BrownWater News July 2010

Barge industry opposes raising oil-spill liability limits

Representatives of the barge and towing industry journeyed to Capitol Hill June 9 to try to head off possible legislation leading to the uncapping of liability limits against parties responsible for oil spills.

At a hearing to review provisions of the Oil Pollution Act of 1990 (OPA 90), spokesmen for the American Waterways Operators (AWO) testified that regulations established by OPA 90 have been “a public policy success, creating a safer operations environment for the tank barge industry and resulting in an enormous reduction in oil spills from vessels.â€

Turning to a possible legislative response to the Deepwater Horizon oil spill in the Gulf of Mexico, Buckley McAllister, a member of the AWO’s executive committee and vice president and general counsel of McAllister Towing, urged lawmakers to recognize the differences between vessels and offshore oil production facilities.

“Tank vessels are not oil production facilities,†McAllister told the House Transportation and Infrastructure Committee. “A worst-case discharge from a vessel is a quantifiable amount.â€

McAllister explained that proposals to significantly raise liability limits threaten to raise the costs of insurance to a price that responsible small- and medium-sized companies cannot afford.

McAllister told lawmakers that tank barge oil spill volumes have plummeted 99.6 percent since OPA 90, with a record low of 4,347 gallons in 2009. He said that was about the same amount of oil estimated to be escaping from the ocean floor in the Gulf of Mexico every 10 minutes in the aftermath of the Deepwater Horizon spill.

McAllister told the committee that more than 90 percent of U.S. tank barges are fitted with double hulls, five years ahead of the OPA 90 deadline; that U.S. Coast Guard-approved tank vessel response plans require vessel owners to plan for worst-case discharge — the loss of a vessel’s entire cargo in adverse weather, and that in 2004 the AWO joined the Coast Guard in supporting legislation to bring towing vessels under a Coast Guard inspection regime and require all towing vessels to have a safety management system.

As for liability limits for tank and non-tank vessels, McAllister said they are two to three times higher than they were in 1990, and that a regulatory mechanism is in place to continue to increase the limits as needed over time.

Meanwhile, the House Transportation and Infrastructure Committee approved for House action on H.R. 5629, a bill that would repeal or adjust the existing limitations on liability for offshore facilities and vessels to require responsible parties to cover 100 percent of the oil pollution cleanup costs and damages to third parties.

The bill, introduced by Rep. James Oberstar (D-Minn.), chairman of the committee, also increases the minimum level of financial responsibility for an offshore facility to $1.5 billion, and requires that all vessels engaged in oil-drilling activities in the U.S. exclusive economic zone (200-mile zone) be U.S.-flag ships owned by U.S. citizens and, therefore, subject to U.S. safety regulations.

Jones Act debate over Gulf oil waivers continues

The Jones Act debate over whether foreign-flag vessels should be allowed waivers to join U.S.-flag ships in cleaning up the millions of gallons of oil spilled in the Gulf of Mexico after BP’s Deepwater Horizon exploded in April continues in Washington, D.C.

On Capitol Hill, Sen. Kay Bailey Hutchison (R-Texas), ranking member of the Senate Commerce, Science and Transportation Committee, introduced a bill that would allow waivers for foreign-flag vessels assisting in responding to the oil spill.

Introduced June 18, the bill (S. 3512) would exempt foreign-flag ships from Jones Act restrictions if engaged in “containment, remediation, or associated activities in the Gulf of Mexico in connection with the mobile offshore drilling unit Deepwater Horizon oil spill.

Meanwhile, Adm. Thad Allen, the national incident commander who is overseeing the oil spill response in the Gulf, was reported as saying that the administration has “not seen any need to waive the Jones Act†as part of the government’s response to the oil spill disaster in the Gulf.

“Nonetheless, the U.S. Coast Guard is continuing to prepare for all possible scenarios and has established an expedited waiver process in the event that qualified American vessels are not available,†Allen said.

The Jones Act requires that cargo moving between U.S. ports, including locations on the outer continental shelf, be carried on U.S.-flagged vessels that are U.S. owned; U.S. built, and crewed by U.S. citizens.

The AWO said that several foreign ships are currently involved in the Gulf response effort, including many skimmers operating outside U.S. territorial waters and therefore not subject to the Jones Act. At this time, the AWO said, no Jones Act waiver is needed or has been granted.

MCTF opposes McCain bill against Jones Act

The Maritime Cabotage Task Force (MCTF) has expressed its opposition to a bill that would repeal Jones Act restrictions on coastwise trade.

“We oppose this legislation,†MCTF said. “All the McCain bill would do is put more Americans out of work.â€

The bill (S. 3525), introduced by Sen. John McCain (R-Ariz.), would amend the law to permit the issuance of a coastwise endorsement for a vessel that qualifies under U.S. law to engage in the coastwise trade.

While introducing his bill on the Senate floor, McCain suggested that “this antiquated and protectionist law†may have kept foreign countries from helping to clean up the Gulf oil spill.

