[Senate Hearing 110-1187]
[From the U.S. Government Publishing Office]



                                                       S. Hrg. 110-1187

 
                   OIL SPILLS FROM NON-TANK VESSELS: 
                  THREATS, RISKS, AND VULNERABILITIES

=======================================================================

                                HEARING

                               before the

     SUBCOMMITTEE ON OCEANS, ATMOSPHERE, FISHERIES, AND COAST GUARD

                                 OF THE

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                           DECEMBER 18, 2007

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation




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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                   DANIEL K. INOUYE, Hawaii, Chairman
JOHN D. ROCKEFELLER IV, West         TED STEVENS, Alaska, Vice Chairman
    Virginia                         JOHN McCAIN, Arizona
JOHN F. KERRY, Massachusetts         TRENT LOTT, Mississippi
BYRON L. DORGAN, North Dakota        KAY BAILEY HUTCHISON, Texas
BARBARA BOXER, California            OLYMPIA J. SNOWE, Maine
BILL NELSON, Florida                 GORDON H. SMITH, Oregon
MARIA CANTWELL, Washington           JOHN ENSIGN, Nevada
FRANK R. LAUTENBERG, New Jersey      JOHN E. SUNUNU, New Hampshire
MARK PRYOR, Arkansas                 JIM DeMINT, South Carolina
THOMAS R. CARPER, Delaware           DAVID VITTER, Louisiana
CLAIRE McCASKILL, Missouri           JOHN THUNE, South Dakota
AMY KLOBUCHAR, Minnesota
   Margaret L. Cummisky, Democratic Staff Director and Chief Counsel
Lila Harper Helms, Democratic Deputy Staff Director and Policy Director
   Christine D. Kurth, Republican Staff Director, and General Counsel
                  Paul Nagle, Republican Chief Counsel
                                 ------                                

     SUBCOMMITTEE ON OCEANS, ATMOSPHERE, FISHERIES, AND COAST GUARD

MARIA CANTWELL, Washington,          OLYMPIA J. SNOWE, Maine, Ranking
    Chairman                         TRENT LOTT, Mississippi
JOHN F. KERRY, Massachusetts         GORDON H. SMITH, Oregon
BARBARA BOXER, California            JOHN E. SUNUNU, New Hampshire
BILL NELSON, Florida                 JIM DeMINT, South Carolina
FRANK R. LAUTENBERG, New Jersey      DAVID VITTER, Louisiana
THOMAS R. CARPER, Delaware
AMY KLOBUCHAR, Minnesota


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on December 18, 2007................................     1
Statement of Senator Boxer.......................................     7
    Prepared statement...........................................     8
Statement of Senator Cantwell....................................    10
Statement of Senator Inouye......................................     3
Statement of Senator Kerry.......................................     3
    Prepared statement...........................................     5
Statement of Senator Lautenberg..................................     1
Statement of Senator Snowe.......................................     6
Statement of Senator Stevens.....................................     2

                               Witnesses

Allen, Admiral Thad W., Commandant, U.S. Coast Guard, Department 
  of Homeland Security...........................................    12
    Prepared statement...........................................    14
Cooper, Hon. Mike, Chairman, Washington State Oil Spill Advisory 
  Council........................................................    64
    Prepared statement...........................................    65
Deaver, William G., President and COO, Totem Ocean Trailer 
  Express, Inc...................................................    72
    Prepared statement...........................................    74
Etkin, Ph.D., Dagmar Schmidt, President, Environmental Research 
  Consulting.....................................................    61
    Prepared statement...........................................    63
Fleming, Susan A., Director, Physical Infrastructure Issues, U.S. 
  Government Accountability Office...............................    25
    Prepared statement...........................................    26
Glackin, Mary M., Deputy Under Secretary of Commerce for Oceans 
  and Atmosphere, National Oceanic and Atmospheric 
  Administration, U.S. Department of Commerce....................    18
    Prepared statement...........................................    20
    Letter, dated January 14, 2008 to Hon. Maria Cantwell from 
      Admiral Thad W. Allen, Commandant, U.S. Coast Guard........    43
    Report, entitled 2006 Report of the Secretary of Commerce to 
      the Congress of the United States Concerning U.S. Actions 
      Taken on Foreign Large-Scale High Seas Driftnet Fishing 
      Pursuant to Section 206(e) of the Magnuson-Stevens Fishery 
      Conservation and Management Act, As Amended by Public Law 
      104-297, The Sustainable Fisheries Act of 1996.............    56

                                Appendix

Letter, dated January 24, 2008 to Hon. Maria Cantwell from Ronald 
  J. Forest, Senior Vice President Operations, Matson Navigation 
  Company........................................................    87
Johnson, Jr., Ben, Chairman, Makah Tribal Council, prepared 
  statement......................................................    83
Response to written questions submitted by Hon. Maria Cantwell 
  to:
    Admiral Thad W. Allen........................................    88
    Hon. Mike Cooper.............................................   104
    William G. Deaver............................................   108
    Dagmar Schmidt Etkin, Ph.D...................................    98
    Susan A. Fleming.............................................    97
Response to written questions submitted by Hon. John F. Kerry to:
    Admiral Thad W. Allen........................................    95


 OIL SPILLS FROM NON-TANK VESSELS: THREATS, RISKS, AND VULNERABILITIES

                              ----------                              


                       TUESDAY, DECEMBER 18, 2007

                               U.S. Senate,
Subcommittee on Oceans, Atmosphere, Fisheries, and 
                                       Coast Guard,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:30 p.m., in 
room SR-253, Russell Senate Office Building, Hon. Frank R. 
Lautenberg, Chairman of the Subcommittee, presiding.

        OPENING STATEMENT OF HON. FRANK R. LAUTENBERG, 
                  U.S. SENATOR FROM NEW JERSEY

    Senator Lautenberg. We're going to open the hearing, and we 
are to be addressing this question: we've seen too much of the 
damage that's created when we have spills and we're today going 
to be examining a fuller extent of what takes place, including 
the damage, the costs to repair. We want to prevent it where we 
can. And when EXXON VALDEZ has spoken, most Americans have an 
immediate reaction. We remember seeing birds, fish, and other 
wildlife covered in black, messy oil; 11 million gallons 
pouring into the sea. I was up there within 3 days of the 
grounding of the EXXON VALDEZ, and disaster was obvious. And, 
of course, there were incredible financial costs involved, as 
well as the damage to the birds and marine life, that existed 
there.
    The EXXON VALDEZ spill cost nearly $4 billion to clean up. 
And believe it or not, Exxon Mobil, which took in $40 million 
in profits in the year 2006, is still fighting the punitive 
damage that was awarded in that case. After the spill, we 
passed the Oil Pollution Act of 1990, which was a landmark rule 
on spill prevention and response. As a Senator from a coastal 
state, and a state whose waterways carry lots of oil shipments, 
I was proud to play a significant role in crafting that bill.
    Unfortunately, more spills followed. In 2004, a single 
hulled oil tanker, the ATHOS I, spilled more than 260,000 
gallons of heavy crude into the Delaware River, which flows 
along our New Jersey boundary. And so last year, with this 
Committee's leadership, we updated our shipping laws. The 
legislation that I authored nearly tripled the amounts that 
polluters must pay for spills caused by single-hull tankers, 
and nearly doubled the liability for nontankers.
    It also required the creation of Federal Advisory 
Commission on Spill Prevention for the Delaware River Region, 
and it required a study by the Government Accountability 
Office--which has been recently completed--on the actual cost 
of spills. And yet, oil spills are still a tremendous risk to 
our environment and our economy. Just last month, we witnessed 
the accident that occurred with the COSCO BUSAN, where they 
spilled 58,000 gallons of oil in the San Francisco Bay.
    After that incident, and important findings by the GAO, it 
is clear that our government's attitude toward oil spill 
prevention or response has been one of complacency, and there 
is more work that has to be done. But first, we need to 
reinforce that polluters should pay for the disasters they 
create. Over the past 16 years, the Oil Spill Liability Trust 
Fund has subsidized polluters to a tune of $39 million. And 
these payouts happen because the Coast Guard failed to update 
Federal liability limits on a regular basis to keep up with 
inflation.
    Now, making sure that polluters pay isn't the only 
challenge we face. For example, the Delaware River Oil Spill 
Advisory Commission has never had a meeting. There is too 
little funding in the Oil Spill Liability Trust Fund to support 
the cleanup of a catastrophic spill. And the oil spill 
prevention research seems to have fallen by the wayside. So I 
want to work with my subcommittee leaders--the Chairman of the 
Subcommittee has arrived, Ms. Senator Cantwell--on legislation 
to correct these problems. And I also plan in my subcommittee, 
the surface and marine maritime subcommittee, to focus on 
better ship designs and operations to prevent oil spills in the 
first place. And we've got to get beyond this complacency when 
it comes to the health of our shores and our economy.
    Madam Chairman? Do you want to go from there?
    Senator Cantwell [presiding]. Thank you, Senator 
Lautenberg. Thank you for opening up this hearing this 
afternoon. I would like to call on Senator Stevens, if he would 
like to make an opening statement.

                STATEMENT OF HON. TED STEVENS, 
                    U.S. SENATOR FROM ALASKA

    Senator Stevens. I did. I think my colleague, the Chairman. 
Can I comment also, because we're going to have to go get 
involved in the--spill very quickly. I think, Admiral, one of 
the most vivid memories I have is flying with your predecessor 
Admiral the day after spill, as we went over the Prince William 
Sound and saw oil spreading over that vast, beautiful place. We 
were both sickened at the time. Many people forget that tanker 
was aground, and only one-fourth of its tanks had spilled. It 
was subsequent action that lead up to all of the oil coming out 
before it was through, in that Sound. I think that's probably 
the most devastating impact we've ever had from oil spills.
    The other one that was in 2004, the SELENDANG AYU went down 
in Alaska with 300,000 gallons of bunker fuel. The San 
Francisco Bay had 50,000 gallons this last year. I think 
Senator Lautenberg mentioned another one here on the East 
Coast. I'm really concerned about the adequacy of the 
prevention and response. I think the Coast Guard has done a 
great job for the Nation in reducing the impact of oil spills, 
but they're stretched very thin now with the responsibilities 
you have on the homeland security. I think we need to make sure 
the Coast Guard has the resources it needs to conduct the 
training and drills that remain so necessary to prevent and 
take care of oil spills.
    I did go down to Valdez this past summer, there at Mile 
800, and witnessed their deployment of the equipment that's 
there. I don't think many people believe we have it, but we 
have four different sets of recovery material in the Prince 
Williams Sound now. The initiatives you have, a Vessel Tracking 
System that is used in the convoying of tankers, double-bottom 
tankers now, since that Oil Pollution Act of 1990, go in and 
out of the Prince William Sound, I hope to God they will 
prevent another spill in our areas. I do think we have to 
improve our tracking systems, not only of the tankers, but of 
all cargo ships that carry substantial amounts of fuel. I hope 
we can get the Committee working together with your agencies 
all through it to make sure the laws we have are adequate to 
give you the authority you need, but I'm worried about the 
funding.
    Since we're in the era of earmarks, I bow to no one in 
terms of the earmarks we make, because they're necessary to 
assure you have the resources you need to continue the 
activities that are so important to prevent these catastrophes 
in the future. Thank you very much, Madam Chairman.
    Senator Cantwell. Thank you. Senator Inouye?

              STATEMENT OF HON. DANIEL K. INOUYE, 
                    U.S. SENATOR FROM HAWAII

    The Chairman. Thank you very much, Madam Chairman. During 
the past decade, significant progress has been made toward 
reducing the number of oil spills from tank vessels. Much of 
that success is the direct result of passage and implementation 
of the Oil Pollution Act of 1990. However, as we all know, in 
recent years, vessel traffic has rapidly increased, with our 
country's growing dependency on imports of fuel. With that 
increase in vessel traffic, it is evident that nontank vessel 
spills are an emerging concern today. Non-tank vessels can 
carry millions of gallons of oil as fuel, and the standards for 
nontank vessels need to be strengthened.
    I am aware that the Coast Guard is in the process of 
finalizing long-awaited rulemakings in this area, and I wish to 
encourage them to take the steps necessary to hasten the 
completion of these regulations. I look forward to hearing the 
testimony to better address these issues from a policy 
perspective. Thank you very much.
    Senator Cantwell. Senator Kerry?

               STATEMENT OF HON. JOHN F. KERRY, 
                U.S. SENATOR FROM MASSACHUSETTS

    Senator Kerry. Thank you, Madam Chairman. As Senator 
Lautenberg has mentioned, a lot of us on this Committee, and as 
Senator Stevens has mentioned in his own comments, we know from 
firsthand experience what happens when we have an oil spill, 
the dramatic environmental and economic impact. I know Senator 
Boxer knows, and obviously Senator Stevens, as was mentioned.
    While the number of oil spills has thankfully been 
decreasing over the past few decades, they still do occur with 
a frightening regularity. And while improvement obviously needs 
to be made--and we've discussed this in this Committee over the 
many years, in fact, leading up to the double hull sort of 
effort--is really how do you prevent them from happening in the 
first place, and the concept of the double hull is a way to do 
that.
    We have certainly learned that when the cameras go away and 
the attention shifts, the local communities are left dealing 
with the impacts for a long, long period of time. On Sunday, 
the 27th of 2003, the tank barge, BOUCHARD No. 120, ran aground 
and spilled an estimated 98,000 gallons of No. 6 fuel in 
Buzzards Bay. Buzzards Bay, you know, Admiral, but for those 
who don't, is a small area surrounded by the coastline of 
Massachusetts and the islands before you break out into 
Nantucket and Vineyard Sound.
    This was the eighth reported grounding in Buzzards Bay in 
the past 4 years, and the fourth since the EXXON VALDEZ. And 
the community is still dealing with the aftereffects of this 
spill. The total cost to clean up estimated to be around $40 to 
$45 million.
    Buzzards Bay has been the site of several catastrophic oil 
spills, and near-miss groundings, because it is the access and 
entrance to the Cape Cod Canal. The largest spill occurred in 
1969, when approximately 189,000 gallons of No. 2 fuel oil 
spilled when the barge FLORIDA ran aground off West Falmouth. 
And then, in 1990, two groundings occurred within 8 days of 
each other--the grounding of a passenger ship, BERMUDA STAR, 
off Cleveland Ledge, and the grounding of another BOUCHARD oil 
barge, No. 145. Two years later, the QUEEN ELIZABETH II 
grounded off Sow and Pigs Reef, way out near Cuttyhunk, near 
the entrance coming in as you head in toward the Canal.
    So these are just a few examples. Now, I think a lot of us 
have adopted the notion on this Committee that the states 
really do have a pretty good sense, if not the best knowledge, 
of what safety measures are needed to try to protect their 
waters. And so, in response to what happened in Buzzards Bay, 
Massachusetts enacted the Oil Spill Prevention Act of 2004. And 
the law required an escort tug for large vessels, and required 
a state pilot for many of the waters, to help steer the barge. 
And these are pretty commonsense moves.
    The tugs can help with an equipment failure or with human 
error, and they can prevent a spill from occurring. The cost of 
an escort tug and a local pilot, as required by the 
Massachusetts Oil Spill Prevention Act, is approximately $6,000 
per tug transit through the Bay and Cape Cod Canal--miniscule 
compared to the profits carried in those vessels, and nothing 
compared to the costs inflicted on the community in the event 
of an oil spill. Nevertheless, Admiral, the Coast Guard 
challenged this law in court, and is still fighting against the 
requirement for a double-hulled vessel to meet these 
requirements.
    The double-hulled ships are relatively new. We've already 
seen massive oil spills from double-hulled vessels. In 2005, a 
double-hulled vessel operated by K-Sea. Transportation hit a 
submerged oil platform, and through a 36-foot gash spilled 3 
million gallons of oil into the Gulf of Mexico. And since 
double-hulled vessels sit deeply in the water, creating a 
greater risk of rupture in shallow areas such as Buzzards Bay, 
we are concerned.
    1.6 billion gallons of fuel travel through Buzzards Bay 
each year. And local entities, we believe, have the specialized 
knowledge to prevent those spills. So the Coast Guard has 
accepted other states' assertion that local waterways require 
specialized knowledge, and hence require the type of actions 
Massachusetts has taken. And we believe, obviously, that 
Buzzards Bay is proof the area needs a preventative action. So 
it is my hope, Admiral, I certainly want to explore with you 
why the Coast Guard opposes this, and would like to see if we 
can't move forward. Thank you, Madam Chairman.
    [The prepared statement of Senator Kerry follows:]

               Prepared Statement of Hon. John F. Kerry, 
                    U.S. Senator from Massachusetts

    Too many of us on this Committee know first hand from our own 
states the tragic and dramatic environmental and economic impact of oil 
spills right off of our shores. Senator Boxer knows, Senator Stevens 
knows--and after our experience in Buzzards Bay, I know what it means 
to a local community that can find itself still reeling from an oil 
spill almost 5 years later.
    Yes, the number of oil spills has thankfully been decreasing over 
the past two decades, they still occur with frightening regularity.
    While improvement should be made in preparedness and response, the 
best way to deal with oil spills is to prevent them from happening in 
the first place.
    One lesson we've all learned is that after the cameras go away and 
the attention shifts, it is the local communities that have to deal 
with the long term consequences of an oil spill. But what we don't seem 
to have understood fully is that it is also the local community that is 
in the best position to prevent an oil spill.
    On Sunday April 27, 2003 the tank barge BOUCHARD No. 120 ran 
aground and spilled an estimated 98,000 of gallons of Number 6 fuel oil 
in Buzzards Bay. This was the eighth recorded grounding in Buzzards Bay 
in the past forty years and fourth since EXXON VALDEZ, and the 
community is still dealing with the after effects of this latest spill. 
The total cost of the cleanup is estimated at $40-45 million.
    Buzzards Bay has been the site of several catastrophic oil spills 
and many, many more near-miss groundings. The largest spill occurred on 
1969 when approximately 189,000 gallons of #2 fuel oil spilled when the 
barge FLORIDA ran aground off West Falmouth. In 1990, two groundings 
occurred within 8 days of each other--the grounding of the passenger 
ship BERMUDA STAR off Cleveland Ledge and the grounding of another 
BOUCHARD oil barge #145. Two years later, the QUEEN ELIZABETH II 
grounded off Sow and Pigs Reef near Cuttyhunk. These are just a few 
examples.
    The states know their waterways best and the local governments know 
what safety measures are needed. That is why, in response to what 
happened in Buzzards Bay, Massachusetts enacted the Oil Spill 
Prevention Act of 2004. This law required an escort tug for large 
vessels and required a state pilot that knows the waterway to help 
steer a barge--common sense measures.
    These tugs can help with an equipment failure or human error and 
prevent a spill from occurring. The cost of an escort tug and a local 
pilot as required by the Massachusetts Oil Spill Prevention Act of 2004 
is approximately $6,000 per tug transit through the Bay and Cape Cod 
Canal--nothing compared to the profits that are carried in that ship, 
and nothing compared to the costs inflicted on a community in the event 
of an oil spill. However, the Coast Guard challenged this law in court 
and is still fighting against the requirement for double hulled vessels 
meet these requirements.
    Though double hulled ships are relatively new, we have already seen 
massive oil spills from double hulled vessels. In 2005, a double hulled 
vessel operated by K-Sea Transportation hit a submerged oil platform 
and through a 36-foot gash spilled 3 million gallons of oil into the 
Gulf of Mexico. Double hulled vessels sit deeper in the water, creating 
a greater risk for a rupture in a shallow area such as Buzzards Bay.
    1.6 billion gallons of fuel travel through Buzzards Bay each year, 
and local entities have the specialized knowledge to help prevent 
future oil spills. While the Coast Guard has been helpful in dealing 
with the response to the oil spill, preempting the State law which will 
help prevent future oil spills is perplexing to me. The Coast Guard has 
accepted other State's assertion that local waterways require 
specialized knowledge and hence require the type of actions 
Massachusetts has taken. The number and severity of oil spills in 
Buzzards Bay serve as proof that this area needs the preventative 
actions the State Law includes, and it is my hope that today we will at 
last get some answers about why these basic steps still face so much 
resistance.

    Senator Cantwell. Thank you, Senator. Senator Snowe?

              STATEMENT OF HON. OLYMPIA J. SNOWE, 
                    U.S. SENATOR FROM MAINE

    Senator Snowe. Thank you, Madam Chair, for holding this 
hearing today on an issue that's vital to the future of our 
ocean and coastal resources. Just over a month ago, many of us 
met here in the immediate aftermath of the disastrous COSCO 
BUSAN oil spill looking for answers of how and why it occurred. 
As those investigations continue, in our discussions today, 
we'll look beyond that single incident and broaden the inquiry 
to determine what more can be done to reduce the likelihood of 
future spills and improve our ability to respond, contain, and 
mitigate the impact in incidents that do occur.
    Also, I would like to thank Senator Boxer. She chaired that 
hearing last month, along with Senator Feinstein, a meeting 
that was very important to provide a clearer picture of the 
response in the environmental disaster that occurred on 
November 7th in the San Francisco Bay. I understand that 
approximately one-third of the oil spilled in that accident has 
been recovered; a percentage well above the average for oil 
recovery. But questions remain about the causes of the 
incident, as well as the adequacy of the response plan, 
including the flow of communications with state and local 
officials and the management of non-Federal assets in the 
immediate aftermath.
    I am troubled by the reports, as many have indicated, not 
only that it was about eight hours before the Coast Guard 
learned of the magnitude of this spill, and then another 4 
hours that lagged between the time the Coast Guard notified 
local officials about the magnitude of this spill, including 
the Mayor of San Francisco. I was pleased to hear you say, 
Admiral, that an independent investigation of the Coast Guard's 
effort is underway. I look forward to the results to help 
determine appropriate changes to a better response strategy and 
the lessons learned.
    I represent a state recognized for more than 5,000 miles of 
majestic coastline, the longest on the Eastern Seaboard. And 
many rely on the beauty and the bounty of our oceans from 
tourism, to fisheries, to maritime transportation--for our 
livelihoods. The Port of Portland plays a very significant role 
hosting ferries and commercial fishing boats, cruise ships, oil 
tankers, and tank barges. Portland is the second-highest volume 
oil importer on the Eastern Seaboard, and we have seen 
firsthand the devastation of oil spills and what it can do to 
our environment, to our shores, and also to the livelihood for 
the many people who depend on the ocean.
    In 1996, the tanker JULIE ANNE discharged nearly 180,000 
gallons of fuel into the Portland Harbor, incurring upwards of 
$43 million in damages.
    We have also seen high volumes of nontanker cargo ships. 
Portland is visited at least by one container ship per week, 
and numbers are expected to grow in the coming years. And we 
are currently experiencing a boom in the cruise ship traffic. 
Large cruise ships, like other massive vessels, such as the 
container and cargo ships, carry hundreds of thousands of 
gallons of fuel oil. Last summer, cruise ships made a record 
number of visits to Maine, including 90 port calls at Mount 
Desert Island, home to the scenic areas of Bar Harbor and 
Acadia National Park. The natural beauty of this region, of 
course, is the main attraction for cruise ships. It is also 
enhanced by its remoteness, something that also increases the 
degree of difficulty for responders should a spill occur.
    During our discussion here following the COSCO BUSAN 
incident, it became clear that large oil spills from cargo 
ships are relatively rare. Furthermore, the recent decline in 
large spills is attributable in no small measure to the passage 
of the Oil Pollution Act back in 1990. In fact, according to 
your agency's statistics, Admiral Allen, in the 10 years prior 
to the passage of that Act, there were over 180 oil spills 
greater than 50,000 gallons, or an average of 18 large spills 
per year. From 1990 through 2004, that number has declined by 
nearly 75 percent. A lot of the Nation's efforts to reduce the 
incidence and impact of oil spills has focused on tanker 
vessels, resulting in improvements such as double hulls and 
Vessel Response Plans. It is time to shift some of that 
attention to nontanker vessels.
    Fully one-fifth of the oil that has spilled into our waters 
since 1990 has come from nontanker vessels, and today's cargo 
ships are capable of holding up to 4 million gallons of oil. It 
is critical that this Committee exercises oversight authority 
to minimize the risk of future calamities like the COSCO BUSAN. 
I look forward to speaking to the witnesses here today, in 
particular Admiral Allen. We have spoken on numerous occasions 
about the Coast Guard's many missions, and I know this is one 
of your multi missions. We have to ensure that you have, 
obviously, the strategy, the policy, and the resources 
necessary to carry out these future endeavors.
    What we need is to adjust the current Federal policy to 
make sure that we are prepared to address any of these oil 
spills and catastrophes in the future. Thank you.
    Senator Cantwell. Thank you. Senator Boxer?

               STATEMENT OF HON. BARBARA BOXER, 
                  U.S. SENATOR FROM CALIFORNIA

    Senator Boxer. Madam Chair, Senator Snowe, thank you so 
much for your extraordinary leadership on this. And as I look 
at everyone here, we all come from states that know the value 
of the ocean, the value of the bay, the environmental value, 
the economic value, and frankly, the culture that we have 
around the ocean. And I just want to say on behalf of 
Californians, who have over 840 miles of coastline, that when 
the COSCO BUSAN struck on the Bay Bridge on November 7th, and 
it ripped the visible 100-foot-long gash in the ship's side, 
and it spewed 58,000 gallons of bunker fuel in the San 
Francisco Bay. When that happened, everyone mobilized. But 
because of a lot of confusion, a lot of facts not getting out 
to the people, we saw this.
    And I'd like to just show you two photographs here of the--
some of the wildlife--2,200 birds and marine mammals were 
injured or killed. And now, we think that 20,000 birds may have 
perished in the oil spill. Show them the other one. And these 
are some of the people who were just giving aid to these 
helpless creatures, and, you know, if we had known 
immediately--immediately--I think things would've been 
different. There's more that we need to do, and I just hope 
that we stay on this. And that's why, Senator Cantwell and 
Senator Snowe, I was so grateful to you for following up on the 
briefing that Senator Feinstein and I did.
    But I also want to point out that, in addition to the harm 
done to the wildlife, others are suffering. And I think Senator 
Stevens might be interested in this point, and I'll wait for 
him, because I do--Senator Stevens, I want to tell you 
something that I thought would interest you in particular, that 
there is are so many ramifications from something like this. 
The Dungeness crab season was suspended for several weeks, 
because of health concerns over the potential for tainted 
seafood, and our whole fishery has been impacted by this. So, 
you know, it's one moment, one incident, one mistake, one 
problem, and it has all these effects for so long.
    I'm going to ask to put my whole statement in the record, 
and my remaining 3 minutes I'm going to highlight that, if I 
might.
    [The prepared statement of Senator Boxer follows:]

 Prepared Statement of Hon. Barbara Boxer, U.S. Senator from California
    I want to thank the Commerce Committee and Senators Cantwell and 
Snowe for holding this hearing today to call attention to the threats 
posed by the large amounts of oil carried by cargo ships.
    I also want to thank Senator Cantwell and the Committee for 
including provisions in the Coast Guard Reauthorization bill to address 
oil spill pollution prevention.
    Unfortunately, Californians know all too well the damage and 
destruction that can occur to our waters, wildlife and communities due 
to toxic bunker fuel used by most shipping companies worldwide.
    The cargo ship the COSCO BUSAN struck the protective bumper of the 
Bay Bridge on November 7, ripping a visible 100 foot long gash in the 
ship's side, spewing 58,000 gallons of bunker fuel into San Francisco 
Bay.
    This disaster has wreaked havoc on our environmentally sensitive 
Bay, killing or injuring at least 2,200 birds and marine mammals. 
Wildlife biologist experts now estimate that more than 20,000 birds may 
have perished due to the spill.
    The negative impacts of the disaster are not just limited to 
extensive environmental damage, Californians all along the coast are 
feeling the effects of this spill on their pocketbooks. The Dungeness 
crab season was suspended for several weeks because of health concerns 
over the potential for tainted seafood.
    At the Members briefing I held shortly after the disaster, I raised 
many questions about the Coast Guard's and NOAA's response to the 
spill. While I appreciate each agency's efforts, there are many more 
questions that still need answers.
    I think we need to re-evaluate how Federal agencies respond to 
these types of environmental disasters and the resources that are 
allocated for oil spills prevention programs and response.
    That is why I recently introduced two bills along with Senator 
Feinstein to help address some of the main issues raised in the wake of 
the spill--the role of and funding for the Coast Guard's Vessel Traffic 
Service (VTS), liability limits for cargo ships, and laptop computers 
for pilots.
    The Maritime Emergency Prevention Act of 2007, which was referred 
to this Committee, gives the local Coast Guard Vessel Traffic Service 
the authority to command a ship to modify its speed and direction in 
the event of an emergency or in hazardous conditions, it mandates 
pilots use laptop computers where appropriate and authorizes increased 
funding for the VTS.
    We need to give the VTS the resources and authority to do its job 
to intervene when circumstances warrant so when we have another 
incident similar to the COSCO BUSAN, the Coast Guard can alert the ship 
in a manner that may prevent an accident.
    Another issue raised recently by this spill is the increasing size 
of cargo ships and the ability of these ships to carry a tremendous 
amount of oil. The largest cargo ships today can carry 4.5 million 
gallons of fuel, and despite those totals, cargo ships are not required 
to have double hulls.
    Mr. Chairman, I think the potential for a major disaster here is 
terrifying. Our communities are no longer in a position of wondering if 
they will have to respond to a major disaster but when.
    That is why I have also introduced legislation, which was referred 
to my EPW Committee, to equalize the liability limits under OPA for oil 
tankers and cargo ships, raising cargo ships from $950 per gross ton to 
$1,900 for double hulled and $3,000 for single hulled ships.
    The GAO report released today points out that the Coast Guard has 
not acted to raise the liability limits for vessels since OPA was 
enacted in 1990, and instead relied on the Oil Spill Liability Trust 
Fund to shoulder the remaining financial burden.
    In fact, the GAO found that of the 51 major spills between 1990 and 
2006, the failure of the Coast Guard to raise the liability limits 
resulted in a $39 million shift in costs from the responsible parties 
to the Oil Spill Liability Trust Fund.
    As we have seen first hand with the disaster in San Francisco Bay, 
the liability limits often cap the liability for the responsible party 
far below what the actual total cost of clean up and recovery for a 
spill.
    I also am working on legislation mandating the development and 
implementation of national guidance for volunteer management during oil 
spills.
    With the San Francisco Bay oil spill we witnessed a tremendous and 
impressive volunteer response. However, we also witnessed confusion and 
inefficiencies with how to properly manage this valuable resource.
    We need national guidance and further local planning and training 
to address the complexities with engaging volunteers and to define how 
to best provide for their worthwhile and safe use.
    Mr. Chairman, as I stated before, many questions still remain about 
whether our Federal agencies have the resources necessary and are up to 
the task of responding to and cleaning up major oil spills.
    I have concerns about whether Coast Guard has the resources to 
adequately monitor the Vessel Response Plans for non-tanker ships and 
whether Coast Guard's current training schedule is sufficient to 
respond to a major spill.
    Why is Coast Guard continuing to drag its feet on rulemaking? Is 
Coast Guard too focused on the security aspects of the Agency and not 
enough on marine environmental protection?
    Finally, should we in the United States step up at the 
international level, like private companies such as Intertanko have, 
and work to ban toxic bunker fuel? We know the benefits of a lower-
sulfur fuel provides for respiratory health, and now we also need to 
think about the potential affects of toxic fuel on our waters and 
marine life.
    As international trade continues to grow, the threat of a 
catastrophic oil spill occurring off the coast of the United States 
continues to grow exponentially.
    I want to thank the Committee for holding this important hearing 
and look forward to working with the agencies and groups present to 
protect our waters and communities.

    Senator Boxer. I think we need to reevaluate how Federal 
agencies respond to these disasters, and I don't certainly have 
all the answers, but Senator Feinstein and I, after our many 
briefings, and Admiral Allen was helpful to us in telling us, 
in his opinion, not that we necessary agreed with everything he 
said, but we came up with a couple of approaches. One bill has 
been referred to this Committee, Mr. Chairman, and I want to 
thank you for your interest.
    The Marine--the Maritime Emergency Prevention Act of 2007 
would take away the ambiguity as to who is in charge when we 
have conditions that are so hazardous that you can't see one 
inch in front of your nose. It would say that the Coast Guard 
declares a hazardous circumstances--declares an emergency 
circumstance, and then it would be responsible to pilot that 
ship in. And right now, what we have is this one's pointing 
here, it was his fault, it was his fault, it was his fault. I 
think, in case of emergency, I have so much faith in the Coast 
Guard. I say to you, Admiral, I think they need to declare that 
there is an emergency, and they take charge, and I think we 
will--I believe, remove some of the problems that we face right 
now. We need to give the VTS, the Vessel Traffic Service, the 
resources they need to do the job, and I think we should be 
ready to do that. The second bill that we introduce--yes, I 
will.
    Senator Stevens. Will you give them the authority to not to 
have to file Environmental Impact Statements and not have to 
clear it with all these other people in order to do that? If 
you will, I'll go with you.
    Senator Boxer. Well, Senator, that question I don't think 
is appropriate at this time. I think we need to sit down and 
look at what has to happen at the moment that they declare that 
there is an immediate emergency and they bring the ship in. I 
don't think it would have anything to do with environmental 
reports. There's no reporting here. It's the when--who leads 
the ship in. So I don't think that's an issue that would come 
up. But if this is something you think we need to deal with, 
fine. I don't get it. I don't think it has anything to do with 
it.
    The second bill that we introduced, which has been referred 
to my Committee on Environment and Public Works, would do the 
following: it would raise the liability limit for the cargo 
ships to the level of the tankers, and it would lower the limit 
if you had a double hull. Because I think Senator Kerry is 
right; the double hull would help a lot. So if we give 
financial incentives, in terms of a liability cap if you have a 
double hull, I think that would help. We're also working on 
legislation that will deal with getting the volunteers into the 
cleanup sooner, because at this point, there was confusion and 
we had volunteers testify who were just beside themselves 
because they couldn't really help.
    So Madam Chair, those are the two pieces of legislation 
that I'd like to talk more with colleagues about. I also think 
it's important that the Coast Guard look at some of the 
rulemaking they're supposed to be doing. I don't know how up to 
date they are on it, but I hear it's going a little slower than 
we would like. So I want to--Oh, only one more point, very 
quickly. The kind of fuel that's spilled is the worst type of 
fuel, this bunker fuel. And there ought to be an international 
treaty to ban this fuel, and our people in the Bush 
Administration say they agree, but they are dragging and 
dragging and dragging.
    So we have a bill, Senator Feinstein and I, that would 
simply say ``Bunker fuel is banned.'' When you're ready to come 
into an area in any of our ports, you've got to change to a 
cleaner fuel, and we have tremendous support from that, from 
all these port communities. So these are some approaches. Thank 
you for your interest and concern.

               STATEMENT OF HON. MARIA CANTWELL, 
                  U.S. SENATOR FROM WASHINGTON

    Senator Cantwell. Thank you, Senator Boxer. And I want to 
thank Senators--Chairman Inouye and Vice Chairman Stevens for 
their long and hard work, and attention to this issue, and to 
many of my colleagues who were here when the EXXON VALDEZ 
situation happened in the passage of the 1990 Act. I really 
think it was groundbreaking legislation that has done a lot to 
protect our environment and to reduce the risk of maritime oil 
pollution.
    The volume, though, of oil spilled nationwide is still far 
too large, and spills are still too frequent. We are here today 
because these events recently in California, I think, demand 
that we reexamine America's oil pollution prevention and 
response. We know that a container ship, the COSCO BUSAN, 
collided with the San Francisco Bay Bridge as it was exiting 
the bay. That collision created a 100-foot gash in the side of 
the vessel, and fuel that was spilled was 58,000 gallons, as my 
colleague from California just said, of bunker fuel into the 
bay, and resulted in one of the largest oil spills in San 
Francisco Bay in the last decade.
    The fact that this ship was not an oil tanker transporting 
oil, like the EXXON VALDEZ, is an important one because the 
cargo ship was built to carry nearly 2 million gallons of oil 
as fuel. And the true scale of that fuel tank that was ruptured 
was 1 million gallons. The incident has brought to light how 
vulnerable our oceans are to the oil spills from nontank 
vessels that carry massive amounts of oil--not as cargo, but as 
fuel. I believe this event highlights a need to reexamine the 
protections of the Oil Pollution Act and whether they are 
sufficient given today's reality.
    Is the current regulation of such nontank vessels 
sufficient in the light of the risks that they pose? When 
nontank vessels are growing, both in size and in number, and 
often carrying volumes of fuel oil in the millions of gallons, 
is it really responsible for us to slow-walk the rules that 
would regulate these vessels? In a world where the cost of 
cleanup for a single catastrophic spill would cost several 
billion dollars, should we really be toying with the solvency 
of the Oil Spill Liability Trust Fund, the very source of 
cleanup dollars in an emergency?
    And when we have better communication and navigation 
technology, safer ship designs, and more innovative ways to 
save ships when things go wrong, isn't prevention a better 
investment than paying for the cleanup in the next catastrophe? 
As recent incidents in San Francisco, the Puget Sound, and 
along the Pacific coastline can attest, much more remains to be 
done to safeguard our waterways and our shorelines. Like many 
of my colleagues here, Washington State knows these issues and 
confronts them every day. Approximately 600 tankers and 3,000 
barges move nearly 15 billion gallons of oil through Puget 
Sound's very fragile ecosystem each year.
    But over 6,000 larger nontank vessels, such as cargo ships 
and freighters transit through the same waters each year, as 
well. And since 1964, vessels have spilled approximately 4.8 
million gallons of oil in Washington waters. Of this, 184,000 
gallons were spilled after the Oil Pollution Act of 1990. I, 
too, will submit the rest of my testimony for the record, 
because I do want to hear the testimony of those witnesses, but 
I think it's safe to say that now we are 17 years after the Oil 
Pollution Act of 1990, and we're nearly 30 years since my 
predecessor Warren Magnuson, Senator Magnuson, banned 
supertankers in Puget Sound. I hope we can continue to make 
progress on this vital issue, and that's why we're here today, 
to hear from these panelists who will join us to bring insight, 
to examine the risks and threats and the vulnerabilities that 
we still face, particularly from nontank vessels.
    So I want to thank the panelists on the first panel. 
Admiral Allen of the U.S. Coast Guard; Ms. Mary Glackin, Deputy 
Under Secretary of the National Oceanic and Atmospheric 
Administration; and Ms. Susan Fleming, Director of Physical 
Infrastructure for the GAO. Welcome, and thank you for being 
here, and for your patience in this hearing this afternoon. And 
Admiral Allen, if you could start with your testimony, we're 
asking each of the witnesses to make a 5-minute statement.

        STATEMENT OF ADMIRAL THAD W. ALLEN, COMMANDANT, 
       U.S. COAST GUARD, DEPARTMENT OF HOMELAND SECURITY

    Admiral Allen. Good afternoon, Madam Chair, Senator Snowe, 
and distinguished members of the Committee. Thank you for the 
opportunity to appear before the Committee today on this very 
important topic. I would ask that my full testimony be 
submitted for the record, and I have a brief opening statement.
    The risks presented by the fuel carried on nontank vessels 
have been recognized for some time, and the recent spill in San 
Francisco has underscored the need to understand the causes and 
to prevent spills from these vessels. I think we have all been 
very clear in our statements here today; there is no better 
approach to this problem than prevention. Once the oil has been 
discharged into the environment, there are no winners. And the 
best any response can do is to mitigate the impact.
    I'd like to provide the Committee with some data today that 
frames the size of the fleet and the threat that we are 
discussing here today. Based on data through December of 2007, 
the Coast Guard has received and reviewed response plans from 
more than 13,000 nontank vessels that call on U.S. ports. Of 
that number, over 8,000 are classified as ocean-buoyant freight 
vessels, such as the COSCO BUSAN. The majority of these vessels 
have fuel capacity between 10,000 and 20,000 barrels. Each 
barrel contains 42 gallons, so the range is 420,000 to 840,000 
gallons, on average.
    However, there are 360 vessels that carry more than 50,000 
barrels, and there are 100 that carry more than 70,000 barrels. 
The highest capacity freight ship listed in our records is 
173,000 barrels, or about 7.3 million gallons. And we all know 
the discharge from the EXXON VALDEZ was close to 10 million. 
The COSCO BUSAN had a capacity of 52,000 barrels, or 2.2 
million gallons, as was stated previously.
    To address the threat posed by nontank vessels, there have 
been several international and domestic steps taken, and more 
are planned and more are needed, as you have stated. Under the 
provisions of MARPOL Annex I, single-hulled fuel tanks are 
being phased out. Double hulls for fuel tanks are required for 
ship contracts awarded after the 1st of August 2007, and for 
ships delivered after 1 August 2010. There are also provisions 
that require a shipboard oil emergency plan. Domestically, 
we've gone further than the international standards. Based on 
recent legislation by the Congress in 2004 and 2006, we have 
established a response plan requirement for nontank vessels 
greater than 400 gross tons.
    The legislation created an August 2005 deadline for the 
implementation of these plans. The Coast Guard issued interim 
guidance in February of 2005 that provided interim 
authorization for nontank vessels to operate under Coast Guard-
reviewed response plans, pending the development of new 
Committee regulations. I noted earlier plans for over 13,000 
vessels have been received and reviewed by the Coast Guard. By 
comparison, we have reviewed response plans for 7,800 tank 
vessels in that same period of time. Clearly, the number and 
increasing fuel capacity of large freight ships justify a 
review of all aspects of spill prevention and response.
    Another significant area of interest is the limit of 
liability for a responsible party under the provisions of OPA 
90. For a number of years, the limits of liability remained as 
established at the time of OPA 90. However, as you know, they 
were significantly increased after the Coast Guard and Maritime 
Transportation Act of 2006 was passed. We believe increasing 
liability limits per incident for single-hulled tankers, 
barges, and nontank vessels greater than 300 gross tons would 
result in a more balanced cost-share between responsible 
parties and the Oil Spill Liability Trust Fund. However, that 
legislation did not increase in a like manner the requirement 
for a Certificate of Financial Responsibility, and we are 
pursuing a rule to adjust that level, and expect to issue it in 
2008.
    Madam Chair, I would like to close with the comment 
regarding Coast Guard rulemaking, as mentioned earlier. My 
comments here today reflect a previous conversation that you 
and I had with your staff, as well as other Members of 
Congress. The current backlog of rules to be developed by the 
Coast Guard exceeds 90. On 9/11/2001, it was approximately 50. 
Despite tremendous effort by our Coast Guard personnel, we are 
not gaining ground, and many important rules have been queued 
awaiting required resources. The situation is unsatisfactory to 
me, I know it's unsatisfactory to you, and it erodes confidence 
in our commitment to important work. I've tasked the Coast 
Guard and Marine Safety and Security Council to assess the 
current situation, and to provide any options to reduce this 
backlog.
    Given the multiple interests involved, I intend to convene 
a National Stakeholders Meeting to seek input and advice on 
this effort. I would ask for the involvement of the Committee 
staff in this effort, as well. Within this context, the Coast 
Guard will continue to aggressively partner with our 
stakeholders to prevent incidents and improve response to 
incidents as they occur. We provided interim guidance to our 
field commanders, based on feedback from the COSCO BUSAN 
response, and I have initiated an Incident Specific Review of 
the responses, which includes third parties.
    The results of that review will be made available before 
the spring hearings, and I will provide the Congress the 
results and make those results available to the public. Thank 
you for the opportunity to be here today. I will be glad to 
answer any questions.
    [The prepared statement of Admiral Allen follows:]

       Prepared Statement of Admiral Thad W. Allen, Commandant, 
           U.S. Coast Guard, Department of Homeland Security

    Good afternoon Madam Chairman and distinguished members of the 
Committee. It is a pleasure to appear before you today to discuss the 
Coast Guard's efforts to reduce and mitigate oil spills from nontank 
vessels. Today I will discuss requirements and implementation of 
nontank vessel response plans and the status of rulemaking pertaining 
to nontank vessels. The Coast Guard is absolutely committed to 
protection of the environment as a valuable public good.
    The Coast Guard plans and prepares for significant oil spill 
incidents, including worst case discharge scenarios, through Area 
Committees and Regional Response Teams. These entities represent a 
partnership of Federal, state, and local agencies and tribal, non-
governmental and private organizations. Through committee process, Area 
Contingency Plans are reviewed, tested, and updated to best manage oil 
spill response operations. These plans identify environmentally 
sensitive areas within the local area of responsibility, establish 
appropriate protection strategies, and list all potential locations for 
staging response equipment. The plans describe command and control 
structures, the role of volunteers, establish conditions for using 
special response procedures such as the use of dispersants, and 
identify the National Response System and local assets that can be 
brought to bear in the event of an oil spill incident.
    The Area Committees and Regional Response Teams oversee other 
preparedness activities such as regular government and industry 
exercises, training evolutions, and risk assessments. Their activities 
are overseen by the National Response Team, and operate under the aegis 
of the National Contingency Plan and the National Response Framework.
    The creation of Coast Guard Sectors unified port and coastal 
operational commands, placing increased resources in the hands of 
Federal On-Scene Coordinator. The Coast Guard conducts regular, 
rigorous, oil spill exercises, inspects vessels and facilities for 
safety and environmental compliance, and participates in a host of 
prevention, planning and preparedness activities related to 
environmental protection and response. Incident Command System training 
is required for all Coast Guard personnel ensuring the skills necessary 
to manage all hazards incidents, including oil spill response 
operations. In addition, Coast Guard Strike Teams offer unique 
capabilities and expertise to assist local response operations and the 
National Strike Force Coordination Center conducts regular assessments 
of the capabilities and readiness of privately owned Oil Spill Removal 
Organizations.

Nontank Vessel Response Plans
    The Coast Guard and Maritime Transportation Act of 2004 amended the 
Federal Water Pollution Control Act to require the preparation and 
submission of oil spill response plans for nontank vessels. The Act 
defined a ``nontank vessel'' as a self-propelled vessel of 400 gross 
tons or greater, other than a tank vessel, that carries oil of any kind 
as fuel for main propulsion and that is a vessel of the United States 
or operates in the navigable waters of the United States. Under the 
Act, response plans for nontank vessels were required to be submitted 
to the Coast Guard by August 8, 2005. The Coast Guard and Maritime 
Transportation Act of 2006 was signed by the President on July 11, 2006 
and further amended the Federal Water Pollution Control Act. Section 
608 of the CGMTA 2006 contained provisions to further amend the FWPCA 
with regard to applicability standards for nontank vessels. All nontank 
vessels that are not assessed under the convention tonnage measurement 
system will use the regulatory tonnage admeasurements system for their 
applicability tonnage. Additionally, U.S. vessels that are not 
operating on the navigable waters of the United States are not required 
to comply with this law.
    The Act provided 1 year for the development and submission of 
nontank vessel response plans. The Coast Guard did not have adequate 
time to provide for public comments and then develop and publish 
regulations within the one-year timeframe. Under the authority provided 
by 33 U.S.C. 1321(j)(5)(G), until regulations are in effect, the Coast 
Guard has authorized nontank vessels to operate without an approved 
plan for up to 2 years if the owner or operator certifies availability 
of personnel and equipment necessary to respond to a worst case 
discharge. On February 4, 2005, the Coast Guard published Navigation 
and Vessel Inspection Circular 01-05 (NVIC 01-05) entitled, ``Interim 
Guidance for the Development and Review of Response Plans for Nontank 
Vessels.'' This document provides guidance to help vessel owners and 
operators develop plans and receive interim operating authorization 
from the Coast Guard. The publishing of NVIC 01-05 was announced to the 
public and industry by Federal Register Notice.
    On June 24, 2005, the Coast Guard published another Federal 
Register Notice and Request for Comments, concerning Nontank Vessel 
Response Plans (70 FR 36649) which informed the public of issues 
related to this legislation, posed questions on the size of the 
population of vessels affected, discussed Coast Guard efforts to engage 
the regulated community, and informed the owners and operators of 
nontank vessels of the Coast Guard's enforcement policy. The Coast 
Guard is currently reviewing, researching, and answering the comments 
received in response to the Federal Register Notice and Request for 
Comments and is drafting a regulatory work plan.
    As of December 1, 2007, the Coast Guard has received and reviewed 
approximately 2,359 nontank vessel response plans covering 13,306 
nontank vessels. As vessel owners submit their nontank plans, these 
plans are reviewed and 2 year interim operating authorization letters 
are issued. As these interim operating authorization letters expire, 
the Coast Guard reissues new interim operating authorizations based 
upon the vessel owner's certification that the necessary private 
resources needed to respond to a worst case discharge are ensured by 
contract or other approved means, per 33 U.S.C. 1321(j)(5)(D).

