
[Federal Register: July 1, 2009 (Volume 74, Number 125)]
[Rules and Regulations]               
[Page 31357-31369]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01jy09-6]                         


[[Page 31357]]

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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 138

[Docket No. USCG-2008-0007]
RIN 1625-AB25

 
Consumer Price Index Adjustments of Oil Pollution Act of 1990 
Limits of Liability--Vessels and Deepwater Ports

AGENCY: Coast Guard, DHS.

ACTION: Interim rule with request for comments.

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SUMMARY: The Coast Guard is increasing the limits of liability under 
the Oil Pollution Act of 1990 (OPA 90), for vessels and deepwater ports 
subject to the Deepwater Port Act of 1974, to reflect significant 
increases in the Consumer Price Index (CPI). This interim rule also 
establishes the methodology the Coast Guard uses to adjust OPA 90 
limits of liability for inflation, including the frequency with which 
such adjustments may be made. The inflation adjustments to the limits 
of liability are required by OPA 90 to preserve the deterrent effect 
and polluter-pays principle embodied in the OPA 90 liability 
provisions. Lastly, this interim rule makes minor amendments to clarify 
the applicability of the OPA 90 single-hull tank vessel limits of 
liability. Because the single-hull tank vessel amendments were not 
previously discussed in the notice of proposed rulemaking (hereafter 
the CPI NPRM), the Coast Guard is inviting additional public comment on 
this issue.

DATES: Effective date: This interim rule is effective July 31, 2009. To 
the extent this interim rule affects the collection of information in 
33 CFR 138.85, the Coast Guard will not enforce the information 
collection request triggered by this rulemaking until it is approved by 
the Office of Management and Budget.
    Comment date: Comments and related material must either be 
submitted to our online docket via http://www.regulations.gov on or 
before August 31, 2009 or reach the Docket Management Facility by that 
date. Comments on collection of information must be sent to the docket 
for this rulemaking and to the Office of Information and Regulatory 
Affairs (OIRA), Office of Management and Budget (OMB), as described 
below, on or before August 31, 2009.

ADDRESSES: You may submit comments identified by docket number USCG-
2008-0007 using any one of the following methods:
    (1) Federal eRulemaking Portal: http://www.regulations.gov.
    (2) Fax: 202-493-2251.
    (3) Mail: Docket Management Facility (M-30), U.S. Department of 
Transportation, West Building Ground Floor, Room W12-140, 1200 New 
Jersey Avenue, SE., Washington, DC 20590-0001.
    (4) Hand delivery: Same as mail address above, between 9 a.m. and 5 
p.m., Monday through Friday, except Federal holidays. The telephone 
number is 202-366-9329.
    To avoid duplication, please use only one of these four methods. 
See the ``Public Participation and Request for Comments'' portion of 
the SUPPLEMENTARY INFORMATION section below for instructions on 
submitting comments.
    Collection of Information Comments: The adjustments to the limits 
of liability implemented by this rulemaking amend the evidence of 
financial responsibility applicable amounts in Title 33 of the Code of 
Federal Regulations (CFR), at section 138.80(f), by reference, and 
therefore revise the collection of information required by 33 CFR 
138.85. A revised collection of information request will be submitted 
to OIRA for approval. If you have comments on the collection of 
information required by section 33 CFR 138.85, you must submit your 
collection of information comments to the docket and to OIRA. To ensure 
that your comments to OIRA are received on time, the preferred methods 
are by e-mail to oira_submission@omb.eop.gov (include the docket 
number and ``Attention: Desk Officer for Coast Guard, DHS'' in the 
subject line of the e-mail) or fax at 202-395-6566. An alternate, 
though slower, method is by U.S. Mail to the Office of Information and 
Regulatory Affairs, Office of Management and Budget, 725 17th Street, 
NW., Washington, DC 20503, Attn: Desk Officer, U.S. Coast Guard, DHS.

FOR FURTHER INFORMATION CONTACT: If you have questions on this interim 
rule, e-mail or call Benjamin White, National Pollution Funds Center, 
Coast Guard, e-mail Benjamin.H.White@uscg.mil, telephone 202-493-6863. 
If you have questions on viewing or submitting material to the docket, 
call Renee V. Wright, Program Manager, Docket Operations, telephone 
202-366-9826.

SUPPLEMENTARY INFORMATION:

Table of Contents for Preamble

I. Public Participation and Request for Comments
    A. Submitting Comments
    B. Viewing Comments and Documents
    C. Privacy Act
    D. Public Meeting
II. Abbreviations
III. Regulatory History
IV. Background
V. Discussion of the Interim Rule, Comments and Changes
    A. What Are the Inflation--Adjusted OPA 90 Limits of Liability 
for Vessels and Deepwater Ports?
    B. Explanation of the CPI Adjustment Methodology
    1. How does the Coast Guard calculate the CPI adjustment to the 
limits of liability?
    2. Which CPI does the Coast Guard use?
    3. What time interval CPI-U does the Coast Guard use for the 
adjustments?
    4. How does the Coast Guard calculate the percent change in the 
Annual CPI-U?
    5. What ``Previous Period'' dates is the Coast Guard using for 
the first inflation adjustments to the limits of liability?
    6. What Annual CPI-U ``Previous Period'' and ``Current Period'' 
values has the Coast Guard used for this first set of inflation 
adjustments to the limits of liability for vessels and Deepwater 
Ports?
    7. How will the Coast Guard calculate the percent change for 
subsequent inflation adjustments to the OPA 90 limits of liability?
    (a) 2012 Adjustments
    (b) How are ``significant increases'' and ``not less than every 
3 years'' defined?
    (c) What if the ``significant increases'' threshold is not met?
    8. What procedures does the Coast Guard plan to use to 
promulgate subsequent inflation adjustments to the OPA 90 limits of 
liability?
    C. Discussion of Comments and Changes
    1. Public Comments on the CPI NPRM
    2. Public Comments on the Prior COFR Rule Relating to CPI 
Adjustments to Limits of Liability
    3. Single-Hull Tank Vessel Clarifying Changes and Request for 
Comment
VI. Regulatory Analyses
    A. Regulatory Planning and Review
    B. Small Entities
    C. Assistance for Small Entities
    D. Collection of Information
    E. Federalism
    F. Unfunded Mandates Reform Act
    G. Taking of Private Property
    H. Civil Justice Reform
    I. Protection of Children
    J. Indian Tribal Governments
    K. Energy Effects
    L. Technical Standards
    M. Environment

I. Public Participation and Request for Comments

    We encourage you to participate in this rulemaking by submitting 
comments and related materials on the amendments to 33 CFR 138.220(b) 
and 138.230(a) that were not discussed in the CPI NPRM. These 
amendments clarify applicability of the OPA 90 single-hull tank vessel 
limits of liability. All comments received on this interim rule will be 
posted, without change, to

[[Page 31358]]

http://www.regulations.gov and will include any personal information 
you have provided.

A. Submitting Comments

    If you submit comments, please include the docket number for this 
rulemaking (Docket No. USCG-2008-0007), indicate the specific section 
of this document to which each comment applies, and provide a reason 
for each suggestion or recommendation. You may submit your comments and 
material online, or by fax, mail or hand delivery, but please use only 
one of these means. We recommend that you include your name and a 
mailing address, an e-mail address, or a phone number in the body of 
your document so that we can contact you if we have questions regarding 
your submission.
    To submit your comment online, go to http://www.regulations.gov, 
select the Advanced Docket Search option on the right side of the 
screen, insert ``USCG-2008-0007'' in the Docket ID box, press Enter, 
and then click on the balloon shape in the Actions column. If you 
submit your comments by mail or hand delivery, submit them in an 
unbound format, no larger than 8\1/2\ by 11 inches, suitable for 
copying and electronic filing. If you submit your comments by mail and 
would like to know that they reached the Facility, please enclose a 
stamped, self-addressed postcard or envelope. We will consider all 
comments and material received during the comment period and may change 
this rule based on your comments.

B. Viewing Comments and Documents

    To view comments, as well as documents mentioned in this preamble 
as being available in the docket, go to http://www.regulations.gov, 
select the Advanced Docket Search option on the right side of the 
screen, insert USCG-2008-0007 in the Docket ID box, press Enter, and 
then click on the item in the Docket ID column. If you do not have 
access to the Internet, you may view the docket online by visiting the 
Docket Management Facility in Room W12-140 on the ground floor of the 
U.S. Department of Transportation West Building, 1200 New Jersey 
Avenue, SE., Washington, DC 20590, between 9 a.m. and 5 p.m., Monday 
through Friday, except Federal holidays. We have an agreement with the 
Department of Transportation to use the Docket Management Facility.

C. Privacy Act

    Anyone can search the electronic form of comments received into any 
of our dockets by the name of the individual submitting the comment (or 
signing the comment, if submitted on behalf of an association, 
business, labor union, etc.). You may review a Privacy Act notice 
regarding our public dockets in the January 17, 2008 issue of the 
Federal Register (73 FR 3316).

D. Public Meeting

    We do not now plan to hold a public meeting. But you may submit a 
request for one using one of the methods specified under ADDRESSES. In 
your request, explain why you believe a public meeting would be 
beneficial. If we determine that one would aid this rulemaking, we will 
hold one at a time and place announced by a later notice in the Federal 
Register.

