, and of
comparable value as those lost, trustees must consider the use of a
resource-to-resource or service-to-service scaling approach. Under this
approach, trustees determine the scale of restoration actions that will
provide natural resources and/or services equal in quantity to those
lost.
(3) Valuation scaling approach. (i) Where trustees have determined
that neither resource-to-resource nor service-to-service scaling is
appropriate, trustees may use the valuation scaling approach. Under the
valuation scaling approach, trustees determine the amount of natural
resources and/or services that must be provided to produce the same
value lost to the public. Trustees must explicitly measure the value of
injured natural resources and/or services, and then determine the scale
of the restoration action necessary to produce natural resources and/or
services of equivalent value to the public.
(ii) If, in the judgment of the trustees, valuation of the lost
services is practicable, but valuation of the replacement natural
resources and/or services cannot be performed within a reasonable time
frame or at a reasonable cost, as determined by Sec. 990.27(a)(2) of
this part, trustees may estimate the dollar value of the lost services
and select the scale of the restoration action that has a cost
equivalent to the lost value. The responsible parties may request that
trustees value the natural resources and services provided by the
restoration action following the process described in Sec. 990.14(c) of
this part.
(4) Discounting and uncertainty. When scaling a restoration action,
trustees must evaluate the uncertainties associated with the projected
consequences of the restoration action, and must discount all service
quantities and/or values to the date the demand is presented to the
responsible parties. Where feasible, trustees should use risk-adjusted
measures of losses due to injury and of gains from the restoration
action, in conjunction with a riskless discount rate representing the
consumer rate of time preference. If the streams of losses and gains
cannot be adequately adjusted for risks, then trustees may use a
discount rate that incorporates a suitable risk adjustment to the
riskless rate.
Sec. 990.54 Restoration selection--evaluation of alternatives.
(a) Evaluation standards. Once trustees have developed a reasonable
range of restoration alternatives under Sec. 990.53 of this part, they
must evaluate the proposed alternatives based on, at a minimum:
(1) The cost to carry out the alternative;
(2) The extent to which each alternative is expected to meet the
trustees' goals and objectives in returning the injured natural
resources and services to baseline and/or compensating for interim
losses;
(3) The likelihood of success of each alternative;
(4) The extent to which each alternative will prevent future injury
as a result of the incident, and avoid collateral injury as a result of
implementing the alternative;
(5) The extent to which each alternative benefits more than one
natural resource and/or service; and
(6) The effect of each alternative on public health and safety.
[[Page 508]]
(b) Preferred restoration alternatives. Based on an evaluation of
the factors under paragraph (a) of this section, trustees must select a
preferred restoration alternative(s). If the trustees conclude that two
or more alternatives are equally preferable based on these factors, the
trustees must select the most cost-effective alternative.
(c) Pilot projects. Where additional information is needed to
identify and evaluate the feasibility and likelihood of success of
restoration alternatives, trustees may implement restoration pilot
projects. Pilot projects should only be undertaken when, in the
judgment of the trustees, these projects are likely to provide the
information, described in paragraph (a) of this section, at a
reasonable cost and in a reasonable time frame.
Sec. 990.55 Restoration selection--developing restoration plans.
(a) General. OPA requires that damages be based upon a plan
developed with opportunity for public review and comment. To meet this
requirement, trustees must, at a minimum, develop a Draft and Final
Restoration Plan, with an opportunity for public review of and comment
on the draft plan.
(b) Draft Restoration Plan. (1) The Draft Restoration Plan should
include:
(i) A summary of injury assessment procedures used;
(ii) A description of the nature, degree, and spatial and temporal
extent of injuries resulting from the incident;
(iii) The goals and objectives of restoration;
(iv) The range of restoration alternatives considered, and a
discussion of how such alternatives were developed under Sec. 990.53 of
this part, and evaluated under Sec. 990.54 of this part;
(v) Identification of the trustees' tentative preferred
alternative(s);
(vi) A description of past and proposed involvement of the
responsible parties in the assessment; and
(vii) A description of monitoring for documenting restoration
effectiveness, including performance criteria that will be used to
determine the success of restoration or need for interim corrective
action.
(2) When developing the Draft Restoration Plan, trustees must
establish restoration objectives that are specific to the injuries.
These objectives should clearly specify the desired outcome, and the
performance criteria by which successful restoration will be judged.
Performance criteria may include structural, functional, temporal, and/
or other demonstrable factors. Trustees must, at a minimum, determine
what criteria will:
(i) Constitute success, such that responsible parties are relieved
of responsibility for further restoration actions; or
(ii) Necessitate corrective actions in order to comply with the
terms of a restoration plan or settlement agreement.
(3) The monitoring component to the Draft Restoration Plan should
address such factors as duration and frequency of monitoring needed to
gauge progress and success, level of sampling needed to detect success
or the need for corrective action, and whether monitoring of a
reference or control site is needed to determine progress and success.
Reasonable monitoring and oversight costs cover those activities
necessary to gauge the progress, performance, and success of the
restoration actions developed under the plan.