Oil Spill Threat
    Nontank vessels pose a threat to the marine environment due to the 
fuel oil capacities of these vessels. Ship fuel, also referred to as 
``bunker'', generally presents a response challenge due to its density 
and inability to break down in the marine environment as fast as 
lighter oils. This is problematic when bunker comes in contact with 
shorelines, marine mammals, birds and environmentally sensitive areas. 
Of the 13,000 nontank vessels in vessel response plan files, 8,364 of 
these vessels are oceangoing freight vessels such as container, 
breakbulk, roll-on/roll-off or bulk cargo ships. The majority of these 
freight vessels have a fuel capacity between 10,000 and 20,000 barrels. 
There are, however, over 360 freight ships with a fuel capacity of 
50,000 barrels or more, and about 100 freight ships with a fuel 
capacity over 70,000 barrels. The highest fuel capacity we have listed 
for a freight ship is over 173,000 barrels. The M/V COSCO BUSAN, with a 
fuel capacity of approximately 52,000 barrels is on the larger side. 
Significant oil spills from nontank vessels over the years have clearly 
identified nontank vessels as an ongoing threat to the marine 
environment. Spills such as the Japanese freighter KUROSHIMA in Summer 
Bay, Alaska in 1997, NEW CARISSA off Coos Bay, Oregon in 1999, the 
SALENDANG AYU off Unalaska Island, Alaska in 2004 and the COSCO BUSAN 
in San Francisco Harbor in 2007 demonstrate the hazard posed by this 
type of vessel.

New Requirements for Oceangoing Freight Ships
    Nontank vessels are vulnerable to spills caused by groundings, 
collisions and allisions due to the location and capacity of onboard 
fuel tanks. Fuel is generally carried in tanks located in the bottom or 
side of the vessels without double hull protection. International oil 
spill prevention and response requirements applicable to oceangoing 
freight ships are based on build date and fuel capacity. These 
requirements address issues such as double hull requirements, 
accidental outflow requirements, and emergency response plans.
    Oceangoing freight vessels are subject to the International 
Convention for the Prevention of Pollution from Ships otherwise 
referred to as MARPOL 73/78. New MARPOL Annex I regulation 12A--Oil 
Fuel Tank Protection has entered into force and applies to all ships (a 
``ship'' means a vessel of any type whatsoever operating in the marine 
environment and includes hydrofoil boats, air-cushion vehicles, 
submersibles, floating craft and fixed or floating platforms) with an 
aggregate oil fuel capacity of 600 cubic meters (this equates to 
approximately 158,500 gallons or 3,775 barrels) and above with a 
building contract on or after 1 August 2007, or which are delivered on 
or after 1 August 2010. The 600 cubic meters applicability threshold 
was established because it generally equates to the MARPOL 600 ton 
deadweight applicability threshold for oil tanker double hull 
requirements in regulation 19. The regulation provides two options for 
the protection of fuel tanks: (1) a prescriptive double hull 
requirement; or (2) a probabilistic accidental oil outflow performance 
requirement. There is an exclusion for small fuel tanks of 30 cubic 
meters or less. OPA 90 requires all new build tank vessels (tank ships 
and barges) that carry oil in bulk to be double hulled. There is no 
bottom limit of how much cargo oils are carried and OPA 90 standards 
are enforced on all tank vessels that operate in the U.S. waters.
    Regulation 37 of Annex I of MARPOL 73/78 requires that each ship 
maintain a Shipboard Oil Pollution Emergency Plan (SOPEP) that 
addresses and mitigates oil spills. There are significant differences 
between SOPEP and Federal Water Pollution Control Act requirements. 
SOPEPs require information in the following areas: spill reporting 
provisions, casualty/spill mitigation procedures, and vital vessel 
information (vessel name, VIN, principal characteristics). FWPCA plans 
require the same information as a SOPEP, but also include more 
stringent requirements including: follow-up report; procedures for 
equipment failure, discharge equipment deployment, internal transfers; 
emergency towing; geographical specific appendices including 
information on Oil Spill Removal Organizations (OSROs); shore-based 
response activities, including use of an ICS or equivalent system; 
identification of spill management team; Salvage and Marine 
Firefighting; lightering provider; Qualified Individual; training; 
exercises; and vessel-specific appendix, including maximum most 
probable and worst case discharge amounts, oil groups carried, tank 
capacities, and specific vessel diagrams.

Adequacy and Enforcement of Vessel Response Plans
    The Coast Guard currently maintains 837 tank vessel response plans 
covering 7,841 vessels and 2,359 nontank vessel response plans covering 
13,306 vessels, both U.S. and foreign flagged. The Coast Guard also 
reviewed and approved 2,594 individual Shipboard Oil Pollution 
Emergency Plans (SOPEPs) for U.S. flag vessels. Additionally, the Coast 
Guard reviewed and approved 570 Shipboard Marine Pollution Emergency 
Plans (SMPEPs) for U.S. flag vessels that carry some form of hazardous 
substance aboard to be in compliance with Regulation 17 of Annex II of 
MARPOL 73/78.

Challenges
    One area of vessel response plan enforcement that has been 
challenging is required transit coverage for vessels operating within 
our Exclusive Economic Zone, but beyond our territorial sea and 
navigable waters jurisdiction. As our maritime domain awareness 
improves with advances in technology, so does our cognizance that there 
are vessels transiting U.S. waters without the required coverage per 
vessel response plan regulations. We are currently examining this issue 
for possible changes in our enforcement practices to address areas in 
the Nation where vessel traffic poses environmental risks and ensure 
the necessary response resources are in place.
    Tank vessel response plans required by the Oil Pollution Act of 
1990, required tank ship owners to ensure the availability of private 
personnel and response resources necessary to respond to a worst case 
discharge including fire and explosion. In the vast majority of U.S. 
ports, oil spill removal organizations, or ``OSROs'' are contracted by 
vessel owners to provide the required resource capacity and spill 
management expertise to respond to worst case discharge scenarios. 
However, in some ports there is far more freight ship traffic than tank 
ship transits. The introduction of nontank vessel response plan 
statutory and regulatory requirements provides for an opportunity to 
increase oil spill response equipment in support of the national 
response plan, especially in remote locations.
    Many states, including Alaska, Washington, Oregon, California and 
Texas passed legislation requiring nontank vessels to have vessel 
response plans. The state requirements are founded upon OPA 90 tank 
vessel response plan requirements, however, there are inconsistencies 
from state to state in applicability and scope and no two states have 
adopted precisely the same requirements. Thus vessels seeking to trade 
between states have to satisfy increasingly disparate requirements 
including maintaining multiple response plans.

Vessel Response Plan Related Rulemaking Projects
    The response plan regime for vessels will change in the future. New 
domestic and international requirements will build on the existing 
response plan foundation to provide an enhanced pollution response 
regime. The Coast Guard has several vessel response plan improvement 
rulemaking projects in various stages of development pertaining to the 
use of dispersants, oil spill tracking, salvage and marine firefighting 
response equipment, implementation and incorporation of International 
Maritime Organization standards into our domestic regulations and the 
development of hazardous substance response plans for vessels and 
facilities. The following is a list of related rulemaking projects:

          Title: Vessel and Facility Response Plans for Oil: 2003 
        Removal Equipment Requirements and Alternative Technology 
        Revisions.
          Docket Number: USCG-2001-8661.
          Summary: The Coast Guard proposes changes to its requirements 
        for oil-spill removal equipment under vessel response plans and 
        marine transportation-related facility response plans. These 
        changes increase the minimum available spill removal equipment 
        required for tank vessels and facilities, add requirements for 
        new response technologies, and clarify methods and procedures 
        for responding to oil spills in coastal waters.
          Status: A Notice of Proposed Rulemaking (NPRM) was published 
        on October 11, 2002 (67 FR 63331). A Final Rule is expected in 
        the near future.

          Title: Salvage and Marine Firefighting Requirements; Vessel 
        Response Plans for Oil.
          Docket Number: USCG-1998-3417.
          Summary: The Coast Guard proposes to revise the vessel 
        response plan salvage and marine firefighting requirements for 
        tank vessels carrying oil. These revisions clarify the salvage 
        and marine firefighting services that must be identified in 
        vessel response plans. The proposed changes will assure the 
        appropriate salvage and marine firefighting resources are 
        identified and available for responding to incidents up to and 
        including the worst-case scenario. The proposed rulemaking will 
        also set new response time requirements for each of the 
        required salvage and marine firefighting services.
          Status: An NPRM was published on May 10, 2002 (67 FR 31868).

          Title: Nontank Vessel Response Plans.
          Summary: The Coast Guard will implement a statutory 
        requirement that an owner or operator of a self-propelled, 
        nontank vessel of 400 gross tons or greater, which operates on 
        the navigable waters of the United States, must prepare and 
        submit an oil spill response plan to the Coast Guard. The 
        rulemaking will specify the content of a response plan, 
        including the requirement to plan for responding to a worst-
        case discharge and a substantial threat of such a discharge. 
        The rulemaking will also specify the procedures for submitting 
        a plan to the Coast Guard.
          Status: To provide guidance to industry, a Navigation and 
        Vessel Inspection Circular (NVIC) was published on February 4, 
        2005. NVIC 01-05 is titled ``Interim Guidance for the 
        Development and Review of Response Plans for Nontank Vessels.'' 
        Change One to NVIC 01-05 was published on January 13, 2006. The 
        work plan for this rulemaking is being finalized.

          Title: Tank Vessel Response Plans for Hazardous Substances.
          Docket Number: USCG-1998-4354.
          Summary: The Coast Guard proposes regulations requiring 
        response plans for certain tank vessels operating on the 
        navigable waters of the United States that could reasonably be 
        expected to cause substantial or significant and substantial 
        harm to the environment by discharging a hazardous substance. 
        These regulations are mandated by the Oil Pollution Act of 1990 
        (OPA 90), which requires the President to issue regulations 
        requiring the preparation of hazardous substance response 
        plans. The primary purpose of requiring response plans is to 
        minimize the impact of a discharge of hazardous substances into 
        the navigable waters of the United States.
          Status: An NPRM was published on March 22, 1999 (64 FR 
        13734).

Adequacy of Nontank Vessel OPA Liability Limits
    While OPA liability limits for vessels were increased significantly 
under the Coast Guard and Maritime Transportation Act of 2006, further 
increases should be considered including increases for nontank vessels.
    The Secretary addressed the adequacy of nontank vessel OPA 
liability limits in a January 5, 2007, report to Congress on vessel 
liability limits in general pursuant to section 603(c) of the CG&MT Act 
of 2006. The first annual update of the report was provided to Congress 
on October 10, 2007.
    As updated, the limited data available indicates that increasing 
liability limits per incident for single hull tank ships, tank barges 
and nontank vessels greater than 300 gross tons in particular would 
result in a more balanced cost share between responsible parties and 
the Oil Spill Liability Trust Fund while positively impacting the Fund 
balance.
    OPA 90 provides for exceptions from limits when, for example, the 
incident is caused by gross negligence, willful misconduct or a 
violation of a Federal safety, operating or construction regulation by 
a responsible party, its agents, employees or contractors.

Oil Spill Prevention, Preparedness, and Research and Development in a 
        Post-9/11 World
    Oil spill prevention and response is a very important function of 
the Coast Guard. The model set forth by Area Committees and the Area 
Contingency Plan process provided a valuable framework for the creation 
of Area Maritime Security Committees and Area Maritime Security Plans. 
Coast Guard oil spill response continues to serve as a model for all 
hazards response in the maritime domain. We strive to leverage our 
partnerships with the maritime industry, Federal, state, and local 
agencies, and Congress to ensure our nations ports waterways operate 
safely, securely, and in a manner that protects our environment. The 
shared goal in preventing or responding to major maritime incidents, 
regardless of the cause, is the same, to save lives, preserve property, 
protect the environment and minimize disruption to the marine 
transportation system.
    The Coast Guard continues to conduct regular, rigorous, oil spill 
exercises, inspect ships and facilities for safety and environmental 
compliance, and participate in a host of prevention, planning and 
preparedness activities related to environmental protection and 
response. We are absolutely committed to the environmental protection 
mission and recognize its importance to the public good. The 
environmental protection mission is part of the well-balance portfolio 
the Coast Guard maintains to ensure our nations ports and waterways 
remain safe, secure, and clean.
    Thank you for the opportunity to testify before you today. I will 
be happy to answer any questions you may have.

    Senator Cantwell. Thank you, Admiral Allen. Thank you for 
your testimony. We will put the whole thing in the record. And 
let's to turn Ms. Glackin. Thank you for being here.

           STATEMENT OF MARY M. GLACKIN, DEPUTY UNDER

        SECRETARY OF COMMERCE FOR OCEANS AND ATMOSPHERE,

        NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION,

                  U.S. DEPARTMENT OF COMMERCE

    Ms. Glackin. Good afternoon, Chairman Cantwell, Ranking 
Member Snowe, and members of the Committee. I appreciate----
    Senator Cantwell. If you could just pull that microphone a 
little closer to you. Thank you.
    Ms. Glackin. OK, great. Is that better? OK. I appreciate 
the opportunity to join you this afternoon. As the Chairman 
said earlier, I'm Mary Glackin, the Deputy Under Secretary of 
Commerce for Oceans and Atmosphere at NOAA. And I wanted to 
take this opportunity to highlight some of the aspects of my 
written testimony about NOAA's many roles in preventing and 
responding to oil spills, as well as the importance of research 
and development to both of those activities.
    Each year, our nation's ports handle approximately 44 
percent of the U.S. international merchandise trade by value. 
On any given day, a variety of vessels, including tankers and 
container ships, carry oil and other goods to their 
destinations. Whenever these vessels travel, they pose a threat 
of oil spills. And it's been pointed out here today, prevention 
is key to this, and one of the key parts of prevention is 
promoting safe marine transportation. Once a spill does occur, 
we must act quickly and effectively to mitigate any harmful 
effects and restore injured resources. To do this, we must 
continue to be prepared for spills and have adequate response 
capabilities.
    I'll speak first of NOAA's role in prevention. The most 
effective way to protect the marine environment is to prevent a 
maritime accident from ever occurring. One role that NOAA plays 
that is key in spill prevention is to provide accurate and 
timely information to mariners through nautical charts. These 
charts are the roadmaps that provide the mariners with the lay 
of the land and delineate important information required for 
vessel safety. Toward that end, NOAA is building a suite of 
Electronic Navigational Charts, and these charts, along with 
global positioning and real-time water levels, current and 
weather data, provide a safe and profitable waterway system.
    To further improve tools for prevention, NOAA is also 
updating the hydrographic data on its charts, using surveys and 
the latest technologies. These updates can prevent accidents by 
exposing previously undetected hazards. The data collected also 
supports spill response trajectory models and coastal 
management efforts.
    And finally, under prevention, NOAA's Physical 
Oceanographic Real Time System or PORTS Program provides real-
time oceanographic and meteorological data at key locations. 
This information provides mariners and port authorities with an 
awareness of the current water levels and weather, which is 
important to prevent groundings. It allows mariners the time 
they need to anticipate the need for difficult maneuvers.
    Shifting to NOAA's role in response, when an oil spill 
occurs, Federal, state, and local agencies across the country 
call on NOAA to help in a response. NOAA's suite of scientific 
products and services, and the expertise of our personnel, are 
critical in mitigating harm. They are also critical in 
providing response information, restoring natural resources, 
and making science-based decisions. During an oil spill, NOAA's 
Office of Response and Restoration provides scientific support 
services, such as overflight observations, identification of 
sensitive environmental areas, and we also provide shoreline 
surveys, toxicity assessments, and the evaluation of cleanup 
alternatives.
    NOAA is also responsible for providing real-time ocean and 
coastal observations to determine the location and the 
trajectory of an oil spill. NOAA's Integrated Ocean Observing 
System program is working to increase the availability and the 
compatibility of this data among all oil spill response 
partners.
    Response training and exercises are also essential to 
maintain capabilities. NOAA has aided in the response to the 
COSCO BUSAN spill by a major field exercise called NOAA Safe 
Seas that we conducted in the San Francisco Bay area in 2006. 
Safe Seas has allowed us to train hundreds of regional staff 
and Beach Watch volunteers in various aspects of response, and 
to test response protocols. Although there is a high level of 
interest in supporting a similar training exercise in the 
Northwest, we have been unable to support such an effort at 
current funding levels.
    After an initial response to an oil spill, NOAA develops a 
restoration plan through the Natural Resource Damage Assessment 
Process. Within this process, NOAA experts determine how to 
best restore injured resources. We'll also ascertain the most 
appropriate restoration products that will compensate the 
public for lost services.
    As I mentioned earlier, research is critical to improving 
oil spill preparedness, response, and restoration. One focus of 
our oil spill research is our partnership with the Coastal 
Response and Research Center at the University of New 
Hampshire. This partnership stimulates innovation in spill 
preparedness response and damage assessment. In the past 
several years, oil spill research has focused on improving 
spill models and studying the effects of released oil on 
affected species. We're also focusing on human dimensions.
    So in conclusion, I'll just mention that I think you'll 
agree that NOAA's expertise is a critical component in 
preventing further incidents, restoring the adverse effects on 
natural resources, and aid in planning and responding. I'd be 
happy to respond to any questions the Committee has.
    [The prepared statement of Ms. Glackin follows:]

   Prepared Statement of Mary M. Glackin, Deputy Under Secretary of 
 Commerce for Oceans and Atmosphere, National Oceanic and Atmospheric 
              Administration, U.S. Department of Commerce

    Good afternoon, Chairman Cantwell, Ranking Member Snowe, and 
Members of the Committee. Thank you for the opportunity to join you 
today. I am Mary Glackin, Deputy Under Secretary of Commerce for Oceans 
and Atmosphere, within the National Oceanic and Atmospheric 
Administration (NOAA). I will be discussing NOAA's role in preventing 
oil spills, our role in spill response, and the importance of research 
and development for both. I will also highlight three examples of non-
tanker vessel spills where NOAA assisted in the response efforts.
Overview
    Our marine transportation system is an intrinsic part of the U.S. 
economy. According to a recent report from the Bureau of Transportation 
Statistics, our marine transportation system conveys as much as 78 
percent of U.S. international merchandise trade by weight and 44 
percent by value through our Nation's ports each year, far more than 
the other transportation modes. On any given day, as part of this 
system, vessels that contain large quantities of fuel oil travel 
through our waterways to their destinations. These vessels include not 
only oil tankers but also container ships, fishing vessels, ferries, 
and other public and private vessels. Wherever these vessels travel, 
their daily transits pose a threat of oil spills. Over the past fifty 
years, ships have doubled in length, width, and draft, and seagoing 
commerce has tripled. The Department of Transportation projects that by 
2020 the volume of marine trade will more than double, particularly in 
international container traffic..
    Despite this increase in vessel traffic and size, the number of oil 
spills in U.S. coastal waters has declined in the two decades since the 
EXXON VALDEZ oil spill. However, the SELENDANG AYU, KUROSHIMA, and SS 
CAPE MOHICAN vessel spills, along with the recent COSCO BUSAN incident, 
serve as reminders that oil spills still happen.
    When oil spills into our coastal waters, it can harm people and the 
environment and cause widespread economic effects. The best remedy is 
to prevent oil spills by promoting safe marine transportation. Once a 
spill occurs, we must act quickly and effectively to mitigate any 
harmful effects and restore injured resources. To ensure a quick and 
effective response, we must continue to be prepared for spills by 
having adequate response capacity and capabilities on hand.
    Response training and exercises are essential to maintaining 
capabilities. Together with the U.S. Coast Guard, the State of 
California, and the Department of the Interior, NOAA conducted a major 
field exercise called NOAA Safe Seas 2006 in the San Francisco Bay area 
in the summer of 2006. Safe Seas allowed us to train hundreds of 
regional staff and Beach Watch volunteers in various aspects of oil 
spill response, and to test the response protocols that would be used 
for a real spill. This exercise reinforces the value of our efforts to 
develop improved capabilities, maintain our capacity, and continue 
response-related research and development efforts for a timely and 
effective response. Due to this exercise, NOAA was able to integrate 
high frequency radar and other data from the Central and Northern 
California Integrated Ocean Observing System into pollution trajectory 
models. Local NOAA personnel and other responders received specific 
capability training that allowed them to function more efficiently 
within the Command Post and in the field during the response to the 
recent COSCO BUSAN oil spill.

NOAA's Role in Prevention
    It is critical to both the Nation's economy and the coastal 
environment that the marine transportation system continues to function 
safely and efficiently as its use grows. The most effective way to 
protect the marine environment is to prevent the maritime accident from 
ever occurring. NOAA plays a vital role in spill prevention by 
providing accurate and timely information to mariners.
    Nautical charts, the mariner's most basic tool, are the `road maps' 
that provide the mariner with the overall `lay of the land' and 
delineate the fundamental information required for the vessel to safely 
navigate the coastline. NOAA is building and maintaining a suite of 
Electronic Navigational Charts (ENCs) to fuel electronic navigation 
systems that can also integrate a variety of environmental data. 
Funding to complete this suite, for full coverage of U.S. waters, is 
included in the FY 2008 President's Budget Request. NOAA is also 
updating the hydrographic data on its nautical charts by surveying with 
the latest full bottom coverage technologies. Much of the 3.4 million 
square nautical miles (nmi2) depicted on these charts were 
collected prior to 1940 with obsolete methods. NOAA has prioritized 
500,000 nmi2 of this area as navigationally significant, and 
is able to survey approximately 3,000 nmi2 a year using 
state-of-the-art technology. Not only do these updates show changes in 
coastal bathymetry, but more importantly, they can prevent maritime 
accidents by exposing previously undetected hazards to navigation. The 
data collected also support scientific uses, spill response trajectory 
models, and other coastal and emergency management efforts.
    Even the most accurate nautical chart cannot help the mariner if 
the vessel's location is not known with certainty. Determining a 
vessel's precise position has been a challenge to mariners for 
centuries. With the advent of the Global Positioning System (GPS), it 
has become possible for mariners to determine their position to within 
meters. NOAA's development and implementation of the Continuous 
Operating Reference System program enables even more precise 
applications of GPS.
    Mariners have traditionally relied on astronomically predicted 
water level and current information to prevent groundings and 
anticipate where difficult maneuvers might be required. However, 
weather and other factors can cause actual conditions to deviate 
significantly from predictions, misleading the mariner, and increasing 
the risk of an accident. NOAA's Physical Oceanographic Real Time System 
(PORTS') program provides real time oceanographic and 
meteorological data at key locations that provides mariners with a 
situational awareness of their operating environment that can help 
avoid accidents. The 14th PORTS' was just established in 
Mobile, Alabama and we are working with the USCG to integrate 
PORTS' data into its Automated Identification System. Two 
different NOAA-funded reports studying the economic impacts of 
PORTS' in Florida and Texas have documented that ports with 
established PORTS' have an over 50 percent reduction in 
groundings (both reports available at http://tidesandcurrents.noaa.gov/
pub.html).
    In addition to PORTS', NOAA's National Marine Sanctuary 
Program has taken steps to address a number of vessel traffic measures 
with the International Maritime Organization, including offshore 
routing measures, reporting measures, Areas to be Avoided (ATBA's), 
Particularly Sensitive Sea Areas and No-Anchoring Areas. These areas, 
including the voluntary ATBA off the Olympic Coast of Washington State 
and the mandatory ATBA off the Florida Keys, have provided additional 
protection for the National Marine Sanctuaries. Off the Olympic Coast, 
NOAA is working with both the U.S. and Canadian Coast Guard to address 
vessels that have been identified as non-compliant; current compliance 
rates are greater than 97 percent over the last 2 years.

NOAA's Role in Response
    Federal, state, and local agencies across the country call on 
NOAA's scientific support when an oil spill occurs. NOAA's suite of 
scientific products and services and the expertise of our personnel are 
critical in mitigating harm, providing critical information for 
allocation of response assets, restoring adversely affected natural 
resources, and making smarter response decisions through the 
application of science. Under the Oil Pollution Act of 1990 (OPA), the 
National Contingency Plan, and the National Marine Sanctuaries Act, 
when an oil spill happens, NOAA is responsible for:

   Providing scientific support to the Federal On-Scene 
        Coordinator, whether the FOSC is EPA or USCG;

   Representing the Department of Commerce on the National and 
        Regional Response Teams;

   Working with our Federal and state co-trustees to assess and 
        restore injured natural resources and the services they 
        provide;

   Fulfilling responsibilities to protect resources when a 
        National Marine Sanctuary is affected; and

   Participating on the Interagency Coordinating Committee on 
        Oil Pollution Research, which coordinates research and 
        development efforts among industry, universities, and others.

    During an oil spill, NOAA's Office of Response and Restoration 
provides scientific support services such as trajectory predictions, 
overflight observations, identification of sensitive environmental 
areas, shoreline surveys, toxicity assessment, and evaluation of 
cleanup alternatives. The Emergency Response Division is charged with 
developing all of NOAA's response models and tools, conducting planning 
in U.S. coastal areas and the Great Lakes, maintaining a 24/7 
notification system, and responding to more than 100 hazardous material 
release notifications each year.
    The NOAA Scientific Support Coordinator (SSC) is the key player in 
the NOAA effort to provide scientific support to an oil spill response. 
Nine SSCs are located around the country, in USCG Districts, to respond 
around the clock to any emergencies involving the release of oil or 
hazardous materials into the oceans or atmosphere. The SSC is supported 
by a diverse group of scientists in Seattle, WA, who are experienced in 
dealing with spill response. The SSC also coordinates access to all of 
NOAA's capabilities including: spot weather forecasts, emergency 
coastal survey and charting capabilities, aerial and satellite imagery, 
and real-time coastal ocean observation data to assist response 
efforts.
    During the COSCO BUSAN oil spill, NOAA's Office of Response and 
Restoration deployed seven people to the spill site to carry out 
overflights, coordinate beach surveys, develop cleanup standards and 
protocols, evaluate risks and effects to natural resources, and 
otherwise support the Federal On-Scene Coordinator. In addition, NOAA 
provided four technical experts in trajectory modeling, toxicity 
assessment, and other specialties to support the response 7 days a week 
from Seattle, WA. NOAA also provided over 30 personnel from the 
National Marine Sanctuary Program and coordinated 90 volunteers (Beach 
Watch) that were trained in the Safe Seas 2006 exercise. The Safe Seas 
exercise improved the capability of NOAA staff and volunteers to 
provide expertise to the Command Post in Liaison, the Environmental 
Unit, Wildlife Operations and the Joint Information Center as well as 
Natural Resource Damage Assessment Activities, in response to the 
recent COSCO BUSAN spill.
    During a coastal oil spill event, NOAA is also responsible for 
providing real-time ocean and coastal observations to our Hazardous 
Materials (HAZMAT) teams and to the USCG to determine the location and 
trajectory of an oil spill. Currently, there is no easy or centralized 
access to the thousands of high frequency radar surface current 
measurements, which are critical for pollution tracking and response 
planning. NOAA HAZMAT staff must contact individual radar operators for 
data. In addition, the data are not compatible from site to site and 
may have gaps in space and time. NOAA's Integrated Ocean Observing 
System program is working to increase availability and compatibility of 
these data, in partnership with regional data providers, through the 
development of common data standards and access points.
    Effective spill response also depends on effective planning and 
preparation. NOAA promotes preparedness by working closely with 
regional response teams and local area committees to develop policies 
on dispersant use, best cleanup practices, communications, and ensuring 
access to science-related resources, data and expertise. In addition, 
NOAA enhances the state of readiness by conducting training for the 
response community to develop better response tools including 
trajectory models, fate models, and integrating improved weather and 
ocean observing systems data into spill trajectory forecasts.

NOAA's Role in Damage Assessment and Restoration
    Oil spills may also diminish the services that natural resources 
provide us, such as fishing, boating, beach going, and wildlife 
viewing, as well as ecological services, such as providing habitat, 
nutrient cycling, and energy transfer through food webs.
    As an agency with Federal trustee responsibilities for many marine 
resources, NOAA seeks, pursuant to OPA, restoration of ocean and 
coastal resources that are harmed by an oil spill. NOAA's trust 
resources include: commercial and recreational fisheries, anadromous 
fish, selected endangered and threatened marine species, selected 
marine mammals, wetlands, mangroves, seagrass beds, coral reefs, and 
other coastal habitats, all resources associated with National Marine 
Sanctuaries and National Estuarine Research Reserves. Restoration is 
accomplished through the Natural Resource Damage Assessment (NRDA) 
process--by assessing injuries, developing a restoration plan that is 
subject to public review, and presenting a claim for restoration costs 
to the responsible party. If the responsible party does not pay the 
claim, the trustees may litigate or file a claim for restoration costs 
with the Oil Spill Liability Trust Fund.
    For incidents occurring in, or creating a significant threat to, a 
National Marine Sanctuary, the National Marine Sanctuaries Act (NMSA) 
provides jurisdictional authority. The NMSA prohibits destroying, 
causing the loss of, or injuring any sanctuary resource managed under 
the statute or regulations for that sanctuary. Thus, during an oil 
spill or any other emergency response incident, NOAA's National Marine 
Sanctuary Program has responsibility under the NMSA and the National 
Contingency Plan for addressing threats and injuries to Sanctuary 
resources. Possible response roles for the Program include 
participating:

   As a jurisdictional authority providing resources in direct 
        support of response operations;

   As a trustee agency assisting in response decisions in order 
        to reduce the environmental consequences of the spill and 
        response actions; and

   As a trustee participating in NRDA activities.

    Natural resource trustees typically work together as a coordinated 
group, often with representatives of the responsible party in a 
cooperative process. NOAA scientists and economists work with other 
Federal and state trustees and responsible parties to ensure that 
coastal and marine resources injured by oil spills are restored.
    NOAA and other natural resource trustees are responsible for two 
types of restoration: primary and compensatory. To fulfill these 
responsibilities, they pursue restoration projects that satisfy the OPA 
goal of restoring natural resources and services to pre-incident 
conditions (primary restoration) and compensating the public for 
interim losses resulting from the injury (compensatory restoration).
    NOAA scientists and economists provide the technical foundation for 
natural resource damage assessments and work with other trustees and 
responsible parties to restore resources injured by oil spills. To 
accomplish this effort NOAA experts collect data, conduct studies, and 
perform analyses needed to determine whether and to what degree coastal 
resources have sustained injury from oil spills. NOAA experts determine 
how best to restore injured resources and to ascertain the most 
appropriate restoration projects to compensate the public for 
associated lost services.
    NOAA has long been interested in looking at alternative ways to 
expedite restoration and cut process costs for natural resource damage 
assessment. One alternative is a cooperative assessment in which the 
responsible party plays a major role with the natural resource 
trustees. Based on NOAA's successful experiences in cooperative 
assessments, NOAA is promoting this approach through national and 
regional dialogues. The intent is to expedite restoration, encourage 
innovative approaches, strengthen partnerships, and provide meaningful 
public involvement. Cooperative assessments offer industry the 
opportunity for a greater role and more control over the timing of 
restoration actions without undermining the natural resource trustee 
responsibilities. This approach also reduces damage assessment costs 
and the risk and costs associated with litigation.

NOAA's Oil Spill Research Role
    Even though the number of large spills from vessels has decreased 
over the last decade, when a spill occurs, we still want to mount the 
best response that science and technology can provide. Oil spill 
research and development is critical to improving the effectiveness of 
oil spill preparedness, response, and restoration.
    NOAA's oil spill research is conducted through NOAA's partnership 
with the Coastal Response Research Center (CRRC) at the University of 
New Hampshire, which was created in 2004. This partnership combines the 
strength of NOAA's spill response staff and the University of New 
Hampshire's research abilities and academic affiliations, and 
stimulates innovation in spill preparedness, response and damage 
assessment. In 2005, NOAA and CRRC supported a report published by the 
National Academy of Sciences entitled Oil Spill Dispersants: Efficacy 
and Effects. Since then NOAA, through CRRC, has funded studies to 
improve decision-making capabilities for dispersant use, and has 
galvanized the national and international spill communities to 
collaborate on dispersant research to minimize duplication of efforts 
and maximize resources. NOAA and CRRC are working to improve predictive 
and response capabilities for oil spills in cold-water environments 
through national and international collaborations. Additionally, NOAA 
and CRRC continue to sponsor workshops to address pressing issues in 
oil spill response, including the use of dispersants, submerged oil, 
human dimensions of spills, habitat equivalency analysis metrics, and 
integrated modeling. NOAA and CRRC work with partner agencies and 
industry to examine the benefits/costs with in situ burning in coastal 
marshes, and communicate how to use the technology to minimize further 
injury to resources. NOAA also works with the U.S. Coast Guard and 
other members of the Regional Response Teams during Ecological Risk 
Assessments, where multiple stakeholders analyze environmental 
tradeoffs with the range of response options for spill events within a 
region. This information is then included into contingency plans, and 
informs research and technology agendas.
    In the past several years NOAA's oil spill research has focused on 
improvements to spill modeling that are essential to predicting where 
oil will go in the environment; exposure and effects of the released 
oil on sensitive and economically-important species; methods to improve 
environmental recovery and restoration; and the human dimensions of 
spills (e.g., social issues, community effects, risk communication 
methods, valuation of natural resources, etc.) that affect decision-
making.

Examples of Response, Restoration, and Research at Work
M/V SELENDANG AYU
    On December 7-8, 2004, the cargo vessel M/V SELENDANG AYU lost 
power, ran aground and broke in half on the shore of Unalaska Island, 
Alaska, losing her 60,000 ton cargo of soybeans and spilling 
approximately 335,000 gallons of fuel oil. During the initial response, 
NOAA participated in aerial observations and mapping of floating and 
beached oil, as well as provided on-scene weather information, 
including the establishment of an emergency remote weather station and 
the provision of a dedicated on-scene meteorologist. To give an example 
of the difficult nature of the work involved, a heavy-lift helicopter 
was used to remove 140,000 gallons of fuel remaining on the wreck by 
transporting seventy, 2,000-gallon fuel canisters, one at a time, 
through the mountains, 25 miles to Dutch Harbor. Without accurate, up 
to date, spot-specific forecasts, it would not have been possible to 
safely conduct this complicated operation in such an extreme climate.
    The SSC provided input on environmental issues to the Unified 
Command, including technical matters related to potential dispersant 
use. The SSC and Scientific Support Team reviewed satellite data and 
remote sensing information and assisted the USCG in prioritizing search 
areas for the flight recorder from a downed helicopter. NOAA 
participated in shoreline and aerial surveys and helped prepare a 
comprehensive map of shoreline contamination. NOAA also worked with the 
USCG, the Department of the Interior, and the State of Alaska to 
monitor cleanup operations and determine the potential trade-offs in 
using one cleanup technique versus another.
    The Port of Dutch Harbor on Unalaska Island is the largest fishing 
port in the United States and the largest Alaskan Native subsistence 
community in the Aleutians. NOAA, U.S. Fish and Wildlife Service, and 
the State of Alaska worked with the local community to address 
subsistence and seafood safety concerns. Any real or perceived 
contamination of fisheries products with oil had the potential to 
disrupt both the local community and worldwide markets. With a 
combination of trajectory analysis and experience from other large 
spills, NOAA was able to provide valuable assistance to the Seafood 
Safety Task Force.
    NOAA continues to work with the other natural resource trustees 
(U.S. Fish and Wildlife Service and the State of Alaska) and the 
responsible party to conduct a natural resource damage assessment. The 
parties are assessing injury to natural resources and beginning to 
evaluate restoration alternatives. Public meetings already have been 
held to solicit local input on potential restoration alternatives, and 
NOAA is committed to providing the public with up to date information 
and meaningful opportunities for review and comment during the damage 
assessment and restoration planning process.

M/V KUROSHIMA
    On November 26, 1997, the M/V KUROSHIMA, a 370-foot refrigerated 
cargo vessel owned by Kuroshima Shipping, S.A., broke away from its 
anchorage in Summer Bay on Unalaska Island, near Dutch Harbor, Alaska. 
While the vessel was attempting to move to a safer anchorage, winds 
reported to be in excess of 100 knots blew the freighter into Second 
Priest Rock, damaging several of the vessel's fuel tanks. The vessel 
subsequently ran aground on the shore of Summer Bay. Two crewmen were 
killed in the incident and approximately 39,000 gallons of heavy fuel 
oil were spilled.
    The SSC provided input to the Unified Command as well as technical 
support in identifying the extent of the oiled areas. NOAA also 
provided shoreline mapping, trajectory and overflight information. NOAA 
led a multi-agency shoreline cleanup assessment team to survey the 
impacted areas and prepare detailed cleanup instructions. Although the 
response was curtailed several times due to poor weather conditions, 
the cleanup was officially completed in July 1998.

SS CAPE MOHICAN
    On October 28, 1996, the military reserve vessel SS CAPE MOHICAN 
spilled an estimated 96,000 gallons of intermediate fuel oil (IFO 180) 
into a dry dock structure. Approximately 40,000 gallons of fuel escaped 
into the San Francisco Bay at Pier 70. The spill occurred during 
routine maintenance when an opened valve discharged stored fuel while 
oil was being transferred from a stabilization tank. The oil affected 
many sensitive and highly valued natural resources including the Gulf 
of the Farallones and Monterey Bay National Marine Sanctuaries, as well 
as historical parks and sites, beaches, and wetlands, and migratory 
birds under Department of the Interior trusteeship. The spill resulted 
in physical fouling of artificial structures (e.g., pier pilings, rip 
rap, and seawalls), sand and gravel beaches, rocky intertidal habitat, 
kelp beds, mudflats, and wetlands. The spill also caused closures of 
recreation areas and oiling of marinas and vessels, including historic 
ships.
    The SSC and NOAA Scientific Support Team provided technical support 
including trajectory and mapping information, resources at risk 
assessments, overflight observations and shoreline assessments. NOAA 
worked with the Department of the Interior and the State of California 
to develop a restoration plan addressing five resource categories 
impacted by the spill: birds, fisheries and water quality, wetland 
habitat, sandy shoreline and rocky intertidal habitats, and lost and 
diminished human use.

Conclusion
    Thank you for the opportunity to discuss with you NOAA's important 
role in oil spill preparedness, response, and restoration. NOAA's 
expertise is critical to prevent further harm, restore adverse effects 
on natural resources, and aid planning and response decision-making 
associated with oil spills. I am happy to answer any questions that you 
may have.

    Senator Cantwell. Thank you, Ms. Glackin. Ms. Fleming? 
Thank you for being here.

            STATEMENT OF SUSAN A. FLEMING, DIRECTOR,

                PHYSICAL INFRASTRUCTURE ISSUES,

             U.S. GOVERNMENT ACCOUNTABILITY OFFICE

    Ms. Fleming. Thank you. Madam Chair, Ranking Member Snowe, 
and members of the Subcommittee, thank you for the opportunity 
to discuss the cost of major oil spills. As the recent accident 
in the San Francisco Bay illustrates, the potential for oil 
spills exists daily across coastal and inland waters of the 
United States. This accident also shows that the potential 
extends well beyond vessels involved in the petroleum industry. 
Cargo, fishing, and other types of vessels also carry 
substantial fuel reserves. Accidents can release this fuel and 
create significant damage. Spills can be expensive, with 
considerable costs to the Federal Government and the private 
sector.
    My testimony today has two parts: The number of major oil 
spills since 1990 and the costs; and second, the factors that 
affect major oil spill costs. First, we estimate that since 
1990, there have been 51 oil spills that have had removal costs 
and damage claims totaling at least a million dollars. 
Responsible parties and the Federal Oil Spill Liability Trust 
Fund have spent between $860 million and $1.1 billion to clean 
up these spills and compensate affected parties. Responsible 
parties paid about 75 percent of these costs; the fund has paid 
the remainder. Since removal costs and damage claims may 
stretch out over many years, the cost of these spills could 
rise.
    I'll now go into a little more detail on the 51 spills. 
These spills, which constitute about 2 percent of all vessel 
spills since 1990, vary greatly from year to year and number in 
costs, and show no discernable trends in frequency, size, or 
type of vessel. They also occurred in a variety of locations, 
on the Atlantic, Gulf, and Pacific coasts, and in open coastal 
waters, and more confined waterways.
    Moving on to my second point, there are three main factors 
that affect the cost of a spill, according to industry experts, 
agency officials, and the studies we reviewed.
    The first factor is the spill's location. Spills that occur 
in remote areas, for example, can increase costs involved in 
mobilizing responders and equipment. Similarly, a spill that 
occurs close to shore, rather than further out at sea, can 
become more expensive because it may involve the use of manual 
labor to remove oil from sensitive shoreline habitats.
    The second factor affecting cost is the time of year the 
spill occurs. A spill at one time of year might be more costly 
than a spill in the same place, but at a different time of 
year. For example, a spill occurring during tourist or fishing 
season might produce substantial compensation claims, while the 
same spill at another time of year might not.
    The third factor affecting costs is the type of oil 
spilled. Fuels, like gasoline, may dissipate quickly, but if 
they do not, they are extremely toxic to fish and plants. Crude 
oil is less toxic, but it doesn't dissipate quickly, and harms 
wildlife if it coats their bodies or if they ingest it, and 
it's much harder to clean up. No single factor clearly predicts 
a spill's cost. The 51 major spills we identified occurred in 
many different types of locations, across all seasons, and with 
all major types of oil. In each case, the three factors came 
together in unique ways to affect the spill's overall cost. 
Although the costs of the San Francisco spill are not fully 
known at this point, location and oil type will again likely 
have an impact.
    In conclusion, major oil spills are rare, but the risk of 
such spills exists daily. Further, spills are expensive, with 
significant cost to the Federal Government, the private sector, 
the environment, the economy, and the public at large. It is 
therefore critical that we do not become complacent in our 
preparedness efforts. Madam Chair, this concludes my statement. 
I will be pleased to answer any questions you, or members of 
the Subcommittee might have.
    [The prepared statement of Ms. Fleming follows:]

      Prepared Statement of Susan A. Fleming, Director, Physical 
      Infrastructure Issues, U.S. Government Accountability Office
    Madam Chair and Members of the Subcommittee:

    We appreciate the opportunity to be here today to discuss the costs 
of major oil spills. As the recent accident in San Francisco Bay 
illustrates, the potential for an oil spill exists daily across coastal 
and inland waters of the United States. Specifically, on November 7, 
2007, a cargo ship leaving the Port of Oakland struck the San 
Francisco-Oakland Bay Bridge, tearing the hull of the ship. As a 
result, over 50,000 gallons of heavy oil spilled into the bay.\1\ The 
total cost of cleaning up the spill, as well as the damage to marine 
wildlife and fisheries is still undetermined. As this spill also 
illustrates, the potential for costly spills is present for vessels 
other than tankers and tank barges involved in the petroleum industry. 
Cargo, fishing, and other types of vessels also carry substantial fuel 
reserves and accidents can release this fuel and create substantial 
damage. Spills can be expensive, with considerable costs to the Federal 
Government and the private sector.
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    \1\ As of December 4, 2007, about 20,000 gallons of oil had been 
recovered.
---------------------------------------------------------------------------
    The framework for addressing and paying for maritime oil spills is 
identified in the Oil Pollution Act of 1990 (OPA), which was enacted 
after the EXXON VALDEZ spill. OPA created a ``polluter pays'' system 
that places the primary burden of liability and the costs of oil spills 
on the vessel owner or operator who was responsible for the spill--that 
is, the responsible party. However, there are financial limitations on 
that liability. Under this system, the responsible party assumes, up to 
a specified limit, the burden of paying for spill costs--which can 
include both removal costs (cleaning up the spill) and damage claims 
(restoring the environment and payment of compensation to parties that 
were economically harmed by the spill). Above the specified limit, the 
responsible party is no longer financially liable.\2\ To pay costs 
above the limit of liability, as well as to pay costs when a 
responsible party does not pay or cannot be identified, OPA authorized 
the Oil Spill Liability Trust Fund (Fund), which is financed primarily 
from a per-barrel tax on petroleum products either produced in the 
United States or imported from other countries. The Fund is 
administered by the National Pollution Funds Center (NPFC) within the 
U.S. Coast Guard. The balance in the Fund--about $600 million at the 
end of Fiscal Year 2006--is well below its peak of $1.2 billion in 
2000. The decline in the Fund's balance primarily reflects an 
expiration of the barrel tax on petroleum in 1994. The tax was not 
reinstated until 2005.
---------------------------------------------------------------------------
    \2\ Responsible parties are liable without limit, however, if the 
oil discharge is the result of gross negligence, or a violation of 
Federal operation, safety, and construction regulations.
---------------------------------------------------------------------------
    While this system is well understood, the costs involved in 
responding to oil spills are less clear. Costs paid from the Fund are 
well documented, but the party responsible for the spill is not 
required to report the costs it incurs. As a result, private-sector and 
total costs for cleaning up spills and paying damages are largely 
unknown to the public. The lack of information about the cost of 
spills, the declining Fund balance, and significant claims made on the 
Fund--for spills in which the removal costs and damage claims have 
exceeded established OPA liability limits--have all raised concerns 
about the Fund's long-term viability.
    Although we have not assessed the November 2007 San Francisco oil 
spill in depth, we have done considerable work looking at the cost of 
major spills in recent years and the factors that contribute to making 
spills particularly expensive to clean up and mitigate. My remarks 
today are intended to provide a context for looking at the Nation's 
approach to paying the costs of such spills. Specifically, my testimony 
today focuses on (1) the number of major oil spills--i.e., spills for 
which the total costs and claims paid was at least $1 million--from 
1990 to 2006 and the total costs of these spills, (2) the factors that 
affect major oil spill costs, and (3) the implications of major oil 
spill costs for the Oil Spill Liability Trust Fund.\3\ My comments are 
based primarily on our September 2007 report on oil spill costs, which 
was issued to the Senate Committee on Commerce, Science, and 
Transportation and the House Committee on Transportation and 
Infrastructure.\4\ In preparing our September report, we analyzed oil 
spill removal cost and claims data from NPFC, the National Oceanic and 
Atmospheric Administration's (NOAA) Damage Assessment, Remediation, and 
Restoration Program, and the Department of the Interior's (DOI) Natural 
Resource Damage Assessment and Restoration Program and the U.S. Fish 
and Wildlife Service (FWS). We also analyzed cost data obtained from 
vessel insurers and through contract with Environmental Research 
Consulting.\5\ We interviewed NPFC, NOAA, and state officials 
responsible for oil spill response, as well as industry experts and 
representatives from key industry associations and a vessel owner. In 
addition, we selected five oil spills on the basis of the spill's 
location, oil type, and spill volume for an in-depth review. During 
this review, we interviewed NPFC officials involved in spill response 
for all five spills, as well as representatives of private sector 
companies involved in the spill and spill response; and we conducted a 
file review of NPFC records of the Federal oil spill removal activities 
and costs associated with spill cleanup. We also reviewed documentation 
from the NPFC regarding the Fund balance and vessels' limits of 
liability. Because private-sector and total costs for cleaning up 
spills and paying damages are not centrally tracked and maintained, we 
obtained the best available cost data from a variety of sources, as 
previously described. We then combined the information that we 
collected from these various sources to develop cost estimates for the 
oil spills. However, because the cost data are somewhat imprecise and 
the data we collected vary somewhat by source, we present the cost 
estimates in ranges. The lower and higher bounds of the range represent 
the low and high end of cost information we obtained. Based on reviews 
of data documentation, interviews with relevant officials, and tests 
for reasonableness, we determined that the data were sufficiently 
reliable for the purposes of our report. We also conducted additional 
research and interviewed NPFC officials to update our September 2007 
report's findings and to gather information on the recent oil spill in 
San Francisco Bay. We conducted this work in December 2007 in 
accordance with generally accepted government auditing standards.
---------------------------------------------------------------------------
    \3\ The National Oil and Hazardous Substances Pollution Contingency 
Plan states that any oil discharge that poses a substantial threat to 
public health or welfare of the United States or the environment or 
results in significant public concern shall be classified as a major 
spill. For the purposes of our work, however, we defined major spills 
as spills with total removal costs and damage claims that exceed $1 
million.
    \4\ GAO, Maritime Transportation: Major Oil Spills Occur 
Infrequently, but Risks to the Federal Oil Spill Fund Remain, GAO-07-
1085 (Washington, D.C.: Sept. 7, 2007). The Coast Guard and Maritime 
Transportation Act of 2006 directed us to conduct an assessment of the 
cost of response activities and claims related to oil spills from 
vessels that have occurred since January 1, 1990, for which the total 
costs and claims paid was at least $1 million per spill. The mandate 
required that the report summarize the costs and claims for oil spills 
that have occurred since January 1, 1990, that total at least $1 
million per spill, and the source, if known, of each spill for each 
year.
    \5\ Environmental Research Consulting is a private consulting firm 
that specializes in data analysis, environmental risk assessment, cost 
analyses, expert witness research and testimony, and development of 
comprehensive databases on oil and chemical spills in service to 
regulatory agencies, nongovernmental organizations, and industry.
---------------------------------------------------------------------------
Summary
    We estimate that from 1990 to 2006, 51 oil spills have involved 
removal costs and damage claims totaling at least $1 million. 
Collectively, from public and nonpublic sources, we estimate that 
responsible parties and the Fund have paid between approximately $860 
million and $1.1 billion to clean up these spills and compensate 
affected parties. Responsible parties paid between about 72 to 78 
percent of these costs; the Fund has paid the remainder, or $240 
million. The overall cost for the 51 spills we identified could also 
increase over time because the claims adjudication processes can take 
many years to resolve. The 51 spills we identified, which constitute 
about 2 percent of all vessel spills from 1990 to 2006, varied greatly 
from year to year in number and cost and showed no discernible trends 
in frequency or size. All vessel types were involved with the 51 major 
spills we identified--with cargo/freight vessels and tank barges 
involved with 30 of the 51 spills.
    Three main factors affect the costs of a spill, according to 
industry experts and agency officials and the studies we reviewed: the 
spill's location, the time of year it occurs, and the type of oil 
spilled.\6\ A remote location, for example, can increase the cost of a 
spill because of the additional expense involved in mounting a remote 
response. Similarly, a spill that occurs close to shore rather than 
further out at sea can become more expensive because it may involve the 
use of manual labor to remove oil from sensitive shoreline habitat. 
Time also has situation-specific effects, in that a spill that occurs 
at a particular time of year might involve a much greater cost than a 
spill occurring in the same place but at a different time of year. For 
example, a spill occurring during fishing or tourist season might carry 
additional economic damage, or a spill occurring during a typically 
stormy season might prove more expensive because it is more difficult 
to clean up than one occurring during a season with generally calmer 
weather. The specific type of oil affects costs because the type of oil 
can affect the amount of cleanup needed and the amount of natural 
resource damage incurred. Lighter oils such as gasoline or diesel fuels 
dissipate and evaporate quickly--requiring minimal cleanup--but are 
highly toxic and create severe environmental impacts. Heavier oils such 
as crude oil do not evaporate, and therefore may require intensive 
structural and shoreline cleanup; and while they are less toxic than 
light oils, heavy oils can harm waterfowl and fur-bearing mammals 
through coating and ingestion. Each spill's cost reflects the 
particular mix of these factors, and no factor is clearly predictive of 
the outcome. The 51 major spills we identified, for example, occurred 
on all U.S. coasts, across all seasons, and with all major types of 
oil; but each spill's particular location, time, or product contributed 
to making it expensive. Although the total costs of the San Francisco 
spill are unknown, some of the same key factors such as location and 
oil type will likely have an impact on the costs of the spill.
---------------------------------------------------------------------------
    \6\ Another potential factor is the size of the spill. Although a 
larger spill will require an extensive and expensive cleanup effort, 
officials reported that compared with the factors presented here, spill 
volume is less important to the costs of oil spill response.
---------------------------------------------------------------------------
    To date, the Fund has been able to cover costs that responsible 
parties have not paid, but risks remain. In particular, the Fund is at 
risk from claims resulting from spills that significantly exceed 
responsible parties' liability limits. The effect of such spills can be 
seen among the 51 major oil spills we identified: 10 of them exceeded 
the limit of liability, resulting in claims of about $252 million on 
the Fund. In the Coast Guard and Maritime Transportation Act of 2006, 
the Congress increased these liability limits, but for two main 
reasons, additional attention to the limits appears warranted. First, 
the liability limits for certain vessel types may be disproportionately 
low compared with their historic spill cost. For example, of the 51 
major spills since 1990, 15 resulted from tank barges. The average cost 
for these 15 tank barge spills was about $23 million--more than double 
the average new liability limit ($10.3 million) for these vessels. The 
Coast Guard is responsible for adjusting limits of liability at least 
every 3 years for significant increases in inflation and for making 
recommendations to Congress on whether adjustments to limits are 
necessary to help protect the Fund.\7\ In its January 2007 report 
examining oil spills that exceeded the limits of liability, the Coast 
Guard had similar findings on the adequacy of some of the new limits. 
However, the Coast Guard did not make explicit recommendations to 
Congress on how the limits should be adjusted. Second, although OPA has 
required since 1990 that liability limits be adjusted every 3 years to 
account for significant increases in inflation, such adjustments have 
never been made. If such adjustments had been made between 1990 and 
2006, claims against the fund for the 51 major spills would have been 
reduced by 16 percent, which could have saved the Fund $39 million. The 
Coast Guard, which has been delegated the authority to adjust limits 
for significant increases in inflation, has not indicated whether it 
will exercise its authority to adjust liability limits in the future. 
Aside from issues related to limits of liability, the Fund faces other 
potential drains on its resources, including ongoing claims from 
existing spills, claims related to already-sunken vessels that may 
begin to leak oil, and the threat of a catastrophic spill such as 
occurred with the EXXON VALDEZ in 1989.
---------------------------------------------------------------------------
    \7\ OPA has required since 1990 that the President--and through 
several delegations to the Secretaries of Transportation and Homeland 
Security and a redelegation to the Coast Guard in 2005--adjust 
liability limits at least every 3 years to account for significant 
increases in inflation. However, the Executive Branch has never made 
such adjustments.
---------------------------------------------------------------------------
    In our September 2007 report, we recommended that the Commandant of 
the Coast Guard (1) determine whether and how liability limits should 
be changed, by vessel type, and make recommendations about these 
changes to the Congress and (2) adjust the limits of liability for 
vessels every 3 years to reflect changes in inflation, as appropriate. 
The Department of Homeland Security (DHS), including the Coast Guard, 
generally agreed with the report's contents and agreed with the 
recommendations. To date, the Commandant of the Coast Guard has not 
implemented these recommendations.