II. Abbreviations

APA Administrative Procedure Act, 5 U.S.C. 551, et seq.
BLS U.S. Department of Labor, Bureau of Labor Statistics
CFR Code of Federal Regulations
COFR Certificate of Financial Responsibility
COFR Rule The final rule published on September 17, 2008, titled 
``Financial Responsibility for Water Pollution (Vessels) and OPA 90 
Limits of Liability (Vessels and Deepwater Ports)'', 73 FR 53691 
(Docket No. USCG-2005-21780)
CPI Consumer Price Index
CPI NPRM The notice of proposed rulemaking published on September 
24, 2008, titled ``Consumer Price Index Adjustments of Oil Pollution 
Act of 1990 Limits of Liability--Vessels and Deepwater Ports'', 73 
FR 54997 (Docket No. USCG-2008-0007)
CPI-U Consumer Price Index--All Urban Consumers, Not Seasonally 
Adjusted, U.S. City Average, All Items, 1982-84=100
Deepwater Port A deepwater port licensed under the Deepwater Port 
Act of 1974 (33 U.S.C. 1501-1524)
DHS U.S. Department of Homeland Security
DOI U.S. Department of Interior
DOT U.S. Department of Transportation
DRPA Delaware River Protection Act of 2006, Title VI of the Coast 
Guard and Maritime Transportation Act of 2006, Public Law 109-241, 
July 11, 2006, 120 Stat. 516
E.O. Executive Order
EPA U.S. Environmental Protection Agency
FR Federal Register
Fund Oil Spill Liability Trust Fund
LNG Liquefied natural gas (methane)
LPG Liquefied petroleum gas
LOOP Louisiana Offshore Oil Port
MODU Mobile Offshore Drilling Unit
MTR Marine transportation-related
NAICS North American Industry Classification System
NMTR Non-marine transportation-related
NPFC National Pollution Funds Center
NPRM Notice of proposed rulemaking
NTR Non-transportation-related
OIRA Office of Information and Regulatory Affairs
OIL Oil Insurance Limited of Bermuda
OMB Office of Management and Budget
OPA 90 The Oil Pollution Act of 1990, as amended (Title I of which 
is codified at 33 U.S.C. 2701, et seq.; Title IV of which is 
codified in relevant part at 46 U.S.C. 3703a)
Sec.  Section symbol
SBA U.S. Small Business Administration
U.S.C. U.S. Code
U.S.C.C.A.N. U.S. Code Congressional and Administrative News

III. Regulatory History

    On September 24, 2008, we published the CPI NPRM, entitled 
``Consumer Price Index Adjustments of Oil Pollution Act of 1990 Limits 
of Liability--Vessels and Deepwater Ports'' in the Federal Register, at 
73 FR 54997. The CPI NPRM proposed to adjust the OPA 90 limits of 
liability, set forth at 33 CFR part 138, subpart B, for vessels and for 
deepwater ports licensed under the Deepwater Port Act of 1974, as 
amended (33 U.S.C. 1501, et seq.) (hereinafter ``Deepwater Ports''), 
for inflation under 33 U.S.C. 2704(d). We received four letters with 
seven comments on the CPI NPRM. No public meeting was requested for 
this rulemaking and none was held.
    Previously, on September 17, 2008, the Coast Guard published a 
related final rule for the OPA 90 Certificate of Financial 
Responsibility (COFR) Program entitled ``Financial Responsibility for 
Water Pollution (Vessels) and OPA 90 Limits of Liability (Vessels and 
Deepwater Ports) (Docket No. USCG-2005-21780), at 73 FR 53691 
(hereafter the COFR Rule). (See also, the COFR Rule NPRM at 73 FR 6642 
and 73 FR 8250.) That rulemaking divided 33 CFR part 138 into two 
subparts, setting forth the COFR program requirements as amended by the 
rulemaking in new subpart A, and (of relevance to this rulemaking) 
setting forth the OPA 90 limits of liability for oil spill source 
categories regulated by the Coast Guard in new subpart B. The COFR Rule 
thereby provided the framework for ensuring regulatory consistency when 
the OPA 90 limits of liability for oil spill source categories 
regulated by the Coast Guard are established or adjusted by regulation 
under 33 U.S.C. 2704(d). Three letters with five comments concerning 
CPI adjustments to the OPA 90 limits of liability were submitted to the 
docket for the related COFR Rule.
    Finally, we received a question on implementation of the related 
final COFR Rule during the public comment period for the CPI NPRM 
(Docket No. USCG-2008-0007-0013). The question, which originally was 
not submitted to the docket for this rulemaking, raised a substantive 
and persuasive issue concerning the applicability of the

[[Page 31359]]

single-hull tank vessel limits of liability that are amended by this 
rulemaking. A similar comment letter was submitted to the COFR Rule 
docket (Docket No. USCG-2005-21780-0013). To address the hull category 
issue raised in the public comment, without delaying the required 
adjustments to the limits of liability for inflation, we are publishing 
this interim rule, with minor amendments to Sec. Sec.  138.220(b) and 
138.230(a), and we are inviting comment on these amendments.
    Although the public will have an opportunity to comment on the hull 
category amendments to Sec. Sec.  138.220(b) and 138.230(a), we note 
that the Coast Guard is issuing the amendments without prior notice and 
opportunity to comment, pursuant to authority under section 4(a) of the 
Administrative Procedure Act (APA) (5 U.S.C. 553(b)). That provision of 
the APA authorizes an agency to issue a rule without prior notice and 
opportunity to comment when the agency for good cause finds that those 
procedures are ``impracticable, unnecessary, or contrary to the public 
interest.'' Under 5 U.S.C. 553(b), the Coast Guard finds that good 
cause exists for not publishing another NPRM with respect to the hull 
category amendments to 33 CFR 138.220(b) and 138.230(a) of this rule so 
as to conform the rule's treatment of the vessel hull categories, which 
were previously adopted in the final COFR Rule and proposed in the CPI 
NPRM, to the OPA 90 statutory scheme, including the Delaware River 
Protection Act of 2006 (DRPA) amendments. Failing to amend the hull 
category provisions would be contrary to the public interest. Moreover, 
it is in the best interest of the public to ensure that vessel owners, 
operators and demise charters are subject to the correct limits of 
liability.
    All comments and other materials related to this rulemaking have 
been placed in the public docket (Docket No. USCG-2008-0007). This 
includes U.S. Department of Labor, Bureau of Labor Statistics (BLS) 
documentation pertinent to this rulemaking.

IV. Background

    In general, under Title I of OPA 90, ``each responsible party 
[i.e., the owners and operators, including demise charterers] for a 
vessel or a facility from which oil is discharged, or which poses a 
substantial threat of a discharge of oil, into or upon the navigable 
waters or adjoining shorelines or the exclusive economic zone is liable 
for the removal costs and damages specified in [OPA 90, at 33 U.S.C. 
2702(b)], that result from such incident.'' (33 U.S.C. 2702(a)).
    Embodying the polluter-pays principle, this liability is strict, 
joint and several.\1\ The responsible parties' total liability for OPA 
90 removal costs and damages (including for removal costs incurred by, 
or on behalf of, the responsible parties) is, however, limited as 
provided in 33 U.S.C. 2704 except under certain circumstances as 
provided in 33 U.S.C. 2704(c). In instances when the OPA 90 limits of 
liability apply, the Oil Spill Liability Trust Fund (the Fund) is 
available to compensate the responsible parties and other claimants for 
OPA 90 removal costs and damages in excess of the applicable OPA 90 
liability limits. (See 33 U.S.C. 2708, 2712(a)(4) and 2713; and 33 CFR 
part 136.)
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    \1\ See Oil Pollution Desk Book, Environmental Law Institute 
1991, hereinafter OPA 90 Desk Book, p. 88, H.R. Conf. Report 101-
653, at p. 102, reprinted in 1990 U.S.C.C.A.N. 779, 780 (``The term 
`liable' or `liability' * * * is to be construed to be the standard 
of liability * * * under section 311 of the [Federal Water Pollution 
Control Act, 33 U.S.C. 1321] . * * * That standard of liability has 
been determined repeatedly to be strict, joint and several 
liability.''); OPA 90 Desk Book p. 93, H.R. Conf. Report 101-653, at 
118, 1990 U.S.C.C.A.N., at 797 (August 3, 1990) (``[T]he primary 
responsibility to compensate victims of oil pollution rests with the 
person responsible for the source of the pollution[.]'').
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    OPA 90, at 33 U.S.C. 2704(a), sets forth the base dollar amounts of 
the limits of liability for four specified oil spill source categories: 
vessels (i.e., single-hull tank vessels, other-hull tank vessels, and 
non-tank vessels), onshore facilities, Deepwater Ports, and offshore 
facilities (other than Deepwater Ports). In addition, to prevent the 
real value of the limits of liability from depreciating over time as a 
result of inflation, and to thereby preserve the polluter-pays 
principle, OPA 90 requires the President to periodically increase the 
limits of liability by regulation to reflect significant increases in 
the CPI. (See 33 U.S.C. 2704(d)(4).)
    In Executive Order (E.O.) 12777, the President delegated 
implementation of the OPA 90 limit of liability inflation adjustment 
authorities, dividing the responsibility among several Federal 
agencies. Through a series of further delegations, the Coast Guard has 
been delegated the President's authority to adjust the OPA 90 limits of 
liability for vessels, Deepwater Ports (including associated 
pipelines), and transportation-related onshore facilities, but not 
including pipelines, motor carriers and railroads (hereinafter ``marine 
transportation-related'' or ``MTR'' onshore facilities). The Department 
of Transportation (DOT) has been delegated the President's authority to 
adjust the limit of liability for onshore pipelines, motor carriers, 
and railways (hereinafter ``non-marine transportation-related'' or 
``NMTR'' onshore facilities). The U.S. Environmental Protection Agency 
(EPA) has been delegated the President's authority to adjust the limits 
of liability for non-transportation-related onshore facilities 
(hereinafter ``non-transportation-related'' or ``NTR'' onshore 
facilities). Finally, the Department of Interior (DOI) has been 
delegated the President's authority to adjust the limits of liability 
for offshore facilities and associated pipelines, other than Deepwater 
Ports (hereinafter ``offshore facilities'').
    In addition, on August 4, 1995, DOT, which then included the Coast 
Guard, promulgated a facility-specific limit of liability for the 
Louisiana Offshore Oil Port (LOOP) under the OPA 90 Deepwater Port 
limit of liability adjustment authority at 33 U.S.C. 2704(d)(2). (60 FR 
39849). The preamble for that final rule specifically contemplated that 
the LOOP regulatory limit of liability would be adjusted for inflation 
to prevent the real value of the LOOP limit from depreciating over 
time.

V. Discussion of the Interim Rule, Comments and Changes

    This interim rule implements the first mandated adjustments, under 
33 U.S.C. 2704(d), to the OPA 90 limits of liability for vessels and 
Deepwater Ports, including LOOP, to reflect significant increases in 
the CPI. This rulemaking also establishes the methodology for making 
inflation adjustments to the OPA 90 limits of liability for all oil 
spill source categories for which the Coast Guard has jurisdiction. The 
inflation-adjusted limits of liability are discussed in subsection V.A. 
of this preamble, below. The inflation adjustment methodology is 
discussed in subsection V.B. of this preamble, below. Public comments 
and changes to the CPI NPRM, including the hull category amendments, 
are discussed in subsection V.C. of this preamble, below.
    As explained in the CPI NPRM, to ensure future consistency in 
inflation adjustments to the limits of liability for all OPA 90 oil 
spill source categories, the Coast Guard has coordinated the CPI 
adjustment methodology with DOT, EPA, and DOI. In addition, the Coast 
Guard, DOT, EPA, and DOI have agreed to coordinate the CPI inflation 
adjustments to the limits of liability for facilities (i.e., for MTR 
onshore facilities regulated by Coast Guard, NMTR onshore facilities 
regulated by DOT, NTR onshore facilities regulated by EPA, and offshore 
facilities regulated by DOI), as part of the next cycle of inflation 
adjustments to the limits of

[[Page 31360]]

liability. This phased approach will allow adequate time for the 
additional interagency coordination necessary to ensure consistency in 
implementing the CPI adjustments to the OPA 90 limits of liability for 
all onshore and offshore facilities.