(c) Public review and comment. The nature of public review and
comment on the Draft and Final Restoration Plans will depend on the
nature of the incident and any applicable federal trustee NEPA
requirements, as described in Secs. 990.14(d) and 990.23 of this part.
(d) Final Restoration Plan. Trustees must develop a Final
Restoration Plan that includes the information specified in paragraph
(a) of this section, responses to public comments, if applicable, and
an indication of any changes made to the Draft Restoration Plan.
Sec. 990.56 Restoration selection--use of a Regional Restoration Plan
or existing restoration project.
(a) General. Trustees may consider using a Regional Restoration
Plan or existing restoration project where such a plan or project is
determined to be the preferred alternative among a range of feasible
restoration alternatives for an incident, as determined under
Sec. 990.54 of this part. Such plans or projects must be capable of
fulfilling OPA's intent for the trustees to restore, rehabilitate,
replace, or acquire the equivalent of the injured natural resources and
services and compensate for interim losses.
(b) Existing plans or projects--(1) Considerations. Trustees may
select a component of a Regional Restoration Plan or an existing
restoration project as the preferred alternative, provided that the
plan or project:
(i) Was developed with public review and comment or is subject to
public review and comment under this part;
(ii) Will adequately compensate the environment and public for
injuries resulting from the incident;
(iii) Addresses, and is currently relevant to, the same or
comparable natural resources and services as those identified as having
been injured; and
(iv) Allows for reasonable scaling relative to the incident.
(2) Demand. (i) If the conditions of paragraph (b)(1) of this
section are met, the trustees must invite the responsible parties to
implement that component of the Regional Restoration Plan or existing
restoration project, or advance to the trustees the trustees'
reasonable estimate of the cost of implementing that component of the
Regional Restoration Plan or existing restoration project.
(ii) If the conditions of paragraph (b)(1) of this section are met,
but the trustees determine that the scale of the existing plan or
project is greater than the scale of compensation required by the
incident, trustees may only request funding from the responsible
parties equivalent to the scale of the restoration determined to be
appropriate for the incident of concern. Trustees may pool such partial
recoveries until adequate funding is available to successfully
implement the existing plan or project.
(3) Notice of Intent To Use a Regional Restoration Plan or Existing
Restoration Project. If trustees intend to use an appropriate component
of a Regional Restoration Plan or existing restoration project, they
must prepare a Notice of Intent to Use a Regional Restoration Plan or
Existing Restoration Project. Trustees must make a copy of the notice
publicly available. The notice must include, at a minimum:
(i) A description of the nature, degree, and spatial and temporal
extent of injuries; and
(ii) A description of the relevant component of the Regional
Restoration Plan or existing restoration project; and
(iii) An explanation of how the conditions set forth in paragraph
(b)(1) of this section are met.
Subpart F--Restoration Implementation Phase
Sec. 990.60 Purpose.
The purpose of this subpart is to provide a process for
implementing restoration.
Sec. 990.61 Administrative record.
(a) Closing the administrative record for restoration planning.
Within a reasonable time after the trustees have completed restoration
planning, as provided in Secs. 990.55 and 990.56 of this part, they
must close the administrative record. Trustees may not add
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documents to the administrative record once it is closed, except where
such documents:
(1) Are offered by interested parties that did not receive actual
or constructive notice of the Draft Restoration Plan and the
opportunity to comment on the plan;
(2) Do not duplicate information already contained in the
administrative record; and
(3) Raise significant issues regarding the Final Restoration Plan.
(b) Opening an administrative record for restoration
implementation. Trustees may open an administrative record for
implementation of restoration, as provided in Sec. 990.45 of this part.
The costs associated with the administrative record are part of the
costs of restoration. Ordinarily, the administrative record for
implementation of restoration should document, at a minimum, all
Restoration Implementation Phase decisions, actions, and expenditures,
including any modifications made to the Final Restoration Plan.
Sec. 990.62 Presenting a demand.
(a) General. After closing the administrative record for
restoration planning, trustees must present a written demand to the
responsible parties. Delivery of the demand should be made in a manner
that establishes the date of receipt by the responsible parties.
(b) When a Final Restoration Plan has been developed. Except as
provided in paragraph (c) of this section and in Sec. 990.14(c) of this
part, the demand must invite the responsible parties to either:
(1) Implement the Final Restoration Plan subject to trustee
oversight and reimburse the trustees for their assessment and oversight
costs; or
(2) Advance to the trustees a specified sum representing trustee
assessment costs and all trustee costs associated with implementing the
Final Restoration Plan, discounted as provided in Sec. 990.63(a) of
this part.
(c) Regional Restoration Plan or existing restoration project. When
the trustees use a Regional Restoration Plan or an existing restoration
project under Sec. 990.56 of this part, the demand will invite the
responsible parties to implement a component of a Regional Restoration
Plan or existing restoration project, or advance the trustees' estimate
of damages based on the scale of the restoration determined to be
appropriate for the incident of concern, which may be the entire
project or a portion thereof.