Background
    With more than 100,000 commercial vessels navigating U.S. waters 
and 12.2 million barrels of oil being imported into the United States 
each day, some oil spills in domestic waters are inevitable. 
Fortunately, however, spills are relatively infrequent and are 
decreasing. While oil transport and maritime traffic have continued to 
increase, the total number of reported spills has generally declined 
each year since 1990.
    OPA places the primary burden of liability and the costs of oil 
spills on the vessel owner and operator who were responsible for the 
spill.\8\ This ``polluter pays'' system provides a deterrent for vessel 
owners and operators who spill oil by requiring that they assume the 
burden of spill response, natural resource restoration, and 
compensation to those damaged by the spill, up to a specified limit of 
liability--which is the amount above which responsible parties are no 
longer financially liable under certain conditions. (See Fig. 1 for the 
limits of liability by vessel type.) For example, if a vessel's limit 
of liability is $10 million and a spill resulted in $12 million in 
costs, the responsible party only has to pay up to $10 million--the 
Fund will pay for the remaining $2 million.\9\ The Coast Guard is 
responsible for adjusting limits for significant increases in inflation 
and for making recommendations to Congress on whether other adjustments 
are necessary to help protect the Fund.\10\ OPA also requires that 
vessel owners and operators must demonstrate their ability to pay for 
oil spill response up to their limit of liability. Specifically, by 
regulation, with few exceptions, owners and operators of vessels over 
300 gross tons and any vessels that transship or transfer oil in the 
Exclusive Economic Zone are required to have a certificate of financial 
responsibility that demonstrates their ability to pay for oil spill 
response up to their limit of liability.\11\
---------------------------------------------------------------------------
    \8\ OPA applies to oil discharged from vessels or facilities into 
navigable waters of the United States and adjoining shorelines. OPA 
also covers substantial threats of discharge, even if an actual 
discharge does not occur.
    \9\ When responsible parties' costs exceed their limit of liability 
and the limit is upheld--because there was no gross negligence or 
violations of Federal regulations by the vessel owner or operator--the 
responsible party is entitled to file a claim on the Fund to be 
reimbursed for costs in excess of the limit. NPFC reviews the claim to 
determine which costs are OPA-compensable and the responsible party is 
reimbursed from the Fund.
    \10\ Title VI of the Coast Guard and Maritime Transportation Act of 
2006. Public Law 109-241,  603(c)(3).
    \11\ 33 C.F.R.  138. The U.S. Exclusive Economic Zone extends 200 
nautical miles offshore.


---------------------------------------------------------------------------
    Source: GAO.

    OPA consolidated the liability and compensation provisions of four 
prior Federal oil pollution initiatives and their respective trust 
funds into the Oil Spill Liability Trust Fund and authorized the 
collection of revenue and the use of the money, with certain 
limitations, with regard to expenditures.\12\ The Fund's balance has 
generally declined from 1995 through 2006, and since Fiscal Year 2003, 
its balance has been less than the authorized limit on Federal 
expenditures for the response to a single spill, which is currently set 
at $1 billion (see Fig. 2). The balance has declined, in part, because 
the Fund's main source of revenue--a $0.05 per barrel tax on U.S. 
produced and imported oil--was not collected for most of the time 
between 1993 and 2006.\13\ As a result, the Fund balance was $604.4 
million at the end of Fiscal Year 2006.\14\ The Energy Policy Act of 
2005 reinstated the barrel tax beginning in April 2006.\15\ With the 
barrel tax once again in place, NPFC anticipates that the Fund will be 
able to cover potential noncatastrophic liabilities.
---------------------------------------------------------------------------
    \12\ The prior Federal laws regarding oil pollution included the 
Federal Water Pollution Control Act, the Deepwater Port Act, the Trans-
Alaska Pipeline System Authorization Act, and the Outer Continental 
Shelf Lands Act Amendments of 1978. Congress created the Fund in 1986 
but did not authorize collection of revenue or use of the money until 
it passed OPA in 1990.
    \13\ The tax expired in December 1994. Besides the barrel tax, the 
Fund also receives revenue in the form of interest on the Fund's 
principal and fines and penalties.
    \14\ Recent related GAO products include GAO, U.S. Coast Guard 
National Pollution Funds Center: Improvements Are Needed in Internal 
Control Over Disbursements, GAO-04-340R (Washington, D.C.: Jan. 13, 
2004) and GAO, U.S. Coast Guard National Pollution Funds Center: Claims 
Payment Process Was Functioning Effectively, but Additional Controls 
Are Needed to Reduce the Risk of Improper Payments, GAO-04-114R 
(Washington, D.C.: Oct. 3, 2003).
    \15\ The Energy Policy Act of 2005. Public Law 109-58  1361. The 
barrel tax is scheduled to be in place until 2014.



    Source: GAO analysis of NPFC data.
    Note: The Fund balance increase in 2000 was largely due to a 
transfer of $181.8 million from the Trans-Alaska Pipeline Liability 
Fund.

    OPA also defines the costs for which responsible parties are liable 
and for which the Fund is made available for compensation in the event 
that the responsible party does not pay or is not identified. These 
costs, or ``OPA compensable'' costs, are of two main types:

   Removal costs: Removal costs are incurred by the Federal 
        Government or any other entity taking approved action to 
        respond to, contain, and clean up the spill. For example, 
        removal costs include the equipment used in the response--
        skimmers to pull oil from the water, booms to contain the oil, 
        planes for aerial observation--as well as salaries and travel 
        and lodging costs for responders.

   Damages caused by the oil spill: OPA-compensable damages 
        cover a wide range of both actual and potential adverse impacts 
        from an oil spill, for which a claim may be made to either the 
        responsible party or the Fund. Claims include natural resource 
        damage claims filed by trustees, claims for uncompensated 
        removal costs and third-party damage claims for lost or damaged 
        property and lost profits, among other things.\16\
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    \16\ OPA authorizes the United States, states, and Indian Tribes to 
act on behalf of the public as natural resource trustees for natural 
resources under their respective trusteeship. Trustees often have 
information and technical expertise about the biological effects of 
pollution, as well as the location of sensitive species and habitats 
that can assist the Federal On-Scene Coordinator in characterizing the 
nature and extent of site-related contamination and impacts. Federal 
Trustees include Commerce, DOI, the Departments of Agriculture, 
Defense, Energy, and other agencies authorized to manage or protect 
natural resources.

    The Fund also covers costs when responsible parties cannot be 
located or do not pay their liabilities. NPFC encounters cases where 
the source of the spill, and therefore the responsible party is 
unknown, or where the responsible party does not have the ability to 
pay. In other cases, since the cost recovery can take a period of 
years, the responsible party may become bankrupt or dissolved. Based on 
our analysis of NPFC records, responsible parties have reimbursed the 
majority--about 65 percent--of the Fund's costs for the 51 spills.\17\
---------------------------------------------------------------------------
    \17\ Our analysis excluded the spills with limit of liability 
claims.
---------------------------------------------------------------------------
    Response to large oil spills is typically a cooperative effort 
between the public and private sector, and there are numerous players 
who participate in responding to and paying for oil spills. To manage 
the response effort, the responsible party, the Coast Guard, EPA, and 
the pertinent state and local agencies form the unified command, which 
implements and manages the spill response.\18\ Appendix I contains 
additional information on the parties involved in spill response.
---------------------------------------------------------------------------
    \18\ The Incident Command System (ICS) is a standardized response 
management system that is part of the National Interagency Incident 
Management System. The ICS is organizationally flexible so that it can 
expand and contract to accommodate spill responses of various sizes. 
The ICS typically consists of four sections: operations, planning, 
logistics, and finance/administration.
---------------------------------------------------------------------------
Oil Spills Costing At Least $1 Million Occurred Infrequently Between 
        1990 and 2006, but Estimated Costs Total $860 Million to $1.1 
        Billion
    On the basis of information we were able to assemble about 
responsible parties' expenditures and payments from the Fund, we 
estimate that 51 oil spills involving removal costs and damage claims 
totaling at least $1 million have occurred from 1990 to 2006. During 
this period, 3,389 oil spills occurred in which one or more parties 
sought reimbursement from the Fund. The 51 major spills represent less 
than 2 percent of this total.\19\ As Figure 3 shows, there are no 
discernable trends in the number of major oil spills that occur each 
year. The highest number of spills was seven in 1996; the lowest number 
was zero in 2006.
---------------------------------------------------------------------------
    \19\ We established the universe of major oil spills from 1990 to 
2006, based on available public and private sector data in consultation 
with NPFC, Environmental Research Consulting, and other industry 
experts. Additionally, we gathered removal costs and damage claims data 
from Federal agencies involved in spill response, claims payments, and 
conducting natural resource damage assessments (Coast Guard, NOAA, DOI, 
and FWS); and to the best of our ability, we gathered private-sector 
cost data from vessels insurers, and in contract with Environmental 
Research Consulting.



    Source: GAO analysis of NPFC data.
    Note: Because spill costs accrue over time, there may have been 
vessel spills in 2006 for which costs will exceed $1 million in the 
future.

    These 51 spills occurred in a variety of locations and involved a 
range of vessel types. The spills occurred on the Atlantic, Gulf, and 
Pacific coasts and include spills both in open coastal waters and 
inland waterways. In addition, as Figure 4 shows, 30 of the 51 spills 
involved cargo/freight vessels and tank barges, 12 involved fishing and 
other types of vessels, and 9 involved tanker vessels.



    Source: GAO.

    The total cost of the 51 spills cannot be precisely determined 
because private-sector expenditures are not tracked,\20\ the various 
parties involved in covering these costs do not categorize them 
uniformly, and spills costs are somewhat fluid and accrue over time. 
Because spill cost data are somewhat imprecise and the data we 
collected vary somewhat by source, the results described below will be 
reported in ranges, in which various data sources are combined 
together. The lower and higher bounds of the range represent the low 
and high end of cost information we obtained.
---------------------------------------------------------------------------
    \20\ Under regulation S-K, 17 C.F.R. 229, companies that are 
publicly traded must disclose any outstanding liabilities, including 
liabilities such as oil spill removal costs or claims made against the 
company for natural resource or third-party damages incurred. However, 
many vessel owners or operators are not publicly traded companies.
---------------------------------------------------------------------------
    Our analysis of these 51 spills shows their total cost was 
approximately $1 billion--ranging from $860 million to $1.1 billion. 
This amount breaks down by source as follows:

   Amount paid out of the Trust Fund: Because the NPFC tracks 
        and reports all Fund expenditures, the amount paid from the 
        Fund can be reported as an actual amount, not an estimate. For 
        these 51 spills, the Fund paid a total of $239.5 million.

   Amount paid by responsible parties: Because of the lack of 
        precise information about amounts paid by responsible parties 
        and the differences in how they categorize their costs, this 
        portion of the expenditures must be presented as an estimate. 
        Based on the data we were able to obtain and analyze, 
        responsible parties spent between $620 million and $840 
        million. Even at the low end of the range, this amount is 
        nearly triple the expenditure from the Fund.

    Costs of these 51 spills varied widely by spill, and therefore, by 
year (see Fig. 5). For example, 1994 and 2004 both had four spills 
during the year, but the average cost per spill in 1994 was about $30 
million, while the average cost per spill in 2004 was between $71 
million and $96 million. Just as there was no discernible trend in the 
frequency of these major spills, there is no discernible trend in their 
cost. Although the substantial increase in 2004 may look like an upward 
trend, 2004 may be an anomaly that reflects the unique character of two 
of the four spills that occurred that year. These two spills accounted 
for 98 percent of the year's costs.



    Source: GAO.
    Note: Because we are reporting costs from multiple sources of data, 
the data were combined and grouped into cost ranges. In some cases, 
however, there was only one cost estimate. In those cases, we present 
the amount as a single cost estimate.

Key Factors Affect Oil Spill Costs in Unique Ways
    Location, time of year, and type of oil are key factors affecting 
oil spill costs, according to industry experts, agency officials, and 
our analysis of spills.\21\ Officials also identified two other factors 
that may influence oil spill costs to a lesser extent--the 
effectiveness of the spill response and the level of public interest in 
a spill. In ways that are unique to each spill, these factors can 
affect the breadth and difficulty of the response effort or the extent 
of damage that requires mitigation.
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    \21\ Another potential factor is the size of the spill. Although a 
larger spill will require an extensive and expensive cleanup effort, 
officials reported that compared with the factors presented here, spill 
volume is less important to the costs of oil spill response.
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Location Impacts Costs in Different Ways
    The location of a spill can have a large bearing on spill costs 
because it will determine the extent of response needed, as well as the 
degree of damage to the environment and local economies. According to 
state officials with whom we spoke and industry experts, there are 
three primary characteristics of location that affect costs:

   Remoteness: For spills that occur in remote areas, spill 
        response can be particularly difficult in terms of mobilizing 
        responders and equipment, and they can complicate the logistics 
        of removing oil from the water--all of which can increase the 
        costs of a spill.

   Proximity to shore: There are also significant costs 
        associated with spills that occur close to shore. Contamination 
        of shoreline areas has a considerable bearing on the costs of 
        spills as such spills can require manual labor to remove oil 
        from the shoreline and sensitive habitats. The extent of damage 
        is also affected by the specific shoreline location.

   Proximity to economic centers: Spills that occur in the 
        proximity of economic centers can also result in increased 
        costs when local services are disrupted. A spill near a port 
        can interrupt the flow of goods, necessitating an expeditious 
        response in order to resume business activities, which could 
        increase removal costs. Additionally, spills that disrupt 
        economic activities can result in expensive third-party damage 
        claims.

Time of Year Has Impact on Local Economies and Response Efforts
    The time of year in which a spill occurs can also affect spill 
costs--in particular, impacting local economies and response efforts. 
According to several state and private-sector officials with whom we 
spoke, spills that disrupt seasonal events that are critical for local 
economies can result in considerable expenses. For example, spills in 
the spring months in areas of the country that rely on revenue from 
tourism may incur additional removal costs in order to expedite spill 
clean-up, or because there are stricter standards for clean up, which 
increase the costs.
    The time of year in which a spill occurs also affects response 
efforts because of possible inclement weather conditions. For example, 
spills that occur during the winter months in areas of the country that 
experience harsh winter conditions can result in higher removal costs 
because of the increased difficulty in mobilizing equipment and 
personnel to respond to a spill in inclement weather. According to a 
state official knowledgeable about a January 1996 spill along the coast 
of Rhode Island, extremely cold and stormy weather made response 
efforts very difficult.

Type of Oil Spilled Impacts the Extent of the Response Effort and the 
        Amount of Damage
    The type of oil spilled affects the degree to which oil can be 
cleaned up and removed, as well as the nature of the natural resource 
damage caused by the spill. The different types of oil can be grouped 
into four categories, each with its own set of impacts on spill 
response and the environment (see Table 1).



    Source: NOAA.

    Lighter oils such as jet fuels, gasoline, and diesel fuel dissipate 
and evaporate quickly, and as such, often require minimal cleanup. 
However, these oils are highly toxic and can severely affect the 
environment if conditions for evaporation are unfavorable. For 
instance, in 1996, a tank barge that was carrying home-heating oil 
grounded in the middle of a storm near Point Judith, Rhode Island, 
spilling approximately 828,000 gallons of heating oil (light oil). 
Although this oil might dissipate quickly under normal circumstances, 
heavy wave conditions caused an estimated 80 percent of the release to 
mix with water.\22\ Natural resource damages alone were estimated at 
$18 million, due to the death of approximately 9 million lobsters, 27 
million clams and crabs, and over 4 million fish.
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    \22\ National Research Council of the National Academies, Oil in 
the Sea III: Inputs, Fates, and Effects (Washington, D.C.: 2003).
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    Heavier oils, such as crude oils and other heavy petroleum products 
are less toxic than lighter oils but can also have severe environmental 
impacts. Medium and heavy oils do not evaporate much, even during 
favorable weather conditions, and can blanket structures they come in 
contact with--boats and fishing gear, for example--as well as the 
shoreline, creating severe environmental impacts to these areas, and 
harming waterfowl and fur-bearing mammals through coating and 
ingestion. Additionally, heavy oils can sink, creating prolonged 
contamination of the sea bed and tar balls that sink to the ocean floor 
and scatter along beaches. These spills can require intensive shoreline 
and structural clean up, which is time-consuming and expensive. For 
example, in 1995, a tanker spilled approximately 38,000 gallons of 
heavy fuel oil into the Gulf of Mexico when it collided with another 
tanker as it prepared to lighter its oil to another ship.\23\ Less than 
1 percent (210 gallons) of the oil was recovered from the sea, and as a 
result, recovery efforts on the beaches of Matagorda and South Padre 
Islands were labor intensive, as hundreds of workers had to manually 
pick up tar balls with shovels. The total removal costs for the spill 
were estimated at $7 million.
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    \23\ Lightering is the process of transferring oil at sea from a 
very large or ultra-large carrier to smaller tankers that are capable 
of entering the port.
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Other Factors Also Affect Spill Costs
    Some industry experts cited two other factors as also affecting 
costs incurred during a spill.

   Effectiveness of Spill Response: Some private-sector 
        officials stated that the effectiveness of spill response can 
        impact the cost of cleanup. The longer it takes to assemble and 
        conduct the spill response, the more likely it is that the oil 
        will move with changing tides and currents and affect a greater 
        area, which can increase costs. Some officials said the level 
        of experience of those involved in the incident command is 
        critical to the effectiveness of spill response. For example, 
        they said poor decisionmaking during a spill response could 
        lead to the deployment of unnecessary response equipment, or 
        worse, not enough equipment to respond to a spill. Several 
        officials expressed concern that Coast Guard officials are 
        increasingly inexperienced in handling spill response, in part 
        because the Coast Guard's mission has been increased to include 
        homeland security initiatives.

   Public interest: Several officials with whom we spoke stated 
        that the level of public attention placed on a spill creates 
        pressure on parties to take action and can increase costs. They 
        also noted that the level of public interest can increase the 
        standards of cleanliness expected, which may increase removal 
        costs.

Key Factors Will Likely Influence Cost of San Francisco Spill
    The total costs of the San Francisco spill are currently unknown. 
According to NPFC officials, as of December 4, 2007, the Unified 
Command estimated that $48 million had been spent on the response, 
which includes approximately $2.2 million from the Fund.\24\ The total 
costs will not likely be known for a while, as it can take many months 
or years to determine the full effect of a spill on natural resources 
and to determine the costs and extent of the natural resource damage. 
Our work for this testimony did not include a thorough evaluation of 
the factors affecting the spill. However, some of the same key factors 
that have influenced the cost of 51 major oil spills will likely have 
an effect on the costs in the San Francisco spill. For example, the 
spill occurred in an area close to shore, which caused the closing of 
as many as 22 beaches, according to Coast Guard officials. A weather-
related factor was that the spill occurred during dense fog, which 
complicated efforts to determine how much of an area the spill covered. 
Moreover, the cargo ship spilled a heavy oil--specifically intermediate 
fuel oil--that requires particularly intensive shoreline and structural 
clean-up, and harmed scores of birds and marine mammals through coating 
and ingestion.\25\ Concerns have also been raised about the 
effectiveness of the spill response and incident command, another of 
the factors cited as contributing to increased costs. The National 
Transportation Safety Board, the Coast Guard, as well as other 
government agencies, are currently investigating the details of the 
accident and the subsequent response.
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    \24\ According to NPFC officials, the OPA limit of liability for 
this vessel, if the limit applies under the circumstances of the spill, 
is approximately $61.8 million.
    \25\ Intermediate fuel oil is a common diesel fuel used to power 
marine vessels.
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Fund Has Been Able to Cover Costs Not Paid by Responsible Parties, but 
        Risks Remain
    The Fund has been able to cover costs from major spills that 
responsible parties have not paid, but risks remain. Specifically, the 
current liability limits for certain vessel types, notably tank barges, 
may be disproportionately low relative to costs associated with such 
spills. There is also no assurance that vessel owners and operators are 
able to financially cover these new limits, because the Coast Guard has 
not yet issued regulations for satisfying financial responsibility 
requirements. In addition, although OPA calls for periodic increases in 
liability limits to account for significant increases in inflation, 
such increases have never been made. Aside from issues related to 
limits of liability, the Fund faces other potential drains on its 
resources, including ongoing claims from existing spills.

Further Attention To Limits of Liability Is Needed
    The Fund has been able to cover costs from major spills that 
responsible parties have not paid, but additional focus on limits of 
liability is warranted. Limits of liability are the amount, under 
certain circumstances, above which responsible parties are no longer 
financially liable for spill removal costs and damage claims. If the 
responsible party's costs exceed the limit of liability, they can make 
a claim against the Fund for the amount above the limit. Major oil 
spills that exceed a vessel's limit of liability are infrequent, but 
their impact on the Fund can be significant. Ten of the 51 major oil 
spills that occurred since 1990 resulted in limit-of-liability claims 
on the Fund.\26\ These limit-of-liability claims totaled more than $252 
million and ranged from less than $1 million to more than $100 million. 
Limit-of-liability claims will continue to have a pronounced effect on 
the Fund. NPFC estimates that 74 percent of claims under adjudication 
that were outstanding as of January 2007 were for spills in which the 
limit of liability had been exceeded. The amount of these claims under 
adjudication was $217 million.\27\
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    \26\ Additional spills had costs in excess of the vessel's limit of 
liability, but either the limit was not upheld or no claim was filed by 
the responsible party.
    \27\ This figure is based on all spills with claims on the Fund, 
currently under adjudication, not just the 51 major spills. U.S. Coast 
Guard, Report on Oil Pollution Act Liability Limits, Jan. 5, 2007. Like 
our report, the Coast Guard's report was prepared in response to a 
provision in the Coast Guard and Maritime Transportation Act.
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    We identified three areas in which further attention to these 
liability limits appears warranted: the appropriateness of some current 
liability limits, the need to adjust limits periodically in the future 
to account for significant increases in inflation, and the need for 
updated regulations for ensuring vessel owners and operators are able 
to financially cover their new limits.

Some Recent Adjustments to Liability Limits Do Not Reflect the Cost of 
        Major Spills
    The Coast Guard and Maritime Transportation Act of 2006 
significantly increased the limits of liability from the limits set by 
OPA in 1990. Both laws base the liability on a specified amount per 
gross ton of vessel volume, with different amounts for vessels that 
transport oil commodities (tankers and tank barges) than for vessels 
that carry oil as a fuel (such as cargo vessels, fishing vessels, and 
passenger ships). The 2006 Act raised both the per-ton and the required 
minimum amounts, differentiating between vessels with a double hull, 
which helps prevent oil spills resulting from collision or grounding, 
and vessels without a double hull (see Table 2 for a comparison of 
amounts by vessel category).\28\ For example, the liability limit for 
single-hull vessels larger than 3,000 gross tons was increased from the 
greater of $1,200 per gross ton or $10 million to the greater of $3,000 
per gross ton or $22 million.
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    \28\ OPA requires that all tank vessels (greater than 5,000 gross 
tons) constructed (or that undergo major conversions) under contracts 
awarded after June 30, 1990, operating in U.S. navigable waters must 
have double hulls. Of the 51 major oil spills, all 24 major spills from 
tank vessels (tankers and tank barges) involved single-hull vessels.



---------------------------------------------------------------------------
    Source: Coast Guard and Maritime Transportation Act of 2006.

    Our analysis of the 51 spills showed that the average spill cost 
for some types of vessels, particularly tank barges, was higher than 
the limit of liability, including the new limits established in 2006. 
As Figure 6 shows, the 15 tank barge spills and the 12 fishing/other 
vessel spills had average costs greater than both the 1990 and 2006 
limits of liability. For example, for tank barges, the average cost of 
$23 million was higher than the average limit of liability of $4.1 
million under the 1990 limits and $10.3 million under the new 2006 
limits. The nine spills involving tankers, by comparison, had average 
spill costs of $34 million, which was considerably lower than the 
average limit of liability of $77 million under the 1990 limits and 
$187 million under the new 2006 limits.\29\ Similarly, the 15 major 
spills involving cargo/freight vessels had an average spill cost of $67 
million, which was lower than both the 1990 and 2006 limits of 
liability.
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    \29\ The average limits of liability for the spills involving 
tankers are much greater than the average liability for tank barges 
because the liability is based on the volume of the vessel, and tankers 
generally have much higher volumes than tank barges.



---------------------------------------------------------------------------
    Source: GAO.

    In a January 2007 report examining spills in which the limits of 
liability had been exceeded, the Coast Guard had similar findings on 
the adequacy of some of the new limits.\30\ Based on an analysis of 40 
spills in which costs had exceeded the responsible party's liability 
limit since 1991, the Coast Guard found that the Fund's responsibility 
would be greatest for spills involving tank barges, where the Fund 
would be responsible for paying 69 percent of costs. The Coast Guard 
concluded that increasing liability limits for tank barges and non tank 
vessels--cargo, freight, and fishing vessels--over 300 gross tons would 
positively impact the Fund balance. With regard to making specific 
adjustments, the Coast Guard said dividing costs equally between the 
responsible parties and the Fund was a reasonable standard to apply in 
determining the adequacy of liability limits.\31\ However, the Coast 
Guard did not recommend explicit changes to achieve either that 50/50 
standard or some other division of responsibility.
---------------------------------------------------------------------------
    \30\ U.S. Coast Guard, Report on Oil Pollution Act Liability 
Limits, Jan. 5, 2007.
    \31\ We did not assess the reasonableness of adopting such a 
standard in determining liability limits.
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Liability Limits Have Not Been Adjusted for Inflation
    Although OPA requires adjusting liability limits to account for 
significant increases in inflation, no adjustments to the limits were 
made between 1990 and 2006, when the Congress raised the limits in the 
Coast Guard and Maritime Transportation Act. During those years, the 
Consumer Price Index rose approximately 54 percent.\32\ OPA requires 
the President, who has delegated responsibility to the Coast Guard, 
through the Secretary of Homeland Security, to issue regulations not 
less often than every 3 years to adjust the limits of liability to 
reflect significant increases in the Consumer Price Index.\33\ We asked 
Coast Guard officials why no adjustments were made between 1990 and 
2006. Coast Guard officials stated that they could not speculate on 
behalf of other agencies as to why no adjustments had been made prior 
to 2005 when the delegation to the Coast Guard was made.\34\
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    \32\ The new limits, which increased an average of 125 percent for 
the 51 vessels involved in major oil spills, were substantially higher 
than the rise in inflation during the period.
    \33\ Congress reiterated this requirement in the Coast Guard and 
Maritime Transportation Act by requiring that regulations be issued 3 
years after the enactment of the act (July 11, 2006) and every 3 years 
afterward to adjust the limits of liability to reflect significant 
increases in the Consumer Price Index.
    \34\ OPA has required since 1990 that the President--and through 
several delegations to the Secretaries of Transportation and Homeland 
Security and a redelegation to the Coast Guard in 2005--adjust 
liability limits at least every 3 years to account for significant 
increases in inflation. However, the Executive Branch has never made 
such adjustments.
---------------------------------------------------------------------------
    The decision to leave limits unchanged had financial implications 
for the Fund. Raising the liability limits to account for inflation 
would have the effect of reducing payments from the Fund, because 
responsible parties would be responsible for paying costs up to the 
higher liability limit. Not making adjustments during this 16-year 
period thus had the effect of increasing the Fund's financial 
liability. Our analysis showed that if the 1990 liability limits had 
been adjusted for inflation during the 16-year period, claims against 
the Fund for the 51 major oil spills would have been reduced 16 
percent, from $252 million to $213 million. This would have meant a 
savings of $39 million for the Fund.

Certification of Compliance With the New Liability Limits Is Not in 
        Place
    Certificates of Financial Responsibility have not been adjusted to 
reflect the new liability limits. The Coast Guard requires Certificates 
of Financial Responsibility, with few exceptions, for vessels over 300 
gross tons or any vessels that are lightering or transshipping oil in 
the Exclusive Economic Zone as a legal certification that vessel owners 
and operators have the financial resources to fund spill response up to 
the vessel's limit of liability. Currently, Certificate of Financial 
Responsibility requirements are consistent with the 1990 limits of 
liability and, therefore, there is no assurance that responsible 
parties have the financial resources to cover their increased 
liability.\35\ The Coast Guard plans to initiate a rulemaking to issue 
new Certificate of Financial Responsibility requirements. Coast Guard 
officials indicated their goal is to publish a Notice of Proposed 
Rulemaking by the end of 2007, but they said they could not be certain 
they would meet this goal.
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    \35\ According to the NPFC, while liable parties are not required 
to establish an ability to pay at the higher amended limits until the 
certificate of financial responsibility rule is published as required 
by OPA, those parties are liable for the higher amounts.
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Other Challenges Could Also Affect the Fund's Condition
    The Fund also faces several other potential challenges that could 
affect its financial condition:

   Additional claims could be made on spills that have already 
        been cleaned up: Natural resource damage claims can be made on 
        the Fund for years after a spill has been cleaned up. The 
        official natural resource damage assessment conducted by 
        trustees can take years to complete, and once it is completed, 
        claims can be submitted to the NPFC for up to 3 years 
        thereafter.\36\ For example, NPFC recently received and paid a 
        natural resource damage claim for a spill in U.S. waters in the 
        Caribbean that occurred in 1991.
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    \36\ Federal response costs for spills that resulted from 
Hurricanes Katrina and Rita were paid from the Stafford Act Disaster 
Relief Funds. However, private parties can seek reimbursement from the 
Fund for cleanup costs and damages in the future. According to NPFC, it 
is difficult to estimate future liabilities to the Fund as a result of 
Hurricanes Katrina and Rita, but as of July 2007, there are no claims 
pending in connection with these hurricanes.

   Costs and claims may occur on spills from previously sunken 
        vessels that discharge oil in the future: Previously sunken 
        vessels that are submerged and in threat of discharging oil 
        represent an ongoing liability to the Fund. There are over 
        1,000 sunken vessels that pose a threat of oil discharge.\37\ 
        These potential spills are particularly problematic because in 
        many cases there is no viable responsible party that would be 
        liable for removal costs. Therefore, the full cost burden of 
        oil spilled from these vessels would likely be paid by the 
        Fund.
---------------------------------------------------------------------------
    \37\ Michel, J., D. Etkin, T. Gilbert, J. Waldron, C. Blocksidge, 
and R. Urban; 2005. Potentially Polluting Wrecks in Marine Waters: An 
Issue Paper Prepared for the 2005 International Oil Spill Conference.

   Spills may occur without an identifiable source and 
        therefore, no responsible party: Mystery spills also have a 
        sustained impact on the Fund, because costs for spills without 
        an identifiable source--and therefore no responsible party--may 
        be paid out of the Fund. Although mystery spills are a concern, 
        the total cost to the Fund from mystery spills was lower than 
        the costs of known vessel spills in 2001 through 2004. 
        Additionally, none of the 51 major oil spills was the result of 
---------------------------------------------------------------------------
        discharge from an unknown source.

   A catastrophic spill could strain the Fund's resources: 
        Since the 1989 EXXON VALDEZ spill, which was the impetus for 
        authorizing the Fund's usage, no oil spill has come close to 
        matching its costs.\38\ Cleanup costs for the EXXON VALDEZ 
        alone totaled about $2.2 billion, according to the vessel's 
        owner. By comparison, the 51 major oil spills since 1990 cost, 
        in total, between $860 million and $1.1 billion. The Fund is 
        currently authorized to pay out a maximum of $1 billion on a 
        single spill. Although the Fund has been successful thus far in 
        covering costs that responsible parties did not pay, it may not 
        be sufficient to pay such costs for a spill that has 
        catastrophic consequences.
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    \38\ The EXXON VALDEZ only discharged about 20 percent of the oil 
it was carrying. A catastrophic spill from a vessel could result in 
costs that exceed those of the EXXON VALDEZ, particularly if the entire 
contents of a tanker were released in a `worst-case discharge' 
scenario.
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Concluding Observations
    In conclusion, the ``polluter pays'' system established under OPA 
has been generally effective in ensuring that responsible parties pay 
the costs of responding to spills and compensating those affected. 
However, increases in some liability limits appear warranted to help 
ensure that the ``polluter pays'' principle is carried out in practice. 
For certain vessel types, such as tank barges, current liability limits 
appear disproportionately low relative to their historic spill costs. 
The Coast Guard has reached a similar conclusion but so far has stopped 
short of making explicit recommendations to the Congress about what the 
limits should be. Absent such recommendations, the Fund may continue to 
pay tens of millions for spills that exceed the responsible parties' 
limits of liability. Further, to date, liability limits have not been 
regularly adjusted for significant changes in inflation. Consequently, 
the Fund was exposed to about $39 million in liability claims for the 
51 major spills between 1990 and 2006 that could have been saved if the 
limits had been adjusted for inflation. Without such actions, oil 
spills with costs exceeding the responsible parties' limits of 
liability will continue to place the Fund at risk. Given these 
concerns, in our September 2007 report, we recommended that the 
Commandant of the Coast Guard (1) determine whether and how liability 
limits should be changed, by vessel type, and make recommendations 
about these changes to the Congress and (2) adjust the limits of 
liability for vessels every 3 years to reflect significant changes in 
inflation, as appropriate. DHS, including the Coast Guard, generally 
agreed with the report's contents and agreed with the recommendations. 
To date, the Commandant of the Coast Guard has not implemented these 
recommendations.
    Madame Chair this concludes my statement. I would be pleased to 
answer any questions that you or other Members of the Subcommittee may 
have at this time.

               Appendix I: Information on Spill Response
    Response to large oil spills is typically a cooperative effort 
between the public and private sector, and there are numerous players 
who participate in responding to and paying for oil spills. To manage 
the response effort, the responsible party, the Coast Guard, EPA, and 
the pertinent state and local agencies form the Unified Command, which 
implements and manages the spill response.\39\ Beyond the response 
operations, there are other stakeholders, such as accountants who are 
involved in documenting and accounting for costs, and receiving and 
processing claims. In addition, insurers and underwriters provide 
financial backing to the responsible party. The players involved in 
responding to and/or paying for major spill response are as follows: 
\40\
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    \39\ The Incident Command System (ICS) is a standardized response 
management system that is part of the National Interagency Incident 
Management System. The ICS is organizationally flexible so that it can 
expand and contract to accommodate spill responses of various sizes. 
The ICS typically consists of four sections: operations, planning, 
logistics, and finance/administration.
    \40\ For a full description of the organizational structure and 
procedures for preparing for and responding to discharges of oil, see 
The National Oil and Hazardous Substances Pollution Contingency Plan, 
40 C.F.R.  300.

   Government agencies: The lead Federal authority, or Federal 
        On-Scene Coordinator, in conducting a spill response is usually 
        the nearest Coast Guard Sector and is headed by the Coast Guard 
        Captain of the Port.\41\ The Federal On-Scene Coordinator 
        directs response efforts and coordinates all other efforts at 
        the scene of an oil spill. Additionally, the on-scene 
        coordinator issues pollution removal funding authorizations--
        guarantees that the agency will receive reimbursement for 
        performing response activities--to obtain services and 
        assistance from other government agencies. Other Federal 
        agencies may also be involved. NOAA provides scientific 
        support, monitoring and predicting the movement of oil, and 
        conducting environmental assessments of the impacted area. The 
        Federal, state, and tribal trustees join together to perform a 
        natural resource damage assessment, if necessary. Within the 
        Coast Guard, the NPFC is responsible for disbursing funds to 
        the Federal On-Scene Coordinator for oil spill removal 
        activities and seeking reimbursement from responsible parties 
        for Federal costs. Additionally, regional governmental entities 
        that are affected by the spill--both state and local--as well 
        as tribal government officials or representatives may 
        participate in the Unified Command and contribute to the 
        response effort, which is paid for by the responsible party or 
        are reimbursed by the responsible party or the Fund.\42\
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    \41\ Although this report focuses on vessels, and most vessel 
spills are in the Coast Guard zone of jurisdiction, EPA is the lead on-
scene coordinator in the inland zone, and Coast Guard is lead on-scene 
coordinator in the coastal zone.
    \42\ State governments can seek reimbursement directly from 
responsible parties or from the Fund. State officials in Alaska, 
California, New York, Rhode Island, Texas, and Washington said that 
state agencies recover almost all of their costs, either directly from 
responsible parties or from the NPFC. Officials in Texas said that the 
reimbursement rate for oil spill costs may be as high as 98 percent.

   Responsible parties: OPA stipulates that both the vessel 
        owner and operator are ultimately liable for the costs of the 
        spill and the cleanup effort. The Coast Guard has final 
        determination on what actions must be taken in a spill 
        response, and the responsible party may form part of the 
        Unified Command--along with the Federal on-scene coordinator 
        and pertinent state and local agencies--to manage the spill 
        response. The responsible parties rely on other entities to 
        evaluate the spill effects and the resulting compensation. 
        Responsible parties hire environmental and scientific support 
        staff, specialized claims adjustors to adjudicate third-party 
        claims, public relations firms, and legal representation to 
        file and defend limit of liability claims on the Fund, as well 
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        as serve as counsel throughout the spill response.

   Qualified individuals: Federal regulations require that 
        vessels carrying oil as cargo have an incident response plan 
        and, as part of the plan, they appoint a qualified individual 
        who acts with full authority to obligate funds required to 
        carry out response activities. The qualified individual acts as 
        a liaison with the Federal On-Scene Coordinator and is 
        responsible for activating the incident response plan.

   Oil spill response organizations: These organizations are 
        private companies that perform oil spill cleanup, such as 
        skimming and disposal of oil. Many of the companies have 
        contractual agreements with responsible parties and the Coast 
        Guard. The agreements, called basic ordering agreements, 
        provide for prearranged pricing, response personnel, and 
        equipment in the event of an oil spill.

   Insurers: Responsible parties often have multiple layers of 
        primary and excess insurance coverage, which pays oil spill 
        costs and claims. Pollution liability coverage for large 
        vessels is often underwritten by not-for-profit mutual 
        insurance organizations. The organizations act as a collective 
        of ship owners, who insure themselves, at-cost. The primary 
        insurers of commercial vessels in U.S. waters are the Water 
        Quality Insurance Syndicate, an organization providing 
        pollution liability insurance to over 40,000 vessels, and the 
        International Group of P&I Clubs, 13 protection and indemnity 
        organizations that provide insurance primarily to foreign-
        flagged large vessels.\43\
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    \43\ These 13 organizations are American Steamship Owners Mutual 
Protection and Indemnity Association, Inc.; Assuranceforeningen Gard; 
Assuranceforeningen Skuld; the Britannia Steam Ship Insurance 
Association Limited; the Japan Ship Owners' Mutual Protection & 
Indemnity Association; the London Steam-Ship Owners' Mutual Insurance 
Association Limited; the North of England Protection and Indemnity 
Association, Limited; the Shipowners' Mutual Protection and Indemnity 
Association (Luxembourg); the Standard Steamship Owners' Protection and 
Indemnity Association (Bermuda), Limited; the Steamship Mutual 
Underwriting Association (Bermuda), Limited; the Swedish Club; United 
Kingdom Mutual Steam Ship Assurance Association (Bermuda), Limited; the 
West of England Ship Owners Mutual Insurance Association (Luxembourg).

    At the Federal level, the National Oil and Hazardous Substances 
Pollution Contingency Plan provides the framework for responding to oil 
spills.\44\ At the port level, each port has an Area Contingency Plan, 
developed by a committee of local stakeholders, that calls for a 
response that is coordinated with both higher-level Federal plans and 
lower-level facility and vessel plans. The Federal plans designate the 
Coast Guard as the primary agency to respond to oil spills on water. 
The Coast Guard has a National Strike Force to provide assistance to 
efforts by the local Coast Guard and other agencies.\45\ The Coast 
Guard also has an exercise program--known as the Spills of National 
Significance exercise program--to test national level response 
capabilities. This program is focused on exercising the entire response 
system at the local, regional and national level using large-scale, 
high probability oil and hazardous material incidents that result from 
unintentional causes such as maritime accidents or natural disasters. 
The most recent program exercise, in June 2007, tested the response and 
recovery to an oil and hazardous materials release in the wake of a 
large scale earthquake in the Mississippi and Ohio River valleys.
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    \44\ The National Oil and Hazardous Substances Pollution 
Contingency Plan is a part of a larger plan known as the National 
Response Plan which covers a wide variety of contingencies that include 
natural disasters, major disasters, and terrorist attacks.
    \45\ The National Strike Force was established in 1973. Originally 
comprised of three 17-member strike teams, today's National Strike 
Force totals over 200 active duty, civilian, and reserve Coast Guard 
personnel for three distinct regions--the Atlantic, Gulf and Pacific.

    Senator Cantwell. Thank you. And thank you all for your 
testimony and the focus on this important issue. I know many of 
my colleagues will have questions, but I think what I want to 
do is to start with 5-minute rounds, and if we want to have a 
second round on this panel, we can, but we do have another 
panel afterwards. So I want to get to them as time allows and 
have interest.
    So we'll just have to take a reading after that. But let's 
start with 5-minute rounds, if we could, and I'd like to start 
with how the 1990 Act required the preparedness of Vessel 
Response Plans. And each of you mentioned that in your 
testimony, and the effectiveness of the response structure. All 
vessels that carry oil as cargo over 400 gross tons, that carry 
that fuel, must have a Vessel Response Plan. And these response 
plans are to address the potential of discharge from the 
vessel.
    So Congress mandated the Coast Guard to come up with the 
2004 Maritime Transportation Act with what these actual 
regulations should be, what is the final rule implemented into 
law. So just a yes or no answer, if you can just tell me 
whether you think it's important that we get this done. Just a 
yes or no.
    Senator Lautenberg. Yes.
    Ms. Fleming. Yes.
    Senator Cantwell. OK. Admiral Allen? Will we these 
regulations put in place within the next 12 months?
    Admiral Allen. We're putting together a regulatory work 
plan right now. As I stated in my opening statement, we did 
provide guidance to the industry, and they have submitted plans 
to us that we have reviewed, and they have been acting under 
those plans. So we are constructively meeting the intent, but 
the rule is not out there and it needs to get out there. I'm 
prepared to put resources out, and I think we've got a good 
chance to get it done in the next 12 to 18 months, but there 
are----
    Senator Cantwell. I'm asking you for a yes or no commitment 
of whether we'll have that done in the next year or not. In the 
next 12 months. If it takes longer than 12 months--but I think 
what we're trying to get at is we----
    Admiral Allen. Oh, you certainly have my commitment. Yes, 
ma'am. Yes, ma'am.
    Senator Cantwell. I'm asking you more yes or no, do you 
think it can be done, and are you----
    Admiral Allen. It can be done in 12 months. As I say, we 
have a number of rules in the backlogs, so we can do this in 12 
months. It will likely displace something else, but yes, it can 
be done.
    Senator Cantwell. Do you think it should be done in the 
next 12 months, Admiral?
    Admiral Allen. I would like to collaborate and talk about 
that, because I would like to get that sense from the Congress 
how to compete in priorities on the rules that we'd be required 
to make.
    Senator Cantwell. I think we're here today because we think 
it's very important. So happy to have that collaboration, but I 
think you will hear from us that we expect it to be done soon. 
Let me ask you about how many nontank vessels under law haven't 
submitted a response plan--that haven't done so.
    Admiral Allen. Well, any nontank vessel that is calling 
here is required to have one, so if there is not one that's 
been prepared, it means they're not calling the United States, 
ma'am.
    Senator Cantwell. So you say there is none.
    Admiral Allen. None that I'm aware.
    [An appended statement from Admiral Allen on this issue 
follows:]

                                  United States Coast Guard
                       U.S. Department of Homeland Security
                                   Washington, DC, January 14, 2008
Hon. Maria Cantwell,
Chair,
Fisheries and Coast Guard Subcommittee,
Committee on Commerce, Science, and Transportation,
U.S. Senate,
Washington, DC.