A. What Are the Inflation-adjusted OPA 90 Limits of Liability for 
Vessels and Deepwater Ports?

    The new OPA 90 limits of liability for vessels and Deepwater Ports 
(rounded to the closest $100), adjusted for inflation using the 
adjustment methodology established by this rulemaking, are:

------------------------------------------------------------------------
                                   Previous limit of     New limit of
         Source category               liability           liability
------------------------------------------------------------------------
(a) Vessels:
    (1) For an oil cargo tank     The greater of      The greater of
     vessel greater than 3,000     $3,000 per gross    $3,200 per gross
     gross tons with a single      ton or              ton or
     hull, including a single-     $22,000,000.        $23,496,000.
     hull tank vessel fitted
     with double sides only or a
     double bottom only.
    (2) For a tank vessel         The greater of      The greater of
     greater than 3,000 gross      $1,900 per gross    $2,000 per gross
     tons, other than a vessel     ton or              ton or
     referred to in (a)(1).        $16,000,000.        $17,088,000.
    (3) For an oil cargo tank     The greater of      The greater of
     vessel less than or equal     $3,000 per gross    $3,200 per gross
     to 3,000 gross tons with a    ton or $6,000,000.  ton or
     single hull, including a                          $6,408,000.
     single-hull tank vessel
     fitted with double sides
     only or a double bottom
     only.
    (4) For a tank vessel less    The greater of      The greater of
     than or equal to 3,000        $1,900 per gross    $2,000 per gross
     gross tons, other than a      ton or $4,000,000.  ton or
     vessel referred to in (3).                        $4,272,000.
    (5) For any other vessel....  The greater of      The greater of
                                   $950 per gross      $1,000 per gross
                                   ton or $800,000.    ton or $854,400.
(b) Deepwater Ports:
    (1) For a Deepwater Port,     $350,000,000......  $373,800,000.
     other than a Deepwater Port
     with a limit of liability
     established by regulation
     under 33 U.S.C. 2704(d)(2).
    (2) For the Louisiana         $62,000,000.......  $87,606,000.
     Offshore Oil Port (LOOP)
     \2\.
------------------------------------------------------------------------

    The new inflation-adjusted limits of liability for vessels and 
Deepwater Ports are set forth in Sec.  138.230(a) and (b).\3\
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    \2\ Currently LOOP is the only Deepwater Port with a limit of 
liability established by regulation under 33 U.S.C. 2704(d)(2).
    \3\ Section 138.230(b)(2)(i) contains the limit of liability for 
LOOP. Section 138.230(b)(2)(ii) has been reserved for future use to 
set forth any other Deepwater Port limits of liability that may be 
established by regulation under 33 U.S.C. 2704(d)(2). Section 
138.230(c) has been reserved for future use to set forth the limit 
of liability for MTR onshore facilities.
---------------------------------------------------------------------------

    We note that the single-hull tank vessel limits of liability were 
described in 33 CFR part 138, subpart B, and in the CPI NPRM as 
applying to all tank vessels. Following the public comment period for 
the CPI NPRM, however, the Coast Guard determined that the single-hull 
limits of liability only apply under the OPA 90 statutory scheme to a 
single-hull tank vessel that is ``constructed or adapted to carry, or 
carries, oil in bulk as cargo or cargo residue'' (referred to in this 
preamble as a single-hull ``oil cargo tank vessel''). The Coast Guard 
is, therefore, amending Sec. Sec.  138.220 (Definitions) and 138.230 
(Limits of liability) to clarify this point, and invites public comment 
on this issue.

B. Explanation of the CPI Adjustment Methodology

1. How does the Coast Guard calculate the CPI adjustment to the limits 
of liability?
    We calculate the CPI adjustments to the limits of liability for 
Coast Guard source categories using the following formula:
    New limit of liability = Previous limit of liability + (Previous 
limit of liability x percent change in the CPI from the year the 
Previous limit of liability was established, or last adjusted by 
statute or regulation, whichever is later, to the present year), then 
rounded to the closest $100.
2. Which CPI does the Coast Guard use?
    The BLS publishes a variety of inflation indices. We use the 
``Consumer Price Index--All Urban Consumers, Not Seasonally Adjusted, 
U.S. City Average, All Items, 1982 - 84 = 100'', also known as ``CPI-
U''. This is the most current and is the broadest index published by 
BLS. It also is commonly relied on in insurance policies and other 
commercial transactions with automatic inflation protection, by the 
media, and by economic analysts.
3. What time interval CPI-U does the Coast Guard use for the 
adjustments?
    BLS publishes the CPI-U in both monthly and annual periods. For 
consistency and simplicity, we use the annual period CPI-U (hereinafter 
the ``Annual CPI-U'') rather than the monthly period CPI-U. In this 
way, as explained further in the CPI NPRM, we can avoid having to 
publish distinct percent change values for the different sources and 
source categories in future adjustment cycles, based on the month when 
each source or source category's limit of liability was established or 
last adjusted.
4. How does the Coast Guard calculate the percent change in the Annual 
CPI-U?
    We calculate the percent change in the Annual CPI-U using the BLS 
escalation formula described in Fact Sheet 00-1, U.S. Department of 
Labor Program Highlights, ``How to Use the Consumer Price Index for 
Escalation'', September 2000.
    This formula provides that:
    Percent change in the Annual CPI-U = [(Annual CPI-U for Current 
Period - Annual CPI-U for Previous Period) / Annual CPI-U for Previous 
Period] X 100.

[[Page 31361]]

    Fact Sheet 00-1 is available from the BLS online at http://
www.bls.gov. The Fact Sheet may also be viewed on the docket for this 
rulemaking, at Docket No. USCG-2008-0007-0011.
    The following example illustrates how we applied the BLS escalation 
formula to calculate the percent change in the Annual CPI-U used in 
this rulemaking to adjust the limits of liability for vessels and 
Deepwater Ports generally:
Annual CPI-U for Current Period (2008): 215.3
Minus Annual CPI-U for Previous Period (2006): 201.6
Equals index point change: 13.7
Divided by Annual CPI-U for Previous Period: 201.6
Equals: 0.068
Result multiplied by 100: 0.068 X 100
Equals percent change in the Annual CPI-U: 6.8 percent
    The ``Current Period'' and ``Previous Period'' Annual CPI-U values 
may be viewed on the docket, at Docket No. USCG-2008-0007-0012, and 
online at http://data.bls.gov. Note that the ``Current Period'' value 
for this methodology will always be the Annual CPI-U for the previous 
calendar year. This is due to the schedule for BLS publication each 
year of the Annual CPI-U. Note also that the percent change is rounded 
to one decimal place.
5. What ``Previous Period'' dates is the Coast Guard using for the 
first inflation adjustments to the limits of liability?
    As explained in the CPI NPRM, the ``Previous Period'' date for the 
first inflation adjustments to the limits of liability in 33 U.S.C. 
2704(a) (i.e., the limits of liability for all Coast Guard delegated 
source categories other than LOOP), is 2006. This is based on the date 
of enactment of the DRPA, which was July 11, 2006, and is the last date 
the limits of liability in 33 U.S.C. 2704(a) were adjusted.\4\ In 
addition, the ``Previous Period'' date for the first inflation 
adjustment to the LOOP limit of liability is 1995. This is based on the 
date the LOOP limit of liability was established by regulation, which 
was August 4, 1995. (See 60 FR 39849.) There have been no adjustments 
made to the LOOP limit of liability since 1995.
---------------------------------------------------------------------------

    \4\ As proposed in the CPI NPRM, we will also use the 2006 
Annual CPI-U as the ``Previous Period'' date for the first set of 
adjustments to the limit of liability for MTR onshore facilities.
---------------------------------------------------------------------------

6. What Annual CPI-U ``Previous Period'' and ``Current Period'' values 
has the Coast Guard used for this first set of inflation adjustments to 
the limits of liability for vessels and Deepwater Ports?
    The ``Previous Period'' and ``Current Period'' values used for this 
rulemaking are as follows:
    (a) For LOOP, the ``Previous Period'' value, using the 1995 Annual 
CPI-U, is 152.4; the ``Current Period'' value, using the 2008 Annual 
CPI-U, is 215.3.
    (b) For vessels and Deepwater Ports generally (i.e., all Deepwater 
Ports other than LOOP), the ``Previous Period'' value, using the 2006 
Annual CPI-U, is 201.6; the ``Current Period'' value, using the 2008 
Annual CPI-U, is 215.3.
    Inserting these values into the BLS escalation formula yields the 
following percent change values in the Annual CPI-U (rounded to one 
decimal place):
    For LOOP: 41.3 percent
    For vessels and other Deepwater Ports: 6.8 percent
7. How will the Coast Guard calculate the percent change for subsequent 
inflation adjustments to the OPA 90 limits of liability?
    This rulemaking also establishes the adjustment methodology the 
Coast Guard will use for subsequent CPI adjustments to the OPA 90 
limits of liability for all Coast Guard source categories, including 
MTR onshore facilities. In this interim rule we adopt the methodology 
proposed in the CPI NPRM with one clarification. Specifically, as 
discussed further below, we have clarified in Sec.  138.240 that the 
Coast Guard has discretion to adjust the limits more frequently than 
every three years.
(a) 2012 Adjustments
    For the next set of inflation adjustments to the limits of 
liability, scheduled for 2012, we plan to publish the adjustments, in 
coordination with similar rulemakings by DOT, EPA and DOI, for all 
Coast Guard source categories, including MTR facilities. This will be 
done to simplify subsequent inflation adjustments to the limits of 
liability for all of the OPA 90 source categories.
    Specifically, unless Congress amends the limits of liability again, 
we will calculate the Annual CPI-U change using: (1) the 2008 Annual 
CPI-U as the ``Previous Period'' value for vessels and Deepwater Ports 
including LOOP, and (2) the 2006 Annual CPI-U as the ``Previous 
Period'' value for MTR facilities since that will be the first time 
those limits will be adjusted. In addition, assuming the coordinated 
set of rulemakings is completed in 2012, we will use the 2011 Annual 
CPI-U as the ``Current Period'' value.
(b) How are ``significant increases'' and ``not less than every 3 
years'' defined?
    As explained in the CPI NPRM, OPA 90, at 33 U.S.C. 2704(d)(4), as 
amended by Section 603 of the DRPA, requires that the OPA 90 limits of 
liability be adjusted ``not less than every 3 years * * * to reflect 
significant increases in the Consumer Price Index.''
    The word ``increases'' indicates clearly that Congress intended 
that the limits be adjusted only for inflation, and that there would be 
no decreases to the limits of liability due to decreases in the CPI. 
It, however, is equally apparent that, if Congress had wanted the 
adjustments to occur routinely every 3 years, the mandate would not 
have included the qualifier ``significant.'' The word ``significant'' 
is not defined in OPA 90. As discussed in greater detail in the CPI 
NPRM, we therefore looked to the legislative history and to the 
dictionary meaning of ``significant'' to help interpret what Congress 
meant.
    The Conference Report Joint Explanatory Statement, at p. 106, 
describes the CPI adjustment mandate as requiring adjustments ``at 
least once every three years'', to reflect significant increases in the 
CPI. (See OPA 90 Desk Book, p. 89, H.R. CONF. REP. 101-653, Joint 
Explanatory Statement, August 1, 1990.) This explanation indicates that 
the statutory wording ``not less than'' means that adjustments are 
permitted, but not required, more frequently than every three years. 
The Conference Report and other legislative history provide general 
indications of the overall intent of the OPA 90 liability provisions. 
(See CPI NPRM.) The legislative history does not, however, explain what 
Congress meant by the word ``significant''. Nor have we found any other 
Federal statute that uses the same wording. Congress, therefore, left 
it to the President to give meaning to the term ``significant''.
    The plain meaning of ``significant'' is ``meaningful'' (see 
Webster's II New Riverside University Dictionary (1988)), but 
meaningful in respect to what? Consistent with the Congressional focus 
on preserving OPA 90's deterrent effect and avoiding risk shifting to 
the Fund, the Coast Guard analyzed historical data on incident costs. 
We found that even small increases in the CPI can have significant risk 
shifting impacts. (See Report On Oil Pollution Act Liability Limits, 
U.S. Department Of Homeland Security, U.S. Coast Guard, transmitted to 
the Senate Committee on Commerce,