(d) Response to demand. The responsible parties must respond within
ninety (90) calendar days in writing by paying or providing binding
assurance they will reimburse trustees' assessment costs and implement
the plan or pay assessment costs and the trustees' estimate of the
costs of implementation.
(e) Additional contents of demand. The demand must also include:
(1) Identification of the incident from which the claim arises;
(2) Identification of the trustee(s) asserting the claim and a
statement of the statutory basis for trusteeship;
(3) A brief description of the injuries for which the claim is
being brought;
(4) An index to the administrative record;
(5) The Final Restoration Plan or Notice of Intent to Use a
Regional Restoration Plan or Existing Restoration Project; and
(6) A request for reimbursement of:
(i) Reasonable assessment costs, as defined in Sec. 990.30 of this
part and discounted as provided in Sec. 990.63(b) of this part;
(ii) The cost, if any, of conducting emergency restoration under
Sec. 990.26 of this part, discounted as provided in Sec. 990.63(b) of
this part; and
(iii) Interest on the amounts recoverable, as provided in section
1005 of OPA (33 U.S.C. 2705), which allows for prejudgment and post-
judgment interest to be paid at a commercial paper rate, starting from
thirty (30) calendar days from the date a demand is presented until the
date the claim is paid.
Sec. 990.63 Discounting and compounding.
(a) Estimated future restoration costs. When determining estimated
future costs of implementing a Final Restoration Plan, trustees must
discount such future costs back to the date the demand is presented.
Trustees may use a discount rate that represents the yield on
recoveries available to trustees. The price indices used to project
future inflation should reflect the major components of the restoration
costs.
(b) Past assessment and emergency restoration costs. When
calculating the present value of assessment and emergency restoration
costs already incurred, trustees must compound the costs forward to the
date the demand is presented. To perform the compounding, trustees may
use the actual U.S. Treasury borrowing rate on marketable securities of
comparable maturity to the period of analysis. For costs incurred by
state or tribal trustees, trustees may compound using parallel state or
tribal borrowing rates.
(c) Trustees are referred to Appendices B and C of OMB Circular A-
94 for information about U.S. Treasury rates of various maturities and
guidance in calculation procedures. Copies of Appendix C, which is
regularly updated, and of the Circular are available from the OMB
Publications Office (202-395-7332).
Sec. 990.64 Unsatisfied demands.
(a) If the responsible parties do not agree to the demand within
ninety (90) calendar days after trustees present the demand, the
trustees may either file a judicial action for damages or seek an
appropriation from the Oil Spill Liability Trust Fund, as provided in
section 1012(a)(2) of OPA (33 U.S.C. 2712(a)(2)).
(b) Judicial actions and claims must be filed within three (3)
years after the Final Restoration Plan or Notice of Intent to Use a
Regional Restoration Plan or Existing Restoration Project is made
publicly available, in accordance with 33 U.S.C. 2717(f)(1)(B) and
2712(h)(2).
Sec. 990.65 Opening an account for recovered damages.
(a) General. Sums recovered by trustees in satisfaction of a
natural resource damage claim must be placed in a revolving trust
account. Sums recovered for past assessment costs and emergency
restoration costs may be used to reimburse the trustees. All other sums
must be used to implement the Final Restoration Plan or all or an
appropriate component of a Regional Restoration Plan or an existing
restoration project.
(b) Joint trustee recoveries. (1) General. Trustees may establish a
joint account for damages recovered pursuant to joint assessment
activities, such as an account under the registry of the applicable
federal court.
(2) Management. Trustees may develop enforceable agreements to
govern management of joint accounts, including agreed-upon criteria and
procedures, and personnel for authorizing expenditures out of such
joint accounts.
(c) Interest-bearing accounts. Trustees may place recoveries in
interest-bearing revolving trust accounts, as provided by section
1006(f) of OPA (33 U.S.C. 2706(f)). Interest earned on such accounts
may only be used for restoration.
(d) Escrow accounts. Trustees may establish escrow accounts or
other investment accounts.
(e) Records. Trustees must maintain appropriate accounting and
reporting procedures to document expenditures from accounts established
under this section.
(f) Oil Spill Liability Trust Fund. Any sums remaining in an
account
[[Page 510]]
established under this section that are not used either to reimburse
trustees for past assessment and emergency restoration costs or to
implement restoration must be deposited in the Oil Spill Liability
Trust Fund, as provided by section 1006(f) of OPA (33 U.S.C. 2706(f)).
Sec. 990.66 Additional considerations.
(a) Upon settlement of a claim, trustees should consider the
following actions to facilitate implementation of restoration:
(1) Establish a trustee committee and/or memorandum of
understanding or other agreement to coordinate among affected trustees,
as provided in Sec. 990.14(a)(3) of this part;
(2) Develop more detailed workplans to implement restoration;
(3) Monitor and oversee restoration; and
(4) Evaluate restoration success and the need for corrective
action.
(b) The reasonable costs of such actions are included as
restoration costs.
[FR Doc. 95-31577 Filed 12-29-95; 8:45 am]
BILLING CODE 3510-12-P