Dear Madam Chair:

    I am writing to advise you of the need to correct my testimony from 
the December 18, 2007, hearing pertaining to oil spills from non-tank 
vessels. During the hearing, you questioned me about the number of non-
tank vessels which have yet to submit response plans. I indicated that 
any non-tank vessel calling on a U.S. port is required to have a Non-
tank Vessel Response Plan (NTVRP). I further added that vessels without 
such plans are not permitted to call on U.S. ports; I have since 
learned that this is incorrect. Specifically, there are instances where 
both U.S. and foreign-flagged non-tank vessels have entered and 
operated in the United States without a Coast Guard-reviewed NTVRP.
    Absent the effect of a formal rule to implement the NTVRP required 
by the Coast Guard Maritime Transportation Act of 2004 (MTA), as 
amended in 2006, the fully enforceable requirement is the international 
standard required under MARPOL Annex I. Annex I requires that non-tank 
vessels over 400 gross tons have an approved Shipboard Oil Pollution 
Emergency Plan (SOPEP).
    The Coast Guard ensures vessels possess valid SOPEPs during Port 
State Control examinations and domestic inspections. However, these 
standards are not as detailed and rigorous as those required by MTA. In 
the case of M/V COSCO BUSAN, both the MTA-required NTVRP and 
international SOPEP requirements were met.
    I have initiated a review of the interim guidance provided to our 
field commanders following the passage of MTA, the effectiveness of 
that guidance, and a more accurate determination of the compliance 
rate. I am accountable to ensure the statutory NTVRP requirement is met 
and will take appropriate action. I am available to provide a more 
comprehensive brief upon your return from holiday recess.
    Thank you for your leadership on this important national issue. The 
Coast Guard is committed to protecting the environment through 
prevention and stands ready to answer any questions you may have. You 
can reach me through my Senate Liaison Office. Identical letters have 
been sent to Senator Snowe, Senator Stevens and Senator Inouye.
            Sincerely,
                                             Thad W. Allen,
                                                   Admiral,
                                          U.S. Coast Guard, Commandant.

    Senator Cantwell. And is the Coast Guard effectively 
enforcing the response plans?
    Admiral Allen. Yes. We've received and reviewed, and I'm 
going to give them authority to operate as nontank vessels 
under the Circular that was issued in 2005 to conform to the 
legislation, ma'am.
    Senator Cantwell. And what kind of uniformity do you think 
there is in these response plans?
    Admiral Allen. Well, the guidance that was issued to the 
industry regarding nontank vessels is very similar to the tank 
vessel plans that are already required out there, and we're 
looking for continuity between two sets of plans. And so 
they're basically mirrored on the tank vessel plans made.
    Senator Cantwell. And so you'd be surprised if--I mean, I 
think we're going to hear from my colleague from California, 
and we already heard a little from Senator Snowe on this issue 
of the response time in general. And I think what we're seeing 
in this particular case is perhaps a lack of uniformity and the 
lack of oversight might have a broad array of what these 
response plans have been.
    But clearly, notifying people hours and hours later I don't 
think is what we had in mind. But let's say, for example, if 
this particular ship did not have a response plan, what would 
have happened? What would have transpired?
    Admiral Allen. In this ship, it had to have a response 
plan, as it is a requirement to enter the port, ma'am. And 
every time it had to have met the requirements of the Circular 
that was issued in 2005 would have to be reviewed and accepted 
by the Coast Guard.
    Senator Cantwell. Ms. Glackin and Ms. Fleming, do you have 
any----
    Ms. Glackin. No. This role is primarily a Coast Guard role. 
We would consult on these things as needed.
    Senator Cantwell. How sufficient do you think the response 
plans are today?
    Ms. Glackin. I'm not in a position to answer that.
    Senator Cantwell. OK. OK, Senator Snowe, I'm going to turn 
it over to you.
    Senator Snowe. Thank you, Madam Chair. Admiral Allen, on 
these interim plans, what percentage of the nontanker fleet 
does this represent those who have these Vessel Response Plans 
on file?
    Admiral Allen. The total population of Non-Tank Vessel 
Response Plans on file is about 13,000. The subset of our large 
ocean wave freight vessels, like the COSCO BUSAN, is about 
8,000.
    Senator Snowe. 8,000 out of how many total? 15,000?
    Admiral Allen. Thirteen--Yes, ma'am.
    Senator Snowe. What is the reason due to the backlog on 
these regulations that you're so far behind?
    Admiral Allen. The legislation required that the rule be 
done within a year. We could not get the rule done within a 
year, so we issued interim guidelines that were constructively 
the same----
    Senator Snowe. Yes.
    Admiral Allen.--as the Tank Vessel Response Plans that were 
required OPA 90. We're in the process of putting together a 
regulatory plan to write that regulation right now. But in the 
interim, we issued guidance that was basically the same as the 
Tank Vessel Response Plans.
    Senator Snowe. Yes. Do you have the resources to carry out 
these regulations?
    Admiral Allen. I don't think we've got adequate resources 
right now. No, ma'am. And we can even talk about that. I've 
gone to the Administration, and I am getting support for more 
resources moving forward.
    Senator Snowe. Do you require a budgetary increase?
    Admiral Allen. It requires a couple of things. We can move 
internal resources, but you're robbing Peter to pay Paul. We 
can do that increase in the staffs that make rules. We also 
need to talk about the priority in which rules are being made. 
And we're trying to establish a task force to take a look at 
it.
    Senator Snowe. What's the timeline for reaching a decision 
in exactly how you're going to proceed?
    Admiral Allen. Quite frankly----
    Senator Snowe.--at what point?
    Admiral Allen. I cannot conceive of coming to the hearing 
this next spring and not having a move forward on the 
regulatory backlog for the Coast Guard, ma'am. It's 
unsatisfactory to you, but it's unsatisfactory to me, as well.
    Senator Snowe. Admiral Allen, also on the response 
personnel, I gather from following the exercise in 2004, the 
Coast Guard's After Action Report stated that response 
personnel were not proficient with their equipment, and that 
there was a shortage of experienced personnel to fill these 
positions? What have you done to develop a response capability 
and to work on these deficiencies?
    Admiral Allen. We have a national--we call it our Prep 
Program. It's a national exercise program where we issue 
guidelines every year. Our large major spill exercises for the 
last year have been met. I've asked for a detailed data 
collection to make sure that all of the training requirements 
clear down to the lower levels have been consistent with the 
guidance that was provided out there. And we'll be looking at 
that as part of the incident review that we're doing, ma'am. If 
there is a gap there, I will advise you. But for the major 
large significant exercises to be conducted both by industry 
and the government, we have been meeting those criteria.
    Senator Snowe. OK. Are these drills being conducted with 
adequate frequency?
    Admiral Allen. Yes. They're according to standard. Yes. The 
current standard is there should be six to eight major spill 
exercises a year. We completed seven last year. The industry is 
supposed to lead 13 to 16, and they've led 16, ma'am.
    Senator Snowe. Yes. And are you going to incorporate 
anything you've learned from this recent spill with the COSCO 
BUSAN?
    Admiral Allen. Yes, ma'am. Most notably, if I could just 
summarize, and as Senator Boxer already indicated, I think 
things in our country right now, in terms of information 
available to the public, for we're not envisioning, with OPA 90 
this past--we look at NGOs, how to bring volunteers in, and 
take advantage of our more modern communications.
    Senator Snowe. Yes. And Ms. Fleming mentioned the NGO 
report. There are various issues that have an impact on the 
severity of the spill, and the cost of the cleanup, especially 
around port facilities, and that's something I mentioned in my 
opening statement, whether it's at the Port of Portland or up 
near Bar Harbor and Acadia National Park. We do have dense fog, 
high winds, and that all adds excessively to the dangerous 
conditions in which these ships are coming into port. How is 
the Coast Guard addressing those issues? What authority do you 
have to regulate that traffic around various ports?
    Admiral Allen. The Coast Guard has extensive authority to 
regulate traffic, and I would differentiate the movement of 
vessels in the port as opposed to Vessel Traffic Services for 
the purposes of this answer, as far as high winds, hurricane 
conditions, and so forth. We routinely put restrictions on port 
entry or port departure, and we have the current authority to 
be able to do that.
    Although, what we need to look at going forward is issues 
like if there was low visibility in a port, to move beyond the 
judgment of the pilot to be able to make that vessel movement 
and whether or not there needs to be a government role in doing 
that. And that is handled differently around the country, but 
most notably, the pilot's associations make determinations on 
whether or not it's safe to move a vessel. But we have 
statutory authority to intervene as well.
    Senator Snowe. OK. Ms. Fleming, you mentioned several 
things, one of which, 51 spills, up to a billion dollars, which 
sounds like a lot of money for 51 oil spills. But you say in 
your report the Fund has been able to cover costs not paid by 
responsible parties, but risks remain.
    Ms. Fleming. Yes.
    Senator Snowe. So we're not able to recover the costs from 
the responsible parties with respect to the cleanup?
    Ms. Fleming. What I've highlighted in my statement is that 
the Coast Guard reports that as of the end of Fiscal Year 2006, 
the Fund balance was about $600 million.
    Senator Snowe. Yes.
    Ms. Fleming. At its peak, there was about $1.2 billion. 
There's enough, because of the recent reinstitution of the 
barrel tax, to cover non-catastrophic spills. However, we've 
highlighted in our work that there are other factors that could 
affect the solvency of the Trust Fund. For instance, there are 
still spills out there for which additional costs may accrue 
for instance, additional natural resource damage claims.
    As you know, in a 1991 spill, the claims were just filed 
and they were just paid by the fund. So another thing is that 
previously sunken vessels could discharge oil. That comes into 
play particularly if there is no viable responsible party, 
because the fund would pay the full cost for those types of 
incidents. So while the fund is in good shape to cover non-
catastrophic costs there are other factors that could affect 
the solvency of the fund.
    Senator Snowe. Yes, Admiral Allen?
    Admiral Allen. I just wanted to add that another issue is 
whether the response exceeds the limits of liability of the 
responsible party. Then the fund is vulnerable at that point. 
That's why it's very, very important to look at limits of 
liability.
    Senator Snowe. To raise them?
    Admiral Allen. Yes.
    Senator Snowe. Yes, to raise them? Would you agree, Ms. 
Fleming?
    Ms. Fleming. Yes. We agreed with that--it was a 
recommendation that we made in our September report, that for 
certain vessel types we change the liability limits to be more 
commensurate with the historic spill costs for certain vessels, 
such as tank barges.
    Senator Snowe. OK. Well, that's something obviously we 
should consider then and take action on. Thank you.
    Senator Cantwell. Thank you. Senator Lautenberg?
    Senator Lautenberg. OK. Admiral Allen, pursuant to the 
discussion that was just taking place with Senator Snowe and 
Ms. Fleming, what do you do where there is a billion-dollar 
cost allowed in the event of a catastrophic spill, what do you 
do in the case of a major spill that a billion dollars of 
Federal cleanup assistance is required, and the Trust Fund 
doesn't have it? What then takes place?
    Admiral Allen. Well, sir, first of all, it would depend on 
the vessel and the limits of liability and how much the 
responsible party had to pay. I'm assuming your question is 
based on the fact that we went over the limits of liability and 
over what was available in the fund. We would have to go back 
and seek additional appropriations or support from Congress to 
source the fund.
    Senator Lautenberg. How does that happen in a timeline that 
requires the additional funding?
    Admiral Allen. We have not had to do that in the history of 
the fund. As you know, we have reinstituted the upper-barrel 
tax and the fund is increasing back up. In fact, I would just 
like to make a correction, we're up around $943 million right 
now, and we're bringing in about $250 million to $300 million a 
year based on that tax, and we think we're going to stabilize 
at about $2 billion by 2014. We have not faced a catastrophic 
incident that challenged the entire amount of the fund yet, 
sir.
    Senator Lautenberg. Ms. Fleming, what brought you to 
revisit the Federal liability limits to better align the 
polluter responsibilities over damages that they cause in a 
spill?
    Ms. Fleming. We believe for certain vessel types, most 
notably tank barges, the liability limits are 
disproportionately low compared to historic oil spill costs. 
Even with the recent limits, the 2006 limits, we did an 
analysis that shows both the 1990 liability limits for certain 
vessel types, as well as the 2006, stayed disproportionately 
low compared to what a historic oil spill costs.
    Senator Lautenberg. Are barges enveloped in the same 
structure that provide the insurance necessary, the insurance 
that a regular vessel would have? Are the barges ever put in 
the separate designations that are not really able to meet the 
same financial obligations that a seagoing vessel would?
    Admiral Allen. They're covered and required to meet those 
obligations. Yes, sir.
    Senator Lautenberg. Admiral, it's been a year and a half 
since the Federal liability limits have been set. When will the 
Coast Guard publish new regulations requiring shippers to prove 
that they can meet the required financial liabilities now?
    Admiral Allen. Well, you know limits of liability have 
already been raised, subsequent to the legislation. What we are 
now required to do is raise the Certificate of Financial 
Responsibility; in other words, their assurance that they can 
pay that up to the same levels. That rule is in process right 
now. We're expecting to be published in 2008.
    Senator Lautenberg. And did the COSCO BUSAN possess your 
required proof of----
    Admiral Allen. They did. And as a result of the earlier 
legislation, their limits of liability range from approximately 
$31 million to almost $61 million regarding this particular 
incident.
    Senator Lautenberg. Does it look like that's going to be 
enough to cover the damage that resulted from this?
    Admiral Allen. Yes, sir.
    Senator Lautenberg. So it would fall--does it first fall to 
the fund or does it----
    Admiral Allen. The responsible party pays, sir.
    Senator Lautenberg. The responsible party----
    Admiral Allen. Yes, sir.
    Senator Lautenberg.--pays to whatever their liability is 
today.
    Admiral Allen. Yes, sir. As they move above the limits of 
liability, obviously, there is a conversation that has to 
occur. However, there are provisions that you can weigh the 
limits of liability based on certain circumstances, and those 
discussions are going on now with the Department of Justice.
    Senator Lautenberg. Are they required to meet those 
standards if they've got a vessel afloat? A higher level of----
    Admiral Allen. Up to their limits of liability, yes, sir.
    Senator Lautenberg. Up to the limit of the Federal 
liability standards?
    Admiral Allen. Yes, sir. And we see many companies that go 
above their limit of liability, just because it's the 
responsible thing to do. But they are captive to liability if 
there are certain exigencies that exist. In this case, there 
are reasons why you can move above the limits of liability 
based on the circumstances surrounding the incident itself. And 
quite frankly, we are discussing them now.
    Senator Lautenberg. Before Congress updated the Federal Oil 
Spill Liability Limits last year, the Coast Guard failed for 16 
years to raise the limits as required by law to keep up with 
the CPI. Now, as a result, we ended up subsidizing polluters by 
some $39 million. When will the Coast Guard next update these 
limits to keep up with inflation?
    Admiral Allen. Sir, there is not any procedure in place 
right now to add a Consumer Price Index increase to those 
limits, and that was fixed in the legislation in our committee 
rules. What we still have to do is move that over to the 
Certificates of Financial Responsibility, which is the 
financial assurance that they can pay, and that's already being 
done right now and will be issued in 2008, sir.
    Senator Lautenberg. It's been a year and a half since my 
law passed requiring the Coast Guard to create the Delaware 
River Oil Spill Advisory Commission. This Commission has still 
not had its first meeting. And the Coast Guard has not yet 
appointed members to it. What's taking place, Admiral?
    Admiral Allen. Sir, the situation is that the nomination 
period closes out in January, and we need to establish a 
committee.
    Senator Lautenberg. The time runs out in January?
    Admiral Allen. We have asked for nominations, and the 
nominating period closes in January, at which point we will 
send the paperwork for the establishment of the Committee, sir.
    Senator Lautenberg. You're prepared to present candidates?
    Admiral Allen. Yes, sir.
    Senator Lautenberg. Thank you very much, Madam Chairman.
    Senator Cantwell. Thank you. Senator Boxer?
    Senator Boxer. Thank you so much, Senator, again. It's my 
understanding if there is gross negligence then the cap doesn't 
apply. Is that correct?
    Admiral Allen. There's a provision for that. Yes, ma'am.
    Senator Boxer. So that if--So the cap only applies if it 
was just sort of an act of God. But if it's gross negligence, 
the cap doesn't apply. Let me just ask our GAO person this 
question. My understanding is we have several issues here. One 
is the cap itself, and the second issue is that the cap is 
different for oil tankers versus cargo ships. It's like half 
the amount. And it seems to me, as Senator Feinstein and I 
looked at this, and I'm so happy everyone is interested in 
this, because this will go over to the EPW. But if we can come 
up with--obviously, Senator Feinstein and I are certainly not 
wedded to what we did, but let me tell you what we did.
    We took the limits for the nontanker ships, put the cargo 
ships, such as this ship that crashed into the Bay Bridge, and 
we moved it up to equal the liability cap of the tankers, 
because now, as Senator Snowe points out, there is so much more 
oil being carried by these other type of ships. So we equalized 
it. And also, I guess, the third question is the issue of the 
double hulls. Right now, is there a different cap if you have a 
double hull?
    Admiral Allen. In establishing limits of liability, there 
is.
    Senator Boxer. Good.
    Admiral Allen. Double hulls, double size, there is 
different----
    Senator Boxer. Right.
    Admiral Allen.--gradations, and then it's an amount by 
gross tonnage, and we can provide----
    Senator Boxer. OK.
    Admiral Allen.--a detailed----
    Senator Boxer. Well, my understanding is it's 3,000 per 
gross ton for a single-hulled vessel and $1,800 for a double-
hulled vessel is what we have per gross ton. But I said in my 
comments, the issue is equalizing this. And then, the next 
issue is maybe we want to review the double hulls more as we 
reform this. So I think this is an area that we really need to 
deal with. Just in all honesty, I am very disappointed in your 
response to Senator Cantwell's questions about the Vessel 
Response Plans. And in her prodding you, saying can you promise 
to be here, in your answer, well, it would have to displace 
other rules, so I really can't tell you.
    Now, this law passed in 2004. We're going into 2008. That's 
4 years. It's unacceptable. So could you tell me what we can do 
to help you get the resources you need, the people you need? 
Because it's just not right. That's not an answer we want to 
hear. We know the Coast Guard has a lot of issues being part of 
Homeland Security, and one of the things we worried about when 
the Coast Guard went into Homeland Security is, you know, we 
were afraid that maybe this would take second tier of your 
interests.
    Now, it can't. You have to tell us what you need to do 
everything: Homeland Security and protecting our resources. 
Because I'll tell you, if this starts to take second fiddle, 
and we have more of these issues, we look at more of these 
birds, and we can't have a fishing season, we are looking at a 
very grim future indeed. So can you tell us, from your bottom 
of your heart and in all honesty, how can we help you get to 
the point where you have the resources to do all the 
rulemakings that you have to do?
    Admiral Allen. Well, it's more people to do legal analysis, 
economic analysis, regulatory analysis, and all the 
requirements of the Administrative Procedures Act and all of 
the policy guidance. Some of these require environmental impact 
statements.
    Senator Boxer. Yes.
    Admiral Allen. The hoops you have to jump through for some 
of these rules are extensive. The average time to make a rule 
in the Coast Guard right now--not just because of resources, 
but because of the process, because I think we have to look at 
the process, too--is 3.5 years. That is unsatisfactory.
    Senator Boxer. Yes. Well, could you please, in writing, 
just--we're asking a question. If you were to have to do--if 
you decided you want to complete all your rulemakings that 
you've had to set aside, what would you need? Because it would 
help us. We want to be there for you. We want this to happen I 
can tell you. We can't sit back. I mean, we pass these laws, 
and then colleagues, we think they're going to do the rules, 
and they don't do the rules because they don't have the 
resources. It's just wrong. And it's not an answer. It's not 
going to satisfy my people back home. So thank you for your 
candor, and I look forward to getting this.
    [The requested information follows:]

    The Coast Guard has chartered a Rulemaking Review and Reform 
Project (RRRP) to conduct a top to bottom review of our rulemaking 
processes and to facilitate increases in capacity. The RRRP will assess 
the current state of rulemaking, determine root causes of rulemaking 
delays and identify specific opportunities for improvement. The RRRP 
will deliver a complete report with recommendations and an 
implementation plan by April 2008.
    Moreover, the Consolidated Appropriations Act, 2008 (Pub. L. 110-
161) provided the Coast Guard with 31 additional full time positions to 
apply toward rulemaking efforts. A working group within the RRRP has 
begun an expedited process for hiring these new rulemaking personnel. 
We expect to begin hiring personnel by April 1, 2008 and to be near 
full complement by September 30, 2008. These additional resources will 
allow us to make significant, near-term progress in our existing 
rulemaking backlog.

    Senator Boxer. Now, I wanted to ask a question about bunker 
fuel, and then I'll be done. The Coast Guard has represented 
the United States at the International Maritime Organization 
negotiations on bunker fuel, recommending that either lower 
sulfur be used, or technology used to retrofit existing ships. 
In light of the recent tragedy in San Francisco Bay, should the 
United States consider taking a stronger stand by supporting a 
ban on bunker fuel, just flat-out?
    Admiral Allen. We could do that, ma'am, but I'm not sure it 
would have the constructive effect, because we can only 
regulate what goes on within our economic zone in our 
territorial sea. Many ships would end up carrying two tankers 
of fuel, using bunker fuel outside the EEZ, and leaving the 
larger----
    Senator Boxer. Absolutely. And guess what? If that's what 
happens, that's a huge victory for our people, because my 
people, who live around ports, and I'm sure it goes to--we have 
all the ships coming in. We do 40 percent of the exports that 
come through Los Angeles/Long Beach, and I've got to tell you, 
the people are suffering. The kids who live around there, they 
have lower lung development.
    And if that happens, we feel that that is a first step. We 
would love to see an international agreement. But short of 
that, we have legislation that would ban the bunker fuel. But I 
have to just say, if you have to change your fuel when you get 
close to American waters, fine. But if you want the privilege 
of coming into our waters, then you need to step up to the 
plate and keep the air clean, because this bunker fuel--that's 
what spilled in the bay. This is horrific. It's terrible on the 
lungs, it's terrible on the water. And so, sir, I think if the 
outcome was, yes, that we have to get them to change the fuel 
as they're coming into our ports, then that will help us.
    Admiral Allen. Yes, ma'am. I would say that this has been 
done under MARPOL Annex VI, which involves air emissions. It 
would remove some of the bunker fuel, but there will be bunker 
fuel on the ship that it used to maneuver before it came into 
the country.
    Senator Boxer. I under----
    Admiral Allen. I just want to be clear.
    Senator Boxer. I totally get it. That's why we're amending 
the Clean Air Act. That's why our bill does that in the EPW 
Committee. Well, thank you.
    Senator Cantwell. Thank you. Senator Kerry?
    Senator Kerry. Thank you, Madam Chairman. So Admiral, I 
sort of asked a question, in essence, to really summarize your 
familiarity with the Oil Spill Prevention Act that was passed 
in Massachusetts. In several other states, the Coast Guard did 
not challenge similar legislation. We had several oil spills 
back in the day, so why does the Coast Guard not allow 
Massachusetts to protect its own environmental interests there?
    Admiral Allen. Sir, I don't think it's a matter of that. 
And, in fact, I think on 85 and 90 percent of what's involved 
here, we actually agree. The real issue is the inclusion----
    Senator Kerry. We know what it involves if we go to court. 
I mean----
    Admiral Allen. Well, these are the double hulls, sir, as 
you know.
    Senator Kerry. I know, but--well, I understand that. But 
that's exactly what they want to require, any major ship 
carrying major amounts of oil, no matter what, double hull or 
not, because double hull, as it obviously draws more, and has 
as much risk in a shallow area if it--if somebody mis-
navigates. I mean, the last spill took place because they went 
for the wrong side of the navigation buoy.
    Admiral Allen. Yes, sir.
    Senator Kerry. So why can't a double hull do that?
    Admiral Allen. Sir, when we do a rulemaking, again, like we 
were talking about earlier, under the Administrative Procedures 
Act and the current guidelines, we have to do a regulatory 
analysis and an economic analysis, and look at the cost 
benefits of the solution that we're going to provide in the 
rules. When you do that, the cost of regulating a double-hull 
tanker in which an investment has already been made has a 
higher degree of safety, and you work through this process, it 
drives you to different than what the state arrived at, then we 
have the issue of trying to provide a standard set of rules 
across the country, so that we're not dealing with 50 different 
sets of guidelines within the Federal Government, sir. We'd be 
happy to work with you on it, sir.
    Senator Kerry. Well, I understand that--I mean, it's not 
skin off your back if a state has a stricter requirement, as 
long as the ship that's coming through is going to enforce it. 
I mean, the requirement is pretty simple. They've got to have a 
minimum staffing watch requirement. That's fairly standard 
fare. They've got to have a tug pilot, and then, a mandatory 
navigational route.
    Admiral Allen. Yes, sir.
    Senator Kerry. I mean, what is complicated about that?
    Admiral Allen. Sir, there is nothing complicated about it 
at all, and it would be a higher degree of safety were we to 
apply this to double hulls. All I was saying is the analysis 
that a company's rulemaking required to do leads you to an 
answer that says there is not a greater benefit to include 
double hulls through the regulatory process. And if that's 
unsatisfactory, we need to look at that process, sir.
    Senator Kerry. Well, obviously, the state disagrees with 
you.
    Admiral Allen. Yes, sir.
    Senator Kerry. So in effect, the Coast Guard is, by virtue 
of its oppositional roles, trying to overrule the state's 
desire to regulate its own waters.
    Admiral Allen. No, sir. I think what we're trying to do is 
take a Federal position, and there are a lot of higher legal--
--
    Senator Kerry. You've never taken that position in other 
places.
    Admiral Allen. Sir, the position we have taken regarding 
special areas and what the state has done, I think we have been 
consistent. I can provide you the background on that.
    Senator Kerry. Is that the only place where there is a 
double hulled rule of this type?
    Admiral Allen. I would have to go back and check, sir. I 
would be happy to respond for the record.
    Senator Kerry. Would you, please?
    Admiral Allen. Yes, sir.
    [The requested information follows:]

    In August 2007, The First Coast Guard District published amendments 
to an existing regulated navigation area that includes Buzzards Bay. 
The rule accomplished four objectives:

        (1) It requires tug escorts for single-hull tankers transiting 
        Buzzards Bay and carrying 5,000 or more barrels of oil or other 
        hazardous material.

        (2) It requires a federally licensed pilot, in addition to the 
        crew, to be onboard the primary tug during the transit.

        (3) It maintains the recommended route for tankers as 
        ``recommended'' vice mandatory to allow mariners maximum 
        flexibility in the event of unusual circumstances and;

        (4) It establishes a vessel movement reporting system to better 
        track and monitor tanker movements in the Bay.

    It is true that the Massachusetts state rule, currently being 
challenged by the Department of Justice in Federal court, requires tug 
escorts and state licensed pilots for double-hulled tankers, as well. 
During the rulemaking process, the state asked that the Coast Guard 
adopt the same rule. After careful consideration, the Coast Guard 
rejected the state's proposal, for the following reasons:

        1. As stated in the preamble to the Final Rule, the Coast Guard 
        believes that double hulls provide a sufficient margin of 
        safety for tankers transiting Buzzards Bay. The bottom 
        characteristics of the Bay are primarily rocky--a condition 
        double hulls are designed to protect against. The State has 
        repeatedly cited a situation in the Gulf of Mexico where a 
        double-hulled tanker was involved in a spill. This situation 
        presented a unique set of facts--a tanker struck a submerged, 
        uncharted oil platform that sank during Hurricane Rita. These 
        facts are unlikely to be repeated in Buzzards Bay.

        2. As Admiral Sullivan, the First District Commander, stated 
        when the final rules were published, the Coast Guard is seeking 
        opportunities to create economic incentives for shippers to use 
        double hull tankers; the State's rule, by requiring tug escorts 
        of both single and double hull tank vessels removes that 
        incentive. Prior to the B-120 spill in 2003, approximately 20 
        percent of tanker transits through Buzzards Bay were in double 
        hull tankers. In 2005, that percentage rose to nearly 58 
        percent, and has since remained at that level. The Coast Guard 
        seeks to increase that percentage; our regulatory choice is one 
        method of accomplishing that goal. By Federal statute, single 
        hull tankers will be largely phased out in the U.S. by 2015. 
        The Coast Guard has no authority to accelerate that timetable. 
        In contrast, the international phase-out will be largely 
        complete by 2010. Without double hull incentives in certain 
        sensitive areas like Estuaries of National Significance 
        (Buzzards Bay is so designated), use of single hull tankers 
        might conceivably increase.

        3. It has long been the Coast Guard's position that consistent, 
        uniform national and international regulation is the most 
        effective method to ensure navigation safety and protection of 
        the marine environment. The majority of maritime accidents are 
        caused by human error, and a confused mariner is an unsafe 
        mariner. Conflicting Federal and state regulations can create 
        such confusion. The Coast Guard wants mariners to concentrate 
        on navigating safely, not on whether a state rule or a Federal 
        rule applies in a certain waterway.

    Regulated Navigation Areas, such as the one covering Buzzards Bay, 
are created under the authority of the Ports and Waterways Safety Act 
of 1972, as amended. That statute requires the Coast Guard to consult 
and work closely with affected states before promulgating any new rules 
regulating vessel traffic. The Coast Guard takes that mandate very 
seriously, as interaction with our state and local partners is a 
crucial component of developing sound, sensible rules. In the case of 
the Buzzards Bay rule, the Coast Guard coordinated closely with state 
and local government through briefings, public hearings and by giving 
the state and several cities and towns formal consultative status 
during the rulemaking process. In the final analysis, our nation, as 
described in the Federalist Papers, through the founding of the 
Republic and in numerous, subsequent Congressional and Supreme Court 
actions, has long recognized the need to ultimately speak with one 
voice on matters maritime.
    The actions of the Coast Guard throughout this rulemaking process 
have been consistent with those objectives, while always keeping in 
mind the value and importance of input from all stakeholders. San 
Francisco Bay, Prince William Sound and Puget Sound are the only other 
places where there are tug escort rules for tankers. The conditions in 
those places, as well as the statutory and regulatory history for their 
creation are sufficiently distinct that they may not be compared to 
Buzzards Bay to determine what requirements should exist in Buzzards 
Bay. For example, in San Francisco, there are no Federal tug escort 
rules with which the state rule might conflict, and no indication that 
there is a need for any Federal tug escort regulation. In Prince 
William Sound, the rules are statutorily mandated as part of Oil 
Pollution Act of 1990. In Puget Sound, the tank vessels requiring 
escort serve only ports in the State of Washington, whereas in Buzzards 
Bay, they serve several states (Rhode Island, Connecticut, New York, 
New Hampshire and Maine), in addition to Massachusetts, and thus an 
obvious need for Federal uniformity.
    Finally, the law established by the Supreme Court in U.S. v. Locke 
in 2000, strengthened and clarified how Federal rules applicable to 
vessel regulation preempt state rules. This strengthened Federal 
preemption regime for vessel regulation was not so clear when the Puget 
Sound rules were adopted in 1994.

    Senator Kerry. I think you should. And, you know, it's--
well, it's obviously frustrating, particularly when you look at 
the cost issue. Secretary Glackin, the NOAA Damage Assessment 
Remediation and Restoration is not yet completed, the damage 
assessment for Buzzards Bay. And the community has not been 
compensated for shellfish loss, salt marsh, beach damage, et 
cetera. What is the status of when will the community be 
compensated to have those environmental issues being addressed?
    Ms. Glackin. Senator, I'll have to get back to you with the 
specifics on that, but I can tell you that that activity is 
ongoing and we're moving forward with that. I'm sorry. I'm just 
not prepared to give you a date.
    Senator Kerry. Would you get us something more specific, 
please?
    Ms. Glackin. Absolutely.
    Senator Kerry. We are moving forward. It's been several 
years now. It just goes on and on. These folks are not big 
conglomerates and corporations; they get hurt, they get hurt.
    Ms. Glackin. I understand.
    Senator Kerry. And the compensation is pretty critical. And 
we're supposed to do that for them.
    Ms. Glackin. Yes. I understand.
    Senator Kerry. All of us. You, me, et cetera. So I'd like 
to see if we could address that. Admiral, you know, for the 24 
years that I've been on this Committee, almost 24, I've been 
involved with these issues with the waterways, the Coast Guard. 
I used to be Chairman of the Subcommittee with the Coast Guard. 
And I've always been frustrated. I mean, I'm frustrated. I 
imagine you are, and you can't say it. You and I have had a 
little bit of this discussion previously.
    But the Coast Guard's responsibilities just keep getting 
bigger and bigger, and go up and up and up. You know, and any 
fair measurement says that you're not getting what you need in 
terms of the increases in complement to your personnel and to 
your assets. And so, it's hard for us to sit here and sort of 
measure really where we are in terms of Homeland Security 
requirements, drug interdiction requirements, public safety 
requirements, enforcement, EPA enforcement, and all those other 
things you have to do.
    And I wonder if you can share with us--I mean, I know it's 
difficult under the structure we have--but can you at least 
share with us the priorities that you wish you had to have a 
better ability to be able to address?
    Admiral Allen. I can say that I can tell you that these 
priorities also represent Secretary Chertoff, as well, because 
I talked with him personally about it. We have to put more 
people in certain critical functions at least in the 
perceptions of our stakeholders and overseers, whether or not 
our performance has diminished, at least, there is a perception 
that we've been diverting and not been taking care of business. 
And there is another safety area with inspections, other areas 
of rulemaking, watch standards for our command centers in our 
ports, people that play a direct impact on managing the 
waterways and preventing these events from happening. I've made 
my requirements clear, and thus far I've gotten support from 
the Secretary.
    Senator Kerry. Well, can I emphasize something that's 
bothered me for a long, long time? I was recently down in South 
Africa, and in South Africa, in the port, I saw a lot of 
Taiwanese and Japanese trawlers and fishing vessels in the 
South African port. Senator Stevens and I took the issue of the 
driftnet fishing to the United Nations in the 1990s, and we 
succeeded in getting it banned. But there were folks out there 
doing it, and about 50 percent or more of the catch is ``by 
catch'' and it's discarded.
    And all across the globe, but obviously, we care--we have 
to care about it all, but our primary focus is needless to say 
on our shorelines. But I talked to our own fishermen. I've seen 
and it's happening up in New England and elsewhere. We just 
don't have adequate capacity to enforce, to monitor anywhere. 
And I'd like not see that left out of the list of immediate 
priorities. I mean, we've got to have the ability to be able to 
bring stocks back and enforce fisheries, or else we're in 
trouble.
    Admiral Allen. I can give you a response for the record. I 
can give you a couple of highlights, if you'd like, sir.
    Senator Kerry. I would.
    Admiral Allen. One of the real issues--and you know this 
all too well from your service--is maritime patrol aircraft and 
sensors to be able to understand what's out there, establish a 
threat, and be able to interdict a target of interest. We have 
done a couple of things in the last couple of years that I 
think are going to provide us a significant improvement on our 
performance there. This last year, we combined maritime patrol 
aircraft from Japan and Canada, working with the Coast Guard 
cutter with a Chinese shiprider on interdicting seven high seas 
driftnet cases in the middle of the Pacific. Three of them 
constituted severe enough infractions that we took them back to 
the Chinese and turned them over for prosecution. We also 
established an adjoined program office with Customs and Border 
Protection on UAVs, trying to extend our region and also take 
care of the new Hawaiian Island Sanctuary, sir. But I can 
provide you more for the record.
    [The requested information follows:]

    The attached annual Report of the Secretary of Commerce to the 
Congress of the United States Concerning U.S. Actions Taken on Foreign 
Large Scale High Seas Driftnet Fishing (2006) incorporates Coast Guard 
contributions and summarizes overall U.S. Government actions to combat 
High Seas Driftnet (HSDN) fishing worldwide. Coast Guard HSDN 
enforcement operations have focused exclusively on the North Pacific 
Ocean. The success of Coast Guard HSDN enforcement operations in the 
North Pacific results from dedicated cooperation with, and coordinated 
planning between, a number of Pacific Rim governments and counterpart 
enforcement agencies.
Coast Guard HSDN Enforcement Efforts in 2007
    U.S.-PRC HSDN Enforcement MOU. The United States and the People's 
Republic of China (PRC) conducted joint operations in 2007 pursuant to 
the terms of a Memorandum of Understanding (MOU) to ensure effective 
implementation of United Nations General Assembly (UNGA) Resolution 46/
215 in the North Pacific Ocean. The MOU (also referred to as the 
``U.S.2DPRC Shiprider Agreement'') established boarding procedures for 
law enforcement officials of either country to board and inspect U.S. 
or Chinese-flagged vessels suspected of driftnet fishing. The MOU 
allows PRC officials to embark on U.S. Coast Guard vessels or aircraft.
    Coast Guard Partnership with the PRC Fisheries Law Enforcement 
Command (FLEC). The Coast Guard has had a strong working relationship 
with the PRC Fisheries Law Enforcement Command (FLEC) for well over a 
decade, and China has provided opportunities for 46 enforcement 
officials to visit and work with the Coast Guard since 1994. In May 
2007, the Coast Guard hosted familiarization visits for PRC FLEC 
enforcement officers as well as an operational planning meeting for the 
2007 enforcement season. Two FLEC officers rotated through the North 
Pacific Regional Fishery Training Center in Kodiak, Alaska from April 
through August 2007. In addition, two Chinese FLEC shipriders were 
deployed on U.S. Coast Guard Cutters (USCGCs) BOUTWELL and MIDGETT 
during their Illegal, Unregulated, Unreported (IUU) fisheries patrols. 
The FLEC officials in Kodiak passed real-time operational information 
to their colleagues onboard the Coast Guard cutters at sea. These 
officials were instrumental in facilitating communications between the 
Coast Guard and the PRC FLEC, effectively expanding the jurisdictional 
reach of both enforcement agencies and allowing for the largest number 
of HSDN vessel seizures in the North Pacific since implementation of 
the MOU. The Coast Guard hopes to host additional PRC officials during 
the 2008 fishing season.
    Aircraft patrols. In recent years, the Coast Guard has patrolled 
High Threat Areas in the North Pacific in support of the U.S. High Seas 
Driftnet Enforcement Act and North Pacific Anadromous Fish Commission 
(NPAFC) initiatives, as well as to monitor compliance with the United 
Nations (UN) moratorium on large-scale HSDN operations. Operation North 
Pacific Watch, the Coast Guard's 2007 multi-national HSDN enforcement 
campaign, began in April with support from Canadian deployments to 
Shemya Island, Alaska, Coast Guard Air Station Kodiak, Alaska deployed 
once from Shemya to patrol the HSDN High Threat Area, and additional 
Coast Guard HC-130s flew in late September 2007 to support joint 
operations with USCGC BOUTWELL and USCGC MIDGETT.
    In early September 2007, a Coast Guard Seventeenth District law 
enforcement officer participated in a joint surveillance aircraft 
patrol with the Japan Coast Guard (JCG) (the second of such flights, 
the first being in 2006). The purpose of this JCG flight was to patrol 
for IUU fishing activity and perform communications exercises with 
USCGC BOUTWELL. The patrol identified several radar contacts in the 
HSDN High Threat Area but weather conditions precluded a specific 
determination of vessel type and activity. This information did, 
however, directly facilitate subsequent positioning of USCGC BOUTWELL 
for follow-on HSDN interdictions.
    Surface patrols. USCGC BOUTWELL also participated in a multi-
national IUU fisheries enforcement patrol from July 22 to November 7, 
2007 that included NPAFC party states and fisheries law enforcement 
officials from the PRC. USCGC BOUTWELL patrolled the HSDN High Threat 
Area, made port calls in Japan, Russia, and China, and embarked a PRC 
Fisheries Law Enforcement Command (FLEC) shiprider. USCGC MIDGETT 
deployed on short notice from the Bering Sea to the HSDN High Threat 
Area in late September due to reports of multiple possible HSDN fishing 
vessel sightings. USCGC MIDGETT expanded the surface patrol coverage 
through coordinated patrolling with USCGC BOUTWELL. During September 
and October of 2007, these U.S. Coast Guard Cutters interdicted and 
subsequently transferred custody of six PRC-flagged HSDN-capable 
fishing vessels to Chinese authorities for additional investigation and 
prosecution.
    While patrolling on September 14, 2007, USCGC BOUTWELL's embarked 
helicopter located the Indonesian F/V FONG SENG No. 818 rigged for 
large-scale driftnet fishing on the high seas. As USCGC BOUTWELL closed 
position, the crew of FONG SENG No. 818 conducted evasive maneuvers and 
attempted to conceal nets and gear on deck. USCGC BOUTWELL documented 
the vessel's configuration and activity, while at the same time 
performing Right of Approach \1\ questioning alongside the vessel to 
gather registry information, which USCGC BOUTWELL was eventually able 
to obtain. The Coast Guard joined with the U.S. Department of State to 
report this activity to the Government of Indonesia and has initiated 
diplomatic dialogue regarding F/V FONG SENG No. 818's observed 
activities. It is suspected that FONG SENG No. 818 is a sister ship of, 
and is associated with, the F/V RONG SHENG No. 828, which Russian 
authorities seized on the high seas in June 2007 with a reported 90 
metric tons of salmon onboard.
---------------------------------------------------------------------------
    \1\ Annotated Supplement to the Commanders Handbook of the Law of 
Naval Operations, Naval War College, 1997 (Section 3.4)
---------------------------------------------------------------------------
    In addition to the enforcement efforts associated with seizure of 
the six PRC-flagged large-scale HSDN vessels, USCGC CHASE conducted a 
joint IUU fisheries law enforcement patrol, officer exchange, and 
training engagement with the Russian Federal Security Service patrol 
vessel VOROVSKY in April 2007. The vessels conducted a joint boarding 
exercise on the Alaska State Trooper vessel WOLSTAD in preparation for 
future North Pacific IUU fishing and Central Bering Sea law enforcement 
operations.

2006 Report of the Secretary of Commerce to the Congress of the United 
 States Concerning U.S. Actions Taken on Foreign Large-Scale High Seas 
  Driftnet Fishing Pursuant to Section 206(e) of the Magnuson-Stevens 
 Fishery Conservation and Management Act, As Amended by Public Law 104-
               297, The Sustainable Fisheries Act of 1996

I. Introduction
    Public Law 101-627: The President signed Public Law 101-627, the 
Fishery Conservation Amendments of 1990, on 28 November 1990. Title I, 
Section 107, of the law amended Section 206 of the Magnuson-Stevens 
Fishery Conservation and Management Act (hereafter referred to as the 
Magnuson-Stevens Act) (16 U.S.C. 1826) to incorporate and expand upon 
provisions of the Driftnet Impact Monitoring, Assessment, and Control 
Act of 1987.
    Section 206(b) of the Magnuson-Stevens Act sets forth Congressional 
findings, including inter alia that ``the continued widespread use of 
large-scale driftnets beyond the exclusive economic zone (EEZ) of any 
nation is a destructive fishing practice that poses a threat to living 
marine resources of the world's oceans.'' It also notes the expansion 
of large-scale driftnet fishing into other oceans and acknowledges the 
30 June 1992 global driftnet moratorium called for by United Nations 
General Assembly (UNGA) Resolution 44/225. Finally, Section 206(b) 
recognizes the moratorium on the use of large-scale driftnets agreed 
through the Convention for the Prohibition of Fishing with Long 
Driftnets in the South Pacific, also known as the Wellington 
Convention.
    Section 206(c) sets forth Congress's driftnet policy, specifically 
that the United States should:

        (1) implement the moratorium called for by UNGA Resolution 44/
        225;

        (2) support the Tarawa Declaration and the Wellington 
        Convention; and

        (3) secure a permanent ban on the use of destructive fishing 
        practices, and in particular large-scale driftnets, by persons 
        or vessels fishing beyond the exclusive economic zone of any 
        nation.

    Section 206(d) directs the Secretary of Commerce, through the 
Secretary of State and the Secretary of Homeland Security, to seek to 
secure international agreements to implement immediately the findings, 
policy, and provisions of Section 206, particularly the international 
ban on large-scale driftnet fishing.
    Section 206(e) directs the Secretary of Commerce, after 
consultation with the Secretaries of State and Homeland Security, to 
submit to Congress no later than 1 January an annual report (1) 
describing the efforts made to carry out Section 206, especially 
subsection (c); (2) evaluating the progress of those efforts, the 
impacts on living marine resources, including available observer data, 
and plans for further action; (3) listing and describing any new high 
seas driftnet fisheries developed by nations that conduct or authorize 
their nationals to conduct large-scale high seas driftnet fishing; and 
(4) listing nations that conduct or authorize their nationals to 
conduct high seas driftnet fishing in a manner that diminishes the 
effectiveness of or is inconsistent with any international agreement 
governing large-scale driftnet fishing to which the United States is a 
party. (The number of reporting requirements in Section 206(e) of 
Public Law 101-627 were reduced in 1996 to those above by Public Law 
104-297, the Sustainable Fisheries Act.)
    Finally, Section 206(f) provides that, if at any time the Secretary 
of Commerce, in consultation with the Secretaries of State and Homeland 
Security, identifies any nation that warrants inclusion in the list 
described in (4) above, the Secretary shall certify that fact to the 
President. This certification shall be deemed to be a certification for 
the purposes of Section 8(a) of the Fishermen's Protective Act of 1967 
(22 U.S.C. 1978(a), as amended by Public Law 102-582), commonly 
referred to as the Pelly Amendment. Such a certification gives the 
President discretion to embargo products imported into the United 
States from that nation, so long as such action is consistent with U.S. 
obligations under the General Agreement on Tariffs and Trade.
    Public Law 102-582: On 2 November 1992, the President signed Public 
Law 102-582, the High Seas Driftnet Fisheries Enforcement Act. Among 
other things, this Act is intended to enforce implementation of UNGA 
Resolution 46/215, which called for a worldwide driftnet moratorium 
beginning 31 December 1992. Once the Secretary of Commerce identifies a 
country as a nation whose nationals or vessels are conducting large-
scale driftnet fishing beyond the EEZ of any nation, pursuant to the 
Act, a chain of U.S. actions is triggered. The Secretary of the 
Treasury must deny entry of that country's large-scale driftnet vessels 
to U.S. ports and navigable waters. At the same time, the President is 
required to enter into consultations with the country within 30 days 
after the identification to obtain an agreement that will effect the 
immediate termination of high seas large-scale driftnetting by its 
vessels and nationals. If these consultations are not satisfactorily 
concluded within 90 days, the President must direct the Secretary of 
the Treasury to prohibit the importation into the United States of 
fish, fish products, and sport fishing equipment from the identified 
country. The Secretary of the Treasury is required to implement such 
prohibitions within 45 days of the President's direction.
    If the above sanctions are insufficient to persuade the identified 
country to cease large-scale high seas driftnet fishing within 6 
months, or if it retaliates against the United States during that time 
period as a result of the sanctions, the Secretary of Commerce is 
required to certify this fact to the President. Such a certification is 
deemed to be a certification under Section 8(a) of the Fishermen's 
Protective Act of 1967 (22 U.S.C. 1978(a), as amended by Public Law 
102-582).
    Public Law 104-43: Public Law 104-43, the Fisheries Act of 1995, 
was enacted on 3 November 1995. Title VI of this law, the High Seas 
Driftnet Fishing Moratorium Protection Act, prohibits the United 
States, or any agency or official acting on behalf of the United 
States, from entering into any international agreement with respect to 
the conservation and management of living marine resources or the use 
of the high seas by fishing vessels that would prevent full 
implementation of UNGA Resolution 46/215. Title VI also charges the 
Secretary of State, on behalf of the United States, to seek to enhance 
the implementation and effectiveness of the UNGA resolutions and 
decisions regarding the large-scale high seas driftnet moratorium 
through appropriate international agreements and organizations. 
Finally, the Act specifies that the President of the United States 
shall utilize appropriate assets of the Department of Defense, the U.S. 
Coast Guard (USCG), and other Federal agencies, to detect, monitor, and 
prevent violations of the U.N. large-scale high seas driftnet 
moratorium for all fisheries under the jurisdiction of the United 
States, and to the fullest extent permitted under international law for 
fisheries not under U.S. jurisdiction.
    The National Marine Fisheries Service (NMFS), National Oceanic and 
Atmospheric Administration (NOAA), Department of Commerce, in 
consultation with the Department of State and the Department of 
Homeland Security, submits the following report for 2006 in fulfillment 
of the Section 206(e) reporting requirement. Information pertaining to 
U.S. actions in support of the Act prior to 2006 and after 1988 can be 
found in the 1990-2005 annual driftnet reports to the Congress 
available from NMFS.