[[Page 31362]]

Science, and Transportation on January 5, 2007.)
    For example, based on our further analysis of the historical cost 
averages in that report, a 1 percent per year increase in the CPI will 
shift incident cost risk from the responsible parties to the Fund by an 
estimated $900,000 over three years. When adjustments to limits of 
liability are delayed, the Fund will, with inflation, inevitably be at 
risk for a higher share of incident costs than intended by OPA 90. 
Consequently, responsible party risk and the intended deterrent effect 
of the limits of liability are reduced.
    In consideration of the historical data, the Coast Guard believes 
it is reasonable and consistent with Congressional intent to treat any 
cumulative increase in the CPI of 3 percent or greater over a three 
year period as significant and as the appropriate threshold for 
triggering an adjustment to the limits of liability.
    A triennial 3-percent threshold results in a predictable, regular 
schedule of smaller-increment adjustments to the limits of liability 
for inflation. It thereby maintains a balance between responsible party 
risk and Fund risk.
    We considered whether to adjust the limits more frequently than 
every three years. A triennial adjustment period affords adequate time 
for rulemaking, including time required for necessary interagency 
coordination on future adjustments to the facility limits of liability. 
The Coast Guard will, therefore as a general rule, use the three year 
adjustment period in the future. We have, however, clarified in Sec.  
138.240 that the Coast Guard has discretion to adjust the limits of 
liability before three years. For example, if a new limit of liability 
is established by Congress for a particular source category, the new 
statutory limit of liability might be adjusted for inflation sooner 
than three years after the date the new limit of liability was enacted 
in order to put the new limit of liability on the same inflation-
adjustment cycle used for all other source categories.
    Thus, once all of the OPA 90 source categories are on the same 
adjustment schedule, and except in instances when increases in the 
Annual CPI-U over any three-year period are not significant (i.e., are 
less than 3 percent increase in the Annual CPI-U) or if the Coast Guard 
determines in its discretion that an adjustment is needed before three 
years, we will generally calculate future adjustments to the limits of 
liability using the cumulative percent change in the Annual CPI-U for 
the previous three available years. For example, in 2015 (assuming a 
significant increase in the Annual CPI-U after the 2012 adjustments), 
we will calculate the Annual CPI-U change using the 2011 Annual CPI-U 
as the ``Previous Period'' value and the 2014 Annual CPI-U as the 
``Current Period'' value.
    (c) What if the ``significant increases'' threshold is not met?
    The next set of CPI adjustments to the limits of liability, 
currently scheduled for 2012, will put all Coast Guard source 
categories regulated under OPA 90, including the MTR onshore 
facilities, on the same adjustment schedule regardless of whether the 
significant increase threshold is met. Thereafter, for any three-year 
period in which the percent change in the Annual CPI-U is not 
significant in that the cumulative change is less than 3 percent over 
three years, we will publish a notice of no adjustment in the Federal 
Register. In such event, we will re-evaluate the percent increase in 
the Annual CPI-U in each subsequent year until the cumulative percent 
change in the Annual CPI-U from the last adjustment is 3 percent or 
greater. We will then base the adjustment on the Annual CPI-U change 
since the last adjustment.
    For instance, if in 2015 the cumulative percent change in the 
Annual CPI-U from 2011 to 2014 is 2 percent, we will publish a notice 
of no adjustment in the Federal Register in 2015. The following year in 
2016, if the 3 percent change threshold is met, we will publish 
adjustments to all of the limits of liability for Coast Guard source 
categories based on the Annual CPI-U percent change from 2011, as the 
``Previous Period'', to 2015, as the ``Current Period''. The next 
adjustment will, in that case, be no more than three years later in 
2019, again assuming that the cumulative percentage increase between 
the 2015 Annual CPI-U and the 2018 Annual CPI-U is significant.
8. What procedures does the Coast Guard plan to use to promulgate 
subsequent inflation adjustments to the OPA 90 limits of liability?
    This rulemaking has provided the public the opportunity to comment 
on the inflation index (Annual CPI-U), the significance threshold, and 
the calculation methodology for the first, and subsequent, CPI 
adjustments to the limits of liability for Coast Guard source 
categories. The Coast Guard intends to coordinate future inflation 
increases to the OPA 90 limits of liability with the other delegated 
agencies (DOT, EPA and DOI) to ensure consistency, and will consider 
approaches for streamlining the process at that time.

C. Discussion of Comments and Changes

    This section discusses the comments we received on the CPI NPRM. 
This includes a discussion of one clarification we have made, in 
response to a comment, concerning the frequency of limit of liability 
adjustments. We also discuss CPI-related comments we received in 
letters submitted to the related COFR Rule docket. Finally, we discuss 
a comment we received that was submitted to the docket after the public 
comment period on the CPI NPRM and the resulting amendments to clarify 
applicability of the OPA 90 single-hull tank vessel limits of 
liability. (See Docket No. USCG-2008-0007-0013; see also, Docket No. 
USCG-2008-0007-0014.)
1. Public Comments on the CPI NPRM
    We received four letters with seven comments on the CPI NPRM. One 
letter was submitted anonymously. The other letters were from a state 
environmental agency and two liquefied natural gas (LNG) Deepwater Port 
developers. Three of the four letters raised issues beyond the scope of 
this rulemaking.
    The anonymous commenter suggested that the Coast Guard increase oil 
spill fines by 5,000 percent and hold oil company executives personally 
liable for oil spills. This comment is beyond the scope of this 
rulemaking. The primary purpose of this rulemaking is to implement the 
statutorily-mandated inflation increases to the OPA 90 limits of 
liability. Any other increase to the limits of liability would have to 
be authorized by Congress. Moreover, the OPA 90 limits of liability 
only concern the liability of responsible parties for OPA 90 removal 
costs and damages. The OPA 90 limits of liability and this regulation 
do not limit, or otherwise affect or concern, the amount of fines and 
penalties or other liability of responsible parties under other 
provisions of law.
    The two LNG Deepwater Port developers commented that they intend to 
seek facility-specific regulatory adjustments to the OPA 90 limits of 
liability for their planned LNG Deepwater Ports under 33 U.S.C. 
2704(d)(2). The comment asked that those new regulatory limits be set 
forth in the reserved paragraph at 33 CFR 138.230(B)(2)(ii). The Coast 
Guard agrees that 33 CFR 138.230(B)(2)(ii) has been reserved for 
facility-specific regulatory limits that may be established in the 
future under 33 U.S.C. 2704(d)(2). This comment, however, raises issues 
that go beyond the scope of this rulemaking. This rulemaking does not

[[Page 31363]]

concern requests for facility-specific regulatory limits of liability 
under 33 U.S.C. 2704(d)(2). This rulemaking is instead concerned with 
implementing the statutorily-mandated inflation adjustments to the 
existing OPA 90 limits of liability and ensuring that they are 
correctly applied.
    The LNG Deepwater Port developers also commented that the OPA 90 
limit of liability applicable to Deepwater Ports generally should not 
be adjusted for inflation in respect to LNG Deepwater Ports. The 
commenters made several points in this respect. First, they argued that 
the threat of an oil spill from an LNG Deepwater Port is much less than 
from an oil Deepwater Port and that the regulatory limit of liability 
established under 33 U.S.C. 2704(d)(2) for LOOP, the only oil Deepwater 
Port currently in operation, is lower. They also pointed out that the 
Coast Guard had previously determined that two LNG Deepwater Ports 
currently in operation did not trigger OPA 90 for the purpose of 
establishing new liability limits under 33 U.S.C. 2704(d)(2), and asked 
that this determination be expanded to all LNG Deepwater Ports. 
Finally, they argued that the limits of liability should not be 
adjusted in respect to LNG Deepwater Ports until LNG Deepwater Ports 
subject to OPA 90 are placed in operation.
    We disagree with this comment. OPA 90, at 33 U.S.C. 2704(a)(4), 
sets forth a single limit of liability that applies to all Deepwater 
Ports regardless of type, whether oil or LNG. OPA 90 further requires 
that the Deepwater Port limit of liability be adjusted for significant 
increases in the CPI.
    The Coast Guard acknowledges that the United States has previously 
determined that LNG, other than natural gas distillates and condensate, 
is not ``oil'' as that term is defined under OPA 90. (See, e.g., 63 FR 
42699, Aug. 11, 1998; 67 FR 47041, Jul. 17, 2002.) In addition, the 
Coast Guard has determined, in the context of three applications for 
liability limit adjustments under 33 U.S.C. 2704(d)(2), that those 
particular Deepwater Ports were not OPA 90 ``facilities'' as defined at 
33 U.S.C. 2701(9).\5\ This was because the subject Deepwater Ports were 
not designed, constructed or operated to use structures, equipment, or 
devices for ``exploring for, drilling for, producing, storing, 
handling, transferring, processing, or transporting oil.'' \6\
---------------------------------------------------------------------------