II. Description and Progress of Efforts Made to Carry Out Provisions of 
        Section 206(c) Policy

A. Implementation of the Driftnet Moratorium Called for by UNGA 
        Resolutions 
        44/225, 45/197, and 46/215

1. Current Status of the Driftnet Moratorium
    As of 31 December 2006, the UNGA global moratorium on large-scale 
high seas driftnet fishing has been in effect for 14 years. 
International implementation of the moratorium in the world's oceans 
and enclosed and semi-enclosed seas continues to be generally 
successful, although problem areas remain. Of the two major problem 
areas in recent years, the North Pacific Ocean and the Mediterranean 
Sea, 98 vessels capable of conducting unauthorized large-scale high 
seas driftnet fishing operations were sighted \1\ in the North Pacific 
Ocean in 2006. At least 12 vessels were reported operating on the high 
seas of the Mediterranean Sea in 2006 with large-scale driftnets.
---------------------------------------------------------------------------
    \1\ A number of these vessels were unidentified, raising the 
possibility of multiple sightings of the same vessel or vessels. For 
purposes of this report, only those vessels that were visually 
confirmed as driftnet-capable have been considered sightings.
---------------------------------------------------------------------------
a. North Pacific Ocean
    No large-scale driftnet fishing vessels were intercepted on the 
high seas of the North Pacific Ocean by the international community in 
2006. However, 98 vessels capable of driftnet fishing were sighted 
operating in the Northwestern Pacific.
(1) Regional Driftnet Enforcement Coordination
    North Pacific Anadromous Fish Commission (NPAFC): The NPAFC serves 
as a forum for promoting the conservation of anadromous stocks and 
ecologically-related species, including marine mammals, sea birds, and 
non-anadromous fish, in the high seas area of the North Pacific Ocean. 
This area, as defined in the Convention for the Conservation of 
Anadromous Stocks in the North Pacific Ocean (the Convention that 
established the NPAFC), is ``the waters of the North Pacific Ocean and 
its adjacent seas, north of 33+ North Latitude beyond 200 nautical 
miles from the baselines from which the breadth of the territorial sea 
is measured.'' The members of the NPAFC are Canada, Japan, the Republic 
of Korea (Korea), Russia, and the United States.
    In addition, the NPAFC serves as the venue for coordinating the 
collection, exchange, and analysis of scientific data regarding the 
above species within Convention waters. It also coordinates high seas 
fishery enforcement activities by member countries. The Convention 
prohibits directed fishing for salmonids and includes provisions to 
minimize the incidental take of salmonids in other fisheries in the 
Convention area. Although it does not specifically ban high seas 
driftnet fishing, fishing for salmonids on the high seas has 
historically been carried out in this manner. As a result, the NPAFC 
and its enforcement activities are primarily targeted against high seas 
driftnet fishing vessels. The members of the NPAFC jointly plan and 
coordinate their high seas enforcement operations in order to most 
efficiently utilize enforcement resources.
    NPAFC Enforcement Evaluation and Coordination Meeting (EECM): 
Representatives of the NPAFC Parties met in Juneau, Alaska, on 28 
February-1 March 2006, for the annual NPAFC EECM. The meeting included 
presentations by each Party on enforcement efforts to date in 2006; 
coordination of enforcement plans and resources for the remainder of 
2006; a demonstration on the use of the Parties' Integrated Information 
System (IIS), a software tool developed by Russia to improve 
information sharing and coordination; and a discussion on the 
applicability of the FAO model scheme on port state measures to combat 
illegal, unreported and unregulated (IUU) fishing in the NPAFC 
Convention Area. The Parties also discussed the characterization of 
vessels to be placed on a ``Vessels of Interest'' list on the IIS; 
i.e., those vessels believed to be engaged in fishing activity contrary 
to the Convention.
    On 2 March, following the EECM, an enforcement symposium ``Patrol 
tactics, planning and execution of enforcement in the NPAFC Convention 
Area'' was held in Juneau. The purpose of the symposium was to bring 
together enforcement professionals from each of the NPAFC Parties to 
share lessons learned and best practices from their respective 
agencies. Enforcement officers, ship captains, and air crews from 
Canada's Department of Fisheries and Oceans (DFO) and Department of 
National Defense (DND), Japan's Fisheries Agency (FAJ) and Coast Guard, 
Republic of Korea's Ministry of Maritime Affairs and Fisheries, 
Russia's Federal Security Service, and the United States' NMFS and USCG 
participated. Each agency made a presentation which was followed by 
lengthy and spirited discussion. The NPAFC funded the attendance of two 
representatives from each of the Parties. The symposium fostered a very 
productive exchange of ideas and presented a valuable opportunity for 
the actual vessel, aircraft, and enforcement officers to meet each 
other prior to the beginning of the 2006 fishing season.
    NPAFC Annual Meeting: The 14th Annual Meeting of the NPAFC was held 
in Vancouver, British Columbia, on 23-27 October 2006. Enforcement 
officials of the Parties met under the auspices of the NPAFC Committee 
on Enforcement to review enforcement activities in 2006 and begin 
planning activities for 2007. Representatives of Taiwan observed the 
proceedings of the meeting.
    As a result of the Parties' cooperative enforcement efforts in 
2006, no vessels were detected engaged in illegal large-scale driftnet 
fishing for salmon in the NPAFC Convention Area. However, sightings, 
boardings, and fishing vessel seizures from 2003-2006 indicate that the 
high seas driftnet threat in the North Pacific Ocean may be increasing, 
and shifting fishing effort from salmon to squid and albacore tuna. At 
least 26 vessels suspected of high seas driftnet fishing were sighted 
in 2003, 22 vessels in 2004, 24 vessels in 2005, and 98 vessels in 
2006. Unfortunately, the Parties were unable to investigate and 
positively identify many of these vessels because of their remote 
location. The Parties believe that the majority of the vessels were 
from the People's Republic of China (China) because of the type of 
vessel, the characteristic style of the Chinese characters used for 
vessel names, and because many Chinese-flagged squid jigging vessels 
were often sighted fishing in close proximity.
    Approximately two thirds of the 2006 sightings occurred in the 
September-November time-frame. In past years, the Parties concentrated 
most of their enforcement efforts in the summer months. In 2005, Japan 
patrolled the northwestern part of the Convention Area in September-
DOctober and made 17 of the 24 total driftnet vessel sightings for the 
year. There is some uncertainty as to whether the increased number of 
sightings represents a real increase in the occurrence of large-scale 
high seas driftnet fishing in the North Pacific Ocean or whether 
enforcement efforts have uncovered an existing IUU fishery.
    Although the NPAFC has successfully deterred high seas salmon 
fishing and served as a forum for joint enforcement planning and 
coordination in the NPAFC Convention Area, it has limited enforcement 
authority against non-salmon non-Party high seas driftnet fishing 
threats. Because of the different target species and vessel flags 
involved, the NPAFC will work multilaterally through enforcement and 
diplomatic channels to bring pressure on these driftnet fishing vessels 
and their flag states to end operations in the NPAFC Convention Area. 
The NPAFC Parties agreed to send a letter from the Commission to the 
Chinese Government to request it to take preventative measures to 
ensure that Chinese vessels and nationals are not involved in high seas 
driftnet fishing operations on anadromous fish stocks in the NPAFC 
Convention Area and to express its concern about the increased number 
of Chinese vessels equipped with driftnet gear. The letter would also 
invite China to partner with the NPAFC Parties to combat such illegal 
activity.
    In light of the continuing threat of unauthorized high seas salmon 
fishing in the Convention Area, Parties agreed to maintain 2007 
enforcement efforts at levels similar to 2006 as a deterrent to 
unauthorized fishing activity. To coordinate enforcement efforts, the 
Parties agreed to hold the annual EECM in Busan, Korea, from 27 
February-1 March 2007.

    Senator Kerry. Well, I really appreciate that. Yes, I would 
like that. I'd like to follow up with you sometime and talk 
about it, and see how we could sort of think this through and 
plan for some things as we head into next year and beyond, 
because it's very distressing. And I'm hearing unbelievable 
stories of depleted stocks on almost everything everywhere, and 
not to mention the pollution issues and others kinds of issues. 
One last thing--container ships.
    Admiral Allen. Yes, sir.
    Senator Kerry. Drop some of these containers out on the 
ocean, and they float, submerged, and they become a serious 
hazard to other shipping. What, if anything, could be done? I 
understand there is an enormous number. I've heard it's in the 
thousands--maybe you can shed some light on this--of containers 
that in storms or bad lashing and loading and other procedures, 
they lose them. And because of the weight, they don't really 
sink completely because of the buoyancy, but they also don't 
float so we see them. And they're a real hazard to navigation.
    Admiral Allen. Yes, sir. I'm just prepared to handle the 
reporting, but if I could, for the record, I will go back and 
consult with the International Maritime Organization and 
Secretary General Mitropoulos, and I will give you our best 
estimate on worldwide figures.
    Senator Kerry. I would really appreciate that.
    Admiral Allen. Yes, sir.
    [The requested information follows:]

    It is estimated that between 500 and 2,000 containers are lost at 
sea annually. While the International Maritime Organization does not 
collect data regarding numbers of containers lost overboard world-wide, 
National Cargo Bureau records indicate that at least 500 containers are 
lost each year. Some industry trade publications estimate approximately 
2,000 containers are lost annually. It is reasonable to assume that 
some containers losses are not reported and the number for any given 
year may be skewed by one or two major incidents. As such, we conclude 
that between 500 and 2,000 are lost annually.

    Senator Kerry. Thank you, Madam Chair.
    Senator Cantwell. Thank you. And I want to thank the 
panelists for their testimony. I think this will be the first 
of probably several hearings that we'll end up having on this 
issue, perhaps even a third hearing. Admiral Allen, I think you 
will take away that my colleagues are very concerned about this 
rulemaking, whether it's on salvage or response plans or 
updating the Oil Spill Liability Trust Fund for inflation.
    All of those things we think are things that we're falling 
behind on, so we would prefer the Coast Guard come to us and 
lead the charge on the changes that we're now wanting to be 
proposing as it relates to these nontank vessels, these cargo 
containers, because I think that many of my colleagues are 
expressing here today, in addition to Senator Boxer, issues 
that we think need to be updated from the 1990 Act. So we look 
forward to discussing that with you further, and for the 
timeline to respond to these various rulemaking authorities, 
sir. With that, I thank the other panelists for being here, as 
well, and for your work, and we look forward to dialoguing with 
you about this important issue.
    I'd like to call up the second panel now--Dr. Dagmar Etkin, 
who is the President of the Environmental Research Consulting, 
Mr. Mike Cooper, Chairman of the Washington State Oil Spill 
Advisory Council, and Mr. Bill Deaver, President and Chief 
Operating Officer of Totem Ocean Trailer Express. And if those 
who are exiting could help us by doing so quickly and quietly, 
we would appreciate it, so that we can get on with the second 
panel.
    And I think that we would like to start with you, Dr. 
Etkin, for being here with us today and for your testimony. And 
if the witnesses could keep their comments to 5 minutes or so, 
thank you.

     STATEMENT OF DAGMAR SCHMIDT ETKIN, Ph.D., PRESIDENT, 
               ENVIRONMENTAL RESEARCH CONSULTING

    Dr. Etkin. Thank you. Good afternoon, and thank you for the 
opportunity to speak today.
    Senator Cantwell. Dr. Etkin, if you could just pull the 
microphone a little closer to you, thank you.
    Dr. Etkin. Thank you. For 19 years, I've been an 
independent consultant on oil spill risks, statistics, 
environmental impacts, costs and response, in the U.S. and 
internationally. I've been a consultant to the Coast Guard and 
Corps of Engineers, National Research Council, EPA, NOAA, GAO, 
and to the States of California and Washington. I've been on 
three U.N. IMO task teams on environmental risks from shipping. 
And I have also worked with NGOs and industry. I've seen many 
sides of this complex issue.
    Spill risk is the probability of spillage multiplied by 
spill consequences--environmental, economic, social, and 
political. The probability of nontank vessel spillage has 
decreased over 20 years despite increases in shipping, but we 
now know that the consequences of the spill may be great. The 
risk remains.
    Most nontank vessel spills are small incidents that occur 
during bunker transfers and other operations that result in 
relatively small spills. But there have also been significant 
spills related to accidental groundings and collisions, notably 
the recent incident in San Francisco.
    Spill consequences are directly related to volume, oil 
type, location, and timing. Heavy oil that often spills from 
nontank vessels presents a particular challenge with regard to 
its persistence and its propensity to coat bird feathers and 
shorelines. Spill volume is a factor, but even a relatively 
small spill in a bad location can cause serious damage. Timing 
is also important. Had the San Francisco spill occurred in 
January, ten times as many birds may have been oiled.
    There are three arenas in which we can make progress: 
prevention, preparedness, and response--preferably in that 
order. It is best to prevent spills in the first place, and 
there are proven ways to accomplish this. Safer ship design, 
such as double hulls, and increased financial responsibility 
requirements, with Certificates of Financial Responsibility, 
have reduced tanker spills in the U.S. waters more so than 
outside the U.S. We have a better class of tankers in the U.S. 
waters due to our more stringent regulations.
    This strategy can be extended to nontank vessels. Double-
hulled bunker tanks and cargo ships reduce the probability of 
spillage after impact. Requiring tug escorts in challenging 
waterways in sensitive areas has proven to be an effective 
measure in Washington State. Improvements in vessel traffic 
systems and crew training can also prevent accidents. We should 
also carefully study nontank vessel liability limits, taking 
into account the oil volume carried and the actual spillage 
risk.
    Being prepared to respond promptly and effectively are keys 
to success. Studies I've conducted for Washington State show 
that increased response equipment deployed at the scene earlier 
than required can significantly reduce impacts. Pre-booming of 
vessels and pre-positioning of response equipment during oil 
transfers can increase the chances of successful damage 
mitigation. Maintenance inspections and spill exercises are 
also important. Spills will happen, but we've been fortunate. 
We've never had a worst-case tanker or large cargo ship 
discharge in U.S. waters. With the total release, the spill in 
San Francisco could have involved 20 times as much oil, or a 
thousand times as much oil had it been a fully loaded tanker. 
We cannot become complacent. We must increase and then maintain 
preparedness even as spill rates are going down.
    Spill response presents an opportunity for improvement, as 
well. There are many technological challenges in spill 
response. Despite decades of research and development, and 
practical experience, we are still left with relatively 
inefficient mechanical recovery options and largely manual 
shoreline cleanup methods. Booms and skimmers do not work well 
in high currents in San Francisco Bay. The forces of physics 
simply come into play.
    Even when conditions are favorable, it's rare that more 
than 10 to 25 percent of spilled oil is recovered. Dispersants 
can be effective, but their use is limited in sensitive near-
shore waters and on heavier oils. But there are ways to improve 
spill response. Simply repositioning of some boom can better 
protect sensitive areas. Ironically, I was working with 
California Fish and Game on alternative booming strategies to 
protect sensitive areas of San Francisco Bay when the recent 
spill occurred.
    I've worked with the U.S. Coast Guard on studies to improve 
detection of submerged and floating oil with laser technologies 
to improve response and reduce damages. Special booming 
techniques for faster water conditions have been developed by 
the U.S. Coast Guard; these need to be applied. We need to 
continue to fund research and development efforts and to train 
responders with the best techniques. We have an excellent spill 
response testing and training facility at OHMSETT in New 
Jersey, and many excellent researchers and practitioners to 
learn from.
    Last, I think we have an opportunity and responsibility for 
public education. The public has unrealistic expectations of 
what spill responders and officials can do to magically erase 
spilled oil. Rather than point accusatory fingers at officials 
or industry, we need to work together to educate the public 
about realistic expectations when a spill does occur and get 
their support rather than animosity. There is no time to be 
looking for good guys and bad guys. We need public support; 
funding for spill prevention, preparedness, and response 
efforts; and we need to make the public understand that 
rational, scientifically based decisionmaking and planning are 
required to reduce the likelihood of future spills and to 
respond effectively when they do occur. We are all in this 
together. Thank you.
    [The prepared statement of Dr. Etkin follows:]

     Prepared Statement of Dagmar Schmidt Etkin, Ph.D., President, 
                   Environmental Research Consulting

    My name is Dagmar Schmidt Etkin. For the past 19 years, I have been 
an independent environmental consultant specializing in oil spill risk 
analysis, spill statistics, costs, environmental impacts, policy 
analysis, and response issues in the U.S. and internationally. I have 
been a consultant to the U.S. Coast Guard, Minerals Management Service, 
Maritime Administration, Army Corps of Engineers, National Research 
Council Transportation Research and Ocean Studies Boards, EPA, NOAA, 
GAO, California Department of Fish and Game, and Washington Department 
of Ecology. I have been on three United Nations task teams on oil 
pollution and environmental risk assessments from shipping. I have also 
worked closely with non-governmental organizations and industry on oil 
spill issues. In my work, I have had the privilege of seeing many sides 
of this complex issue.
    Spill risk is a combination of the probability of spills occurring 
multiplied by the consequences (environmental, economic, social, and 
political). The probability of spillage from a non-tank vessel has 
decreased in the last two decades despite the fact that there have been 
increases in worldwide shipping, but the potential consequences of a 
spill are still great. The risk remains. The data indicate that the 
greatest proportion of spills from non-tank vessels occurs during 
bunker transfers and other operations which result in relatively small 
spills. And there have been a number of significant spills related to 
accidental groundings, collisions, and allisions that have resulted in 
larger oil releases, notably the recent COSCO BUSAN spill in San 
Francisco.
    The consequences of a spill are directly related to four main 
factors--volume, oil type, location, and timing. Heavy oil that often 
spills from non-tank vessels presents a particular challenge with 
regard to its persistence and its propensity to coat bird feathers and 
visibly impact shorelines. Spill size is certainly a factor, but even a 
relatively small spill (note that the recent COSCO BUSAN spill was 
actually a relatively small spill with regard to an accident-related 
non-tank vessel spill) in the wrong location can cause serious damage 
on many fronts. Timing is an important issue. Had the San Francisco 
spill occurred 2 months later, ten times as many birds may have been 
oiled!
    There are three arenas in which we can make progress in reducing 
the impacts of spills from non-tank vessels--better efforts at 
prevention, better preparedness, and better response, preferably in 
that order.
    Prevention--It would be best to prevent spills from non-tank 
vessels in the first place. There are proven ways that this can be 
done. We know that the phasing-in of double hulls and better ship 
design, as well as increasing financial responsibility requirements, 
have reduced tanker spills in U.S. waters in particular. We have a 
better class of tankers in U.S. waters due to our more stringent 
requirements. This tactic can be extended to non-tank vessels. Double-
hulled bunker tanks on cargo ships reduce the probability of spillage 
with a grounding, collision, or allision. Requiring tug escorts in 
challenging waterways has proven to be an effective prevention measure 
in Washington State. Improvements in vessel traffic systems and crew 
training can help prevent accidents in the first place. We should also 
carefully study the issue of liability limits for non-tank vessels 
taking into account the amount of oil carried and potential for 
spillage.
    Preparedness--Being prepared to respond promptly and effectively 
after notification of a spill is the key to success in spill response. 
Studies I have conducted for Washington Department of Ecology have 
shown that increasing the amount of spill response equipment and 
requiring it to be at the scene earlier than is currently required can 
result in significant reductions in impacts. Pre-booming of vessels and 
having response equipment on standby during oil transfer and bunkering 
operations--one of the most common times during which spills occur--can 
increase the chances of successfully mitigating spill damages. 
Maintenance of equipment and maintaining readiness with required spill 
exercises and inspections are important to keep prepared for the next 
spill. Spills will happen. We have been fortunate that we have never 
had a worst-case discharge from a tanker or from a large cargo ship in 
U.S. waters. The situation in San Francisco Bay could have involved 
twenty times as much oil from a non-tank vessel and a thousand times as 
much oil with a fully-loaded tanker. We must maintain preparedness even 
if spill rates are going down!
    Response--Finally, spill response presents an opportunity for 
improvement. There are many technological challenges in spill response. 
Despite decades of research and development, as well as experience on 
many actual spills, we are still left with relatively inefficient on-
water mechanical containment and recovery options, occasional 
opportunities to apply chemical dispersing agents, and tedious, largely 
manual, shoreline cleanup methods. Booms and skimmers do not work well 
in high currents, such as those seen in much of San Francisco Bay. The 
forces of physics come into play. Even when all things are in favor it 
is rare that more than 10-25 percent of spilled oil is recovered. 
More--as was recovered in San Francisco--is considered a real success. 
Oil spill dispersants can be effective, but their use is limited in 
sensitive nearshore waters and on heavier oils.
    But, there are ways to improve spill response in addition to 
timing. Positioning of boom to protect particularly sensitive sites can 
dramatically reduce damages. Ironically, I was in the midst of working 
with California Fish and Game on some new booming strategies to protect 
sensitive areas of San Francisco Bay when the recent spill occurred. I 
have worked with the Coast Guard on studies to improve oil detection 
through the use of laser fluorosensor technologies. Better detection of 
submerged and floating oil can improve spill response and reduce 
damages. Booming in fast-water conditions requires special techniques 
that can be applied by skilled responders. We need to continue to fund 
research and development efforts of the U.S. Coast Guard and others. We 
have the best spill response testing facility at OHMSETT in New Jersey 
and many excellent researchers and practitioners to learn from.
    Lastly, I think we have an opportunity and responsibility for 
public education. The public has unrealistic expectations of what spill 
responders and officials can do to magically erase the oil that has 
spilled. The oil is on the water. The oil is on the birds. It is 
unfortunate, but rather than pointing accusatory fingers at officials, 
we need to work together to educate the public about realistic 
expectations when a spill does occur and get their support rather than 
animosity. There is no time to be looking for ``good guys'' and ``bad 
guys''. We need public support in continuing to fund spill prevention, 
preparedness, and response efforts. We need to make the public 
understand that rational, scientifically-based decision-making and 
planning is required to reduce the likelihood of future spills from 
non-tank vessels or any source and to respond effectively when they do 
occur. We are all in this together.
    Thank you for your time.

    Senator Cantwell. Mr. Cooper, thank you for being here.

 STATEMENT OF HON. MIKE COOPER, CHAIRMAN, WASHINGTON STATE OIL 
                     SPILL ADVISORY COUNCIL

    Mr. Cooper. Thank you. Thank you, Madam Chair and Senator 
Snowe for conducting this hearing, and for inviting me to come 
and testify. I am Mike Cooper, Chairman of the Washington State 
Oil Spill Advisory Council. I am pleased to be here today on 
behalf of the people of the State of Washington to talk to you 
about this very important issue. I have submitted written 
testimony, and I would like it to be included in the record.
    The Oil Spill Advisory Council's goal is to act as a 
mechanism to foster a long-term partnership and consensus 
between communities, government, and industry. Governor 
Gregoire noted earlier this year that, to prevent oil spills, 
it is important for the public to be engaged and involved. Only 
if public engagement continues can we battle complacency. I 
encourage Congress to support the work of citizen advisory 
councils like those in Washington and Alaska.
    It is important to note that the Council's enabling 
legislation, signed by the Governor, invited Washington tribes 
to participate, and they do. However, we do recognize that, as 
a State-created entity, we cannot stand and speak for the 
tribes because of the very unique government-to-government 
relationship they have with the Federal Government and the 
state government.
    Washington's marine resources are unique. Puget Sound, the 
Strait of Juan de Fuca, the Pacific coastline, and the Columbia 
River each have very unique economic and environmental value. 
We must do everything humanly possible to maintain that value, 
both for our economy and for our environment. Washington's 
waterways, specifically Puget Sound, are unique in that we have 
23 ferry routes crisscrossing the traffic lanes that are used 
by cargo vessels--23 ferry routes in addition to the 6,000 
transits you've already heard about create 167,000 transits a 
year across the shipping lanes.
    Today, I want to talk a little bit about a few of the 
things that I think that Congress can do, that we could 
recommend and move forward on, that will really help this 
issue, specifically for cargo vessels. First, I think it's 
important that the Congress think about delegating authority to 
capable states, like Washington, to conduct vessel inspections, 
investigations, and enforce Federal regulations, and to review 
and improve vessel and facility contingency plans.
    Second, you've already heard about the double hull issue. I 
think it's important for us to move forward on the issue of 
putting double-hulled fuel tanks on cargo vessels. Third, I 
think it's important for Washington State, in particular, for 
Congress to have the Coast Guard move the high-volume port line 
from Port Angeles, Washington to the entrance of the Strait of 
Juan de Fuca.
    This would enable the Coast Guard to have additional rules 
in place to protect the 60 miles of coastline from Port 
Angeles, Washington out to Cape Flattery. Every other high-
volume port line in the country has its line at the entrance to 
the waterway, not 60 miles inland as is the case in Washington 
State.
    And finally, Congress could extend the restrictions in the 
Area To Be Avoided around the Pacific Coast Marine Sanctuary to 
nontank vessels. The Olympic Coast National Marine Sanctuary is 
one of our nation's most treasured maritime and marine areas. 
Its mission is to protect the sanctuary and ensure that future 
generations are able to use it and enjoy it. By extending the 
Area To Be Avoided to cargo vessels, and not just oil vessels, 
I think we would go a long way to protecting that sanctuary and 
to preventing potential spills in the sanctuary.
    I would like to close by stressing the importance of all 
levels of government working together to solve this very 
important challenge before us. The Federal, state, tribal, and 
local governments need to work with important stakeholder 
groups like the oil and cargo industry, as well as the 
environmental community and our local ports, to solve this 
issue. Thank you very much. I'd be happy to answer questions.
    [The prepared statement of Mr. Cooper follows:]

Prepared Statement of Hon. Mike Cooper, Chairman, Washington State Oil 
                         Spill Advisory Council

I. Introduction
    Good morning, Madam Chair and members of the Committee. I am Mike 
Cooper, Chairman of the Washington State Oil Spill Advisory Council. 
Thank you for inviting me to testify. I am pleased to appear before you 
today on behalf of the Council and the State of Washington. Also, I 
wish to thank the Chair for her continuing leadership to protect 
Washington State from the risk of oil spills. Particularly I wish to 
thank the Senator for her efforts to assure that the Neah Bay tug 
remains on stand-by protecting our outer coast and the Strait of Juan 
de Fuca from the perils of drift landings.
    The mission of the Council is to maintain Washington's vigilance in 
preventing oil spills in marine and navigable waters, by ensuring an 
emphasis on oil spill prevention while also recognizing the importance 
of improving spill preparedness and response. The Council's goal is to 
act as a mechanism to foster a long-term partnership and consensus 
between communities, government, and industry. The Council operates by 
consensus, even on the difficult issues. To date, it has not been 
necessary for the Council to avail itself of its statutory 
authorization allowing nine members to call for a majority vote.
    It is important to note: Through the Council's organic legislation 
and as implemented by Governor Christine Gregoire, Washington State 
invited Washington tribal governments to participate on the Council. 
And they do participate. However, we do recognize that the Council, as 
a State-created entity, can not stand in for the tribes, as they are 
resource trustees with whom the Federal Government has a direct 
relationship. Additionally, we recognize that the tribes should be 
invited as a sovereign to work with the state and Federal governments 
on these important natural resources issues.
    In light of the growing oil spill risks from commercial cargo 
vessels, I will limit my testimony to the regulation of these vessels. 
My intention with my testimony is to generally represent the various 
governmental and citizen interests of Washington. There was not 
sufficient time for the Council to come to consensus over my remarks. 
We will have a meeting in January 2008, however. Our agenda will 
include an action item to discuss my testimony and to provide some 
follow up from the Council on my testimony.
    One thing I know we all agree upon is the value of citizen advisory 
councils. As Governor Gregoire noted earlier this year, to prevent oil 
spills it is important for the public to be engaged and involved; only 
if public engagement continues can we battle complacency. The Council 
encourages Congress to support the work of citizen advisory councils 
like those in Alaska and Washington. These bodies play a vital role in 
ensuring vigilance in oil spill prevention, response, and remediation. 
Members of Washington's Oil Spill Advisory Council not only live and 
breathe in and among the fragile Puget Sound, but they also are vested 
in the success of our local economy. For this reason, citizen bodies 
are very well suited to spotlight problem areas and to effectuate 
needed change.
    The issue before the Subcommittee is how to better regulate non-
tank vessels. In Washington, we understand the urgency of grappling 
with this issue, particularly in light of the significant spill from a 
cargo vessel into San Francisco Bay on November 7 of this year. This 
was a spill caused when a container ship sideswiped the stationary Bay 
Bridge. The vessel spilled 58,000 gallons of fuel oil, blackening the 
coastline and wildlife, shutting down the fishing industry, and 
requiring an expensive mop-up operation.

II. Risk from Cargo Vessels in Puget Sound

A. Washington's Waters Are Unique
    Washington's marine resources are unique in their geographic 
characteristics, their rare beauty, for the bounty they provide--and 
for their fragility. Puget Sound is a shimmering estuary with oysters, 
clams, and soul stirring views for the nearly four million people who 
live near its waters. The Strait of Juan de Fuca is a rushing narrow 
waterway that carries the tides in and out of Puget Sound and acts as 
our country's natural border between its western most portion and 
Canada. Washington's Pacific Coastline boasts rugged and rocky 
coastlines, a part of which includes the federally protect Olympia 
Coast Marine Sanctuary.
    But Washington's waters also are in peril. For example, State 
studies show that just beneath the shimmering surface of Puget Sound 
lies a sick and dying water body. Further, the region's two keystone 
marine species--the orca whale and the salmon--are listed under the 
Federal Endangered Species Act. It is said that the region's 
populations of the orca whale are so fragile that they are only one 
large oil spill away from extinction.
    We must do everything humanly possible to ensure that Washington's 
coastal and marine environments and navigable waters continue to be a 
source of beauty, recreation, health, ecological integrity, food 
production, and economic betterment for Washington citizens. We need 
Congress to help.

B. Puget Sound Bears Unique Risks Due to Passenger Ferry and Commercial 
        Vessel Interactions
    Washington is unique in that a very large number passenger ferries 
crisscross through the traffic lanes in which large cargo vessels are 
required to travel. Washington has the largest car passenger fleet in 
the Nation. As population grows, the number of ferry transits will 
increase. As cargo vessel grow larger and the number of cargo vessel 
transits increase, so too will the risk of them negatively interacting 
with an increasingly active ferry fleet.
    Cargo vessels are growing in both size and number in Washington. 
These vessels encounter passenger ferries zipping around the Sound 
taking Washington citizens to and fro. This poses a growing risk of oil 
being spilled in Washington's waters from cargo vessels.
    A growing number of cargo vessels are transiting more frequently in 
Washington's waters. In 2006, there were over 6,000 cargo and passenger 
vessel that engaged in ``entering transits'' in Washington. This number 
jumps to over 12,000 when considering that most cargo vessels entering 
Puget Sound must leave through the Strait of Juan de Fuca. In Puget 
Sound alone, there were over 2,000 cargo and passenger vessel transits. 
Again, when one considers that these vessels must leave Puget Sound, 
this number jumps to over 4,000 trips. These transits happen in 
conjunction with 23 public passenger ferry routes that, in 2006, had 
over 167,000 transits made through them across the commercial vessel 
traffic lanes.\1\ As cargo vessels grow bigger and increase their 
transit numbers, the risk posed by interactions between cargo vessels 
and passenger ferries will increase. And, of course, this is 
complicated by a very high volume of recreational boater traffic, which 
exists due to Washington's popularity with recreational boaters and 
fishers.
---------------------------------------------------------------------------
    \1\ Washington's Vessel Entries and Transits for Washington Waters, 
VEAT 2006, WDOE Publication 07-08-005.
---------------------------------------------------------------------------
C. Risk From Cargo Vessels Currently Exist and Will Continue to Grow
    Cargo vessels have a history of having dangerous mishaps in 
Washington's waters. After a review of Washington vessel incident data, 
the Washington Department of Ecology concluded that:

   Cargo and passenger vessel casualty and near-miss rate trend 
        is downward, but the spill rate trend is flat.

   The overall downward trends should be viewed in light of 
        other indicators that show there are generally longer periods 
        of time between spills to marine waters--especially large 
        spills.

   Ongoing efforts by Ecology, the Coast Guard, maritime 
        industry, tribes, and public advocacy groups appear to be 
        pushing most spill and incident rates downward in Washington 
        State. However, maintaining the downward trend will require 
        focused on-going efforts. Also, Ecology specifically believes 
        non-tank vessels need to be regulated to a much higher standard 
        than exists today.

    Projections show that cargo vessels will grow in both size and in 
number. In 1999, the U.S. Coast Guard reported that over 65 percent of 
the vessels above 300 gross tons (GT) that transited the Strait of Juan 
de Fuca were container ships and bulk carriers.\2\ The Coast Guard 
report also noted that Puget Sound waterborne commerce is becoming 
increasingly dominated by container traffic--over 75 percent of the 
tonnage moved through the Port of Seattle is not in containers, with 
break bulk traffic, including paper and pulp, moved through Tacoma and 
surrounding ports.\3\ Movements of dry cargo are predicted by the Coast 
Guard study to increase by 3.6 percent per year through 2025.\4\ Thus, 
by 2025, it is expected that bulk carrier and containership transits 
will increase from 7,513 transits in 2000 to over 12,425 transits in 
2025. Additionally, these ships will get much larger. The 1999 Coast 
Guard report noted that in 1997 27 percent of container ships were less 
than 2,500 TEU and that 36.7 percent were 2,500 to 4,000 TEUs, with 
36.1 percent being greater than 4,000 TEUs. The report noted that the 
first of the large 6,000 TEU container ships were delivered in 1996, 
and more than thirty 4,500 plus TEU container ships were delivered 
through 1999. The study projects that by 2025, that only 30 percent of 
the container fleet will be comprised of vessels under 4,000 TEU, with 
70 percent of the fleet being comprised of vessels over 4,000 TEU.\5\
---------------------------------------------------------------------------
    \2\ Regulatory Assessment, Use of Tugs to Protect Against Oil 
Spills in the Puget Sound Area, p. 7, U.S. Coast Guard, Report No. 
9522-02, November 15, 1999.
    \3\ Regulatory Assessment, p. 13, November 15, 1999.
    \4\ Regulatory Assessment, p. 18.
    \5\ Regulatory Assessment, p. 1-20.
---------------------------------------------------------------------------
    Naturally, the bunker fuel carried increases with the size of the 
ship. Thus, the Coast Guard reported that gallons of oil transported as 
bunker in cargo vessels (bulk liquid carriers, bulk carriers, container 
ships, and vehicle carriers) would increase from 78,385,168 gallons in 
2000 to over 143,405,063 gallons per year in 2025. This is a transit 
increase of about 160 percent and an increase of oil transported by 
cargo vessels of about 180 percent.\6\ While this may not have quite 
the ``wow factor'' as what is predicted to be carried by oil tank 
vessels, this oil transport presents a serious and significant risk.
---------------------------------------------------------------------------
    \6\ Regulatory Assessment, p. 19-20.
---------------------------------------------------------------------------
D. Global Climate Change Will Worsen Existing Risk
    As human-induced climate change inevitably worsens, there will be 
more random and serious weather events. For example, this past December 
3, Seattle experienced its second rainiest day on record. First place 
goes to a rainy day in very recent history--2003. Now that we can 
predict that the 100-year storm will come much more frequently, weather 
related vessel incidents may increase accordingly. As an example of 
this, on December 3, the KAUAI, a 720-foot container ship sailing near 
Cape Flattery, Washington was suddenly smashed by a large ocean swell. 
The waves broke out the wheelhouse windows, damaged electronic systems 
and knocked out the ship's primary steering system.
    Disaster was averted, however. The vessel did not drift onto the 
rocks and spill oil because the state-funded Neah Bay rescue tug 
launched to save the stranded cargo vessel. This was the tug's thirty-
fourth save since it was put on stand-by status in 1999. Its thirty-
fifth save came days later on December 12 when it saved the NA HOKU, a 
105-foot tug towing a fuel barge containing more than two million 
gallons of diesel fuel and about a half million gallons of gasoline. 
The tug was headed down Washington's outer coast when its primary 
electrical generator engine failed about 12.5 miles west of Cape 
Flattery. As storm events gain strength and frequency, it is paramount 
to have a tug that intervenes to prevent groundings when vessels are 
disabled or have reduced maneuverability or propulsion capability while 
transporting oil and other cargo along the Pacific coast and through 
the Strait of Juan de Fuca.

III. Options for Reducing Risk from Cargo Vessels

A. Introduction
    Seeing strong Federal regulations put into place at the Federal 
level is extremely important to the Council and the State of 
Washington, particularly in areas in which states are limited in their 
ability to prevent oil spills from underway vessels engaged in 
commerce.\7\
---------------------------------------------------------------------------
    \7\ United States v. Locke, 529 U.S. 89, 120 S. Ct. 135 (2000).
---------------------------------------------------------------------------
    There are several very real changes Congress could make to enhance 
prevention of oil spills from non-tank vessels.
    First, Congress could work to enhance Federal and state 
collaboration to prevent oil spills, including changing Coast Guard and 
state dynamics and authorities. For example, Congress could delegate 
authority to capable states like Washington to conduct vessel 
inspections, conduct investigations, and enforce Federal regulations, 
and to review and approve vessel and facility contingency plans.
    Second, Congress could federally apply Washington's Voluntary Best 
Achievable Protection Standards to non-tank vessels.
    Third, Congress could require that cargo vessels be redesigned so 
that their bunker fuel tanks are not so vulnerable to injury and 
leakage.
    Fourth, Congress could require that the Coast Guard complete the 
``Salvage Rule'' and also extend it to non-tank vessels.
    Fifth, Congress could relocate the high-volume port line to the 
entrance of the Strait of Juan de Fuca.
    Sixth, Congress could extend restrictions in the Area To Be Avoided 
around the Pacific Coast Marine Sanctuary to non-tank vessels (not just 
oil cargo vessels) and expand the definition of ``carrying cargo'' to 
include tank oil ``clingage.''
    Last, Congress could implement Federal non-tank vessel contingency 
planning requirements and recognize state accepted ``umbrella'' plans.

B. Enhanced Federal and State Collaboration to Prevent Oil Spills; 
        Changes to Coast Guard and State Interactions and Authorities
    The State of Washington, through the State Department of Ecology, 
has a positive and strong partnership with the Coast Guard. This 
relationship was affirmed and reinforced earlier this year at an oil 
spill summit between Governor Gregoire and Admiral Houck, Commander of 
the Thirteenth District of the U.S. Coast Guard. But, we acknowledge 
there is still work to be done. The following are recommendations for 
continued improvements as they relate to non-tank vessels.
    Again, these recommendations have not been vetted through the 
Council, which will take these issues up at its January meeting. While 
certain industries may not fully agree with these recommendations, most 
of the stakeholder groups represented by the Council would agree. Also, 
the State Department of Ecology agrees.
Delegate Authority to Capable States Like Washington
    The Washington Department of Ecology and the Oil Spill Advisory 
Council maintain that one way to optimize Federal and state resources 
would be for Congress to direct the Coast Guard to delegate authority 
to capable states to perform several functions: conduct vessel 
inspections, conduct investigations and enforce Federal regulations, 
and to review and approve vessel and facility contingency plans.
Review and Approve Vessel and Facility Contingency Plans
    The Washington Department of Ecology has reviewed and approved non-
tank, tank vessel, and facility contingency plans for over thirteen 
years. Washington regulators have a long history of implementing a 
rigorous plan review and drill program. Ecology's plan review staff 
members are recognized nationally as leaders. This reputation is based 
on local knowledge and relationships built with communities, industry, 
Federal, state and local agencies, and tribal nations.
    The Federal Government has only recently begun to require 
contingency plans from non-tank vessels. All tank and non-tank vessel 
contingency plan reviews are centralized by the Coast Guard to ensure 
consistency in applying standards. Copies of the plans are maintained 
at the Coast Guard's Headquarter offices in Washington, D.C., rather 
than in local Captain of the Port offices. Yet, any spill that occurs 
is going to have a local impact and any response will typically be 
managed by local state and Federal officials, using local Area 
Contingency Plans.
    Delegating authority for qualified and experienced state personnel 
to conduct these activities would maximize efficiency and effectiveness 
of both agencies' resources and provide a strong unified approach for 
responding to spills in Washington waters. Further, it would enhance 
mutual respect and collaboration between state and Federal safety 
professionals, and would reduce duplication of efforts where agencies 
have concurrent jurisdiction or areas of mutual interests.
Vessel Inspections and Delegation to Investigate Violations of and 
        Enforce Coast Guard Regulations
    The Washington Department of Ecology has a staff of trained and 
experienced mariners who board tank vessels through a program called 
the Voluntary Best Achievable Protection Program (BBAP). This program 
was put into place after U.S. v. Locke as a way for the state to 
continue to provide oil spill prevention services for underway tank 
vessels. The program has been enormously successful.
    Through the VBAP program, Ecology inspectors board participating 
tank vessels and conduct inspections to determine whether VBAP 
standards are being met. Simultaneously, inspectors are able to 
determine if the vessels are compliant with Coast Guard regulations. In 
this way, Ecology inspectors can act as the Coast Guard's eyes and 
ears.
    Ecology's experience has been that vessel crews see Ecology staff 
as mentors who provide education regarding what is expected in 
Washington waters under applicable law. The experienced Ecology 
inspectors are seen as equals--as experienced mariners, many of whom 
have lived and worked in Washington's waters for years, even decades. 
This augments Coast Guard activities, many of which are performed by 
staff rotating into a Washington assignment from a different area or 
from the Coast Guard Academy. Having state inspectors board 
participating vessels is of enormous benefit. Education conducted by 
state inspectors has increased crew ``situational awareness,'' which is 
often a key to preventing incidents that lead to oil spills.
    It makes sense to expand the role of this trusted and capable 
resource to include inspecting both tank and non-tank vessels and 
conducting investigations to determine compliance with Coast Guard 
Rules. It also would seem logical to extend this authority to allowing 
capable states to assist with enforcement of Federal Coast Guard 
regulations on both tank and non-tank vessels.

C. Federally Apply Washington's Voluntary Best Achievable Protection 
        (VBAP) 
        Standards to Non-tank Vessels
    Many of Washington's thirty-one VBAP standards for tankers already 
have been incorporated into Federal and international standards. 
Insofar as these standards have not been extended to non-tank vessels, 
it is logical to extend them. Washington's VBAP standards include, but 
are not limited to, navigation watch, bridge-watch composition, bridge 
resource management, voyage planning, refresher training, drug and 
alcohol policies, personnel evaluation system, work hours, language 
proficiency, record keeping, and preventative maintenance 
documentation. These standards are geared toward preventing incidents 
while underway that could lead to oil spills in marine waters.
    Cargo vessels are growing appreciably in their size and in the 
amount of bunker they will hold. Therefore, taking measures to reduce 
incidents that could result in bunker fuel entering marine waters is a 
sound risk reduction strategy.

D. Vessel Design; Double Hull Bunker Tanks on Cargo Vessels
    Just as Federal law no longer allows tankers to be constructed 
without a double hull in order to protect oil cargo, neither should 
vessels be constructed with unprotected bunker tanks. Current 
regulatory requirements permit fuel tanks to be arranged outside of the 
cargo block region and to be located adjacent to the shell. This was an 
issue with the COSCO BUSAN that ``scraped'' the side of the San 
Francisco Bay Bridge and instantly lost 58,000 gallons of bunker.

E. Complete and Extend the Coast Guard Salvage and Firefighting Rule 
        for Vessel Contingency Planning
    The Federal Water Pollution Control Act, as amended by the Oil 
Pollution Act of 1990, mandated that the Coast Guard issue regulations 
to improve response capabilities from tank vessels and minimize the 
impact of oil spills from these vessels. The Coast Guard promulgated a 
rule in 1993 that required salvage and marine firefighting resources in 
vessel oil spill response plans for tank vessels. This rule should be 
finalized and also extended to cargo vessels.
    The Coast Guard's 1993 rule did not set forth specific requirements 
because salvage and marine firefighting response resource requirements 
were viewed as unique to each vessel. The CG intended to rely on plan 
holders to prudently identify contractor resources to meet their needs. 
The CG thought that significant benefits of a quick and effective 
salvage and marine firefighting response would be sufficient incentive 
for industry to develop salvage and firefighting capabilities similar 
to the development of oil spill removal organizations. Also, the Coast 
Guard mandated no specific response times due to concerns over the 
capacity of these resources that existed in the United States. Yet, 
under the 1993 rule, response plans submitted for approval after 1998 
(by owners or operators of tank vessels carrying groups I through V 
petroleum oil as a primary cargo) had to identify a salvage company 
with expertise and equipment and a company with firefighting capability 
that could be deployed to a port nearest to the vessel's operating area 
within 24 hours of notification or discovery of a discharge.
    In 1997, the CG became aware that anticipated salvage and marine 
firefighting capability development was not occurring. Instead, there 
was disagreement among plan holders, salvage and marine firefighting 
contractors, marine associations, public agencies, and other 
stakeholder regarding what constituted adequate salvage and marine 
firefighting resources. There was also concern over the ability to meet 
the 24-hour requirement. So, the Coast Guard delayed implementation of 
the 1998 requirement. In 2001, the Coast Guard suspended the rule 
again, saying the suspension would be lifted in 2004.
    In 2002, the Coast Guard issued a notice of proposed rulemaking to 
amend the 1993 rule in light of stakeholder meetings that occurred. The 
proposed rule provided that plan holders of a vessel carrying groups I 
through V of petroleum oil as primary cargo would need to identify, in 
their plans, a salvage and marine firefighting resources provider(s) 
that performs the specific salvage and marine firefighting services 
identified in a proposed table. The CG said that the proposed table 
provided the specificity that was previously lacking while still 
maintaining flexibility for each vessel. Focusing on services, versus 
specific equipment, was deemed to be more practical for the plan 
holder, since the amount and type would vary depending on the vessel's 
characteristics and the operating environment.
    This proposed rule generated many comments of many different 
perspectives. The rule was never finalized. Instead, just before the 
1993 rule's suspension was to end in 2004, the Coast Guard issued a 
notice stating it would suspend the rule for another 3 years until 
2007. Then in 2004, the Coast Guard issued another 3 year suspension 
and the new date for the suspension to end is in 2009.
    Congress should consider directing the Coast Guard to finish this 
rule, incorporate the changes suggested by the Pacific States/British 
Columbia Oil Spill Task Force, and extend the rule to non-tank vessels.

F. Relocate the High-Volume Port Line to the Entrance of the Strait of 
        Juan de Fuca
    The Department of Ecology finds that the high-volume port line, 
currently located at Port Angeles, should be moved to the entrance of 
the Strait of Juan de Fuca.
    The Coast Guard's oil spill response planning requirements apply 
(or do not apply) to an area based on whether the area is east or west 
of the high-volume port line that currently is established in an 
alignment from Port Angeles, Washington to Vancouver Island, Canada. As 
a result of this, response equipment is not required to be pre-staged 
close to Washington's outer coast. Staging equipment only in this 
eastern area increases the time it will take to mount an effective 
response to a spill event on the outer coast.
    Puget Sound is a high-volume port and, therefore, merits more 
response equipment being available in the event of a spill. The Strait 
of Juan de Fuca is the only commercial vessel traffic highway through 
which vessels traveling into Puget Sound proceed. Yet, having the high-
volume port line established at Port Angeles, rather than at Strait's 
entrance, denies much of this high volume vessel highway the same 
response equipment protections that are available east of Port Angeles.
    High-volume port lines for all other ports in the country are 
located at the entrances to main water bodies, not sixty miles inside 
as in the case of Washington. Similarly situated areas should be 
treated similarly.
    The State of Washington is concerned that Washington's coastline is 
not adequately protected on the basis of the current high-volume port 
line location. The eventual Federal requirement for a marine salvage 
response capability is also expected to be based on this high-volume 
port line. The State is very concerned that this may jeopardize a 
timely rescue/response action off of our pristine coastline. We urge 
Congress to shift this critical response benchmark to the entrance of 
the Strait of Juan de Fuca.

G. Extend the Pacific Coast Marine Sanctuary Area to Be Avoided to 
        Include Non-Tank Vessels (Not Just Oil Carrying Tank Vessels) 
        and Expand Definition of ``Carrying Cargo'' To Include Tank Oil 
        ``Clingage''
    The Olympic Coast National Marine Sanctuary is one of our Nation's 
most treasured marine areas. Its mission is to protect the sanctuary 
and ensure that future generations are able to use and enjoy it. That 
means that managing the sanctuary to both conserve its resources and 
encourage uses that are compatible with conservation. To this end, the 
Area To Be Avoided was created by the International Maritime 
Organization. The ATBA standard is that ``all ships and barges carrying 
cargoes of oil or hazardous materials'' will not enter the ATBA.
    Recently, the Oil Spill Advisory Council wrote a letter to the 
NOAA's Olympic Coast Marine Sanctuary questioning why vessels with 
hundreds or thousands of gallons of oil ``clingage'' inside their tanks 
are not considered to be ``carrying cargo,'' and thus required to stay 
outside of the ATBA. The Council asked that the Sanctuary revisit its 
interpretation of ``carrying cargo'' and make a determination about 
whether oil carrying ships and barges that are mostly empty should be 
considered empty and not carrying cargo, or whether they should be 
considered mostly empty and carrying some cargo.
    Unfortunately, the Sanctuary responded that it feels constrained by 
the ATBA language and that it will continue to consider vessels that 
have only residual product in their holds as not ``carrying cargo,'' 
and thus not having to stay out of the Sanctuary's ATBA.
    The Council asks that Congress act to change this. The Council has 
learned from the Washington Department of Ecology (Ecology) that oil-
carrying vessels that have been ``emptied'' actually contain at least 
several hundred gallons of oil onboard, and are more likely to contain 
several thousand gallons of oil ``residue.'' We have even learned that 
one vessel that had its tanks cleaned and certified to be gas-free was 
still carrying 15,000 gallons of diesel when it landed on the rocks.
    The Council has learned that if an incident involving a vessel 
carrying thousands of gallons of oil, or even hundreds of gallons of 
oil, resulted in a release of that oil to the environment, serious 
environmental and economic harm would almost certainly result. There 
are scenarios where the release of this residue oil could cost the 
State of Washington millions and millions of dollars.
    True, the severity of any oil related incident depends on factors 
such as the type of oil released, where the oil is spilled, whether 
weather conditions are conducive to containment and recovery, and the 
sensitivity of impacted habitats and resources. However, it goes 
without saying that hundreds or many thousands of gallons of oil 
released into the environment would not be an insignificant event, 
especially in an area where the precautionary principle is being 
implemented as the IMO deemed it to be ``exceptionally important to 
avoid casualties.''
    Additionally, preventing huge cargo vessels with many thousands of 
gallons of oil as bunker to transit through the ATBA is not consistent 
with the goals of the ATBA or the Sanctuary. Therefore, Congress should 
expand the ATBA to include non-tank vessels that are simply transiting 
through the ATBA without any real need to be there (such as fishing 
vessels who are actively fishing inside the sanctuary).

H. Vessel Response Plans for Non-Tank Vessels
    Federal regulations for non-tank vessel contingency plans should be 
finalized without further delay and aggressively implemented. In 
addition, Congress should recognize state accepted planning standards 
that increase response effectiveness.
    Many states, including Washington and Oregon, have adopted an 
``umbrella'' approach for non tank vessel planning, approving a single 
plan that covers large classes of vessels. The state believes the 
Federal rules should fully recognize state accepted umbrella plans that 
are locally designed. They are more cost-effective for industry and 
ensure the local first-response capability is aggressively launched in 
the event of a spill. This approach is also able to provide a smooth 
transition to any longer-term response organization without 
compromising Federal or international standards. This can be 
accomplished by delegation of authority to authorized states.

I. Impose Additional Speed Limits in Vessel Traffic Lanes; Enforce With 
        Civil and Criminal Penalties
    The pilot maneuvering the COSCO BUSAN was speeding. Had he not 
been, he possibly could have averted the vessel away from the bridge. 
The pilot apparently had a history of being careless and going too 
fast. Had there already been in place enforceable speed limits that 
could form the basis for fining companies and for taking away the 
license of a pilot or a master, it is quite possible that the COSCO 
BUSAN pilot would not have been ``behind the wheel.''
    The larger the vessel, the longer it takes to stop. Cargo ships 
often take miles to slow down and stop. The difference in being able to 
avert disaster or not, could be as little as one knot. Therefore, it is 
important to slow down vessel traffic and to enforce vessel speed 
limits, just like we do on our Nation's highways. Indeed, it is even 
more important given that one ``boat wreck'' can ``wipe out'' an entire 
community, its culture, and its economy. Congress could impose these 
speed limitations and couple them with strong Coast Guard enforcement.

IV. Conclusion
    I would like close by stressing how vitally important it is for all 
levels of government to work together to solve these issues--for the 
Federal Government to work with state, tribal, and local governments to 
assure that while we pursue the interests of commerce, we do not do so 
at the expense of other things that are so dearly important to our 
culture, our local communities, and our general well being.
    Thank you for inviting me to testify before the Senate Commerce 
Committee. I would be happy to answer any questions you have.

    Senator Cantwell. Thank you, Mr. Cooper. Mr. Deaver, 
welcome, and thank you for being here.

STATEMENT OF WILLIAM G. DEAVER, PRESIDENT AND COO, TOTEM OCEAN 
                     TRAILER EXPRESS, INC.

    Mr. Deaver. Thank you very much, Madam Chair. Thank you, 
Madam Chairman and Ranking Member Snowe. I am William Gary 
Deaver, Bill, President of Totem Ocean Trailer Express. And I 
want to thank you for the opportunity to express my company's 
views on this matter.
    Totem Ocean Trailer Express, or TOTE, is a Jones Act 
carrier transporting cargo between Tacoma, Washington and 
Anchorage, Alaska. Since 1975, we have been serving the people 
of Alaska by transporting the things that Alaskans eat, wear, 
and use. We have 170 shore-based employees and provide direct 
and indirect jobs for an additional 525 individuals onboard our 
vessels, as stevedores, truck drivers, warehouse operators, and 
others. Together, we have served the Alaska trade consistently, 
efficiently, and without a significant oil spill for 32 years. 
We currently operate two new vessels that were built at 
NASSCO's shipyard in San Diego and were delivered in 2003.
    Madam Chairman, TOTE believes that prevention is better 
than cleanup, and we have designed our ships with our operating 
systems to prevent oil spills. Our ships were designed to 
minimize the risk of oil spills, such as the recent tragedy in 
San Francisco. Specifically, TOTE's ships carry their fuel in 
tanks that are approximately eight feet inside the sides of the 
outer hull; in other words, an object has to penetrate the side 
of the ship by more than eight feet in order to rupture the 
fuel tank.
    Moreover, the tanks themselves have double bottoms, and are 
elevated more than ten feet above the bottom of the hull, 
thereby offering similar safety in the event of a grounding. 
The tanks themselves are vertical, instead of being parallel to 
the waterline as is traditionally the case. This is a very 
crucial safety factor. The fuel tanks are approximately 20 feet 
wide; hence, only about 20-foot-wide band of the ship's 839-
foot length is vulnerable. There is no fuel tank behind the 
other 819 feet of the ship's sides.
    The combination of the set-back from the outer hull and the 
vertical orientation of the fuel tanks means that to breach the 
fuel tank an object would have to penetrate the hull by more 
than eight feet, and the penetration would have to occur within 
a 20-foot band, which is less than one-fortieth of the ship's 
length. In other words, even a collision that penetrated the 
hull by more than eight feet would not damage the fuel tanks if 
the collision occurred on the other thirty-nine fortieths of 
the ship's length.
    In addition, TOTE's vessels incorporate numerous other 
elements that reduce the risk of oil pollution and other 
environmental hazards, such as: we have three separate radar 
systems on each vessel; we have redundant oily water separators 
on each vessel, ensuring that gray water discharge from the 
vessel is 98 percent pure; each vessel operates with twin 
electric screws with four main and two auxiliary diesel 
generators with diesel electric; twin rudders; airspace stern 
tube sealing system that prevents lubricant leaks; and a self-
containing ballast system to prevent the spread of invasive 
species through ballast discharge.
    These design elements went beyond what was legally 
required, and they were expensive. We estimate that we spent 
approximately $15 million per ship for system redundancies and 
environmental enhancements that were not legally required. But 
TOTE's people and our operating practices are at least as 
important as preventing oil spills as the vessel design.
    First, as a Jones Act carrier, our ships are crewed by 
Americans. Therefore, language and communication problems are 
minimized when the Master, crew, and pilot speak a common 
language. Moreover, our crews are highly trained, experienced, 
and well-qualified to operate our vessels safely and in an 
environmentally sound manner. All of us take immense pride in 
TOTE's commitment to environmentally sound vessel design 
features and our operating safety processes.
    The main terminals in both Alaska and Washington State were 
certified ISO-14001:2004, which is Environmental Management 
System compliant this past June for all the facilities and all 
the loading and unloading cargo and equipment to and from the 
vessels. In addition, each of our ships enters and leaves Puget 
Sound and Cook Inlet approximately 50 times per year. Our 
Masters have all been with TOTE for at least 15 years. They 
know their crews, they know the waters, they know the pilots. 
The pilots know the ships, they know the Masters, and of 
course, they know the waters.
    In Alaska, for example, TOTE contracts with pilots who ride 
the ships fulltime from Tacoma to Anchorage and back, thereby 
eliminating the risk and uncertainty of having to take on a 
pilot in stormy Cook Inlet in the darkness of an Alaskan 
winter. We believe that these measures, which we have taken 
voluntarily, are the best, most proactive ways to minimize the 
risk of oil spills and other environmental safety hazards in 
our industry. Thank you for this opportunity to express our 
views.
    [The prepared statement of Mr. Deaver follows:]

      Prepared Statement of William G. Deaver, President and COO, 
                   Totem Ocean Trailer Express, Inc.

    Madam Chairman and members of the Subcommittee, I am William G. 
Deaver, President of Totem Ocean Trailer Express, Inc. I want to thank 
you for this opportunity to express my company's views on this matter.
    Totem Ocean Trailer Express, or TOTE, is a Jones Act carrier 
transporting cargo between Tacoma, Washington and Anchorage, Alaska. 
Since 1975, we have been serving the people of Alaska by transporting 
the things that Alaskans eat, wear, and use. We have 170 shore based 
employees and provide direct and indirect jobs for an additional 525 
individuals onboard our vessels, as stevedores, truck drivers, 
warehouse operators and others. Together, we have served the Alaska 
trade consistently, efficiently, and without a significant oil spill 
for thirty-two years. We currently operate two new vessels that were 
built at NASSCO's shipyard in San Diego and were delivered in 2003.
    Madam Chairman, TOTE believes that prevention is better than clean-
up and we have designed our ships and our operating systems to prevent 
oil spills.
    Our ships were designed to minimize the risk of oil spills such as 
the recent tragedy in San Francisco Bay. Specifically, TOTE's ships 
carry their fuel in tanks that are approximately 8 feet from the sides 
of the ship's outer hull. In other words, an object would have to 
penetrate the ship's side more than 8 feet in order to rupture the fuel 
tank. Moreover, the tanks themselves have double bottoms and are 
elevated more than ten feet above the bottom of the hull, thereby 
offering similar safety in the event of a grounding.
    The tanks themselves are vertical, instead of being parallel to the 
water line as is traditionally the case. This is a crucial safety 
factor. The fuel tanks are approximately 20 feet wide. Hence only about 
a 20-foot wide band of the ship's 839-foot length is vulnerable; there 
are no fuel tanks behind the other 819 feet of the ship's sides. The 
combination of the set-back from the outer hull and the vertical 
orientation of the fuel tanks means that to breach the fuel tank an 
object would have to penetrate the hull by more than 8 feet and the 
penetration would have to occur within a 20-foot band, which is less 
than one-fortieth of the ship's length. In other words, even a 
collision that penetrated the hull by more than 8 feet would not damage 
the fuel tanks if the collision occurred on the other thirty-nine 
fortieths of the ship's length.
    In addition, TOTE's vessels incorporate numerous other elements 
that reduce the risk of oil pollution and other environmental hazards, 
for example:

   Three separate radar systems;

   Redundant oily water separators ensure that our grey water 
        discharge is 98 percent pure;

   Twin electric screws with four main and two auxiliary diesel 
        generators;

   Twin rudders;

   Airspace stern tube sealing system that prevents lubricant 
        leakage; and

   Self-contained ballast system to prevent the spread of 
        invasive species through ballast discharge.

    These design elements went beyond what was legally required, and 
they were expensive. We estimate that we spent approximately $15 
million per ship for system redundancies and environmental enhancements 
that were not legally required.
    But TOTE's people and our operating practices are at least as 
important in preventing oil spills as the vessel design. First, as a 
Jones Act carrier, our ships are crewed by Americans. Language and 
communication problems are minimized when the Master, crew, and pilot 
speak a common language. Moreover, our crews are highly trained, 
experienced and well-qualified to operate our vessels safely and in an 
environmentally sound manner. All of us take immense pride in TOTE's 
commitment to environmentally sound vessel design features and our 
operating safety processes. The main facilities in both Alaska and 
Washington State were certified ISO-14001:2004 (Environmental 
Management Systems) compliant this past June for all facilities and the 
loading and unloading of cargo and equipment to and from our vessels.
    In addition, each of our ships enters and leaves Puget Sound and 
Cook Inlet approximately fifty times per year. Our Masters have all 
been with TOTE for at least 15 years. They know their crews, they know 
the waters and they know the pilots. The pilots know the ships, they 
know the Masters, and of course they know the waters. In Alaska, for 
example, TOTE contracts with pilots who ride the ship full time from 
Tacoma to Anchorage and back, thereby eliminating the risk and 
uncertainty of having to take on a pilot in stormy Cook Inlet in the 
darkness of an Alaskan winter.
    We believe these measures, which we have taken voluntarily, are the 
best, most pro-active ways to minimize the risk of oil spills and other 
environmental and safety hazards in our industry. Thank you for this 
opportunity to express our views.

    Senator Cantwell. Thank you, Mr. Deaver. And I want to 
thank all the panelists who are--the second panel seems to be 
focused a little more on the prevention issue, not that 
colleagues here didn't want to know a lot about where we are on 
this rulemaking and response plans and things of that nature. 
But if I could follow on this line of prevention, and ask each 
of you about where you really think we are, in context of--I 
guess you could just say a grade, if you will, in the context 
of prevention.
    We have prevention, we have preparedness, and we have 
response plans. And I think we all know how expensive the 
response plans are. So I'm just trying to get a sense of where 
you--how much Mr. Deaver there is showing a stellar response, I 
guess I would say. It sounds like you may be the leader of the 
industry. But I want to hear from Dr. Etkin and Mr. Cooper, as 
well, on how much more you think we need or can be doing on 
preparedness. If you had to give us a grade today, what would 
you give us, and what else do you think we need to be doing?
    Dr. Etkin. A grade on preparedness?
    Senator Cantwell. Yes.
    Dr. Etkin. I'd probably give us a C. I think that because 
we've had fewer spills, I think there are fewer people who were 
well-trained to respond. Many of the old-school response people 
who are involved in some of the larger spills are retiring now. 
They tell me that there are many people who are spill 
responders who have never actually been to a really big spill. 
And I think that's a concern.
    I think we need to increase our preparedness in terms of 
the amount of equipment that we have available, and we need to 
train and position that equipment in a way that we can get out 
there more quickly, because, as I've shown many times in 
trajectory modeling and other studies, that the more quickly 
you get out there to respond, the better you are in terms of 
reducing damages and the spread of the oil. That's certainly an 
issue that merits attention.
    In terms of prevention, I think we're doing better in the 
U.S. than elsewhere. I've done some work on the international 
front, and I see that we tend to have a better class of vessels 
coming into U.S. waters, particularly with regard to the 
Certificate of Financial Responsibility. Ship owners are afraid 
to come into U.S. waters, because they're afraid of the 
liability limits, they're afraid of natural resource damages 
assessments, which is something that does not exist outside the 
United States. So there certainly is that to consider.
    But I think we need to carefully examine those liabilities, 
and then we can see that we really recover all of the costs of 
the spill.
    Senator Cantwell. Thank you. Mr. Cooper? And really, I'm 
focusing on--Dr. Etkin, I believe that you said it--about 
working together and being positive. What we need to understand 
is how much more is out there in the area of preparedness, and 
I want to make sure--I'm thrilled that you seem to be doing a 
lot of work in this particular area. If you help us understand 
where we are and how much better we can do?
    Mr. Cooper. In Washington State, I think, in particular, in 
the preparedness area, we've come a long way, largely because 
of some actions that have been taken by the Governor and the 
State Legislature over the last two or 3 years in requiring 
plans for--requiring pre-booming and requiring plans for 
bunkering--for pre-booming during bunkering, and requiring 
better contingency plans and things like that at the state 
level.
    I think we've got a long ways to go. We could do many more 
things. There are some people who think that, for example, the 
tug escort requirements in the Strait of Juan de Fuca could be 
a little bit stricter. There are some who believe that we need, 
as I mentioned, that we need to push harder on the double hull 
issue. One of the things that I see in Puget Sound, in 
particular, and on the outer coast, is the increased traffic of 
barges and tugs carrying fuel, something that we haven't spent 
a lot of time talking about.
    So we're probably in very, very good shape in Washington, 
but we can always do more. The other thing I would note is the 
Memorandum of Agreement that the state signed with the Coast 
Guard and how we're going to jointly manage the waterways for 
prevention and preparedness. So, I'd say nationally we're a C. 
I'd like to believe that in Washington State we're a B or a B+ 
in many of those areas. But we're not perfect.
    Senator Cantwell. Thank you. Mr. Deaver?
    Mr. Deaver. I would give us a C-. I think that industry can 
continue to do more. We have a carrier in Evergreen Maritime, 
out of the Republic of China, that have come up--there are 
vessels now that have the vertical fuel tanks, similar to what 
TOTE has put in, which I think is a very positive step, and 
those ships are culling on the West Coast. So I think that that 
is a very positive step, but I think that industry can continue 
to do more.
    Senator Cantwell. Mr. Deaver, why did TOTE respond so 
aggressively to the development of vessels that met these 
prevention techniques that have been so helpful, and having 
that stellar record for so many years?
    Mr. Deaver. We looked at the vessel assets that we were 
building, and we said that these vessels will be in operation 
for up to and exceeding 40 years. And we were looking over the 
horizon as to what the regulations might be, or how we would 
really want to treat the waters that we live and work in. So we 
voluntarily took the measures, because we said it was simply 
the right thing to do in the environment that we work.
    Senator Cantwell. So how many other companies have vessels, 
such as TOTE, with tanks in the center of the ship, well 
protected from possible eruption from collision and other 
activities?
    Mr. Deaver. The only ones that I'm really aware of are the 
new Evergreen ships that have come out, but I'm not totally 
aware of that. But the industry, I believe, will begin to 
migrate to that vertical-type tank within these ships?
    Senator Cantwell. They will do so on their own or--is there 
an economic benefit for doing that?
    Mr. Deaver. I think that there is a benefit environmentally 
in being able to say that they have taken the steps to mitigate 
spills. But economically, I don't know that that could be said 
at this point.
    Senator Cantwell. So your company looked at it over a 40-
year period and just decided that this is the right thing to 
do.
    Mr. Deaver. It is the right thing to do.
    Senator Cantwell. Thank you. Senator Snowe?
    Senator Snowe. Yes. Thank you, Madam Chair. Dr. Etkin, I 
know it's important to move forward, but what are the lessons 
learned from what happened with COSCO BUSAN? What were your 
impressions of the Coast Guard's response, and where we could 
make improvements? Obviously, there are a number of issues that 
emerged from that incident, including the lack of timeliness on 
the part of the Coast Guard and notifying local officials other 
than the Coast Guard itself being notified about the magnitude 
and dimensions of the oil spill from 142 to 58,000 gallons.
    Obviously there are a number of issues that we are going to 
have to address, and so will the Coast Guard. In your 
observations, in fact, I'd like to get any of the impressions 
from the panel, what are the lessons learned? What would you 
recommend to us on the basis that you've been able to discern 
from this incident, and that we should do better?
    Dr. Etkin. Well, I actually have had the opportunity to go 
to San Francisco recently. I did see the oiled shorelines and I 
spoke directly to some of the Coast Guard people and other 
responders who were involved in this spill, because I was 
involved in working on efforts of prevention and response with 
California Fish and Game. I don't know enough about the 
specifics of the incident to comment too specifically on that. 
I'm concerned about saying anything more.
    I do collect case histories of spills, and analyze them 
after the fact, and this would be one of the spills that I will 
have to look at in terms of lessons learned. But just offhand, 
certainly, the delay in response contributed greatly to 
allowing that oil to spread so far throughout the bay. I know 
that there are very, very challenging currents in San Francisco 
Bay. I've done some modeling with those currents, some 
trajectory models, and you see that it really is a challenge to 
do on-water oil recovery in this environment.
    But that being said, there was a remarkable--I think you 
had mentioned this earlier--a remarkable oil recovery rate. I 
was told there was about 36 percent, which is actually a very 
high rate. It doesn't sound very high, but with regard to on-
water oil recovery, mechanical oil recovery, it is relatively 
high. So somebody was doing something right there, but I think 
that the delay in notification was an issue. And certainly, I 
had gotten an initial notice that there were 130 gallons that 
were spilled, and I didn't think much of it.
    I received these notifications myself, and I was thinking, 
``Oh, OK. Well, I'll just chalk that up to one of the smaller 
ones.'' Then I heard that it was so much larger, and I did hear 
that the oil must have spilled very, very quickly from that 
size of a gash. Obviously, the oil doesn't just slowly release. 
I don't know what happened, and certainly that should be 
investigated, because that delay absolutely contributed to the 
spread of the oil.
    Senator Snowe. Do you think the 36 percent recovery rate is 
the best we could expect? In other words, it's very difficult 
to increase that amount of recovery?
    Dr. Etkin. I'm sorry to say that that is probably true. 
Except in very unusual circumstances, where you're in very 
calm, sheltered waters, or where you have a pre-boomed vessel 
that happens to have a spill during oil transfer operations. 
You can sometimes get oil recovery 75 percent or even higher in 
those sorts of circumstances. But on-water recovery, when 
you're trying to boom it, contain it, and skim it, very rarely 
more than 10 to 25 percent, so it's actually remarkable that it 
was 36 percent.
    Although I suspect that some of that oil that they included 
in that count was what was recovered from the shoreline, so I 
would take that with a grain of salt.
    Senator Snowe. Do you think the Coast Guard's Response 
Program is robust enough to address this with nontanker 
vessels, since they represent about a third of the----
    Dr. Etkin. Well, I think a spill is a spill, regardless of 
the source, and certainly there are all kinds of spills from 
all sorts of sources and facilities we handle. I think that the 
Coast Guard's Strike Force Team and, in general, the Regional 
Response Teams, these are very highly trained people who know 
what they're doing. And I think that there are probably ways 
which they could work better with some of the oil spill removal 
organizations and private entities that are hired by the 
responsible party. There are probably communication issues and 
jurisdiction issues.
    Senator Snowe. Yes. One of the issues was using volunteers. 
There were so many available at the time, and they weren't 
integrated in the process early on, and that's one of the other 
issues.
    Dr. Etkin. Yes. My sister was one of those people who were 
there as a volunteer. I know that many people were sorely 
disappointed that they could not do something. I think there 
needs to be a way to bring people into the process, because 
there are a lot of very motivated people who want to help.
    Senator Snowe. Mr. Cooper, do you have any impressions? I 
know you were suggesting we should create or delegate one of 
the authorities that is already vested in the Coast Guard to 
state authorities, whether it's for inspections, regulations, 
or conducting investigations. Do you think that's possible for 
states to have adequate resources to assume financial 
responsibilities? Even if preferable, as well, to have a 
central authority, one who creates a consistency from one 
agency, such as the Coast Guard, to oversee all of those 
responsibilities?
    Mr. Cooper. I think if we're going to do that kind of 
delegation, it's important to know that we have a capable 
state. And that's why I chose that word in my testimony. A 
capable state, like I believe Washington State is, where we 
have people in the Department of Ecology that are well-trained 
mariners that actually do inspections with the Coast Guard now, 
and in some cases do some of the inspections, as a part of the 
Memorandum of Agreement between the State and Federal 
Government, on oil tank vessels.
    And I think that the first thing that would have to happen 
is the Coast Guard would have to ensure that the state had the 
policies and the training and the personnel in place to do 
those inspections for them, under the authority of the Coast 
Guard. But without that training at the State level, I don't 
think it's practical to pass it on if the state doesn't have 
the resources to be able to do it.
    Senator Snowe. Yes. Do you think you could establish a 
level of consistency with respect to the inspections, for 
example, in enforcement? If you were to delegate it to, say, 
certain states that have the capabilities?
    Mr. Cooper. The assumption would be that the states would 
do the inspections consistent with the Coast Guard standards, 
and that it would be actually acting as an arm of the Coast 
Guard.
    Senator Snowe. Yes. Do you have any views about the COSCO 
BUSAN in any way from your vantage point?
    Mr. Cooper. I haven't looked at the information yet. The 
reports are just starting to come out. The Oil Spill Advisory 
Council is looking forward to more extensive briefings on the 
lessons learned as the complete report comes out. I will say 
that the volunteer issue is an issue that came up in 
Washington, following the very small oil spill on the tip of 
Vashon Island, in an area called Dalco Passage, and we've been 
working hard in our advisory capacity at the Department of 
Ecology to try to figure out how to train volunteers.
    And one of the issues that consistently comes up, both in 
the Coast Guard and from the Department of Ecology, is what 
level of HAZWOPER training do those people need to have to be 
able to respond as volunteers? Now, I know there are people, 
perhaps some in this room, who responded as volunteers to the 
TENYO MARU spill on the Washington Coast, and perhaps at the 
EXXON VALDEZ spill in Alaska, as volunteers were used there. So 
the question is--how do you include organized groups of 
volunteers? I think it's very, very important to include the 
community.
    We have caches of equipment now at the local government 
level in Washington. The Legislature made an appropriation, and 
we actually have local fire departments and local port 
districts that have small caches of booms so that they can 
respond instantly and without waiting for the longer response 
time, and I think the response time is one of the things that's 
going to come out as a very critical issue after that spill.
    In my other life as a firefighter, where you put equipment 
and how fast you respond had a lot to do with whether or not 
the house burned down, and I think that type of logic needs to 
be applied to spill response. We need to shorten response 
times, and we need to get trained personnel, boom, and 
equipment more strategically located around areas like, in our 
state, Puget Sound, or in California, the San Francisco Bay, so 
that the equipment can get to the scene a lot faster.
    Senator Snowe. Maybe incorporating drills for volunteers. A 
lot of our local counties have volunteer fire departments, for 
example, and emergency personnel. Maybe that's another way of 
doing that, incorporating the drills so you have that pattern 
of response, and it happens intuitively, based on the 
experience in those drills. Since obviously people were 
standing by and waiting to help, and they were frustrated 
because they weren't able to as the spill got worse. It's an 
interesting point. We really have to draw from our experience 
and discern in what ways we can improve. Thank you.
    Mr. Deaver, finally, obviously, your company has a very 
impressive track record, and you've taken a very proactive, 
aggressive approach to prevention. It really is, when you think 
about the amount of money your company has invested to ensure 
and guard against oil spill risks. Did you have any views 
about, for example, the Coast Guard's response? Some are 
suggesting we should increase their authority with respect to 
monitoring the transit of vessels in and out of port, in terms 
of their direction or their speed, to have the Coast Guard 
watches be more involved in vessel monitoring the trafficking 
of vessels coming into the port.
    Mr. Deaver. With the VTS system in an area like San 
Francisco Bay, I think that it would be very difficult to have 
someone in the VTS office giving directions, settings for the 
best level of speed, on an ongoing basis, let's say as an air 
traffic controller does with airplanes. That is left normally 
to the pilot and to the captain. And I have read a lot about 
the incident in San Francisco, and the questions that I would 
really have there would also come as to what is the real 
liability and responsibility of the pilot and the Master in the 
incident. Because I think that that has to be really clearly 
identified going forward. So it's more of a question.
    Senator Snowe. Thank you. Thank you, Madam Chair.
    Senator Cantwell. Thank you, Senator Snowe. And to follow 
up on that, Mr. Deaver, and to our other panelists, because 
we've really talked about on the prevention side, what were 
some of the key issues in which we needed to spend more time 
on. And that is in thinking about our prevention efforts.
    And I don't know if you could comment on, in general--I'm 
not talking about this specific incident in San Francisco Bay--
but human error, communications systems, and weather. If you 
could--Mr. Deaver, you mentioned that you had a three-radar 
system, and I'm assuming that you use that, and probably pretty 
aggressively in avoiding weather issues and staying out of 
particularly challenging times and particularly challenging 
areas. But of those issues, or any other ones, where do you 
think we need to be spending more time on prevention?
    Mr. Deaver. I think it's really in the management 
processes, generally, within the companies. The vessel 
construction, and putting internal tanks in vessels, will take 
a long period of time. There has been a tremendous number of 
new-built container ships in the last, let's say, 5 years, that 
I believe almost all of the tanks are bottom tanks onboard 
those vessels. So I think it's really in the management 
processes, and I think that clearly there has to be good 
language skills onboard the vessel at the time that it's 
transiting U.S. waters.
    Senator Cantwell. Are you saying that's a significant 
problem today or----
    Mr. Deaver. I would ask that question going forward. I 
don't know. I mean, TOTE is an American-owned company, 
American-crewed, English obviously is the language. But I think 
that that is a question when you get into many of the 
international arrivals into the United States.
    Senator Cantwell. Mr. Cooper?
    Mr. Cooper. As Mr. Deaver stated, I think management 
practices really need to be focused on as part of the human 
error question. Oftentimes, and one of the things we're 
finding, we're doing a root cause analysis right now, and we're 
discovering that the Coast Guard and the State Department of 
Ecology's recordkeeping is not the same, or historically has 
not been the same.
    It's better now. But, oftentimes, things get called human 
error, but when you break down the subsets you find out it's 
because a company didn't have a policy or didn't have crew 
training, or had a management practice that needed to be 
addressed. So I think you need to break it down and talk about 
where the human error originates. What causes a human being to 
make a mistake? Were they tired? Were they not trained? Was 
there a policy that wasn't in place? But I think, in 
particular, in Washington----
    Senator Cantwell. Do you suggest we follow that up with 
better rulemaking on that?
    Mr. Cooper. If rulemaking is not in place that addresses 
those issues, it probably should be.
    Senator Cantwell. OK, thank you. I'm sorry--were you going 
to add something else?
    Mr. Cooper. Well, I was just going to very briefly talk 
about the weather. I think, in particular, in Washington, 
weather is something you need to be paying attention to in the 
coastal areas where wind and storms are factors. There's a lot 
of debate going on right now in the state about whether or not 
tankers should be transferring their cargo when the weather is 
too--even in Bellingham and Port Angeles--when the weather is 
too bad for them to boom that vessel.
    There's probably going to be a question about whether or 
not the state is preempted from making that decision, and so I 
think weather is probably something that should be looked at, 
as well, and rulemaking around when you can transfer fuel and 
when you cannot transfer fuel, and when is it too rough for 
those vessels to be transiting in and out, especially in narrow 
waterways.
    Senator Cantwell. Thank you. Dr. Etkin?
    Dr. Etkin. Actually, I was involved in the study on 
currents and prepositioning of the booms in Washington State, 
and looked at areas where the currents at all times or most 
times were going to be too high to actually effectively be able 
to contain the oil. From this data, the State can then look at 
that and decide, well, should we say that we can't do any oil 
transfers in these locations, or do we need to take into 
account the current and weather conditions at the time? I think 
that's an important thing.
    Certainly, weather is an issue, and fog. I've been to San 
Francisco enough to know that fog occurs a lot in San 
Francisco. And this is something that needs to be factored in. 
We need to look at ways in which one can navigate in fog. And I 
don't know--I'm not knowledgeable enough to know myself how 
we're going to do that, but it certainly is an issue that 
should be looked at. That seems obvious. But human error has 
been shown to be a factor in a lot of spills, and certainly 
what always comes to my mind is the JULIE ANNE spill in the 
Fore River in Portland, Maine, where the pilots ordered a 
``hard right'' and hit the bridge. That was quite a mess up 
there.
    That's an obvious example, but there are certainly a lot of 
human error factors that come into play, and maybe in very 
small ways. And it's important that we actually look at this, 
and there are people who are actually studying this type of 
thing. I think more attention needs to be paid to that, and 
then look, what is it that caused the problem? Is it that the 
crews are tired or not well-trained? And based on what we find 
are the real root causes, that's where there should be 
guidelines or regulations put in place.
    Senator Cantwell. Well, I want to thank the panel very much 
for your testimony today, and your continued work in this area. 
And I want to thank the Vice Chair, Senator Snowe, for 
attending this hearing. Our Committee meeting is adjourned.
    [Whereupon, at 5:09 p.m., the hearing was adjourned.]


                            A P P E N D I X

 Prepared Statement of Ben Johnson, Jr., Chairman, Makah Tribal Council
    Chairman Senator Cantwell and distinguish members of the 
Subcommittee:

    Thank you for the opportunity to provide written testimony to the 
hearing record from a sovereign tribal government perspective.

I. Summary
    While the 58,000 gallon spill caused by the freighter COSCO BUSAN 
in San Francisco Bay last month provided impetus for this hearing, it 
is important to also note that since that time over 4.5 million gallons 
of oil have spilled into the world's oceans from three tanker incidents 
in the Black Sea, South Korea and North Sea. We are grateful for 
Senator Cantwell's leadership on this Subcommittee to help minimize the 
risk of hazardous spills and offer the following comments to that end. 
Cargo freighters comprise the majority of traffic that transits through 
our Usual and Accustomed (U and A) treaty reserved ocean area making 
them the most likely source of a spill. It is also important to 
understand that oil tankers and oil barges pose the risk of the 
largest, most damaging spills to the marine environment and our 
traditional way of life. My tribe has witnessed firsthand the rapid 
growth in the size of the cargo and passenger vessels that transit our 
treaty-protected waters. We realize this increase in size makes them 
more vulnerable to the forces of the wind and potential sources of 
bigger spills. We understand that that the General Accounting Office 
(GAO) has found that over the past 16 years oil tankers and barges 
comprised just under half of the 51 major oil spills in the Nation and 
that the cost of a spill can be greatly increased in remote, 
environmentally sensitive areas like ours where the shipping lanes come 
close to shore. Our treaty-protected resources do not distinguish 
between the sources of oil that cause damage upon the event of a spill. 
We call on Congress to help us to develop the capacity to assure state 
and Federal rulemaking incorporate tribal treaty interests. In 
particular we ask that the Coast Guard adequately completes the Salvage 
and Firefighting rule of OPA 90; requires vessel response plans for non 
tank vessels; and raises the liability cap for all vessels, especially 
oil barges, to keep up with the consumer price index. Finally we 
strongly recommend passage of the Coast Guard Authorization Act of 2008 
with the Neah Bay tug and tribal consultation provisions in place.

II. Introduction
    In 1855, the Makah Indian Tribe signed a treaty with the U.S. 
Government that reserved land adjoining the Strait of Juan de Fuca and 
Olympic Coast in Washington State for the tribe's use and occupation. 
The terms and conditions of the treaty reserve the right of taking 
fish, whale, and seal at our usual and accustomed grounds and stations. 
The Makah treaty area extends out approximately 45 miles west into the 
Pacific Ocean and 70 miles eastward into the Strait of Juan de Fuca 
from Neah Bay, Washington.
    The major center of population on the Makah Indian Reservation is 
Neah Bay, home to a strategically located port situated on the Strait 
of Juan de Fuca, facing Vancouver Island, British Columbia, Canada. 
Neah Bay is the only accessible port on the outer Washington coast 
north of Grays Harbor, located in the southwestern portion of the 
state, on a year round basis. The Makah Tribal government, tribal 
treaty commercial fishing and non-treaty sports and commercial fishing, 
the timber industry and tourism support the local economy. The isolated 
location and natural beauty of the Makah Indian Reservation attracts 
thousands of people each year. Visitor surveys document that a large 
number of people come to the Makah Reservation exclusively to visit the 
Makah Cultural and Research Center. Visitors also enjoy hiking the Cape 
Flattery and Shi Shi Beach trails, also to bird watch, whale watch, 
kayak, surf, dive and stroll on our pristine beaches.
    Makah people are a maritime people who have historically depended 
upon the wealth of the sea for the majority of our food. Our diet 
includes sea mammals, and a numerous variety of fish, shellfish, and 
crustaceans. The Makah Tribe is the only tribe in the United States 
whose treaty reserved rights includes whaling; historically whale 
blubber and oil was a mainstay of our diet.
    The ocean still plays an essential role in the economy and diet of 
Makah people to this day. A unique Makah cultural perspective comes 
directly from the proximity to the ocean, rivers and lakes and the vast 
resources our marine environment contains. The Makah people are able to 
continue to exercise our traditional cultural practices by maintaining 
a basic and intrinsic relationship to our maritime environment.
    Until historic times the Makah Indian Tribe was composed of five 
principal winter villages. The pre-historic population of the Makah is 
estimated to have been approximately 4,000 people, about double what it 
is today. The Makah Tribe has viewed access to the marine environment 
and our marine resources as an inherent sovereign right from time 
immemorial.

III. Oil Spill Risk
    One hundred and fifty years after we signed our treaty with the 
U.S. Government, the Strait of Juan de Fuca has become a primary 
waterway route for oil tankers, cargo and passenger vessels bound to 
port facilities in Washington and British Columbia. Being the ``People 
of the Cape'' and been situated in the northwest most corner of the 
contiguous United States, we understand our exposure to oil spill risk 
is high. The Makah have the largest combined ocean fisheries of any 
federally recognized Indian Tribe in the United States. Our Usual and 
Accustomed (U&A) marine treaty area is located at the crossroads of the 
Strait of Juan de Fuca and the Pacific Ocean. This places us at the 
entrance to a U.S. High-Volume Port Complex, Canada's largest port and 
the world's third largest Naval complex. The Olympic Coast National 
Marine Sanctuary, the Olympic National Park, a National Fish Hatchery 
and a National Wildlife Refuge are adjacent to or part of our treaty 
area. The Makah Tribal Council (MTC) recognizes the importance of 
protecting these national treasures and is fully committed to do our 
part to improve the standards of protection against negative impacts to 
our shared environment.
    These unique circumstances combined with our experience as serving 
as a ``Resource Trustee'' in addressing the impacts of the 4 largest 
persistent oil spills in Washington State history (General Meiggs, 
2,300,000 gallons in 1972; ARCO Anchorage, 239,000 gallons in 1985; 
Nestucca, 231,000 gallons in 1988, TENYO MARU, 400,000 gallons in 1991) 
totaling approximately 3 million gallons of oil spilled on our natural 
and cultural resources afford us strong standing in this discussion.
    The probability of another major oil spill is high in our area as 
the volume of trade is expected to triple in the next 15 to 20 years. 
Yet due to rulemakings that have not adequately considered our treaty 
reserved rights, the western portion of the Strait of Juan de Fuca and 
the outer Washington Coast do not receive the same levels of protection 
from oil spills that the rest of the Washington State waters are 
afforded. For example the placement of the High-Volume Port Line 70 
miles east from the entrance to the Strait of Juan de Fuca means there 
is less oil spill response equipment and personnel stationed adjacent 
to the high seas. In addition, the fact that pilots do not board ships 
until Port Angeles, WA, means captains with varying degrees of 
familiarity with our waters and the English language transit without 
assistance. This is particularly concerning as our region increasingly 
relies on foreign sources for our oil and trade.
    According to Washington State Department of Ecology (DOE) data for 
2006, 3,559 individual vessels made 18,977 transits through Washington 
waters bound to and from ports in Washington, Oregon and British 
Columbia. Cargo and Passenger vessels comprised 65 percent of the 
transits and 88 percent of the vessels making those calls. Oil tankers 
and barges comprised 33 percent of the transits and 10 percent of the 
vessels. Commercial fishing vessels made the balance of the transits.
    Ecology's data also indicates that the cargo and passenger vessels 
likelihood of having an incident, near miss or spill is proportional to 
their frequency of transit for they comprised 63 percent of the 
incidents and spills in 2006 and 65 percent of the traffic. However, 
they pose a greater challenge to the Coast Guard's inspection program 
because they comprise 88 percent of the individual vessels making 
transits through Washington waters in 2006. Preliminary results from 
the most comprehensive vessel traffic risk assessment done to date for 
the British Petroleum Cherry Point Environmental Impact Statement 
suggest that tank vessels have a higher rate of incidences than non 
tank vessels when you control for their frequency of transit, but cargo 
and passenger vessels occur twice as prevalent along our waterways.
    While oil tankers continue to pose the risk of the largest 
catastrophic spill, freighters clearly are the more likely source of a 
spill. This point is further clarified by the fact that the State 
funded Emergency Response Tug, stationed in our port of Neah Bay during 
the winter months since 1999, has responded to 21 cargo and passenger 
vessels (58 percent), 10 tank vessels (28 percent) and 5 fishing 
vessels (14 percent) to date. When it comes to needing tug assistance 
it appears to be based on the proportion of the vessel type calling on 
our waters with freighters being twice as likely to need assistance as 
compared with tank vessels.
    Being the homeport for the Navy's third largest port complex means 
that commercial vessels are not our only source of risk. On August 4, 
2006 the USS NEVADA, a Navy Trident submarine based at Naval Base 
Kitsap-Bangor severed the towline of the tug PHYLLIS DUNLAP and its 
barge at the entrance to the Strait of Juan de Fuca. The tug PHYLLIS 
DUNLAP was transiting with two empty barges when the incident took 
place. This incident is very similar to one that occurred off of Cape 
Flattery in October 2003 when the U.S. Navy sub TOPEKA separated an 
empty oil barge from its tow underscoring our diversity of risks. 
Despite the fact that the Navy's Supervisor of Salvage has tremendous 
expertise and equipment to respond to such incidents none of those 
assets are stockpiled in the Pacific Northwest.
    The Makah Tribe is currently contracted by oil spill response 
organizations as first responders. The newly revised Washington State 
Oil Spill Contingency Plan Rule (173-182 WAC) identifies the 
establishment of Neah Bay as a primary response/staging area. This 
action is supported by the mutual effort between the State of 
Washington DOE and the MTC to identify the needed infrastructure 
improvements to the Port of Neah Bay facilities to accommodate the 
equipment staging requirements as well as expanding the role of tribal 
members as first responders.
    In the Consent Decree of the EXXON VALDEZ Oil Spill it was 
determined that the lack of strategically located ports around Prince 
William Sound with appropriate caches of equipment significantly 
limited the effectiveness of the response.

IV. Addressing the Risk
    It is an unfortunate fact that most maritime safety advances are 
made in response to major accidents. The last most significant event 
was the EXXON VALDEZ of 1989 after which Congress passed OPA 90. This 
comprehensive overhaul of our Nation's oil spill policies directed the 
Coast Guard to implemented the Salvage and Firefighting provisions of 
OPA 90. In support of the OPA 90 mandates the National Academy of 
Science has repeatedly found the U.S. Salvage posture to be far from 
adequate.\1\ The grounding and break up of the bulk carrier NEW CARISSA 
along the Oregon Coast magnified our inability to muster an appropriate 
salvage response.\2\ We believe these examples serve as ample 
motivation for the Coast Guard to complete the rulemaking called for by 
Congress in OPA 90. Post-9/11 the Transportation Research Board has 
found salvage capacities to be even more critical to respond to a 
terrorist attack.\3\
---------------------------------------------------------------------------
    \1\ 1994 NAS Reassessment of the Marine Salvage Posture of the 
United States.
    \2\ ``Crisis on the Coast'' Federal On Scene Coordinator's Report 
and Assessment of M/V NEW CARISSA Oil Spill Response CAPT M. Hall, USCG 
MSO Portland, June 1999.
    \3\ TRB 2003. Marine Salvage Capabilities Responding to Terrorist 
Attacks in U.S. Ports--Actions to Improve Readiness.
---------------------------------------------------------------------------
    The following is an accounting of the Coast Guard's rulemaking 
actions. On May 10, 2002 the Coast Guard published a Notice of Proposed 
Rulemaking (NPRM) entitled ``Salvage and Marine Firefighting 
Requirements; Vessel Response Plans for Oil; Proposed Rule,'' which 
addressed requirements in 33 CFR Part 155 for vessel owners/operators 
of vessels carrying Groups I through V petroleum oil as a primary cargo 
to identify and ensure availability of salvage and marine firefighting 
resources. This rulemaking, previously in the Office of Response (G-
MOR), has moved to the Office of Vessel Activities (CG-543). All 
comments have been addressed and incorporated in the Final Rule for 
Salvage and Marine Firefighting Requirements; Vessel Response Plans for 
Oil.
    On January 23, 2004, a notice of suspension was published in the 
Federal Register, suspending the 24-hour requirement scheduled to 
become effective on February 12, 2004, until February 12, 2007 (69 FR 
3236). The Coast Guard has extend this suspension period for another 2 
years to allow it to complete the rulemaking that will revise the 
salvage and marine firefighting requirements. This extension is 
effective as of February 12, 2007. Termination of the suspension will 
be on February 12, 2009. The Final Rule is currently in its final 
review at USCG Headquarters. In this final review, due to the age of 
this rulemaking, it was determined that the Salvage & Marine 
Firefighting rule is required to undergo an economic and regulatory 
analysis before final USCG approval. After clearance at USCG 
Headquarters, the rulemaking will then be submitted to the Department 
of Homeland Security and then the U.S. Executive Office of Management 
and Budget (OMB) for approval. It is anticipated that this Final Rule 
will be published in 2008. LCDR Reed Kohberger is the point person, G-
5232 (202-372-1471).
    In our February 15, 2006 comment letter to the U.S. Coast Guard 
Salvage and Marine Firefighting Rule (USCG-1998-3417) we requested a 
government-to-government consultation with Coast Guard HQ to discuss 
how our treaty interests were being left out of the rulemaking. An 
initial meeting with USCG Headquarters staff took in Neah Bay on June 
1, 2006 which resulted in an invitation for the MTC to meet with senior 
staff at Coast Guard headquarters in Washington, D.C. to further 
discuss the formal inclusion of tribal treaty interests in the proposed 
rulemaking. During our meeting we agreed with the Coast Guard that 
there isn't a ``Coordination and Consultation'' policy currently 
established in the Department of Homeland Security and therefore the 
Coast Guard. The lack of a Tribal Consultation Policy makes it 
problematic to not only formally consult with Indian tribal governments 
but also to formally represent tribal interests in their rulemaking. We 
pointed out that we also wanted to work with Coast Guard Headquarters 
to assure the associated NEPA review process to the rulemaking be 
completed in a manner that incorporates treaty interests. We further 
pointed out the inclusion of treaty interests in the NEPA action could 
serve as a tool to assist the Coast Guard in continuing to develop the 
formal recognition of their trust responsibility to the Makah Tribal 
governments in mitigating the risk posed by the transportation of oil 
and cargo through the Makah Tribe's marine treaty area.
    The formal inclusion of tribal cultural and resource values into 
the cost benefit analysis applied to the OPA 90 Marine Salvage and 
Firefighting proposed rulemaking would not only provide a thorough 
representation of resources at risk but would also allow for more 
effective oil spill prevention and response strategies be implemented 
by Federal, state and tribal governments. The MTC has maintained as a 
fundamental treaty right requirement, the need to integrate tribal 
cultural and resource values into any cost-benefit analyses, regulatory 
assessment and damage assessment model or any action the USCG is 
involved with that impacts our treaty rights. In doing so the USCG 
would began to lay the foundation work toward satisfying their Trust 
Responsibility to the Makah Tribal Council.
    In regard to the OPA 90 Marine Salvage and Firefighting Proposed 
Rulemaking, it is clear to the MTC that the cost effectiveness of such 
evaluations has only considered the cost of compliance with the rule as 
the cost of not spilling (BNSR: barrels of oil not spilled or spilled 
and removed from the environment). The cost to the marine environment 
or those dependent on it for their cultural or economic livelihood is 
not considered. Similarly, the Coast Guard's establishment of the High-
Volume Port Line (and associated spill response equipment) 70 miles 
east from the open ocean is another example of how our treaty interests 
not being appropriately considered.
    The MTC believes in order for the USCG to adequately address our 
treaty interests and their Trust Responsibility to the MTC, both of 
which were excluded from the OPA 90 Programmatic Regulatory Assessment 
used to select the preferred alternative in the Salvage and 
Firefighting Rule, a permanent multi-mission tug should be stationed in 
Neah Bay. The State of Washington funded rescue tug that has seasonally 
protected our waters since 1999 has provided assistance to 36 vessels 
to date, two in just the past month. This more than exemplifies its 
value to the maritime community and underscores their need to 
underwrite its expense that is minor as compared to the cost of 
spilling on treaty protected resources and State of Washington waters. 
It is also imperative that the Coast Guard assures the liability limits 
keep up with the consumer price index.
    The MTC supports laying the ground work for the oil industry to 
station a permanent multi-mission tug at Neah Bay, WA as part of this 
rule and we strongly recommend further that the Coast Guard use it's 
regulatory authority to have the cargo and passenger vessels assume 
their share of financial responsibility to support the stationing of 
the tug with the implementation of the non-tank rule. We join 
Washington State Governor Gregoire in urging the Congress to pass the 
Coast Guard Authorization bill of 2008 to resolve this matter in a 
timely fashion.
    Vessel Response Plans: Non-Tank Vessels. The Coast Guard 
Authorization Act signed by the President on August 9, 2004, requires 
``nontank vessels'' to submit response plans by August 9, 2005. ``Non-
tank vessels'' are vessels of 400 gross tons and above which use oil 
for propulsion. NVIC No. 01-05 was signed and published on February 4, 
2005 to provide interim guidance to industry for the development and 
review of non-tank vessel response plans. On June 24, 2005, the Coast 
Guard published a Notice and Request for Comment in the Federal 
Register. On February 23, 2006, the USCG published a Notice of 
Availability to the public indicating that Navigation and Inspection 
Circular No. 01-05 was updated and reissued as NVIC 01-05 Change 1. 
This update was in response to questions and comments received from the 
maritime industry. This rulemaking, previously in the Office of 
Response (G-MOR), has moved to the Office of Vessel Activities (CG-
543). The President signed the Coast Guard and Maritime Transportation 
Act of 2006 on July 11, 2006. Section 608 of the CGMTA 2006 contained 
provisions to further amend the FWPCA with regard to applicability 
standards for nontank vessels.
    The Coast Guard is anticipating a 2008 release of the Notice of 
Proposed Rule Making with public hearings to be held in various parts 
of the U.S. The Final Rule is projected to be published in 2010. To 
date, the Coast Guard has received 2,186 nontank vessel response plans 
covering 12,075 vessels. LCDR Rob Smith is the project officer CG-5431 
(202-3721226).
    It is essential that Congress assure that the Coast Guard complete 
this rulemaking in a more timely basis than proposed by the Coast 
Guard, so that the public can be assured that tank and non-tank vessels 
have response plans that are adequate to protect against the maximum 
sized spill they can create. It is also imperative that the Coast Guard 
recognizes legitimate umbrella plans that have been rigorously drilled 
and which may cover many non-tank vessels calling on a particular 
waterway instead of requiring each vessel to have to submit their own 
plan. This could significantly streamline the rulemaking process.