    \5\ The three Deepwater Ports in question are: (1) Excelerate 
Energy/Open Gulf Gateway (formerly the El Paso Energy Bridge)--
submerged turret loading buoy and metering platform, only uses 
lubricating oil for emergency generator (December 15, 2003); (2) 
Excelerate Energy/Northeast Gateway Deepwater Port--two turret-
loading buoys, fueled by natural gas, with a small amount of 
lubricating oil applied to lubricate umbilical lines used to operate 
valves (May 4, 2007); (3) Port Dolphin Energy LLC Deepwater Port--
same design as Northeast Gateway, periodic application of hydraulic 
oil to lubricate umbilical lines used to operate valves (August 6, 
2008).
    OPA 90 defines ``facility'', at 33 U.S.C. 2701(9) as ``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.''
    \6\ At this time, there are only three Deepwater Ports in 
operation: one oil Deepwater Port (LOOP) and two LNG Deepwater Ports 
(Gulf Gateway Energy Bridge and Northeast Gateway). Because of the 
determinations that the two LNG Deepwater Ports do not meet the OPA 
90 definition of facility, and unless conditions change at the two 
operating LNG ports, LOOP is the only existing Deepwater Port 
affected by this rulemaking.
---------------------------------------------------------------------------

    Those case-specific determinations were expressly based on the 
design and operation plans presented by the applicants, and the 
determinations will change if any oil is stored on the ports or if 
their design or operations otherwise change such that the OPA 90 
``facility'' definition applies. Moreover, other LNG Deepwater Port 
designs may well involve more extensive manned operations involving the 
storage, handling, transferring or transporting of various oils (e.g., 
natural gas distillates, fuel oil and oil for service equipment or 
devices used to operate the ports). Whether any LNG Deepwater Port, as 
designed, constructed, or subsequently operated, is an OPA ``facility'' 
will therefore continue to be determined on a case-by-case basis.
    The state environmental agency generally applauded the Coast Guard 
in implementing CPI increases to limits of liability, and expressed 
support for similar adjustments in the future for the MTR onshore 
facility limit of liability. The state also expressed support for use 
of the Annual CPI-U to calculate the percent changes in the CPI, 
agreeing that it is likely to provide better consistency and simplicity 
over time than a monthly period CPI-U.
    The state recommended that the rule authorize adjustments to the 
limits of liability for vessels and Deepwater Ports for periods of less 
than 3 years where the CPI-U increases significantly over any one or 
two year period. Specifically, the state recommends amending section 
138.240(b) to require the Director, National Pollution Funds Center 
(NPFC), to evaluate changes in the CPI-U annually, rather than every 3 
years, and increase the limits of liability whenever the percent change 
in the CPI-U reaches or exceeds the significance threshold of 3 percent 
or greater.
    We disagree that it is necessary, required by OPA 90, or 
appropriate for the Coast Guard to establish a system for more frequent 
routine adjustments to the limits of liability in this rulemaking. The 
triennial adjustment schedule provided for in this rulemaking is 
consistent with the discretion accorded by OPA 90. It also reflects 
several practical considerations, including the time necessary to 
develop regulations, and the time required for necessary interagency 
coordination. Moreover, the Coast Guard can consider the feasibility of 
more frequent periods for routine inflation adjustments in the future. 
Even so, in response to this comment, we have clarified in Sec.  
138.240(b) that the Coast Guard has discretion to adjust the limits of 
liability more frequently than every 3 years. This might be appropriate 
if, for example, new statutory limits of liability are enacted for a 
particular source category in order to adjust the limits of liability 
for that category on the same schedule with all other sources.
2. Public Comments on the Prior COFR Rule Relating to CPI Adjustments 
to Limits of Liability
    In addition to the letters submitted to the docket for this 
rulemaking, three letters with five comments concerning CPI adjustments 
to the OPA 90 limits of liability were submitted to the rulemaking 
docket for the related COFR Rule NPRM. (See Docket Nos. USCG-2005-
21780-0007, -0008 and -0019. For ease of reference, these comments have 
also been posted to the docket for this rulemaking. See Docket Nos. 
USCG-2008-0007-0009, -0010 and -0015.) Those comments were beyond the 
scope of the COFR Rule, which focused on the OPA 90 requirements, under 
33 U.S.C. 2716, for vessel responsible parties to establish and 
maintain evidence of financial responsibility. The comments are, 
therefore, addressed here.
    The comments were submitted by a private individual, an association 
of oil spill regulatory agencies from Alaska, British Columbia, 
Washington, Oregon, Hawaii and California, and a state environmental 
agency. All of the commenters sought increases to the OPA 90 limits of 
liability for inflation.
    The private individual asked the Coast Guard to adjust the OPA 90 
limits of liability for inflation, to ensure polluters bear the cost of 
oil spill cleanup and reimbursement of economic loss to communities 
caused by their actions. The association of oil spill regulatory 
agencies submitted a similar comment noting that the COFR

[[Page 31364]]

Rule NPRM did not ``increase (by the CPI since 1990) the limits of 
liability for facilities under Coast Guard's jurisdiction.''
    These comments have been addressed in part by this rulemaking. 
Specifically, this rulemaking makes inflation adjustments to the limits 
of liability for all vessels and for one category of ``facility'', 
Deepwater Ports. The limit of liability for the other category of 
``facility'' under the Coast Guard's jurisdiction, MTR onshore 
facilities, will be adjusted for inflation in the next cycle of 
inflation adjustments to the limits of liability as part of a 
coordinated set of rulemakings with EPA, DOT, and DOI that will cover 
all source categories subject to OPA 90.
    Also, in response to the association's assumption that the 
adjustments would be from 1990, we note that this preamble, at 
paragraph V.B.5, above, and the CPI NPRM explain our decision to use a 
2006 baseline year for the adjustments, instead of 1990. We received no 
comment on the CPI NPRM from the association or from any other 
commenter concerning this approach. This interim rule therefore 
establishes 2006 as the baseline for all Coast Guard source categories 
other than LOOP, including for MTR onshore facilities.
    The association also noted that the COFR Rule NPRM did not propose 
increases to the limits of liability for vessels, including tank 
barges, by the CPI since 2006 as is required by DRPA. This comment is 
addressed by this rulemaking. Specifically, as required by DRPA, this 
rulemaking adjusts the limits of liability for all vessels, including 
tank barges, for inflation since 2006, the year the limits of liability 
were last amended by Congress.
    One commenter, the state environmental agency that also commented 
on the NPRM for this rulemaking, noted that the limits of liability for 
non-tank vessels should be increased. This comment is addressed by this 
rulemaking to the extent authorized by OPA 90. Specifically, as 
mandated by 33 U.S.C. 2704(d), this rulemaking increases the limits of 
liability for all vessels with limits of liability under OPA 90, to 
reflect significant increases in the CPI. This includes inflation 
adjustments to the limits of liability applicable to non-tank vessels. 
Any other increase to the limits of liability for non-tank vessels 
would have to be authorized by Congress.
    The same commenter stated that the COFR Rule NPRM failed to address 
the issue of limits of liability for oil-handling facilities. Reading 
the comment as expressing support for inflation adjustments to the 
limits of liability for facilities, the comment is addressed in part by 
this rulemaking. Specifically, this rulemaking adjusts the limits of 
liability for inflation for all vessels and for one category of 
facilities, Deepwater Ports. The limit of liability for the other 
category of facility under the Coast Guard's jurisdiction, MTR onshore 
facilities, including the above-mentioned oil-handling facilities, will 
be adjusted for inflation in the next cycle of inflation adjustments to 
the limits of liability, as part of a coordinated set of rulemakings 
with EPA, DOI and DOT, that will cover all facilities subject to OPA 
90.
3. Single-Hull Tank Vessel Clarifying Changes and Request for Comment
    In February 2009, after the CPI NPRM public comment period closed 
on November 24, 2008, the rulemaking team was made aware of an off-the-
record comment from a COFR guarantor concerning applicability of the 
single-hull tank vessel limits of liability in 33 CFR part 138, subpart 
B, to LNG and liquefied petroleum gas (LPG) tank vessels (Docket No. 
USCG-2008-0007-0013). Initially the comment was thought to raise 
questions regarding compliance with the final COFR Rule. This is 
because a similar question, in respect to mobile offshore drilling 
units (MODUs), some of which may not have oil cargo tanks, was 
submitted as a comment to the COFR Rule NPRM (Docket No. USCG-2005-
21780-0013). Further analysis, however, revealed that these comments 
raised a substantive and persuasive issue that was not adequately 
addressed in the COFR Rule.
    Specifically, the regulatory text in 33 CFR part 138, subpart B, as 
adopted in the COFR Rule and the further amendments proposed in the CPI 
NPRM, inadvertently applied the single-hull tank vessel limits of 
liability to vessels that do not carry oil cargo.\7\ We determined that 
this is inconsistent with the statutory scheme, including the single-
hull phase-out requirements of Title IV of OPA 90 and 33 CFR part 
157.\8\ Those requirements only apply to a tank vessel that is 
``constructed or adapted to carry, or carries, oil in bulk as cargo or 
cargo residue'' (referred to in this preamble as ``oil cargo tank 
vessels''). (See 46 U.S.C. 3703a(a)(1)).
---------------------------------------------------------------------------

    \7\ The DOT's hazardous material transportation regulations (49 
CFR 172.101) list LNG (methane) and LPG (petroleum gases) as 
hazardous materials. LNG/LPG vessels, therefore, are ``tank 
vessels'' by definition under OPA 90, 33 U.S.C. 2701(34) (i.e., ``a 
vessel that is constructed or adapted to carry, or that carries, oil 
or hazardous material in bulk as cargo or cargo residue''), and are 
subject to the OPA 90 limits of liability and COFR requirements in 
33 CFR part 138 applicable to tank vessels. As noted above, however, 
Coast Guard, EPA and Minerals Management Service have determined 
that, with the exception of natural gas distillates and condensate, 
LNG and LPG are not ``oil''. (See, e.g., 61 FR 9264, at 9266-68, 
March 7, 1996 (1996 COFR Rule preamble); 62 FR 13991, March 25, 
1997, and 30 CFR 254.1 and 254.6 (Offshore Facility Spill Prevention 
Rule, ``Who must submit a spill-response plan?'' and definition of 
``oil''); 62 FR 14052, March 25, 1997 (Offshore Facility Financial 
Responsibility Rule); 63 FR 42699, August 11, 1998, and 30 CFR 253.3 
(Offshore Facility Financial Responsibility Rule definition of 
``oil''); 67 FR 47042, July 17, 2002 (Oil Pollution Prevention and 
Response; Non-Transportation-Related Onshore and Offshore 
Facilities); 73 FR 74236, December 5, 2008, and 40 CFR 112.2 
(Onshore Facility Spill Prevention Rule).)
    \8\ Section 4115 of OPA 90 added a new section to the U.S. Code, 
46 U.S.C. 3703a. That section requires a single-hull oil cargo tank 
vessel owner to remove the vessel from bulk oil service on a 
specific date, depending on the vessel's gross tonnage, build date, 
and hull configuration.
---------------------------------------------------------------------------