V. Conclusion
    During the past few years, the Makah Tribal Council has dedicated a 
great deal of tribal assets toward incorporating treaty cultural and 
resource protection interests into Federal and state oil spill 
prevention, preparedness and response regulations. Our efforts thus far 
have heightened the government-to-government oil pollution policy 
concerns of the treaty tribes in Washington State, where there is not a 
single mile of coastline that is not covered within the treaty-defined 
area of one of the treaty tribes. The fact that the Coast Guard has not 
developed formal protocols for consultation with tribal governments has 
hampered our oil pollution efforts in the Northwest.
    We strongly believe adequate standards of oil spill protection 
along the outer Washington coast cannot be fully achieved without the 
participation of the affected Indian Tribal governments. Without a 
meaningful and formal government-to-government coordination and 
consultation process in place to address oil pollution issues neither 
the Federal Government or the Makah Tribal Council can effectively meet 
their mutual trust responsibility to protect our natural resources. The 
Makah Tribal Council views the development of a formal consultation 
process with the USCG as a fundamental and efficient means to wed the 
Public Trust Doctrine, which the Federal Government is pledged to 
uphold, to the Federal Trust Responsibility to protect treaty reserved 
rights with the Makah Indian Tribe, which the Federal Government is 
obliged to uphold.
    It is our genuine hope that we are able to formalize a vital 
working relationship with the U.S. Coast Guard to address these 
essential treaty resource and environmental protection goals. We join 
Washington State Governor Christine Gregoire in strongly urging your 
support to maintain the Chairman Senator Cantwell's oil spill 
provisions in the FY 2008 Coast Guard Authorization Bill.
    The MTC would like to thank you for your leadership and continued 
vigilance regarding marine transportation safety in Washington State 
and the Nation.
                                 ______
                                 
                                  Matson Navigation Company
                                      Oakland, CA, January 24, 2008
Hon. Maria Cantwell,
Subcommittee on Oceans, Atmosphere, Fisheries, and Coast Guard,
Senate Committee on Commerce, Science, and Transportation,
U.S. Senate,
Washington, DC.

Madam Chairman:

    On December 18, 2007 your Subcommittee on Oceans, Atmosphere, 
Fisheries, and Coast Guard held a hearing on ``Oil Spills from Non-tank 
Vessels''. Matson Navigation Company is a 125 year-old ocean shipping 
company that today operates 13 Jones Act vessels engaged In the 
carriage of container and RO/RO cargo between the U.S. Pacific Coast 
and Hawaii, Guam, and Asia. Our West Coast terminals are located in 
Seattle, Oakland, and Long Beach. For many years, Matson has been 
deeply involved in the development and implementation of ship 
operational procedures and designs that minimize the discharge of oil 
into the marine environment. We commend you for holding this hearing 
and pledge the availability of Matson's knowledgeable ship operations 
personnel to assist the Subcommittee in developing useful 
recommendations for lowering the risk of oil spills in the marine 
environment.
    We wish, however, to correct the record regarding a statement that 
was introduced at the hearing concerning a Matson vessel. More 
specifically, after describing heavy weather damage to the Matson 
container ship SS KAUAI that occurred on December 3, 2007 off the 
Washington State coastline, the Washington Oil Spill Advisory Council 
stated that ``The vessel did not drift onto the rocks and spill oil 
because the state-funded Neah Bay rescue tug launched to save the 
stranded cargo vessel.'' The facts are that after departing Seattle, 
the SS KAUAI was struck by a series of extremely high 60 foot waves 
near Cape Flattery, Washington, that broke out six bridge windows, and 
damaged several pieces of bridge navigation equipment, including the 
primary steering system. As a result, the Master made a decision to 
return to Seattle for repairs and to allow the passing of an intense NW 
storm. The important point here is that the SS KAUAI made the return to 
Seattle of over 100 nautical miles under its own power and using a 
back-up, redundant steering system that is standard equipment on all 
Matson oceangoing vessels and, Indeed, is required for all U.S. 
registered ships. At no time was the SS Kauai adrift or stranded or 
mechanically unable to maintain course and speed, although this Intense 
storm obviously presented severe operational challenges.
    It is not our purpose here to question the important role of the 
Neah Bay rescue tug or the good intentions of the knowledgeable 
witnesses who took the time and effort to testify at your December 18th 
hearing. Matson simply wants to set the record straight on a point that 
reflects directly on our ship operations and, therefore, on the core of 
our organization. We have operated oceangoing ships in the Pacific 
longer than any other American shipping company, and take great pride 
in our ability to do so extremely well.
    Thank you for taking these comments into consideration.
            Sincerely,
                                          Ronald J. Forest,
                                  Senior Vice President Operations.
cc: P.M. Grill
                                 ______
                                 
   Response to Written Questions Submitted by Hon. Maria Cantwell to 
                         Admiral Thad W. Allen

    Question 1. Is the Coast Guard actively enforcing vessel response 
plans for non-tank vessels?
    Answer. Please see the below text from the Coast Guard letter of 
January 14, 2008 to Senator Ted Stevens, which addresses this issue. A 
copy of this letter was also provided to your office and to Senators 
Snowe and Inouye.

    Dear Senator Stevens,

    I am writing to advise you of the need to correct my testimony from 
the December 18, 2007, hearing pertaining to oil spills from non-tank 
vessels. During the hearing, you questioned me about the number of non-
tank vessels which have yet to submit response plans. I indicated that 
any non-tank vessel calling on a U.S. port is required to have a Non-
tank Vessel Response Plan (NTVRP). I further added that vessels without 
such plans are not permitted to call on U.S. ports; I have since 
learned that this is incorrect. Specifically, there are instances where 
both U.S. and foreign-flagged non-tank vessels have entered and 
operated in the United States without a Coast Guard-reviewed NTVRP.
    Absent the effect of a formal rule to implement the NTVRP required 
by the Coast Guard Maritime Transportation Act of 2004 (MTA), as 
amended in 2006, the fully enforceable requirement is the international 
standard required under MARPOL Annex I. Annex I requires that non-tank 
vessels over 400 gross tons have an approved Shipboard Oil Pollution 
Emergency Plan (SOPEP).
    The Coast Guard ensures vessels possess valid SOPEPs during Port 
State Control examination and domestic inspections. However, these 
standards are not as detailed and rigorous as those required by MTA. In 
the case of M/V COSCO BUSAN, both the MTA-required NTVRP and 
international SOPEP requirements were met.
    I have initiated a review of the interim guidance provided to our 
field commanders following the passage of MTA, the effectiveness of 
that guidance, and a more accurate determination of the compliance 
rate. I am accountable to ensure the statutory NTVRP requirement is met 
and will take appropriate action. I am available to provide a more 
comprehensive brief upon your return from holiday recess.
    Thank you for your leadership on this important national issue. The 
Coast Guard is committed to protecting the environment through 
prevention and stands ready to answer any questions you may have. You 
can reach me through my Senate Liaison Office. Identical letters have 
been sent to Senator Cantwell, Senator Snowe, and Senator Inouye.

    Question 2a. What steps has the Coast Guard taken to ensure the 
solvency of the Oil Spill Liability Trust Fund?
    Answer. Oil Spill Liability Trust Fund (OSLTF) solvency concerns 
were addressed by Congress when it enacted the Energy Policy Act of 
2005. That Act included a provision reinstating the tax on oil which 
had lapsed in 1994. Treasury reports and estimates now show OSLTF 
annual tax revenue of $250-$300 million. The OSLTF has a current 
balance of $988M which includes approximately $79 million available for 
Federal response. The OSLTF balance is expected to continue to increase 
to approximately $2 billion by FY 2014 and then begin to decline again 
after FY 2014 when the tax sunsets.

    Question 2b. Why doesn't the Coast Guard track the amount of money 
responsible parties expend in cleaning up oil spills?
    Answer. The Federal focus is on the adequacy of responsible party 
clean up activities and not the cost of those activities. For many of 
the thousands of incidents reported annually, responsible parties are 
able to clean up their spills with little or no Federal involvement. 
For incidents where Federal authorities manage the overall response, 
only summary cost data is captured as it reflects the RP's effort and 
progress associated with a complete clean up. Responsible parties are, 
however, required to report detailed response cost documentation when 
presenting a claim for reimbursement from the OSLTF under the 
provisions of the Oil Pollution Act of 1990 (OPA).

    Question 2c. How do you know if the private sector is paying its 
``fair share'' if the Coast Guard is not tracking private sector costs 
of an incident?
    Answer. Under OPA Title I a responsible party that does not clean 
up the oil spill solely through its own efforts is strictly liable for 
the Federal, state and private party clean up costs. If the responsible 
party does not pay or settle those costs the OSLTF is available to pay 
claimants and the Coast Guard will seek recourse as appropriate against 
the responsible party for all Federal removal costs and damages, 
including any claims paid. The responsible party's ``share'' will also 
be affected by other circumstances, including whether the applicable 
OPA liability limit applies or liability is unlimited; whether one of 
the OPA narrow defenses to liability applies (i.e., solely caused by 
acts of god, war or third party); and/or the responsible party's 
ability to pay its liability.

    Question 3a. Many have expressed concern that the response to the 
San Francisco oil spill was not as effective as it should have been--
despite the fact that San Francisco recently had a major ``Safe Seas'' 
drill. How would you rate the response to the San Francisco oil spill?
    Answer. The response to the M/V COSCO BUSAN oil spill provided 
important lessons-learned for the Coast Guard. The deployment of 
equipment exceeded state and Federal requirements for on-water recovery 
capability and enabled a greater than average oil recovery. 
Nonetheless, there is opportunity for improvement in preparedness and 
response coordination activities.
    The Coast Guard chartered an Incident Specific Preparedness Review 
(ISPR) on November 14, 2007 to review the strengths and weaknesses of 
the San Francisco Bay Area Contingency Plan and to analyze the 
effectiveness of the Unified Command response to the COSCO BUSAN oil 
spill. The report includes approximately 100 lessons-learned and 128 
recommendations to improve preparedness and response in the San 
Francisco Bay area. The recommendations fall into several broad 
categories including exercises and drills, area contingency planning, 
training, initial actions and unified command. A more detailed review 
is on-going to determine which findings, recommendations, and other 
report information should be forwarded to various departments, 
branches, and field units in the Coast Guard or other agencies for 
action to produce positive, effective, preparedness improvements that 
will benefit the San Francisco Bay region and the Nation as a whole.

    Question 3b. If the response was lacking despite the recent Safe 
Seas drill, what does that mean? Are we so woefully under-prepared that 
even a Safe Seas drill could not guarantee an effective response?
    Answer. The Safe Seas and other drills are designed to test and 
renew working relationships while providing feedback on the 
effectiveness of response. Safe Seas was a successful drill in that it 
improved interagency coordination and preparedness for response. The 
drill also identified lessons-learned for use among the spill response 
community. With respect to the M/V COSCO BUSAN response, we will review 
the recommendations of the ISPR as noted above.

    Question 4a. How often does the Coast Guard conduct drills on oil 
spill response?
    Answer. The requirement for exercises and drills on oil spill 
response are established in the National Preparedness for Response 
Exercise Program (PREP) Guidelines, August 2002. These exercises 
typically include responsible parties and their contractors. The 
exercise requirements apply to each of the Area Committees. In some 
cases, a Coast Guard Sector may have more than one Area Committee. The 
PREP guidelines call for each Area Committee to conduct annually: 
four--Notification Exercises per Area Contingency Plan (ACP), one--Area 
Equipment Deployment Exercise per ACP, one--Area Spill Management Team 
``Table-top'' exercise, and one--Government/Industry Led Full-Scale 
Exercise (FSE) (triennially). On average, nationwide, the PREP 
Guidelines call for 4-6 governmental FSEs led by the government per 
year. Each Federal on Scene Commander (FOSC) and/or Captain of the Port 
(COTP) can conduct up to four discretionary Government-Initiated 
Unannounced Exercises per area per year.

    Question 4b. Do these drills include responsible parties and their 
contractors?
    Answer. Yes, these drills normally involve responsible parties, 
contractors, and other parties.

    Question 4c. How do these drills and preparations vary 
geographically? Do they happen regularly in all regions?
    Answer. Coast Guard oil spill exercise regulations, the PREP 
Guidelines, and other Coast Guard-led oil spill preparedness efforts 
apply nationally. The Coast Guard strives for uniform enforcement and 
preparedness efforts across all geographic regions.

    Question 4d. What geographic regions are strongest in this regard? 
Which are the weakest?
    Answer. As described above, the Coast Guard's exercise and planning 
activities are national, and all areas of the country are given equal 
standing. The primary components of this system include the National 
Response Framework, the National Contingency Plan, the National 
Preparedness for Response Exercise Program (PREP) Guidelines, and Coast 
Guard regulations that apply uniformly to all geographic areas of the 
country. Through these programs, the Coast Guard strives to establish 
and maintain a consistently high level of preparedness across the 
country.

    Question 4e. Do you consider the San Francisco area to be among the 
strongest and most well-prepared regions to respond to oil spills?
    Answer. While the Coast Guard leads oil spill preparedness efforts 
in the coastal area as described above, many other agencies and 
organizations contribute to the effort. While the Coast Guard does not 
specifically rank oil spill preparedness between geographic areas, the 
San Francisco area benefits from the skill of agencies such as CA OSPR, 
and the enthusiasm of its local citizens and non-government 
organizations is especially distinguishing.

    Question 5. Recently, I've been hearing from constituents who are 
concerned that the Coast Guard is falling behind in its traditional 
missions. What should I tell my constituents who have concerns that the 
Coast Guard is no longer providing the level of service on traditional 
missions as it once did?
    Answer. The public should know the Coast Guard is a multi-mission 
service and on duty 24/7. We continue to meet our many responsibilities 
by balancing risk and resources against competing mission requirements. 
We assess risk and assign assets with a view to our highest priority, 
the safety of citizens. The Coast Guard ensures the safe operation and 
navigation of some 20,000 U.S. and foreign-flagged vessels. We conduct 
over 70,000 domestic vessel inspections and 10,000 port state control 
inspections each year to safeguard maritime commerce, international 
trade and supply chain security. We also conduct 14,000 casualty, 
suspension and revocation, and civil penalty cases annually to prevent 
maritime disasters.
    Additionally, many of the resources, competencies and authorities 
needed to assure security are the same needed to enhance maritime 
safety and other traditional missions. As we refine our risk protocols 
and build additional interagency and civil/military partnerships, the 
Coast Guard is better able to balance resource and mission 
requirements. Moreover, the Coast Guard is taking significant 
organizational steps to improve local preparedness and response, and 
moving aggressively to ensure we have the right mix of assets and 
authorities to provide in place the level of service the American 
public expects and requires.

    Question 6. What portion of the Coast Guard's budget is devoted to 
oil spill prevention and response? Has oil spill prevention and 
response experienced a decrease in funding and/or staffing in the Coast 
Guard since 9/11? What are the implications of this? Is it possible 
that we won't realize the full impact of this until a major spill 
happens and it is too late?
    Answer. Oil spill prevention and response is accomplished through 
the Coast Guard's extensive authorities, and layered prevention and 
response capabilities. Spill prevention and response is a major 
component of the Coast Guard's Marine Safety, Aids to Navigation, and 
Marine Environmental Protection missions, which collectively represent 
28 percent percent of the Coast Guard's operating budget.
    The Coast Guard's prevention and response model is based on all 
hazards-all threats. As such, resources allocated to prevention and 
response may be called upon by field commanders for other response 
efforts as warranted. We are seeking to grow the Marine Safety Program 
in FY09. Specifically, the FY 2009 President's budget requests an 
additional $20M and 276 FTE exclusively for the Coast Guard's Marine 
Safety Program.
    Moreover, the recent COSCO BUSAN and associated Incident Specific 
Preparedness Review (ISPR), in addition to annual reviews of Area 
Contingency plans, provide for case by case and continuous review of 
the Coast Guard, inter-agency, and stakeholder response capacity. We 
will institutionalize lessons-learned from the ISPR to improve future 
efforts.

    Question 7. How does the rotation of Coast Guard personnel impact 
oil spill preparedness and response?
    Answer. The rotation of active duty Coast Guard personnel enhances 
oil spill preparedness and response by promoting the sharing and 
dissemination of knowledge and experience among Coast Guard Commands. 
As personnel transfer into new commands they spread skills and 
experiences they have developed from other units across the service. 
The continuing exercises and drills on oil spill responses prepare, 
maintain, and ensure rotating CG personnel have the expertise, 
knowledge, and leadership for diverse assignments and major responses. 
This knowledge and experience is shared throughout the Coast Guard. 
This system, in combination with permanent Coast Guard civilian 
positions in each region, ensures continuity with an infusion of 
diverse spill response experience.

    Question 8. Could you please explain the powers and limitations 
that the Coast Guard has in directing vessels, vessel traffic, and 
vessel movement--particularly in times of emergency. Can the Coast 
Guard give orders to a vessel in the same way that the FAA can give 
orders to planes?
    Answer. The Coast Guard may exercise authority granted to it by the 
Ports and Waterways Safety Act (33 U.S.C. 1221 et. seq.) to issue 
orders to vessels it considers necessary in the interest of marine or 
navigational safety. This authority may be similar to the type of 
authority that the FAA enjoys for issuing orders to aircraft. In 
certain ports, many large commercial vessels must participate in a 
Vessel Traffic Service (VTS) that is monitored and operated by the 
Coast Guard. Unlike the FAA, a VTS does not regularly issue particular 
vessel navigation orders because of the nature of the marine 
environment and the unique factors that must be considered in order to 
safely navigate a large commercial vessel. These factors are different 
than those faced by the FAA. For instance, not all commercial vessels 
carry, or are required to carry, transponders and only vessels of a 
particular type are required to check-in and use VTS services. Indeed, 
there are numerous smaller vessels that are not required to be VTS 
users, may not carry transponders, and consequently the VTS may not 
have a full operational picture of the activities of those vessels.
    Accordingly, when large commercial vessels are navigating within a 
VTS area, it is incumbent on them to rely on typical safe navigation 
techniques such as keeping a proper and constant visual look-out, 
listening for other vessels' sound signals, and monitoring ship surface 
radar for other marine traffic. As such, when a large commercial vessel 
maneuvers, it will be able to take into account the variety of factors 
posed by other marine traffic. More important, it is critical to 
recognize that each vessel has unique handling characteristics that 
will react differently based on the ever changing dynamics of the 
marine environment. Tide, current, wind, time of day and vessel 
operational capabilities will all be evaluated by the vessel operator 
in order to determine the exact rudder, engine and other commands that 
are necessary for proper navigation. Even though the Coast Guard has 
authority to issue particular vessel orders, the Service exercises 
significant restraint in doing so in recognition of the fact that the 
vessel operator may have greater situational awareness because of their 
familiarity with the ship and positioning on its bridge. In essence, 
the FAA issues orders within a more regulated, controlled, and 
predictable operational picture than is available in the marine 
environment.

    Question 9. Would a more FAA-like set of powers for the Coast Guard 
help to avoid oil spills and vessel collisions in the future? What 
would be the advantages and disadvantages of such powers? What would 
the implications be for the maritime industry? For the Coast Guard? 
Would such a setup even be feasible in the maritime world?
    Answer. No, an FAA-like power structure is not optimal for the 
marine environment. The Coast Guard has extensive authorities, such as 
the Ports and Waterways Safety Act (33 U.S.C. 1221 et. seq.) for 
controlling vessel traffic and prevention of oil spills. These 
authorities are similar to those of the FAA for aviation.
    It is unknown if any technology exists that would allow the same 
level of surveillance of waters that air traffic control has of the air 
and if any risk reduction would be realized. Of particular concern with 
such a program would be how it could account for the unique hazards and 
demands of maritime navigation safety which are largely informed by 
information received on the bridge of the ship, including from visual 
lookouts, listening for sound signals from other vessels, and 
monitoring ship surface radar for other marine traffic.
    Moreover, the regulations required to mandate participation in the 
Vessel Traffic Service by every vessel, from the smallest kayak to the 
largest container ship, are unlikely to be implemented without 
substantial resistance from every sector of the maritime community. 
This action would present an enormous shift in the exercise of vessel 
traffic management authority and a huge investment in an unprecedented 
program. Therefore, implementation and enforcement of such an FAA-like 
regulatory structure would be an enormous task and is viewed as an 
unfeasible option.

    Question 10. Most of the time, state and Federal pilots can rely 
upon the equipment onboard the ship to steer the vessel safely. On rare 
occasions, however, the equipment is not reliable. Should pilots have 
laptops that would allow them to link to an independent source of 
navigation information while piloting ships? Wouldn't this help reduce 
possible accidents and spills? Isn't it just common sense to have an 
independent, backup source of information available just in case?
    Answer. This is an active topic of discussion among vessel 
operators, pilots associations, international organizations, and the 
U.S. Coast Guard. There are perceived advantages and disadvantages of 
pilot carry-aboard equipment, such as laptop computers. Advantages of 
pilot carry-aboard equipment include pilot familiarity and 
configuration particular to a given waterway. However, while laptops do 
provide these benefits, their use tends to reduce participation in the 
actual navigation process by the vessel's Bridge Management Team. 
Reducing the role of the ship's crew in directing the movement of the 
vessel places the pilot in the position of being a single point of 
failure and thus has the potential for reducing overall safety.
    The International Convention for the Safety of Life at Sea (SOLAS) 
contains comprehensive requirements for the navigation equipment to be 
fitted on ships. The Convention is amended periodically as new 
technology is developed. Coast Guard regulations require that SOLAS 
vessels have a ``Pilot Plug'' installed so that those pilots who wish 
to use a carry aboard system may have access to the ship's Automatic 
Identification System and its navigation sensors.
    For a pilot carry-aboard laptop to be a useful tool, it would have 
to be designed and certified to standards on par with the standards for 
navigation equipment already fitted on the ship. Anything less could 
increase the risk of a casualty. Nevertheless, such pilot carry-aboard 
equipment could help reduce possible accidents and spills as long as it 
did not adversely impact coordination among the Bridge Management Team.

    Question 11. The navigational equipment on vessels can vary 
substantially--wouldn't a standardized suite of equipment among all 
vessels help to prevent accidents in the future?
    Answer. Navigation equipment on ships subject to the International 
Convention for the Safety of Life at Sea (SOLAS) must meet specific 
international standards. For instance, all radars must meet the 
International Maritime Organization (IMO) radar performance standards 
and the International Electrotechnical Commission (IEC) technical and 
testing standards for radar. The only way the equipment can differ is 
in added features offered by individual manufacturers. This allows ship 
owners to choose equipment that is built to a firm standard but also 
having additional capabilities that are of use in their ships' 
operating environment. Because of this international performance 
regime, SOLAS ships do have standardized equipment suites that only 
vary to the degree manufacturers enhance the basic equipment. However, 
manufacturers, ship-owners and vessel operators are considering 
development of a proposal for a standardized mode of operation that all 
manufacturers could incorporate into their system designs along with 
their individually added features.

    Question 12. Do you believe that vessel operators should function 
under a single common language? Isn't language sometimes a barrier that 
can increase the risk of miscommunications and accidents?
    Answer. Yes. The U.S. Coast Guard recognizes the importance of safe 
bridge-to-bridge and bridge-to-shore communications using a single 
common language. Contained at section 160.113 of title 33 of the Code 
of Federal Regulations is a rule promulgated pursuant to the authority 
of the Ports and Tanker Safety Act that requires all tank ships 
underway in U.S. waters to operate with at least one licensed deck 
officer who is capable of communicating in English.
    The International Maritime Organization and its Member States have 
recognized the importance of communications using a single common 
language as evident in Chapter V, Regulation 15 of the International 
Convention for the Safety of Life at Sea (SOLAS), which requires every 
ship subject to SOLAS to designate a working language that all crew 
members are able to understand and use to ensure effective crew 
performance. SOLAS also requires that all ships subject to SOLAS use 
English as the working language for bridge-to-bridge and bridge-to-
shore safety communications and for communications between the pilot 
and bridge watchkeeping personnel, as well.
    The International Convention on Standards of Training, 
Certification and Watchkeeping for Seafarers, 1978 as amended (STCW 
Convention), requires all officers in charge of a navigational watch to 
demonstrate adequate knowledge of English using the Standard Marine 
Communication Phrases (SCMP) published by the International Maritime 
Organization. SMCP provides a simplified and easily understood version 
of maritime English. The STCW Convention also requires all officers in 
charge of an engineering watch to demonstrate adequate knowledge in 
English to enable the officer to use engineering publications and to 
perform engineering duties.
    During Coast Guard inspections of commercial vessels, Coast Guard 
personnel ensure that ships fulfill these requirements.

    Question 13. While all federally-licensed pilots receive the same 
training, many pilots consider the most substantial part of their 
training to be the state training they receive in addition to the 
training for their Federal license. Yet, standards and training at the 
state level can vary substantially. Are some states and regions more 
vulnerable because of their state piloting license requirements? Is 
there a need for more stringent requirements for a Federal pilots 
license?
    Answer. The Coast Guard has no information to suggest that any 
particular state has piloting license requirements that make it ``more 
vulnerable'' than any other state. The authority for states to regulate 
pilots is addressed in 46 U.S.C. Chapter 85. The Coast Guard does not 
interfere with this authority, and we do not interject into the 
piloting licensing requirements of the individual states.
    The Coast Guard does not have any information to suggest there is a 
need for ``more stringent'' requirements for Federal pilots licenses. 
The requirements for Federal pilots licenses are established in statute 
(46 U.S.C. 7101(e)) and specified in 46 CFR Part 10, Subpart G. The 
requirements include, as applicable: service requirements, route 
familiarization requirements, examination requirements, annual physical 
examination requirements, tonnage requirements and requirements for 
maintaining current knowledge of waters to be navigated.
    Finally, it is important to note the limitations of when an 
individual is actually ``acting under the authority'' of a Federal 
pilot license. In accordance with 46 U.S.C. 8501 and 46 CFR 15.812 , 
only U.S. flag vessels not sailing on register may require a Federal 
pilot (or an individual qualified to ``serve as'' a pilot). U.S. flag 
vessels sailing on register (e.g., to/from a foreign port), and all 
foreign flag vessels, do not require Federal pilotage.

    Question 14. I understand that after several large non-tank vessel 
accidents, including the SELENDANG AYU in Alaska, and the NEW CARISSA 
in Oregon, that the wrecks were not fully removed. How can we allow a 
shipping company to leave their wreckage on the shoreline?
    Answer. In general, once the Federal On-Scene Coordinator 
determines the threat of pollution has been mitigated and/or the 
situation no longer poses the threat of pollution, clean-up required by 
the National Contingency plan will cease and further removal actions 
are the responsibility of the responsible party. By law the Coast Guard 
is responsible for pollution response and only under certain conditions 
would get involved in a vessel's salvage. Generally, the vessel's owner 
is responsible for salvage.
    Coast Guard authority to conduct and direct pollution response 
actions is derived from the Federal Waters Pollution Control Act/Clean 
Water Act and other legislation. This authority does not extend to the 
removal of wrecks once the threat of the associated oil spill and/or 
hazardous material release has been mitigated. At that point, the 
vessel is the responsibility of the vessel's owner. In some cases, a 
Federal On-Scene Coordinator may determine an abandoned vessel 
represents an ongoing threat because it is likely to become an illegal 
dump site. In these cases, the Coast Guard may direct or take action to 
remove the vessel.
    The Coast Guard works with the affected state, the U.S. Army Corps 
of Engineers (USACE), National Oceanic and Atmospheric Administration 
(NOAA), and other appropriate agencies to assess the threats such 
vessels may pose. In particular, the Coast Guard works with NOAA to 
prioritize abandoned vessels through their Abandoned Vessel Program, 
which prioritizes abandoned vessel removal based on impact to 
``sensitive areas'' and available Federal funds.

    Question 15a. Washington State recently completed the response to 
the wreck of the S.S. CATALA. This vessel ran aground in 1965, but only 
recently was the wreck cleaned of fuel oil. I understand that over 
34,000 gallons of fuel was removed, preventing contamination of the 
adjacent state park. Are there other wrecks that we should proactively 
be responding to before oil is spilled?
    Answer. There are a number of wrecks in U.S. waters which may 
contain oil or hazardous materials, but they may not necessarily pose 
an immediate risk. For instance, the USS ARIZONA is known to have fuel 
onboard but studies indicate it does not pose an immediate risk to the 
environment. Identifying all such vessels within the U.S. exclusive 
economic zones and assessing their potential for additional pollution 
would require significant interagency effort and resources.
    Presently, the Coast Guard supports a National Oceanographic and 
Atmospheric Administration (NOAA) initiative which identifies and 
prioritizes wrecks located within marine sanctuaries. When the Coast 
Guard becomes aware of such vessels, they are assessed and mitigated as 
possible.

    Question 15b. Does the Federal Oil Spill fund cover these kinds of 
incidents?
    Answer. Yes. The OSTLF will generally cover the cost of removing 
fuel from abandoned vessels if the Federal On-Scene Coordinator (FOSC) 
determines a wreck poses a substantial threat of pollution to U.S. 
waters and if a responsible party cannot be identified.

    Question 16. Has the government of South Korea requested technical 
assistance from the U.S. Coast Guard in its response to the recent 
major oil spill in that country? If so, how are you providing 
assistance? What is the U.S. Coast Guard's involvement and how long do 
we anticipate that involvement to continue?
    Answer. On December 10, 2007, the U.S. Coast Guard made an offer of 
technical assistance to the Korean Coast Guard (KCG) following the oil 
spill which occurred after a barge collided with the M/V HEBEI SPIRIT 
on December 8, 2007. On December 12, the KCG accepted the U.S. Coast 
Guard's offer. On December 13, the U.S. Technical Assist Team (TAT) 
arrived in Korea; the TAT consisted of three members of the Pacific 
Strike Team and one Scientific Support Coordinator from NOAA. The U.S. 
Coast Guard and NOAA team assisted the KCG with their response 
priorities, which included protection of natural resources including 
the fishing industry, the migratory bird population, and tourist 
beaches. The TAT worked closely with other international teams (i.e., 
Ministry of Maritime Affairs and Fisheries, the Korean Oceanographic 
Research and Development Institute, and the KCG to provide an 
evaluation of the overall effectiveness and management of the oil spill 
response.) Additionally, the TAT assisted KCG in press conference 
preparation. The TAT departed Korea on December 22, 2007.

    Question 17. What is the most appropriate, safe, and helpful role 
for volunteers in the wake of a major oil spill like the one that just 
occurred in San Francisco? What training is required in order for 
volunteers to participate in post-spill cleanup activities?
    In the wake of a major spill, citizens often want desperately to 
help in any way they can, even when this might be a logistical 
nightmare. What is the best way to accomplish this when oil cleanup 
often involves dealing with hazardous materials that require extensive 
training to handle?
    Answer. The best role for volunteers in the wake of an oil spill is 
through pre-existing non-government organizations such as the 
International Bird Rescue Research Center and Tri-State Bird Rescue. 
These and similar organizations provide training on how to rescue and 
rehabilitate oiled wildlife, and have contributed to the success of 
many oil spill response efforts.
    Use of previously untrained volunteers in an oil spill response 
operation poses many challenges. Safety requirements, such as Hazardous 
Waste Operations and Emergency Response (HAZWOPER) certification, 
generally require a minimum of 8-24 hours of training before an 
individual can safely work in or near the hazardous environment of an 
oil spill. Even with this initial safety training completed, volunteer 
responders must receive additional training and direction to 
effectively participate in response operation. The Coast Guard National 
Response Team is developing guidelines on how to best incorporate 
volunteers into an oil spill operation and enhance citizen preparation 
throughout the country.

    Question 18. The `Great Circle Route' is a main trade route between 
the U.S. West Coast and Asia. Vessels leave ports on the West Coast and 
cut through the Aleutian Islands in Alaska en route to ports in China 
and Japan. There have been a number of spills in Alaska from vessels on 
this route. In 2004, the 738-foot SELENDANG AYU broke apart spilling 
330,000 gallons of heavy oil and spilling its entire cargo of soybeans. 
That voyage originated in Seattle. Last year the 654 foot COUGAR ACE 
nearly capsized and sank. It was loaded with 142,000 gallons of fuel 
and 4,800 automobiles and was heading to Portland, OR. Only heroic 
salvage efforts kept the vessel afloat. One salvor died. Has a risk 
assessment been completed for this area? What is being done to improve 
vessel traffic safety?
    Answer. A Ports and Waterways Safety Assessment (PAWSA) was 
completed for the Aleutian Islands in 2006. PAWSA is a rudimentary risk 
assessment process that gathers and evaluates expert opinion on the 
navigation risk character of a waterway. It resulted in several 
recommendations to improve vessel traffic safety, including enhanced 
vessel tracking, improved meteorological information and updated 
navigational information. The Coast Guard continues to work with 
stakeholders in the area to evaluate and implement the recommended 
improvements. The Coast Guard has contracted with the Marine Board of 
the National Academy of Sciences to design a comprehensive risk 
assessment process specifically targeted for the Aleutian Chain and 
ships on a great circle transit. This initial study is expected to be 
completed by May 2008. The actual assessment will then be completed 
through a competitive contractual effort.
    Additionally, the Coast Guard has an Automatic Identification 
System (AIS) tracking receiver in the Unimak Pass region to track 
vessels equipped with AIS. The Coast Guard is also helping to lead 
international efforts for implementation of Long Range Identification 
and Tracking, which would allow the monitoring of vessels transiting 
the great circle route. The PAWSA recommendations and enhanced tracking 
will help improve vessel traffic safety along this great circle route.
                                 ______
                                 
   Response to Written Questions Submitted by Hon. John F. Kerry to 
                         Admiral Thad W. Allen

    Question. The State of Massachusetts passed the Oil Spill 
Prevention Act of 2004 to help protect it's waterways, but the Coast 
Guard continues to challenge this law in court. In several other States 
the Coast Guard did not challenge similar legislation. There have been 
several serious oil spills in Buzzards Bay. Why does the Coast Guard 
not allow Buzzards Bay to manage its own environmental protection 
activities?
    Answer. As a preliminary matter, the Federal Government's current 
challenge concerns only two provisions of the Massachusetts law. The 
other provisions are either unchallenged or the Federal district court 
judge's opinion holding the provisions unconstitutional was not 
appealed by the state. The two provisions that remain subject to the 
litigation are Massachusetts' requirement for a tug escort for double 
hull tank vessels, and a provision requiring certain manning on tank 
vessels. The Coast Guard cannot comment on that litigation; all 
questions with respect to it must be referred to the Department of 
Justice.
    However, in addition to the explanation that is contained in the 
rulemakings document published in the Federal Register at 72 FR 50052, 
the following information explains the Regulated Navigation Area (RNA) 
in Buzzards Bay and why the Massachusetts rules are in conflict.
    In August 2007, the First Coast Guard District published amendments 
to an existing RNA that includes Buzzards Bay. The rule accomplishes 
four objectives:

        (1) It requires tug escorts for single-hull tankers transiting 
        Buzzards Bay and carrying 5,000 or more barrels of oil or other 
        hazardous material.

        (2) It requires a federally licensed pilot, in addition to the 
        crew, to be onboard the primary tug during the transit.

        (3) It maintains the recommended route for tankers as 
        ``recommended'' vice mandatory to allow mariners maximum 
        flexibility in the event of unusual circumstances; and

        (4) It establishes a vessel movement reporting system to better 
        track and monitor tanker movements in the Bay.

    The Commonwealth of Massachusetts' rule, currently being challenged 
in Federal court, requires tug escorts and state licensed pilots for 
double-hulled tankers, as well. During the rulemaking process, the 
State asked that the Coast Guard adopt the same provisions in the State 
rule as a part of the Federal rule. After careful consideration, the 
Coast Guard rejected the State's proposal, for the following reasons:

        1. As stated in the preamble to the Final Rule, the Coast Guard 
        believes that double hulls provide a sufficient margin of 
        safety for tankers transiting Buzzards Bay. The bottom 
        characteristics of the Bay are primarily rocky--a condition 
        double hulls are designed to protect against. The State has 
        repeatedly cited a situation in the Gulf of Mexico where a 
        double-hulled tanker was involved in a spill as justification 
        for a tug escort for double hull tank vessels. However, the 
        Gulf of Mexico incident presented a unique set of facts--a 
        tanker struck a submerged, uncharted oil platform that sank 
        during Hurricane Rita. These facts are unlikely to be repeated 
        in Buzzards Bay.

        2. As Rear Admiral Sullivan, the Coast Guard First District 
        Commander, stated when the final rules were published, the 
        Coast Guard is seeking opportunities to create economic 
        incentives for shippers to use double hull tankers (or stated 
        conversely, to discourage the use of single hull tank vessels). 
        The State's rule, by requiring tug escorts of both single and 
        double hull tank vessels, removes that incentive. Prior to the 
        B-120 spill in 2003, approximately 20 percent of tanker 
        transits through Buzzards Bay were in double hull tankers. In 
        2005, that percentage rose to nearly 58 percent, and has 
        remained relatively constant at that level. The Coast Guard 
        seeks to increase that percentage; our regulatory choice (which 
        creates an economic disincentive to use single hull tank 
        barges) is one method of accomplishing that goal. By Federal 
        statute, single hull tankers will be largely phased out in the 
        United States by 2015. The Coast Guard has no authority to 
        accelerate that timetable. In contrast, the international 
        phase-out will be largely complete by 2010. Without double hull 
        incentives in certain sensitive areas like Estuaries of 
        National Significance (Buzzards Bay is so designated), use of 
        single hull tankers might conceivably increase.

        3. It has long been the Coast Guard's position that consistent, 
        uniform national and international regulation is the most 
        effective method to ensure navigation safety and protection of 
        the marine environment. The majority of maritime accidents are 
        caused by human error, and a confused mariner is an unsafe 
        mariner. Conflicting Federal and state regulations can create 
        such confusion. The Coast Guard wants mariners to concentrate 
        on navigating safely, not on whether a state rule or a Federal 
        rule applies in a certain waterway.

    RNA's, such as the one covering Buzzards Bay, are created under the 
authority of the Ports and Waterways Safety Act of 1972, as amended. 
That statute requires the Coast Guard to consult and work closely with 
affected states before promulgating any new rules regulating vessel 
traffic. The Coast Guard takes that mandate very seriously, as 
interaction with our State and local partners is a crucial component of 
developing sound, sensible rules. In the case of the Buzzards Bay rule, 
the Coast Guard coordinated closely with State and local governments 
through briefings, public hearings and by giving the Commonwealth of 
Massachusetts and several cities and towns formal consultative status 
during the rulemaking process. In the final analysis, our nation, as 
evident in the Federalist Papers and in numerous subsequent 
Congressional and Supreme Court actions, has long recognized the need 
to ultimately speak with one voice on maritime matters. The actions of 
the Coast Guard throughout this rulemaking process have been consistent 
with those objectives, while always keeping in mind the value and 
importance of input from all stakeholders.
    As for tug escort rules elsewhere, San Francisco Bay, Prince 
William Sound and Puget Sound are the only other places where there are 
tug escort rules for tankers. The conditions in those places, as well 
as the statutory and regulatory history for their creation, are 
sufficiently distinct that they should not be compared to Buzzard's Bay 
to determine what requirements should exist in Buzzard's Bay. For 
example, in San Francisco, there are no Federal tug escort rules with 
which the State of California's rule might conflict, and no indication 
that there is a need for any Federal tug escort regulation. In Prince 
William Sound, the rules are statutorily mandated as part of Oil 
Pollution Act of 1990. In Puget Sound, the tank vessels requiring 
escort serve only ports in the State of Washington, whereas in Buzzards 
Bay they serve several states (Rhode Island, Connecticut, New York, New 
Hampshire and Maine) in addition to Massachusetts, and thus further 
supports the need for Federal uniformity. Additionally, the law 
established by the Supreme Court in U.S. v. Locke in 2000, strengthened 
and clarified how Federal rules applicable to vessel regulation preempt 
State rules. This strengthened Federal preemption regime for vessel 
regulation was not as clear when the Puget Sound rules were adopted in 
1994.
                                 ______
                                 
   Response to Written Questions Submitted by Hon. Maria Cantwell to 
                            Susan A. Fleming

    Question 1. Right now a single-hulled tanker has a limit of $3,000 
per gross ton, while freighters are only $950 per gross ton. Do you 
think that tank and non-tank vessels should have comparable liability 
limits?
    Answer. The liability limits for non-tank vessels and tank barges' 
liability limits should be more commensurate with their historic spill 
costs, and as such, in our September 2007 report, we recommended that 
the limits be adjusted based on our analysis of major oil spills. 
Specifically, we found that for certain vessel types, such as tank 
barges, current liability limits appear disproportionately low relative 
to their historic spill costs--and as a result, the Oil Spill Liability 
Trust Fund (Fund) may continue to pay tens of millions for spills that 
exceed the responsible parties' limits of liability. We also found that 
liability limits have not been routinely adjusted for significant 
changes in inflation--resulting in the Fund being exposed to about $39 
million in liability claims for the 51 major spills between 1990 and 
2006 that could have been saved if the limits had been adjusted for 
inflation. Based on these findings, we recommended that (1) the Coast 
Guard determine whether and how liability limits should be changed, by 
vessel type, and make recommendations about these changes to the 
Congress and (2) adjust the limits of liability for vessels every 3 
years to reflect changes in inflation, as appropriate.
    I should note that spills in which the costs exceed the limit of 
liability are rare (42 since the enactment of Oil Pollution Act of 
1990, according to the Coast Guard). However, when they do occur, they 
can be expensive and very costly to the Federal Government. Thus, we 
believe adjustments are warranted.

    Question 2. How would you describe the current fiscal condition of 
the Oil Spill Liability Trust Fund?
    Answer. We did not evaluate the fiscal condition of the Fund. At 
the end of Fiscal Year 2006, however, the balance of the Fund was about 
$604 million, which is well below its peak of $1.2 billion in 2000. 
With the reinstatement of the barrel tax in April 2006, the National 
Pollution Funds Center anticipates that the Fund will be able to cover 
its projected noncatastrophic liabilities. However, there are other 
potential challenges that could affect the Fund's condition and place 
it at risk, such as additional natural resource damage claims that 
could be made on spills that have already been cleaned up, potential 
response costs and damage claims from previously sunken vessels that 
may discharge oil in the future, and spills that may occur without an 
identifiable source, and therefore, no responsible party to pay for 
response costs and damage claims. Furthermore, because the current 
liability limits appear disproportionately low relative to their 
historic spill costs for some vessels, the Fund may continue to pay 
tens of millions for spills that exceed the responsible parties' limits 
of liability.

    Question 3. How much of the Trust Fund is devoted to drills and 
exercises to prepare for oil spill response?
    Answer. Our 2007 report did not examine the amount of Fund 
expenditures used for drills and exercises to prepare for oil spill 
response. However, I would note that in our bodies of work, such as on 
homeland security issues, we have identified drills and exercises as an 
important component in preparedness efforts. Based on previous GAO 
work, we also know that the Coast Guard also has an exercise program--
known as the Spills of National Significance exercise program--to test 
national level response capabilities. This program is focused on 
exercising the entire response system at the local, regional and 
national level using large-scale, high probability oil and hazardous 
material incidents that result from unintentional causes such as 
maritime accidents or natural disasters. A recent program exercise, in 
June 2007, tested the response and recovery to an oil and hazardous 
materials release in the wake of a large scale earthquake in the 
Mississippi and Ohio River valleys. According to Coast Guard officials, 
there was a multi-agency oil spill response exercise, called Safe Seas, 
held in the San Francisco area in August 2006.

    Question 4. Spills are infrequent, but the public demands a swift 
and effective response and prompt restoration. Yes or no: are 
sufficient resources being spent on training and preparedness so that 
when spills happen the agencies are ready to respond?
    Answer. Our 2007 report did not examine the resources spent on the 
Coast Guard's training and preparedness efforts, so we do not know the 
extent to which sufficient resources are being spent on training and 
preparing for spills. However, I would note that in our bodies of work, 
such as on homeland security issues, we have identified drills and 
exercises as an important component in preparedness efforts. But, as we 
heard from agency and private-sector officials, no two oil spills are 
the same and each presents challenges that are different than any other 
spill.

    Question 5. Despite the fact that oil spills occur on a regular 
basis throughout the United States, I understand that we do not have a 
complete understanding of how to most efficiently respond to these 
events. Is additional research in this field needed? If so, are there 
any areas of high priority?
    Answer. Our 2007 report did not examine the efficiency of spill 
response. As we heard from industry experts and agency officials, no 
two oil spills are the same and each presents challenges that are 
different than any other spill. Some private sector officials we spoke 
with, however, cited two challenges facing spill response efforts. 
First, Coast Guard officials are increasingly inexperienced in handling 
spill response, in part because the Coast Guard's mission has been 
increased to include homeland security initiatives. This is a concern 
because poor decision-making during a spill response could lead to the 
deployment of unnecessary response equipment, or worse, not enough 
equipment to respond to a spill. Second, some private-sector officials 
stated that spill response companies, in general, have less experience 
in dealing with spill response and the local geography of an area 
affected by the spill. The geography can be critical to determining 
which spill response techniques are most effective in a given area. 
They attributed the limited experience to the overall decline in the 
number of spills in recent years.

    Question 6. NOAA has a critical role in preparing for and 
responding to oil spills. Why does the Department of the Interior and 
the Environmental Protection Agency receive an annual appropriation 
from the Oil Spill Liability Trust Fund (OSLTF) and NOAA does not?
    Answer. Our 2007 report did not examine the level of annual 
appropriations from the Oil Spill Liability Trust Fund to individual 
Federal agencies, nor how those agencies use the appropriations. 
However, we reported that between 1990 and 2006, approximately 61 
percent of the Oil Spill Liability Trust Fund expenditures went to 
Federal appropriations. The U.S. Coast Guard received the most 
appropriations from the Fund, followed by the Environmental Protection 
Agency, Federal research and other programs, and the Department of the 
Interior.*
---------------------------------------------------------------------------
    \*\ Federal research and other programs include appropriations to 
Department of Transportation, the Denali Commission, and the Oil Spill 
Recovery Institute. The Department of Treasury and the Army Corps of 
Engineers have received appropriations, but these account for about 
0.10 percent of Fund expenditures.
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                                 ______
                                 
   Response to Written Questions Submitted by Hon. Maria Cantwell to 
                      Dagmar Schmidt Etkin, Ph.D.

    Question 1. The rescue tug at Neah Bay, Washington, has rescued 
several ships in distress in the past several weeks. These include a 
720 foot container ship on December 3rd, and an oil tanker barge on 
December 11. The engines of the vessel towing the oil barge went out, 
and the barge was left floating adrift toward shore. With 2 million 
gallons of diesel and 500,000 gallons of gasoline in the barge, a 
grounding and spill would have been disastrous.

   What kinds of environmental impacts would have resulted from 
        a spill if the rescue tug had not been there?

   Can you quantify the costs that were potentially averted by 
        the rescue of these two vessels?

   What would be the costs of a major spill of crude oil or 
        bunker fuel?

   In light of the numerous saves the Neah Bay tug has made, 
        isn't it clear that this is a good return on investment for oil 
        spill prevention?