    Clarifying this issue requires minor amendments to the regulatory 
text in 33 CFR part 138, subpart B, that were not discussed in the CPI 
NPRM. Therefore, in order to adjust the limits of liability for 
inflation as required by 33 U.S.C 2704(d), while also addressing the 
hull category issue, the Coast Guard is publishing this rulemaking as 
an interim rule, and invites the public to comment on the proposed hull 
category clarifications. The following discussion outlines the legal 
basis for clarifying the hull category provisions.
    OPA 90, as amended, at 33 U.S.C. 2704(a)(1)(A) and (B), divides the 
tank vessel limits of liability into two tank vessel hull categories: 
(A) single-hull tank vessels, including a single-hull vessel fitted 
with double sides only or a double bottom only, and (B) other tank 
vessels.\9\
---------------------------------------------------------------------------

    \9\ These two categories are carried forward by reference in 33 
U.S.C. 2704(a)(1)(C). (See 33 U.S.C. 2704(a)(1)(C)(i)(I) and 
(C)(ii)(I) (single-hull tank vessel limits); 33 U.S.C. 
2704(a)(1)(C)(i)(II) and (C)(ii)(II) (other tank vessel limits).)
---------------------------------------------------------------------------

    OPA 90 defines ``tank vessel'' as ``a vessel that is constructed or 
adapted to carry, or that carries, oil or hazardous material in bulk as 
cargo or cargo residue'' (33 U.S.C. 2701). Title I of OPA 90 could, 
therefore, be read to impose the single-hull limits of liability on 
both oil and hazardous material cargo tank vessels. The context of the 
DRPA amendments that increased the vessel limits of liability and 
created the distinction in OPA 90 Title I between single-hull and other 
tank vessels, however, is helpful in understanding that the single-hull 
limits of liability were intended to apply only to oil cargo tank 
vessels.
    The catalyst for DRPA was the 2004 single-bottom, double-sided 
ATHOS I oil cargo tank vessel spill incident on the Delaware River, 
where the limit of liability amounted to about 20 percent of the 
estimated removal costs and

[[Page 31365]]

damages resulting from the spill. In 2006, Congress increased the 
limits of liability for vessels other than single-hull tank vessels by 
approximately 50 percent to reflect CPI increases since enactment of 
OPA 90. But, in recognition of the higher risk of oil spills from 
single-hull oil cargo tank vessels, Congress decided to increase the 
limits of liability for single-hull tank vessels (including a tank 
vessel fitted with double sides only or a double bottom only) by 
approximately 150 percent. Therefore, the single-hull category of OPA 
90 is concerned with those vessels that were the focus of Congressional 
concern, i.e., oil cargo tank vessels.
    Moreover, as previously noted, single-hull vessels are the 
particular concern of OPA 90 Title IV and the Coast Guard's 
implementing regulations at 33 CFR part 157. Those provisions mandate a 
phase-out of single hulls for any tank vessel that is ``constructed or 
adapted to carry, or carries, oil in bulk as cargo or cargo residue'', 
i.e., for any oil cargo tank vessel. Any such vessel must be taken out 
of service or comply by specified deadlines with the Title IV and part 
157 technical requirements for double hulls.
    It is, therefore, reasonable to view the single-hull vessel limits 
of liability in Title I of OPA 90, as applying only to tank vessels 
that are subject to the single-hull phase-out requirements of Title IV 
(i.e., to any tank vessel that is ``constructed or adapted to carry, or 
carries, oil in bulk as cargo or cargo residue'', where the hull of the 
vessel is single, including a double bottom or double sides only). It 
is this category of tank vessel that Congress was concerned with as 
presenting a greater threat of oil pollution, and thereby deserving of 
phase-out regulation and higher limits of liability.
    By the same token, a tank vessel that is not constructed or adapted 
to carry, and that does not in fact carry, oil in bulk as cargo or 
cargo residue, does not have to meet the single-hull phase-out 
requirements of OPA 90 Title IV and 33 CFR part 157. It is, therefore, 
reasonable to view the ``other'' category of tank vessel limits of 
liability under OPA 90 Title I as applying to such vessel (i.e., to any 
tank vessel that is not an oil cargo tank vessel).
    The Coast Guard is clarifying the regulatory text to reflect this 
statutory scheme. Specifically, we have deleted the definition of 
``double hull'' in Sec.  138.220 and all references to ``double hull'' 
in Sec.  138.230. We have also amended the definition of ``single-
hull'' to clarify that it is limited to a single-hull tank vessel that 
is ``constructed or adapted to carry, or that carries, oil in bulk as 
cargo or cargo residue'', and that does not meet the double-hull 
technical standards applicable to oil cargo tank vessels contained in 
33 CFR part 157.\10\ The Coast Guard seeks comments on these regulatory 
text changes.
---------------------------------------------------------------------------

    \10\ Under this wording, the hull configuration of a hazardous 
material tank vessel will be relevant, for purposes of determining 
which limits of liability apply, only if the vessel is ``constructed 
or adapted to carry, or carries, oil in bulk as cargo or cargo 
residue'' (e.g., a vessel carrying LNG distillate or condensate in 
bulk as cargo or cargo residue). It also would only be relevant for 
a MODU if the MODU is ``constructed or adapted to carry, or carries, 
oil in bulk as cargo or cargo residue''. If the vessel is not so 
constructed, adapted or used, it falls in the ``other'' tank vessel 
category of OPA 90 (33 U.S.C. 2704(a)(1)(B), (C)(i)(II) and 
(C)(ii)(II)), and qualifies for the lower limits of liability of 
Sec.  138.230(a)(2) and (4). If it is constructed or adapted to 
carry, or does in fact carry, oil in bulk as cargo or cargo residue, 
the vessel hull will have to meet the double hull requirements of 33 
CFR part 157 to qualify for the lower limits of liability of Sec.  
138.230(a)(2) and (4).
---------------------------------------------------------------------------

VI. Regulatory Analyses

    We developed this interim rule after considering numerous statutes 
and executive orders related to rulemaking. Below we summarize our 
analyses based on 13 of these statutes or executive orders.

A. Regulatory Planning and Review

    This interim rule is not a significant regulatory action under 
section 3(f) of Executive Order 12866, Regulatory Planning and Review, 
and does not require an assessment of potential costs and benefits 
under section 6(a)(3) of that Order. It has not been reviewed by the 
Office of Management and Budget under that Order. A draft Regulatory 
Assessment is available in the docket where indicated under the 
``Public Participation and Request for Comments'' section of this 
preamble. A summary of the Assessment follows:
    On September 24, 2008, the CPI NPRM was published (73 FR 54997) and 
included a supplemental Preliminary Regulatory Assessment of the 
proposed rule. The comment period ended on November 24, 2008. No 
comments were received on the Preliminary Regulatory Assessment. Prior 
to developing the Interim Rule Regulatory Assessment, we confirmed that 
the methodology and data sources contained in the Preliminary 
Regulatory Assessment had not changed, and the only revision since the 
NPRM would be an update for the newly available 2008 Annual CPI-U.
    There are two regulatory costs that are expected from this interim 
rule:
     Regulatory Cost 1: An increased cost of liability to 
responsible parties of vessels and Deepwater Ports.
     Regulatory Cost 2: An increased cost for establishing and 
maintaining evidence of financial responsibility to vessel responsible 
parties under 33 U.S.C. 2716 and 33 CFR part 138, subpart A.
    Existing Deepwater Ports are not expected to have any increased 
evidence of financial responsibility costs as a result of this interim 
rule.
1. Discussion of Regulatory Cost 1
    This rulemaking could increase the dollar amount of removal costs 
and damages a responsible party of a vessel or Deepwater Port would be 
responsible to pay in the event of a discharge, or substantial threat 
of discharge, of oil (hereafter an ``OPA 90 incident''). Regulatory 
Cost 1 will, however, only be incurred by a responsible party if an OPA 
90 incident results in OPA 90 removal costs and damages that exceed the 
vessel or Deepwater Port's previous limit of liability. In any such 
case, the difference between the previous limit of liability amount and 
the new limit of liability amount established by this interim rule will 
be the increased cost to the responsible party.
(a) Affected Population--Vessels
    Coast Guard data, as of May 2007, indicate that, for the years 1991 
through 2006, 41 OPA 90 incidents involving vessels resulted in removal 
costs and damages in excess of the previous limits of liability (an 
average of approximately three OPA 90 incidents per year). For the 
purpose of this analysis, we assume that three OPA 90 incidents 
involving vessels would occur per year over a 10-year analysis period 
(2009-2018), with removal costs and damages reaching or exceeding the 
new limits of liability for vessels established by this interim rule.
(b) Affected Population--Deepwater Ports
    At this time, LOOP is the only Deepwater Port in operation that is 
subject to OPA 90.\11\ As previously noted, to date, LOOP has not had 
an OPA 90 incident that resulted in removal costs and damages in excess 
of LOOP's previous limit of liability of $62 Million. However, for cost 
estimating purposes, we assume that one OPA 90 incident would occur at 
LOOP over the 10-year analysis period (2009-2018), with removal costs 
and damages

[[Page 31366]]

reaching or exceeding the new limit of liability for LOOP. Assuming an 
OPA 90 incident at the LOOP during the next ten years is merely a 
conservative assumption for cost estimating purposes. If there is no 
OPA 90 incident at the LOOP during the next ten years, then we will 
have over-estimated the cost of the rulemaking.
---------------------------------------------------------------------------

    \11\ As previously noted, there are only two LNG Deepwater Ports 
currently in operation (Gulf Gateway Energy Bridge and Northeast 
Gateway). The Coast Guard, however, determined that the design, 
construction, and operation of these LNG Deepwater Ports did not 
meet the definition of an OPA 90 facility under 33 U.S.C. 2701(9). 
(See discussion at V.C.1., above.) Therefore, unless the design, 
construction, and operations at the existing LNG Deepwater Ports are 
changed, the ports will not be affected by this interim rule.
---------------------------------------------------------------------------

(c) Cost Summary Regulatory Cost 1
    The average annual cost of this rulemaking resulting from the three 
forecasted vessel OPA 90 incidents per year is estimated to be $2.0 
Million (non-discounted Dollars). The average annual cost of this 
rulemaking resulting from the one forecasted LOOP OPA 90 incident over 
10 years is estimated to be $2.6 Million (non-discounted Dollars). The 
10-year (2009-2018) present value at a 3 percent discount rate of this 
regulatory cost (vessels and LOOP) is estimated to be $40.0 Million. 
The 10-year (2009-2018) present value at a 7 percent discount rate of 
this regulatory cost (vessels and LOOP) is estimated to be $34.2 
Million.
2. Discussion of Regulatory Cost 2
    Under OPA 90 (33 U.S.C. 2716) and 33 CFR part 138, subpart A, 
responsible parties of vessels and Deepwater Ports are required to 
establish and maintain evidence of financial responsibility to prove 
they have the ability to pay for removal costs and damages in the event 
of an OPA 90 incident up to their applicable limits of liability. 
Because this rulemaking increases the limits of liability for vessels 
and Deepwater Ports and, by reference, the applicable amounts of 
financial responsibility under 33 CFR 138.80(f), responsible parties 
may incur additional cost associated with the corresponding 
requirements for establishing and maintaining evidence of financial 
responsibility.
(a) Affected Population--Vessels
    The rule potentially increases the cost associated with 
establishing financial responsibility under OPA 90 and 33 CFR part 138, 
subpart A, for responsible parties of vessels in two ways. Responsible 
parties using commercial insurance as their method of financial 
guaranty could incur higher insurance premiums. Responsible parties 
using self-insurance as their method of financial guaranty will need to 
seek out and acquire commercial insurance for vessels they operate if 
they are no longer eligible for self-insurance based on their working 
capital and net worth. There are approximately 17,064 vessels using 
commercial insurance and 741 vessels using self-insurance methods of 
guaranty.
(b) Affected Population--Deepwater Ports
    As previously discussed (see VI.A.1.(b), above, Affected 
Population--Deepwater Ports, Regulatory Cost 1), LOOP is the only 
Deepwater Port that would be affected by this interim rule. An increase 
in the LOOP limit of liability of the magnitude of this rulemaking, 
however, is not expected to increase the cost associated with 
establishing and maintaining LOOP's evidence of financial 
responsibility. This is because LOOP uses a facility-specific method of 
providing evidence of financial responsibility to the Coast Guard. 
Specifically, LOOP is insured under a policy issued by Oil Insurance 
Limited (OIL) of Bermuda up to $150 Million per OPA 90 incident and a 
$225 Million annual aggregate. The Coast Guard has historically 
accepted the OIL policy, along with the policy's $50 Million minimum 
net worth and minimum working capital requirements, as evidence of 
financial responsibility. The Coast Guard does not expect that an 
increase in the LOOP limit of liability of the magnitude of this 
rulemaking would change the terms of the OIL policy, result in an 
increased premium for the OIL policy, or require LOOP to have higher 
minimum net worth or working capital requirements.
(c) Cost Summary--Regulatory Cost 2
    For purposes of calculating Regulatory Cost 2, we assume that this 
rulemaking will cause the insurance premiums for vessels that are now 
commercially insured to increase by 5 percent from current levels. We 
also assume that 2 percent of the vessel responsible parties using 
self-insurance to provide evidence of financial responsibility will 
migrate to commercial insurance. Depending on the particular year and 
the discount rate used, annual costs of this interim rule range from 
$1.7 Million to $3.4 Million per year. The 10-year (2009-2018) present 
value, at a 3 percent discount rate, of this regulatory cost is 
estimated to be between $27.8 Million and $28.6 Million. The 10-year 
(2009-2018) present value, at a 7 percent discount rate, of this 
regulatory cost is estimated to be between $23.8 Million and $24.6 
Million. The ranges reflect two vessel profiles that were developed and 
analyzed separately to account for the uncertainty, due to data gaps, 
of when existing single-hulled tank vessels would be phased out.
3. Total Cost--Regulatory Cost 1 + Regulatory Cost 2
    Depending on the particular year and the discount rate used, annual 
costs of this interim rule range from $4.2 Million to $7.9 Million per 
year. The 10-year present value of the total cost of this interim rule 
(Regulatory Cost 1 + Regulatory Cost 2) at a 3 percent discount rate is 
estimated to be between $67.8 Million and $68.6 Million. The 10-year 
present value of the total cost of this interim rule (Regulatory Cost 1 
+ Regulatory Cost 2) at a 7 percent discount rate is estimated to be 
between $58.0 Million and $58.8 Million.
4. Benefits
    With respect to benefits, this interim rule is expected to:
     Ensure that the real value of the OPA 90 limits of 
liability keep pace with inflation over time;
     Preserve the polluter-pays principle embodied in OPA 90 
and, thereby, ensure that limited Fund resources can be optimally 
utilized in responding to future incidents; and
     Result in a slight reduction in substandard shipping in 
United States waterways and ports because insurers would be less likely 
to insure substandard vessels to this new level of liability.

B. Small Entities

    Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have 
considered whether this interim rule would have a significant economic 
impact on a substantial number of small entities. The term ``small 
entities'' comprises small businesses, not-for-profit organizations 
that are independently owned and operated and are not dominant in their 
fields, and governmental jurisdictions with populations of less than 
50,000.
    Based on the threshold analysis conducted in the CPI NPRM, we 
determined that an Initial Regulatory Flexibility Analysis was not 
necessary for the proposed rule. The comment period ended on November 
24, 2008. No comments were received with respect to any aspects of the 
CPI NPRM that might concern small entities. Prior to developing the 
interim rule, we confirmed that the methodology and data sources 
contained in the threshold analysis had not changed, and the only 
revision since the NPRM would be an update for the newly available 2008 
Annual CPI-U.
    Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that 
this interim rule will not have a significant economic impact on a 
substantial

[[Page 31367]]

number of small entities. If you think that your business, 
organization, or governmental jurisdiction qualifies as a small entity 
and that this interim rule will have a significant economic impact on 
it, please submit a comment to the Docket Management Facility at the 
address under ADDRESSES. In your comment, explain why you think it 
qualifies and how and to what degree this interim rule would 
economically affect it.

C. Assistance for Small Entities

    Under section 213(a) of the Small Business Regulatory Enforcement 
Fairness Act of 1996 (Pub. L. 104-121), we want to assist small 
entities in understanding this interim rule so that they can better 
evaluate its effects on them and participate in the rulemaking. If the 
rule would affect your small business, organization, or governmental 
jurisdiction and you have questions concerning its provisions or 
options for compliance, please consult Rachel Hopp, National Pollution 
Funds Center, Coast Guard, telephone 202-493-6753. The Coast Guard will 
not retaliate against small entities that question or complain about 
this interim rule or any policy or action of the Coast Guard.
    Small businesses may send comments on the actions of Federal 
employees who enforce, or otherwise determine compliance with, Federal 
regulations to the Small Business and Agriculture Regulatory 
Enforcement Ombudsman and the Regional Small Business Regulatory 
Fairness Boards. The Ombudsman evaluates these actions annually and 
rates each agency's responsiveness to small business. If you wish to 
comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR 
(1-888-734-3247).

D. Collection of Information

    This interim rule results in a revision of an existing collection 
of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501-3520). As defined in 5 CFR 1320.3(c), ``collection of 
information'' comprises reporting, recordkeeping, monitoring, posting, 
labeling, and other, similar actions. The title and description of the 
information collections, a description of those who must collect the 
information, and an estimate of the total annual burden follow. The 
estimate covers the time for reviewing instructions, searching existing 
sources of data, gathering and maintaining the data needed, and 
completing and reviewing the collection.
    Title: Consumer Price Index Adjustments of Oil Pollution Act of 
1990 Limits of Liability--Vessels and Deepwater Ports.
    OMB Control Number: 1625-0046.
    Summary of the Collection of Information: Not later than 90 days 
after the effective date of the interim rule, responsible parties for 
vessels will be required under 33 CFR part 138, subpart A, Sec.  138.85 
to establish evidence of financial responsibility to the applicable 
amounts determined under 33 CFR part 138, subpart A, Sec.  138.80(f), 
based on the limits of liability as adjusted by this rulemaking.
    Need for Information: This information collection is necessary to 
enforce the evidence of financial responsibility requirements at 33 CFR 
part 138, subpart A. Without this collection, it would not be possible 
for the Coast Guard to know which responsible parties are in compliance 
with the financial responsibility applicable amounts determined under 
33 CFR part 138, subpart A, and which are not. Vessels not in 
compliance are subject to the penalties provided in 33 CFR 138.140.
    Proposed Use of Information: The Coast Guard uses this information 
to verify that vessel responsible parties have established evidence of 
financial responsibility to reflect the financial responsibility 
applicable amounts determined under 33 CFR part 138, subpart A, based 
on the limits of liability as adjusted by this rulemaking.
    Description of the Respondents: Responsible parties and guarantors 
of vessels that require COFRs under 33 CFR part 138, Subpart A.
    Number of Respondents: There are approximately 900 United States 
vessel responsible parties, 9,000 foreign vessel responsible parties, 
and 100 vessel guarantors that submit information to the Coast Guard.
    Frequency of Response: This is a one-time submission occurring not 
later than 90 days after the effective date of the interim rule. 
Subsequent submissions that may be required as a result of regulatory 
changes to limits of liability under 33 U.S.C 2704(d) are not included 
here because they will be addressed in future rulemakings.
    Burden of Response:
    Increased burden associated with reporting requirements:

10,000 vessel responsible parties and guarantors x 1.0 hours per 
response = 10,000 hours

    Estimate of Total Annual Burden: We calculated the burden using the 
``All Occupations'' mean National average hourly wage of $19.21 per 
hour, published by BLS in the August 2007 ``National Compensation 
Survey: Occupational Earnings in the United States''. In addition, BLS 
data shows that total employee benefits are approximately 30 percent of 
total compensation (wages + benefits). Therefore, since wages account 
for 70 percent of total compensation, total compensation per hour is 
$27.44 ($19.21/0.7) and benefits are $8.23.
    We then multiplied the number of net burden hours by the burdened 
labor rate calculated above (rounded to the nearest dollar, i.e. $27 
per hour).
    Increased burden associated with the reporting requirements:

10,000 hours x $27 per hour = $270,000

    As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 
3507(c)), we will submit a copy of this interim rule and an information 
collection request to the Office of Management and Budget (OMB) for its 
review of the collection of information under 33 CFR part 138, subpart 
A, Sec.  138.85.
    In the NPRM we requested public comment on the collection of 
information, and received none. We again ask for public comment on the 
collection of information to help us determine how useful the 
information is; whether it can help us perform our functions better; 
whether it is readily available elsewhere; how accurate our estimate of 
the burden of collection is; how valid our methods for determining 
burden are; how we can improve the quality, usefulness, and clarity of 
the information; and how we can minimize the burden of collection.
    If you submit comments on the collection of information under 33 
CFR part 138, subpart A, Sec.  138.85, submit them both to OMB and to 
the docket for this rulemaking where indicated under ADDRESSES, by the 
date under DATES.
    You need not respond to a collection of information unless it 
displays a currently valid control number from OMB. The Coast Guard 
will not enforce the information collection request triggered by this 
rulemaking until it is approved by OMB. We will publish a document in 
the Federal Register informing the public of OMB's decision to approve, 
modify, or disapprove the collection.