    Answer. The Neah Bay rescue tug has been credited with 37 responses 
since 1999, including two this past December. In the 11 December 2007 
Towing Vessel NA HOKU-T/B NOHO HELE incident,\1\ there could have been 
significant impacts from the spillage of 2,016,000 gallons of diesel 
fuel and 462,000 gallons of gasoline. The spillage of these volumes of 
oil, or even a portion of that oil, could have caused significant 
environmental and socioeconomic impacts. With the westerly wind and 
currents in that area, the oil would have impacted the Olympic Coast 
National Marine Sanctuary and coastal areas. Diesel fuel and gasoline 
are relatively non-persistent and would not have caused significant 
visible coastal oiling, but these oils are extremely toxic. Due to the 
location of the spill, the sea conditions, and the nature of the 
spilled oil, it would have been very difficult to mount a successful 
spill response to mitigate any damages, though resources would likely 
have been expended to attempt this. A shoreline response in the form of 
damage surveys would likely have ensued. Extrapolating from various 
modeling studies conducted for the Washington Department of Ecology,\2\ 
the oil would likely have spread over several hundred square miles. 
While the costs would vary based on the exact impacts of the oils and 
conditions at the time of the incident, the response costs, natural 
resource damages, and socioeconomic impacts could easily have topped 
hundreds of millions of dollars if not $1 billion. Impacts would have 
included fish mortality, subsistence fishing impacts,\3\ commercial 
fishing losses, mortality in diving birds, and damage to sensitive 
marine ecosystems in the designated Olympic National Marine Sanctuary 
and adjoining areas.
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    \1\ The 105-foot towing vessel NA HOKU, towing the single-hulled 
barge NOHO HELE, suffered electrical power generator failures thirteen 
miles off the Washington coast while en route to Portland, Oregon, from 
Port Angeles, Washington, in the vicinity of the Olympic Coast National 
Marine Sanctuary. The T/B NOHO HELE was laden with 2,016,000 gallons of 
diesel fuel and 462,000 gallons of gasoline. Seas were 8-10 feet and 
winds were westerly at 20-30 knots.
    \2\ French-McCay, D., J. Rowe, N.Whittier, S. Sankaranarayanan, 
D.S. Etkin, and L. Pilkey-Jarvis. 2005. Evaluation of the consequences 
of various response options using modeling of fate, effects and NRDA 
costs of oil spills into Washington waters. Proceedings of 2005 
International Oil Spill Conference: 467-473. Etkin, D.S., D. French-
McCay, J. Rowe, N. Whittier, S. Sankaranarayanan, and L. Pilkey-Jarvis. 
2005. Modeling impacts of response method and capability on oil spill 
costs and damages for Washington State spill scenarios. Proceedings of 
2005 International Oil Spill Conference: 457-462. Etkin, D.S. 2004a. 
Response Cost Modeling For Washington State Oil Spill Scenarios. 
Prepared by Environmental Research Consulting, Cortlandt Manor, NY, for 
Washington Department of Ecology, Olympia, WA. Contract No. C040018. 56 
pp. 30 June 2004. Etkin, D.S. 2004b. Socioeconomic Cost Modeling For 
Washington State Oil Spill Scenarios. Prepared by Environmental 
Research Consulting, Cortlandt Manor, NY, for Washington Department of 
Ecology, Olympia, WA. Contract No. C040018. 83 pp. 21 July 2004.
    \3\ Tribal nations of Washington State are highly dependent on fish 
and shellfish caught in Washington waters and on Washington shorelines 
for basic nutritional needs. Young children deprived of protein in 
their formative years can have life-long impairments.
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    The 3 December 2007 rescue of the container ship KAUAI \4\ likely 
averted the spillage of as much as a million gallons of bunker fuel. A 
spillage of this much persistent oil would likely have caused 
significant impacts. Bunker fuel would likely have coated a significant 
length of shoreline with fresh oil or with tar balls along both the 
Washington and Oregon coasts. Depending on conditions at the time of 
the spill, shoreline impacts could have been significant requiring a 
long-term cleanup effort. The spillage of this much bunker fuel would 
likely have had significant impacts on birds and marine mammals. Costs 
for a spill of this type could easily have reached topped hundreds of 
millions of dollars if not $1 billion mark.
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    \4\ On 3 December 2007, the 720-foot container ship KAUAI outbound 
from Seattle, Washington, to Oakland, California, encountered a storm 
with 60-foot waves and 64-knot winds 90 miles west of the entrance to 
the Columbia River. The vessel sustained damage and required escort 
back to the Strait of Juan de Fuca for repairs.
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    A major spill of crude oil from a large tanker would most likely 
result in costs of tens of billions of dollars depending on the 
circumstances surrounding the spill. Impacts of crude oil spills in 
Washington waters would include commercial and subsistence fishing 
losses, significant environmental and natural resource damages, tourism 
losses, and impacts to private and state property. In addition, there 
are likely to be significant social impacts. The demoralizing social 
and psychological impacts of a major spill incident are difficult to 
measure, but have clearly been demonstrated in studies conducted in the 
wake of the EXXON VALDEZ spill.
    The Neah Bay rescue tug program has clearly demonstrated that it 
can avert potential environmental disasters and help in the protection 
of Washington, Oregon, and Canadian waters and shorelines. As such, it 
represents a good return on investment.

    Question 2. I understand that prompt and effective salvage is 
important for preventing and minimizing spills. Keeping oil on the ship 
and keeping it from sinking is critical to protecting the environment. 
Have you studied this issue of the benefits of salvage? Isn't this a 
clear example of how investing in prevention can far outweigh the costs 
of disaster?
    Answer. Logically, the order of preference with regard to 
preventing damage from oil spills is: prevention of accidents and 
actions that can result in vessel damage and spillage, reducing the 
magnitude of spillage at the source, preventing the spread of the oil 
with a high level of response preparedness, protecting the most 
sensitive resources, and, last, doing a thorough job cleaning up the 
oil. Short of preventing the spill in the first place, effective 
salvage measures are the best ways to control the magnitude of an oil 
spill. Stabilizing the vessel, controlling the spillage of oil at its 
source, and reducing the amount of oil released to the environment are 
the next best ways to averting significant damages. Trained salvage 
teams can often significantly reduce the impacts of a spill and turn 
what could have been a significant incident into a relatively minor 
manageable incident.
    To the best of my knowledge there has been no rigorous cost-benefit 
analysis of salvage as a means to reduce oil spillage that has been 
conducted, though it would certainly be possible to do this.\5\ The 
benefits of salvage have been described in a paper presented at the 
2003 International Oil Spill Conference \6\ for which I provided spill 
data and analyses. In this report, data from the International Salvage 
Union (ISU) indicated that in the year 2000, 310 salvage rescue efforts 
averted the spillage of enough oil to represent 11 spills the size of 
the EXXON VALDEZ. This represents roughly $60-$100 billion in averted 
damages in that year alone. Clearly, investing in salvage capabilities 
is an important part of preventing significant environmental damages. A 
more detailed analysis would more clearly elucidate the benefits of 
salvage.
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    \5\ I would recommend an approach that would include an analysis of 
salvage efforts that have been documented and modeling the spillage 
that might have occurred without salvage efforts and then estimating 
the costs with and without the benefits of salvage. I conducted a 
similar study for the U.S. Environmental Protection Agency in which the 
numbers of spill incidents with and without the various prevention 
programs were compared and costs that were ``averted'' with the 
implementation of prevention measures were estimated to determine the 
benefits of the prevention measures. See Etkin, D.S. 2004. Modeling oil 
spill response and damage costs. Proceedings of 5th Biennial Freshwater 
Spills Symp. Etkin, D.S. 2004. Twenty-year trend analysis of oil spills 
in EPA jurisdiction. Proceedings of 5th Biennial Freshwater Spills 
Symposium. Another study was conducted for the U.S. Coast Guard with 
regard to the benefits of various spill response technologies. Etkin, 
D.S. and P. Tebeau, P. 2003. Assessing progress and benefits of oil 
spill response technology development since EXXON VALDEZ. Proceedings 
of 2003 International Oil Spill Conference: pp. 843-850.
    \6\ Lentz, S.A., and F. Felleman. 2003. Oil spill prevention: A 
proactive approach. Proceedings of the 2003 International Oil Spill 
Conference: pp. 3-27.
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    Question 3. Currently liability limits makes a distinction between 
tank and non-tank vessels, and for tank vessels, whether they have 
single or double hulls. If the U.S. were to adjust liability limits for 
vessels, what other factors should be considered? Should non-tank 
vessels get a break for having protectively located fuel tanks?
    Answer. Logically, since the liability limits are related to the 
risk of an oil spill--and risk is the product of the probability of 
having an incident times the consequences or impact of the incident--
these limits should take into account both sides of the risk equation. 
In other words, the limits are designed to anticipate potential costs 
and impacts from spill incident as well as the probability that the 
incident will happen in the first place.\7\
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    \7\ All of this is analogous to the ways in which automobile 
insurance rates are determined. While the procedures vary from state to 
state, there are general principles of setting the insurance rates 
based on driver characteristics (age, experience, and driving history), 
automobile type (including safety features), and location of driving.
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    From the standpoint of potential impacts and consequences of a 
spill, the liability limits should be based on the amount of oil and 
the type of oil that is carried by the vessels, whether they are tank 
vessels or non-tank vessels. The amount of oil factor can easily be 
applied by having a liability limit that is tied to the size of the 
vessel.\8\ The type of oil could also determine the costs that might be 
incurred. A heavier oil would tend to be more expensive with regard to 
cleanup and damages than a lighter non-persistent oil.\9\ Rightly, the 
locations in which the vessels are traveling should also be taken into 
account in that the consequences of a spill are highly contingent on 
the location in which the spill occurs. To some extent this location 
factor is already taken into account with regard to the higher 
financial responsibility requirements in U.S. waters compared to non-
U.S. waters. States are also given the right as per the Oil Pollution 
Act of 1990 of setting their own liability limits, including unlimited 
liability.\10\
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    \8\ There needs to be a certain minimum liability amount in that 
any spill of a commercial vessel of at least 300 GRT will have a 
certain cost due to the logistics of response.
    \9\ In fact, on the international front, there is no liability 
convention for non-persistent oils (including diesel). For a discussion 
of persistent vs. non-persistent oils see: Davis, B., D.S. Etkin, M. 
Landry, and K. Watts. 2004. Determination of oil persistence: A 
historical perspective. Proceedings of Fifth Biennial Freshwater Spills 
Symposium.
    \10\ The following states have unlimited liability for cleanup 
costs and other damages: Alabama, Alaska, California, Connecticut, 
Georgia, Hawaii, Maine, Maryland, Massachusetts, Mississippi, New 
Hampshire, New Jersey, Oregon, Pennsylvania, Rhode Island, South 
Carolina, Virginia, and Washington.
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    The probability of having a spill is dependent on a variety of 
factors, including the structural integrity of the vessel, the location 
in which the vessel transits, the skills of the pilot, captain, and 
vessel crew, and other variable factors, such as weather. Since most of 
these probability factors change from trip to trip, it is difficult to 
assign a particular adjustment to the vessel with regard to its 
liability limits. While the structural integrity of the vessel can vary 
over the lifetime of a vessel and will be dependent on maintenance and 
passing various inspections, the design of the vessel with regard to 
the protection of the oil cargo and/or fuel is not variable from one 
trip to the next. Since it is well established that the protection of 
oil cargo and fuel tanks with secondary hulls or protective locations 
\11\ reduces the probability of spillage and can reduce the amount of 
spillage when a breach does occur, the presence or absence of the 
double hulls or double fuel tanks should be taken into account in 
establishing liability limits.
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    \11\ Michel, K., and T. Winslow. 2000. Cargo ship bunker tanks: 
Designing to mitigate oil spills. SNAME Marine Technology, October 
2000.

    Question 4. I understand from GAO that large spills from tank 
barges often exceed the liability limits. Does it make sense to lump 
barges and tankers together, or should we have separate liability 
limits for tank barges?
    Answer. Tank barges often carry two million gallons of oil, which 
can be a significant amount in the event of a spill. Significant 
damages have resulted from spills from tank barges.\12\ As mentioned 
earlier, liability limits should be based on the risk of spillage with 
regard to the amount of and type of oil carried, as well as the 
probability that such a spill would occur in the first place. In this 
respect, there are likely to be differences between tank ships and tank 
barges.
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    \12\ Two notorious examples include: the 1994 T/B MORRIS J. BERMAN 
spill of 750,000 gallons of No. 6 (Bunker C) fuel oil in Puerto Rico, 
which resulted in $124 million in costs; and the 1996 T/B NORTH CAPE 
spill of 828,000 gallons of diesel fuel in Rhode Island that resulted 
in $190 million in costs.
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    While I have not yet undertaken such an analysis, it would be 
fairly straight-forward to examine the differences in risk from tank 
barges vs. Tankers (tank ships) with regard to the probability of 
spillage given an accident (differentiating between single- and double-
hulls) and the relative amount of cargo that is spilled in the event of 
an accidental grounding, collision, or allusion. This analysis, which 
could be conducted fairly quickly, could determine whether it really 
makes sense to treat tank barges and tank ships differently with regard 
to liability limits and financial responsibility requirements.

    Question 5. In your testimony you said that there has never been a 
worst-case discharge from a large vessel in the U.S. I understand that 
the COSCO BUSAN only spilled about 5 percent of its fuel oil, and the 
EXXON VALDEZ only spilled about 20 percent of its cargo. Yet both 
incidents swamped the local capacity to respond. Despite assurances the 
response was `all hands on deck,' we still did not manage to prevent 
oil from reaching shore and wreaking untold environmental damage.

   Are the worst-case plans realistic?

   What kinds of costs might be anticipated from a truly worst 
        case non-tank vessel spill?

    Answer. A spill of any magnitude is likely to quickly overwhelm 
local resources in that everything that is available locally will 
likely be brought in at the request of the Federal On-Scene Coordinator 
in conjunction with the responsible party's representatives. A tiered 
response in which cascades of resources from local equipment/personnel 
caches, and then from regional and national resources will be brought 
in. In some cases, international assistance may even come into play. 
When the EXXON VALDEZ spill occurred in 1989, our response 
organizations and the general response infrastructure were ill-prepared 
to deal with the magnitude of the response required. Contingency plans 
at the time were ill-conceived and inadequate and response resources 
were not appropriately ready.\13\ Since that time, there have been 
significant improvements in our response infrastructure and readiness. 
The U.S. Coast Guard has implemented a systematic certification of oil 
spill removal organizations (OSROs) with inspections and increased the 
response requirements with regard to response capability standards and 
the timing of responses. But, the fact that with even a relatively 
small spill such as the M/V COSCO BUSAN incident in San Francisco Bay 
in November 2007 our response capabilities were overwhelmed and 
disorganized demonstrates that we still have far to go. OSRO owners 
express that they have difficulties maintaining preparedness with the 
decrease in the number of incidents \14\ and that any increases in 
requirements for increased preparedness with regard to the amount of 
equipment and personnel or the rapidity of the response will likely tax 
the existing infrastructure. The U.S. Coast Guard's response 
requirements are wholly inadequate to respond to anything but a 
moderate-sized spill.\15\ The standards are not even designed to deal 
with spills of a worst-case discharge.\16\
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    \13\ Etkin, D.S. 1990. Oil Spill Contingency Planning, Cutter Info. 
Corp., Arlington, MA, 116 pp.
    \14\ Usher, D. 2003. How response contractors are remaining 
vigilant and viable despite the downward trend in oil spills. 
Proceedings of the 2003 International Oil Spill Conference: pp. 809-
811.
    \15\ A study I conducted for the Washington Department of Ecology 
showed that the state's higher response standard would significantly 
reduce the costs and damages of an oil spill over the Federal (U.S. 
Coast Guard) standards. Etkin, D.S., D. French-McCay, J. Rowe, N. 
Whittier, S. Sankaranarayanan, and L. Pilkey-Jarvis. 2005. Modeling 
impacts of response method and capability on oil spill costs and 
damages for Washington State spill scenarios. Proceedings of 2005 
International Oil Spill Conference: 457-462.
    \16\ The highest level of required response capability (after 3 
days) is about 500,000 gallons of oil removal per day. This would mean 
that it would theoretically take 160 days to completely remove the oil 
from an 80-million gallon spill.
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    If there were to be a worst-case discharge from a fully-laden 
tanker,\17\ this could amount to a spill of 80 million gallons of crude 
oil. The response requirements would depend on the location, but if 
this type of incident were to occur in a coastal area, there would 
likely be a massive response with all local, regional, and national 
resources being brought to the scene over the course of several days.
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    \17\ Crude oil tankers tend to be larger than product tankers. A 
fully-laden product tanker (e.g., one with No. 2 diesel oil ) would 
likely hold less than half this amount.
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    It would be extremely difficult for there to be any kind of 
effective on-water spill response with mechanical containment and 
recovery. The best outcome with such methods might be a recovery of 10-
20 percent of the spilled oil, though with such a large spill, the 
results may be even more disappointing as the spread of the oil would 
quickly make it difficult to contain and remove the oil. Unless the use 
of chemical dispersants \18\ was to be approved, the response will 
likely be largely shoreline cleanup. The shoreline impacts would likely 
reach hundreds of miles. The response would take many months or even 
years to complete.
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    \18\ Chemical dispersants are akin to detergents that are applied 
to the spilled oil on the water surface to chemically and physically 
break the oil down into smaller droplets that can be dispersed and 
diluted with wave action. This methodology is applied in many non-U.S. 
spills to dramatically reduce shoreline oiling. It is the first-order 
of response in many parts of the world, but, because of concerns about 
the potential toxicity of the dispersed oil and the dispersant 
chemicals themselves, it is generally not used in U.S. waters. There 
are certainly limitations in their use in nearshore waters because of 
the lack of physical mixing in shallower waters. The U.S. Coast Guard 
has designated certain areas of pre-approval in U.S. waters, 
principally away from nearshore areas and other sensitive locations.
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    If there were to be a worst-case discharge from a fully-laden 
tanker, the costs could be astronomical. Again, the exact costs would 
depend on oil type, weather conditions, and, most importantly, 
location.\19\ Since there never has been a worst-case tanker discharge 
in U.S. waters and examples from outside the U.S. are not relevant for 
cost-estimation purposes,\20\ it is necessary to model hypothetical 
spills to estimate the costs of a worst-case discharge. While this 
exercise has not been specifically addressed on a national level, there 
are some examples of modeling from which one could extrapolate the 
costs of a worst-case discharge.\21\ Modeling of hypothetical spills of 
80 million gallons indicates that cleanup response costs alone could 
easily reach $15 billion.\22\ Socioeconomic and natural resource 
damages could add several hundred million to billions of dollars on top 
of this. Clearly, no existing liability limit for tankers covers these 
levels of costs.
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    \19\ The location of the spill would determine the sensitive 
resources at risk, as well as the degree of cleanliness (known as the 
``how clean is clean'' factor ) required by the local communities and 
authorities. Generally, the more sensitive resources, such as wetlands, 
require the most expensive cleanup operations because they are both 
sensitive to the impacts of the oil and to the impacts of the response 
operations (e.g., people and equipment trampling through the marsh).
    \20\ The costs of non-U.S. spills tend to be considerably lower 
than those in the U.S. due to the relatively low liability limits set 
in international conventions (Civil Liability and International Oil 
Pollution Compensation Fund Conventions) to which the U.S. is not 
party. The standards of ``cleanliness'' after a spill are also usually 
lower than is norm in the U.S. There is currently no compensation for 
environmental or natural resource damages in non-U.S. spills. In many 
cases, the more effective and less expensive chemical dispersant 
strategy is applied. This tends to significantly reduce the amount of 
shoreline oiling. All of these factors make non-U.S. spills essentially 
irrelevant for cost estimations of U.S. spills.
    \21\ A more rigorous modeling analysis of a variety of hypothetical 
worst-case discharges would be required for a more definitive answer to 
this question. This has not been done to date.
    \22\ Based on modeling work I conducted for National Academy of 
Sciences Transportation Research Board (National Research Council 
Committee for Evaluating Double Hull Tanker Design Alternatives. 2001. 
Environmental Performance of Tanker Designs in Collision and Grounding: 
Method for Comparison. Special Report 259. National Academy Press, 
Washington, D.C. 136 pp. plus appendices on CD-ROM.)
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    A worst-case discharge from a non-tank vessel would be considerably 
smaller, perhaps two million gallons of heavy fuel oil. The costs for 
this type of spill could easily reach $1 billion in spill response 
costs and more in natural resource and socioeconomic damages.
    Overall, in the case of a very large spill or worst-case discharge, 
there will be a prolonged response, astronomical costs, and 
environmental, social, and socioeconomic impacts that may be felt for 
many years or perhaps decades. Because each spill situation is so 
different, it is extremely difficult to precisely plan an appropriate 
response or to accurately predict outcomes. It may not really be 
possible to anticipate every contingency. But, there are many ``lessons 
learned'' that can be derived from past spill experiences here in the 
U.S. as well as from incidents outside the U.S. Post-mortem studies of 
spill responses often show a lack of coordination amongst key players, 
strategic errors, and miscommunication. The difference between a well-
executed spill response and a poorly-executed effort can mean a 
considerable difference in impacts and costs. For example, in one spill 
in Maryland (138,600 gallons of heavy fuel oil), costs (and 
environmental damages) were shown to be at least 60 percent higher than 
they would have been had responders followed the directions of the on-
scene coordinator.\23\
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    \23\ Etkin, D.S., D. French-McCay, and J. Rowe. 2006. Modeling to 
evaluate effectiveness of variations in spill response strategy. 
Proceedings of 29th Arctic and Marine Oilspill Program Technical 
Seminar: 879-892. Etkin, D.S., D. French-McCay, and J. Rowe. 2006. Use 
of trajectory modeling to analyze variations on the response strategies 
for inland spills. Proceedings of 2006 Freshwater Spills Symposium.
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    The keys to a successful response and mitigating damages to the 
greatest extent possible are rapidity of the response with well-trained 
personnel and well-maintained equipment, and good strategic decision-
making based on sound scientific and technical information. A thorough 
understanding of the behavior of oil under different conditions, pre-
planning and exercising of contingency plans including the Incident 
Command System, prioritization of sensitive resources at risk (for 
protection), and informed use of technological equipment and resources 
to locate oil and predict its movement will increase the likelihood of 
success and minimize or reduce damages. Funding of key studies and 
those agencies that are involved in spill response (e.g., U.S. Coast 
Guard, EPA, and NOAA) will help in this regard. When the ``horse is out 
of the barn'' (i.e., the oil has spilled), time is of essence. Each 
hour that passes allows the oil to spread further on the water surface, 
decreasing the likelihood of successful removal and increasing the 
breadth of damages. There are many extremely knowledgeable and talented 
individuals and organizations involved in spill response. We need to 
continue to tap this expertise and continue to train a new generation 
of experts for the future. This will require funding at the Federal and 
state levels, as well as from industry.

    Question 6. A large amount of money is spent on oil spills once 
they occur, but are we spending enough on prevention activities? For 
example, after the SELENDANG AYU and COUGAR ACE incidents in Alaska, 
there were calls for improvements to vessel traffic in the Aleutian 
Islands, but funding for conducting a navigation risk assessment was 
hard to come by.
    Answer. Oil spill response--when conducted in the thorough manner 
expected by a public that is concerned about environmental protection 
and restoration--is very expensive, because of the large amount of 
trained labor, specialized equipment, logistical arrangements, 
hazardous material disposal, and monitoring required. In addition, the 
costs to restore and rehabilitate a damaged environment and to 
compensate socioeconomic damages can be exceedingly high, depending on 
the specific circumstances of the spill. Rehabilitation of damaged 
environmental habitats can take years or decades. Once a spill has 
occurred, these costs and damages are inevitable. There are few things 
that can be done to significantly reduce costs and damages. Because of 
the high costs involved, prevention is the best way to mitigate these 
costs and damages.
    Analyses of vessel-sourced spill incidents often indicate that 
human error and navigational errors in high-vessel traffic areas are at 
the root of most of the larger spill incidents (i.e., those involving 
collisions, allusions,\24\ and groundings). Navigational risk 
assessment studies, such as those that have been conducted in the Puget 
Sound,\25\ can help in developing better vessel traffic control 
systems, improving navigational information for vessel operators, and 
determine the best locations for rescue tugs and spill response 
equipment. These types of studies are complex, when done well, and 
require significant funding. But, funding for these types of studies is 
essential. The implementation of recommended changes in navigational 
practices and other regulations to improve vessel safety that result 
from these studies, can significantly reduce the incidence of spills 
and the devastating costs and impacts that result. A study that I 
conducted for the Washington Department of Ecology \26\ showed that the 
investing in prevention measures to reduce vessel spills can 
significantly reduce the incidence of spills from tank vessels and non-
tank vessels. Clearly, investing in spill prevention and investing in 
the studies that make for informed decisions in spill prevention makes 
good sense.
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    \24\ An allusion occurs when a moving object strikes a stationary 
object, as when a ship hits a pier.
    \25\ Herbert Engineering Corp. and Designers & Planners, 1999. Use 
of Tugs to Protect Against Oil Spills in the Puget Sound Area. U.S. 
Coast Guard Report 9522-001, November 1999. Glosten Associates, Inc., 
and Environmental Research Consulting. 2004. Study of Tug Escorts in 
Puget Sound. Prepared for Washington Department of Ecology, Olympia, 
Washington. Contract No. ECY0414. 135 pp.
    \26\ Etkin, D.S., and J. Neel. 2001. Investing in spill 
prevention--Has it reduced vessel spills and accidents in Washington 
State? Proceedings of 2001 International Oil Spill Conference: 47-56.
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                                 ______
                                 
   Response to Written Questions Submitted by Hon. Maria Cantwell to 
                            Hon. Mike Cooper

    Question 1. The rescue tug at Neah Bay, Washington, has rescued 
several ships in distress in the past several weeks. These include a 
720 foot container ship on December 3rd, and an oil tanker barge on 
December 11. The engines of the vessel towing the oil barge went out, 
and the barge was left floating adrift toward shore. With 2 million 
gallons of diesel and 500,000 gallons of gasoline in the barge, a 
grounding and spill would have been disastrous. From your perspective, 
what would have been the impact on Washington State if one of these 
vessels had not been saved by the rescue tug and there had been a 
catastrophic oil spill? In light of the numerous saves the Neah Bay tug 
has made, isn't it clear that this is a good return on investment for 
oil spill prevention? Do you believe a rescue tug at Neah Bay is a 
necessary preventative investment?
    Answer. You ask what would have been the impact on Washington State 
had one of these vessels not been saved by the rescue tug and there had 
been a catastrophic oil spill?
    While there is no definitive answer to your question, experts 
calculate, at a minimum, that significant oil spills in Washington 
waters could result in hundreds of millions, if not billions, of 
dollars of socioeconomic impacts.
    Yet, this estimate does not incorporate a spill's impact on the 
longer-term quality of life, psychological impacts, and spiritual 
values.
    Neither does it take into consideration the ability of a damaged 
natural environment to provide us with valuable ecosystem services.
Socioeconomic Costs
    An oil spill can have serious socioeconomic impacts. There are 
several good reports on this topic by Environmental Research Consulting 
that are incorporated by reference:

   Regulatory Analyses for Economical and Environmental Impact 
        for U.S. Coast Guard (U.S. Coast Guard) (2005).

   Oil Spill Response, Socioeconomic, and Environmental Cost-
        Benefit Analysis (WA Dept. Ecology): (2003-ongoing);
   Socioeconomic Cost Modeling for Washington State Oil Spill 
        Scenarios: Part II (2005).

    The second cited report provides the following view on 
socioeconomic damages to Washington State in the event of a large 
spill.
    An oil spill can have serious socioeconomic impacts on the affected 
region, local communities, residents, the state, and the Federal 
Government. These impacts include damages to real and personal 
property, loss of use of natural resources (parks and recreation 
areas), and loss of income and expenses (fishing, tourism, recreation, 
shipping and other commerce). As a major shipping port and tourist and 
recreation area, Puget Sound and the Columbia River are particularly 
vulnerable to socioeconomic impacts from oil spills. Reduction in 
tourism, commercial fishing, and blocking the shipping port could have 
widespread impacts. There can also be serious impacts on the Tribal 
Nations, particularly with respect to subsistence fishing. In the case 
of an oil spill, the Oil Pollution Act of 1990 allows the Federal 
Government to collect from responsible parties socioeconomic costs 
including:

   Loss of natural resources (lost-use);

   Losses for destruction of real/personal property;

   Losses of subsistence use of natural resources;

   Net loss of taxes/fees/net profit due to injury, 
        destruction/loss of real/personal property or natural 
        resources;

   Loss of profits or earning capacity due to damage to real/
        personal property or natural resources (e.g., fish); and

   Governmental costs for providing increased or additional 
        public services during or after removal activities.

    In addition to the costs that the Federal and state government 
authorities can collect, there are also possible third-party damage 
suits that can ensue. Successful damage suits in past oil spill 
incidents have included payments for:

   Out-of-pocket costs relating to removal of oil or 
        restoration of impacted property;

   Economic losses, including lost revenues and profits due to 
        lost tourism or business opportunities;

   Cost of repair/replacement of physical property damaged by a 
        spill (e.g., fishing nets, docks);

   Loss of revenues from decreased fishing resource;

   Increased cost of fishing due to necessity of fishing in 
        different locations;

   Damages to real property, including potential damage to 
        market values of properties ``stigmatized'' by an oil spill;

   Possible replacement of natural resources irretrievably 
        oiled by the creation of new natural resources;

   Losses by sport fishermen incurred as result of curtailment 
        of fishing; and

   Subsistence losses to American Natives.

    Socioeconomic costs are based on the real and perceived impacts, 
which are related to the degree of oiling, the oil type and 
persistence, the degree to which cleanup operations can mitigate the 
oil impacts, and the time of the impact.
    This demonstrates that significant oil spills in Washington waters 
could result in hundreds of millions, if not billions, of dollars of 
socioeconomic impacts.
    Oil spills in the state could involve significant impacts to 
commercial fishing, tribal nations, subsistence fishing, ports, 
tourism, wildlife viewing, hunting, and other resources that are 
important to the state. But measuring these values is always difficult 
and often involves a variety of assumptions. Additionally, this measure 
does not include other spill impacts, such as long-term quality of 
life, psychological impacts, and spiritual values.
    Additionally, standard economic damage calculations do not include 
the loss to society of ecosystem services. Modern economic thinking, 
however, is beginning to incorporate this loss into damages 
calculations. When portions of the commons that belong to all humanity 
are lost--for example if a large spill caused the extinction of the 
Orca whale--the ecosystem services provided by those resources are no 
longer available to humanity.

The Cost of Lost Ecosystem Services
    An oil spill would damage the environment's ability to provide us 
with valuable ecosystem services.
    Generally speaking, ecosystem services include provisioning, such 
as the production of food and water; regulating, such as the control of 
climate and disease; supporting, such as nutrient cycles and crop 
pollination; cultural, such as spiritual and recreational benefits; and 
preserving, which includes guarding against uncertainty through the 
maintenance of diversity. Wikipedia. The services of ecological systems 
and the natural capital stocks that produce them are critical to the 
way the Earth's life-support systems function. These directly and 
indirectly contribute to human welfare and represent part of the total 
economic value of the planet. Economic Reasons for Conserving Wild 
Nature, Andrew Balmford, et al., Science Magazine, Vol. 297, August 9, 
2002 (attached* and incorporated by reference).
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    * This article is retained in the Committee's files.
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    Coastal systems, including estuaries, coastal wetlands, river 
deltas and coastal shelves, are particularly rich in ecosystem goods 
and services. They provide widely ranging and highly valued resources 
that include fisheries, open spaces, wildlife habitat, nutrient 
cycling, and recreational opportunities. Integrated Assessment and 
Valuation of Ecosystem Goods and Services provided by Coastal Systems, 
Matthew A. Wilson, et al. (attached* and incorporated by reference). 
They also provide climate regulation and soil formation. Balmford, 
supra.
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    * This report is retained in the Committee's files.
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    Economists are working to develop better frameworks for assessing 
and valuing the goods and services provided by coastal systems. See 
e.g.: Wilson, supra. Experts have estimated that a large-scale oil 
spill in Washington would cause socioeconomic damages in the ``hundreds 
of millions, if not billions'' of dollars. If we add to this the loss 
of ecosystem services, the damages exponentially increase.
TENYO MARU Spill--a Reference Point
    In 1991, the Japanese fish processing vessel TENYO MARU was 
involved in a collision 20 miles west of Cape Flattery. It sank at the 
point of collision in 90 fathoms of water with a reported 475,000 
gallons of oil onboard. It initially leaked a large amount of oil and 
undetermined amounts were reported leaking for more than a month after 
the collision. Beaches were fouled from Vancouver Island, British 
Columbia to northern Oregon.
    While impacts were scattered along the entire Washington State 
shoreline and the northern beaches of Oregon, the heaviest oiling 
occurred along the Makah Indian Reservation and the Olympic National 
Park shoreline. A large number of birds, including Common Murres, 
federally-threatened Marbled Murrelets, auklets, Tufted Puffins and 
Pigeon Guillemots were killed. Kelp beds had substantial amounts of oil 
in them for weeks.
    The U.S. Fish and Wildlife Service (USFWS), the State of 
Washington, and the Makah Indian Tribe were responsible for the care of 
impacted wildlife and, along with the National Oceanic and Atmospheric 
Administration (NOAA) documented the injuries to natural resources. 
These parties formed a Trustee Committee that was responsible for 
planning, designing, constructing, and implementing restoration 
projects to compensate the public for the losses as a result of the oil 
spill.
    The natural resources damages assessment performed by the trustees 
was done under the Oil Pollution Act of 1990 (OPA) and its accompanying 
Natural Resource Damage Assessment and Restoration (NRDAR) process. The 
goal of OPA is to make the environment and the public whole for 
injuries to natural resources and services resulting from an incident 
involving a discharge of oil. Through this process, the Trustees work 
to return the injured natural resources and services to a pre-incident 
condition and to compensate the public for their losses.
    Importantly, the NRDA process excludes any assessment of the loss 
of ecosystem services. Rather, as the natural resources damages 
settlement for the TENYO MARU shows, the trustees come up with a list 
of restoration projects needed in light of the spill. Then the trustees 
attempt to collect the costs for performing those projects from the 
spiller.
    For example, to settle the trustees' claims for the TENYO MARU 
accident, defendants agreed to pay approximately $5.2 million to 
restore, rehabilitate, replace, or acquire the equivalent of natural 
resources injured by the oil discharge. This was in addition to 
$500,000 to pay a civil penalty assessed by the U.S. Coast Guard, 
$3,000,000 to reimburse oil removal costs, $340,028 to reimburse damage 
assessment costs incurred by the Trustees, for a total settlement cost 
of $9 million (over and above approximately $2.4 million in removal 
costs previously paid).
    The $5.2 million dollar portion paid for the following projects: 
(1) permanent protection of Marbled Murrelet habitat and reduction of 
river silt to the marine ecosystem, (2) terrestrial Marbled Murrelet 
surveys to protect forested habitat through the identification of 
nesting locations, (3) restoration of Common Murre colonies in Copalis 
National Wildlife Refuge, (4) emergency towing vessel at entrance to 
the Strait of Juan de Fuca, and (5) producing publications, signs, and 
brochures. http://www.fws.gov/westwafwo/contaminants/
Final%20Tenyo%20sum%20.pdf.
    This settlement is significant--$5.2 million. Yet it does not 
represent the whole picture on damages from the TENYO MARU spill to 
Washington State. First, it was the product of a legal settlement. 
Second, not all types of damages, such as loss of ecosystem services, 
were considered. Yet, the natural resources damages assessment for the 
TENYO MARU spill does seem to serve as a good reference in thinking 
about how badly a large oil spill could damage Washington State.
    You ask, in light of the numerous saves the Neah Bay tug has made, 
isn't it clear that this is a good return on investment for oil spill 
prevention? You further ask, do you believe a rescue tug at Neah Bay is 
a necessary preventative investment?
    The Neah Bay tug is, without a doubt, a great investment in 
Washington State. It's like spending pennies to get millions of 
dollars. In the fall of 2006, the Oil Spill Advisory Council estimated 
that providing enhanced year-round coverage with the Neah Bay tug would 
cost about $11 million. This cost, even calculated over one-hundred 
years, pales in comparison to the damages that one catastrophic spill 
would have on Washington State. I most definitely believe the Neah Bay 
tug is a necessary investment in our state.

    Question 2. Do you feel that the Coast Guard devotes adequate time 
and resources to oil spill prevention and response?
    Answer. I very much wish the answer were yes. However, I do not 
believe that it is. I do not believe the United State's Coast Guard 
devotes enough time to spill prevention and response. This, of course, 
is not a function of the men and women who serve our country in the 
Coast Guard being undedicated, uncommitted, or untalented. I believe 
the contrary to be true.
    However, the Coast Guard is a multi-mission agency. Oil Spill 
Advisory Council staff have spoken with Coast Guard staff who espouse a 
commitment to a mission, not only to protect the environment and 
enhance marine safety, but also to facilitate the free flow of 
interstate commerce. In addition, Congress recently brought the Coast 
Guard under the rubric of the Department of Homeland Security. 
Therefore, the vast majority of the Coast Guard's resources and focus 
is on preventing terrorism.
    It is possible that, if Congress provides the Coast Guard with more 
resources and refocuses the Coast Guard's attention on natural resource 
protection, the Coast Guard would begin to devote more time and 
resources to oil spill prevention and response.

    Question 3. One of the goals of the citizen's advisory council is 
to promote public engagement. What do you think the roles of volunteers 
should be during spills?
    Answer. There is a role for the public to play in cleaning up oil 
spills. When an oil spill fouls our local community, our local 
resources, and our local natural environments, local people feel an 
overwhelming urge to do something. If properly prepared and organized, 
local people who are desperate to help can become an invaluable cleanup 
resource.
    If it can be done safely, local volunteers familiar with local 
waters could participate in oil spill assessment and response. 
Volunteers can prepare beaches to get oiled by picking up debris and 
standard beach litter that would collect oil and have to be sent to the 
hazardous landfill. Volunteers also can participate in limited and 
supervised beach cleanup. They can also participate in the response to 
oiled wildlife--including hazing, search and collection, processing and 
care, tracking and release.
    We have seen from the COSCO BUSAN spill in San Francisco that we 
must greatly improve our efforts around volunteer coordination. The 
Coast Guard recently released a lessons learned report of the San 
Francisco spill called Incident Specific Preparedness Review (ISPR), M/
V COSCO BUSAN Oil Spill in San Francisco Bay, Report On Initial 
Response Phase, January 11, 2008 (http://www.uscgsan
francisco.com/posted/823/CoscoBusanISPRFinal.190115.pdf).
Observations
    The San Francisco Bay area public is interested in volunteering for 
oil spill cleanup but there is not an active pre-training program for 
oil spill response. California OSHA and Environmental Protection Agency 
regulations require minimum training before responders can enter the 
oil spill collection areas to avoid exposure to hazards. Both Coast 
Guard publications and the Area Contingency Plan (ACP) discourage the 
use of convergent volunteers for cleaning up oil. The ACP states that 
``Volunteers will not be utilized to work directly in the recovery of 
oil. Volunteers will not be assigned to work in areas where there is a 
known or a potential health hazard due to chemical exposure such as oil 
recovery, etc.'' However, the ACP does say that trained volunteers may 
pick up tarballs.
    It was reported and confirmed that the issue of convergent 
volunteers wishing to clean up oil (as opposed to oiled wildlife) had 
never arisen in the 17 years since OPA 90 was enacted. Accordingly, 
there was no program in place to conduct required HAZWOPER training of 
volunteers for this purpose in advance of the spill, other than 
training with respect to oiled wildlife. The Unified Command (UC) was 
playing ``catch-up'' trying to find training protocols and address a 
difficult situation on the spot. The UC was completely taken by 
surprise, unprepared, and ill-equipped to deal with the outpouring of 
convergent volunteers willing to help pick up oil off of beaches, and 
the local government entities who supported them. With no volunteer 
training protocols or materials in place, agencies were forced to pull 
together training materials and protocols during the spill response 
itself, taking time away from other duties.
    A lack of planning for a convergent volunteer program, and a 
general lack of attention to convergent volunteers, resulted in long 
and frustrating delays that impacted the response overall. Establishing 
a training program for volunteers during an incident is challenging and 
impacts the ability for the UC to adequately assess available resources 
and conduct normal operations.

Recommendations
    The Coast Guard recommends:

   Government use models such as the California Oil Wildlife 
        Care Network (OWCN) volunteer program to develop an organized 
        volunteer program.

   Planners develop a uniform approach to the use of convergent 
        volunteers for oil spill response, consistent with local needs, 
        to reflect the use of these volunteers in response operations.

   The National Response Team develop generic guidance for ACP 
        committees to develop convergent volunteer sections in local 
        ACPs.

   Planners integrate trained, experienced organizations into 
        the ACP and drills to assist with volunteer coordination and to 
        be an outlet for volunteer interest.

   Update the ACP (and other state and Federal safety policies/
        regulations accordingly) to provide a process and protocols for 
        convergent volunteers to assist with some beach cleanup (e.g., 
        who's responsible for volunteer coordination, how the 
        volunteers can and cannot be used, liability, training venues, 
        etc.).

   Volunteer management be staffed at UC in accordance with the 
        ACP and address the issue of convergent volunteers.

   Integrate trained, experienced organizations into the ACP 
        planning process and oil spill drills to assist with volunteer 
        coordination and to be an outlet for volunteer interest.

    It is noteworthy that the Coast Guard praised California's ability 
to effectively mobilize volunteers to clean up oiled wildlife. This is 
noteworthy because California maintains a well-funded, well-organized, 
and award-winning oiled wildlife care network, which is un-paralleled 
in any other state. Thus, a spill in another state would predictably 
have similar problems to the general use of volunteers.
    This indicates that we need to make great improvements in 
developing and maintaining programs to develop and manage a base of 
trained volunteers and integrate this program into the Unified Command.
    We have heard from our own Washington Department of Ecology that 
efforts to recruit and maintain volunteer base seem unsustainable. 
People who volunteer to become trained often lose interest and fade 
away. This indicates to me that we have to work harder at doing 
outreach and education. We need to dedicate more resources to educating 
citizens about the sources and causes of spills and about the 
socioeconomic ramifications of spills, both large and small. We need to 
build community around participating in a corps of volunteers that will 
spring into action when a spill occurs.
    This effort would not need to be limited to interested individuals. 
Targeted outreach to professional and volunteer fire departments, 
Rotary Clubs, and other nongovernmental organizations could be very 
successful.
    Too often, however, agencies have budgets and staff and conflicting 
mandates. These agencies, must make tough choices of the allocation of 
tight resources. Therefore, these agencies have not placed an emphasis 
on developing coordinated and robust volunteer coordination and 
education programs. The result is that both the Coast Guard and 
Washington State have a great deal of room for making improvements in 
the way they work together to recruit, train, mobilize, and coordinate 
volunteers.
                                 ______
                                 
   Response to Written Questions Submitted by Hon. Maria Cantwell to 
                           William G. Deaver

    Question 1. Mr. Deaver, I understand your ships have a number of 
design features and safety standards that are well above and beyond the 
requirements. Your company has clearly made a conscious decision to 
invest in oil pollution prevention. What are the benefits that your 
business is seeing as a result of your investments in oil pollution 
prevention?
    Answer. TOTE invested approximately $15,000,000 per vessel in 
additional safety features and redundancies that will help prevent 
vessel incidents and spills in the years ahead. Clearly, our investment 
is one that will last the 40+ year life of our vessel assets, however, 
any attempt to quantify the return on invested capital for an event 
which hopefully will never occur is too difficult to estimate. What we 
do know is that if it is even a close call, we would rather err on the 
side of doing too much on prevention, rather than too little. 
Uncompromising reliability adds enough value to our customers business 
that it results in lower future costs to maintain that customer and can 
create enough value to charge more for our service than a low 
reliability carrier. The major benefits derived to date are that of a 
``state of the industry safety record'', and customer, public, and 
industry recognition that our enhancements are a positive step forward 
in designing and operating environmentally friendly vessels in future 
years. TOTE owners and employees live and work in the Puget Sound and 
Cook Inlet regions and our commitment is to keep our environment as 
pristine and as natural as possible. Bottom line, it was the right 
investment for us to make in the communities and environment where we 
live and work.

    Question 2. What can be done to encourage other shipping companies 
to voluntarily do the same?
    Answer. Seminars and conferences will clearly communicate the need 
for change and enhancements. We are much more in favor of ``the carrot 
than the stick'', however, when it comes to incentivizing companies to 
make capital and operating decisions with respect to their vessels. 
These incentives can take a variety of forms on the investment side, 
tax credits or some other form of a one time financial incentive that 
would motivate companies to modify their existing vessels. There are 
operating cost incentives such as an exemption from ``rescue tug'' 
payment fees which could motivate modifications to existing vessels, or 
new build enhancements. Generally, modifications would be very 
expensive and it would involve thousands of vessels, not hundreds. The 
``prevention'' dollars are significant, and world-wide ship yards and 
vessel owners need direction as to what is acceptable to the United 
States. The United States needs to work very closely with the 
International Maritime Organization (IMO) for the creation of new rules 
and regulations that meet our needs.

    Question 3. Mr. Deaver, this past January the containership MSC 
NAPOLI, was damaged in a storm and then intentionally grounded in the 
English Channel to keep from sinking. The vessel was only slightly 
smaller than the COSCO BUSAN. Many of the containers were lost at sea 
and debris was spread for miles. Does TOTE have a contingency for such 
a scenario?
    Answer. TOTE's contingency plans primarily rest with the securement 
systems we have on our Ro-Ro vessel which are quite different than a 
conventional container vessel. Each trailer or container on a chassis 
that is carried on a TOTE Ro-Ro vessel are secured through the use of a 
patented ``Rolox'' box that secures the trailers ``5th wheel'' to the 
deck of the vessel, and either 2 or 4 chains and binders are used to 
further secure the trailer depending on the stow of the trailer on the 
vessel and anticipated weather conditions. We experience severe weather 
conditions in the Gulf of Alaska resulting in vessel rolls as severe as 
45 degrees, thus requiring our ``redundancy'' securement system. The 
redundant vessel propulsion and navigation systems provide a 
significant safety margin should one of the main generators, motors, or 
rudders fail at a critical time; we have 6 diesel electric generators, 
two electric propulsion motors, and twin rudders. The loss of all power 
at any given time is extremely unlikely.

    Question 4. Mr. Deaver, I understand that your ships have a number 
of design features and safety standards that are well above and beyond 
the requirements. It is refreshing to hear about such stories. How can 
we bring other ships including foreign flagged vessels up to the 
standards?
    Answer. We need very strict regulations from the International 
Maritime Organization (IMO) that address the issues that we have 
discussed, supported by Federal regulations. Voluntary compliance will 
most likely not achieve our national goals in the near future, thus we 
need either incredibly high penalties and fines for spills that will 
force the carriers to comply, or IMO and Federal regulations that 
dictate the minimum requirements for vessels calling U.S. ports. 
Requiring carriers to comply should not become a marketplace 
competitive issue as all carrier would be required to comply, thus all 
would have an expense issue that they would need to pass through in the 
marketplace.

    Question 5. Is it cost effective to upgrade vessels, or do we need 
to wait for the next generation of vessels to be built?
    Answer. I do not believe there is a simple answer to this question 
as there are hundreds of classes of vessels, some new, and some old. 
What might be cost effective for one vessel, might not be cost 
effective for another vessel of a different type, or age. Thousands of 
vessels would need to be modified and it would take many years to 
accomplish the required upgrades. It would be very expensive to modify 
many of the existing vessels, but It would be a good question to pose 
to the International Maritime Organization once new standards are 
established.

    Question 6. Mr. Deaver, TOTE Shipping use vessels that carry roll-
on/roll-off cargo. How is this different than a typical container ship?
    Answer. TOTE's business model requires us to be in port for less 
than 12 hours based on the sea mile distance between Anchorage, AK, and 
Tacoma, WA and our need to turn the vessel in 7 days. Our cargo 
trailers require wheels as they are driven on and off the vessel, 
whereas a container ship operation leaves the wheels, or chassis in 
port. The containers are lifted on and off the vessels by large gantry 
cranes, and are stowed in either cells below deck, or staked on deck. 
The containers above deck are generally secured through lashing cables 
and rods, or in stacking frames on some vessels. Our Ro-Ro trailers are 
secured with our Rolox box, and chains and binders. Our Ro-Ro operation 
is a very efficient and fast operation, allowing us to minimize our 
port time.

    Question 7. Are oils and hazardous materials carried in Ro-Ro 
tanks?
    Answer. During 2007, TOTE carrier in excess of 57,000 FEU (forty 
foot equivalents) of cargo to Alaska and we carried 8 20-foot ISO tanks 
of lube oil, and 26 other tank loads of hazardous materials. These 
tanks are always secured with 4 chains and binders and we have not had 
issues with the carriage of tanks through the years.

                                  
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