E. Federalism

    A rule has implications for federalism under Executive Order 13132, 
Federalism, if it has a substantial direct effect on State or local 
governments and would either preempt State law or impose a substantial 
direct cost of compliance on them. We have analyzed this interim rule 
under that Order and have determined that it does not have implications 
for federalism.

[[Page 31368]]

F. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) 
requires Federal agencies to assess the effects of their discretionary 
regulatory actions. In particular, the Act addresses actions that may 
result in the expenditure by a State, local, or tribal government, in 
the aggregate, or by the private sector, of $100,000,000 or more in any 
one year. Though this interim rule will not result in such an 
expenditure, we do discuss the effects of this interim rule elsewhere 
in this preamble.

G. Taking of Private Property

    This interim rule will not effect a taking of private property or 
otherwise have taking implications under Executive Order 12630, 
Governmental Actions and Interference with Constitutionally Protected 
Property Rights.

H. Civil Justice Reform

    This interim rule meets applicable standards in sections 3(a) and 
3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize 
litigation, eliminate ambiguity, and reduce burden.

I. Protection of Children

    We have analyzed this interim rule under Executive Order 13045, 
Protection of Children from Environmental Health Risks and Safety 
Risks. This interim rule is not an economically significant rule and 
does not create an environmental risk to health or risk to safety that 
may disproportionately affect children.

J. Indian Tribal Governments

    This interim rule does not have tribal implications under Executive 
Order 13175, Consultation and Coordination with Indian Tribal 
Governments, because it does not have a substantial direct effect on 
one or more Indian tribes, on the relationship between the Federal 
Government and Indian tribes, or on the distribution of power and 
responsibilities between the Federal Government and Indian tribes.

K. Energy Effects

    We have analyzed this interim rule under Executive Order 13211, 
Actions Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use. We have determined that it is not a ``significant 
energy action'' under that order because it is not a ``significant 
regulatory action'' under Executive Order 12866 and is not likely to 
have a significant adverse effect on the supply, distribution, or use 
of energy.

L. Technical Standards

    The National Technology Transfer and Advancement Act (NTTAA) (15 
U.S.C. 272 note) directs agencies to use voluntary consensus standards 
in their regulatory activities unless the agency provides Congress, 
through the Office of Management and Budget, with an explanation of why 
using these standards would be inconsistent with applicable law or 
otherwise impractical. Voluntary consensus standards are technical 
standards (e.g., specifications of materials, performance, design, or 
operation; test methods; sampling procedures; and related management 
systems practices) that are developed or adopted by voluntary consensus 
standards bodies.
    This interim rule does not use technical standards. Therefore, we 
did not consider the use of voluntary consensus standards.

M. Environment

    We have analyzed this interim rule under Department of Homeland 
Security Management Directive 023-01 and Commandant Instruction 
M16475.lD, which guide the Coast Guard in complying with the National 
Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have 
concluded that this action is one of a category of actions which do not 
individually or cumulatively have a significant effect on the human 
environment. This interim rule is categorically excluded under section 
2.B.2, figure 2-1, paragraph (34)(a) of the Instruction. This interim 
rule sets forth the methodology the Coast Guard uses to increase OPA 90 
limits of liability to reflect significant increases in the CPI, and 
makes the first set of statutorily-mandated inflation increases to the 
OPA 90 limits of liability for vessels and Deepwater Ports. An 
environmental analysis checklist and a categorical exclusion 
determination are available in the docket where indicated under 
ADDRESSES.

List of Subjects in 33 CFR Part 138

    Hazardous materials transportation, Insurance, Limits of liability, 
Oil pollution, Reporting and recordkeeping requirements, Water 
pollution control.

0
For the reasons discussed in the preamble, the Coast Guard amends 33 
CFR part 138 as follows:

PART 138--FINANCIAL RESPONSIBILITY FOR WATER POLLUTION (VESSELS) 
AND OPA 90 LIMITS OF LIABILITY (VESSELS AND DEEPWATER PORTS)

0
1. The authority citation for part 138 is revised to read as follows:

    Authority: 33 U.S.C. 2704; 33 U.S.C. 2716, 2716a; 42 U.S.C. 
9608, 9609; Sec. 1512 of the Homeland Security Act of 2002, Public 
Law 107-296, Title XV, Nov. 25, 2002, 116 Stat. 2310 (6 U.S.C. 
552(d)); E.O. 12580, Sec. 7(b), 3 CFR, 1987 Comp., p. 198; E.O. 
12777, Sec. 5, 3 CFR, 1991 Comp., p. 351, as amended by E.O. 13286, 
68 FR 10619, 3 CFR, 2004 Comp., p.166; Department of Homeland 
Security Delegation Nos. 0170.1 and 5110. Section 138.30 also issued 
under the authority of 46 U.S.C. 2103 and 14302.


0
2. Revise Subpart B to read as follows:

Subpart B--OPA 90 Limits of Liability (Vessels and Deepwater Ports)

Sec.
138.200 Scope.
138.210 Applicability.
138.220 Definitions.
138.230 Limits of liability.
138.240 Procedure for calculating limit of liability adjustments for 
inflation.


Sec.  138.200  Scope.

    This subpart sets forth the limits of liability for vessels and 
deepwater ports under Title I of the Oil Pollution Act of 1990, as 
amended (33 U.S.C. 2701, et seq.) (OPA 90), as adjusted under Section 
1004(d) of OPA 90 (33 U.S.C. 2704(d)). This subpart also sets forth the 
method for adjusting the limits of liability by regulation for 
inflation under Section 1004(d) of OPA 90 (33 U.S.C. 2704(d)).


Sec.  138.210  Applicability.

    This subpart applies to you if you are a responsible party for a 
vessel as defined under Section 1001(37) of OPA 90 (33 U.S.C. 2701(37)) 
or a deepwater port as defined under Section 1001(6) of OPA 90 (33 
U.S.C. 2701(6)), unless your OPA 90 liability is unlimited under 
Section 1004(c) of OPA 90 (33 U.S.C. 2704(c)).


Sec.  138.220  Definitions.

    (a) As used in this subpart, the following terms have the meaning 
as set forth in Section 1001 of OPA 90 (33 U.S.C. 2701): deepwater 
port, gross ton, liability, oil, responsible party, tank vessel, and 
vessel.
    (b) As used in this subpart--
    Annual CPI-U means the annual ``Consumer Price Index--All Urban 
Consumers, Not Seasonally Adjusted, U.S. City Average, All items, 1982-
84=100'', published by the U.S.

[[Page 31369]]

Department of Labor, Bureau of Labor Statistics.
    Director, NPFC means the head of the U.S. Coast Guard, National 
Pollution Funds Center (NPFC).
    Single-hull means the hull of a tank vessel that is constructed or 
adapted to carry, or that carries, oil in bulk as cargo or cargo 
residue, that is not a double hull as defined in 33 CFR part 157. 
Single-hull includes the hull of any such tank vessel that is fitted 
with double sides only or a double bottom only.


Sec.  138.230  Limits of liability.

    (a) Vessels. The OPA 90 limits of liability for vessels are--
    (1) For a single-hull tank vessel greater than 3,000 gross tons, 
the greater of $3,200 per gross ton or $23,496,000;
    (2) For a tank vessel greater than 3,000 gross tons, other than a 
single-hull tank vessel, the greater of $2,000 per gross ton or 
$17,088,000.
    (3) For a single-hull tank vessel less than or equal to 3,000 gross 
tons, the greater of $3,200 per gross ton or $6,408,000.
    (4) For a tank vessel less than or equal to 3,000 gross tons, other 
than a single-hull tank vessel, the greater of $2,000 per gross ton or 
$4,272,000.
    (5) For any other vessel, the greater of $1,000 per gross ton or 
$854,400.
    (b) Deepwater ports. The OPA 90 limits of liability for deepwater 
ports are--
    (1) For any deepwater port other than a deepwater port with a limit 
of liability established by regulation under Section 1004(d)(2) of OPA 
90 (33 U.S.C. 2704(d)(2)) and set forth in paragraph (b)(2) of this 
section, $373,800,000;
    (2) For deepwater ports with limits of liability established by 
regulation under Section 1004(d)(2) of OPA 90 (33 U.S.C. 2704(d)(2)):
    (i) For the Louisiana Offshore Oil Port (LOOP), $87,606,000; and
    (ii) [Reserved].
    (c) [Reserved].


Sec.  138.240  Procedure for calculating limit of liability adjustments 
for inflation.

    (a) Formula for calculating a cumulative percent change in the 
Annual CPI-U. The Director, NPFC, calculates the cumulative percent 
change in the Annual CPI-U from the year the limit of liability was 
established, or last adjusted by statute or regulation, whichever is 
later (i.e., the Previous Period), to the most recently published 
Annual CPI-U (i.e., the Current Period), using the following escalation 
formula:

Percent change in the Annual CPI-U = [(Annual CPI-U for Current Period-
Annual CPI-U for Previous Period) / Annual CPI-U for Previous Period] x 
100.

    This cumulative percent change value is rounded to one decimal 
place.
    (b) Significance threshold. Not later than every three years from 
the year the limits of liability were last adjusted for inflation, the 
Director, NPFC, will evaluate whether the cumulative percent change in 
the Annual CPI-U since that date has reached a significance threshold 
of 3 percent or greater. For any three-year period in which the 
cumulative percent change in the Annual CPI-U is less than 3 percent, 
the Director, NPFC, will publish a notice of no inflation adjustment to 
the limits of liability in the Federal Register. If this occurs, the 
Director, NPFC, will recalculate the cumulative percent change in the 
Annual CPI-U since the year in which the limits of liability were last 
adjusted for inflation each year thereafter until the cumulative 
percent change equals or exceeds the threshold amount of 3 percent. 
Once the 3-percent threshold is reached, the Director, NPFC, will 
increase the limits of liability, by regulation, for all source 
categories (including any new limit of liability established by statute 
or regulation since the last time the limits of liability were adjusted 
for inflation) by an amount equal to the cumulative percent change in 
the Annual CPI-U from the year each limit was established, or last 
adjusted by statute or regulation, whichever is later. Nothing in this 
paragraph shall prevent the Director, NPFC, in the Director's sole 
discretion, from adjusting the limits of liability for inflation by 
regulation issued more frequently than every three years.
    (c) Formula for calculating inflation adjustments. The Director, 
NPFC, calculates adjustments to the limits of liability in Sec.  
138.230 of this part for inflation using the following formula:

New limit of liability = Previous limit of liability + (Previous limit 
of liability x percent change in the Annual CPI-U calculated under 
paragraph (a) of this section), then rounded to the closest $100.

    (d) [Reserved].

    Dated: June 25, 2009.
William R. Grawe,
Acting Director, National Pollution Funds Center, United States Coast 
Guard.
[FR Doc. E9-15563 Filed 6-30-09; 8:45 am]

BILLING CODE 4910-15-P