“Within a week of the explosion, 13 countries, including several European nations, offered assistance from vessels and crews with experience in removing oil spill debris, and as of June 21, the State Department has acknowledged that overall it has had 21 aid offers from 17 countries. However due to the Jones Act, these vessels are not permitted in U.S. waters.â€

McCain said the administration has the ability to grant a waiver of the Jones Act to any vessel — “just as the previous administration did during Hurricane Katrina — to allow the international community to assist in recovery efforts. Unfortunately, this administration has not done so.â€

A similar bill was introduced in the House June 23 by Rep. John Carter (R-Texas). That bill (H.R. 5585) waives Jones Act restrictions against foreign-flag vessels engaged in containment, remediation or associated activities in the Gulf of Mexico in connection with the Deepwater Horizon oil spill.

NWC worries about watershed planning bill

The National Waterways Conference (NWC) has expressed its concern about the Sustainable Watershed Planning Act, a draft bill that could be included in the forthcoming Water Resources Development Act.

The stated goal of the draft legislation is to establish the Office of Sustainable Watershed Management (within the White House) to assess, coordinate and implement policies and actions to ensure the sustainable use of the water resources of the United States.

In a letter to leaders of the House Transportation and Infrastructure Committee, Amy Larson, president of the NWC, said the conference supports long-term coordination and planning of water resources, but that the draft legislation “would mandate a heavy-handed top down approach, which is contrary to the traditional management of water resources at the state and local levels.â€

Larson said the draft bill also would direct the development of watershed plans to improve the ecological health of the watershed, and require federal projects to maximize ecological benefits.

“This narrow focus ignores the multiple uses of our water resources, including navigation critical to our economic competitiveness, life-saving flood control, municipal and industrial water supply and hydropower production,†Larson said. “Any watershed plans must necessarily address all water resources uses.â€

Missouri River recovery panel seeks new members

The U.S. Army Corps of Engineers is soliciting applications to fill vacant stakeholder positions on the Missouri River Recovery Implementation Committee. The committee was formed to advise the Corps on a study of the Missouri River and its tributaries and to provide guidance to the Corps with respect to the Missouri River recovery and mitigation activities currently underway.

Completed application forms should be mailed by July 30 to U.S. Army Corps of Engineers, Omaha District (Attn: MRRIC), 1616 Capitol Ave., Omaha, NE 68102-4901 or e-mailed to info@mrric.org, with MRRIC in the subject line.

AWO questions fire suppression proposal

The American Waterways Operators has questioned the U.S. Coast Guard’s proposal that would require vessels with fixed carbon dioxide (CO2) fire suppression systems to install lockout valves to prevent the accidental discharge of CO2 while crews are in a confined space conducting maintenance.

Jennifer Carpenter, AWO senior vice president – national advocacy, said in comments submitted May 25 that the Coast Guard should first consider the proposed new requirements in the context of current industry practice.

Carpenter said a review would show that current practice is “rigorous†and that the requirements proposed by the Coast Guard are “redundant.â€

“It is standard practice for many towing companies to eliminate the possibility of an accidental CO2 discharge entirely by disengaging the CO2 fire suppression system when maintenance is being conducted in the protected space,†Carpenter said. “AWO questions the practical benefit of lockout valves in light of the already rigorous procedures many towing companies have implemented to ensure the safety of persons working in protected spaces.â€

DOT plans first rule to protect disabled boat, ship passengers

Department of Transportation Secretary Ray LaHood has announced plans for the first federal rule to specifically provide Americans with Disabilities Act (ADA) protections for disabled boat and ship passengers.

The rule would apply to vessels operated by public entities, and vessels operated by private entities primarily engaged in the business of transporting people.

Under the proposed rule, vessel operators cannot charge extra for accessibility-related services to passengers, cannot require passengers to furnish their own attendants and cannot deny access to passengers based on disability. The rule would become effective 120 days after being published.

Stark named executive director of GICA

James Stark has been named executive director Gulf Intracoastal Canal Association (GICA), effective July 6. 

Most recently, Stark has been consulting on the response and recovery operations associated with the Deepwater Horizon oil spill in the Gulf. He also served as the Federal Emergency Management Agency (FEMA) assistant administrator for Gulf Coast Recovery. Prior to that, Stark was a Gulf Region Operations/Logistics Coordinator for Titan Maritime LLC, a salvage firm in Pompano Beach, Fla.

Sanchez bill would pay for environmental impact statement

Rep. Linda T. Sanchez (D-Calif.) has introduced a bill that would authorize funds in the Harbor Maintenance Trust Fund to be used to pay up to 100 percent of the eligible costs of preparing environmental impact statements for a harbor’s navigation project.

The bill, H.R. 5621, may be cited as the Harbor Maintenance Trust Fund Improvement Act of 2010.

About the Author:

Carlo Salzano has been in journalism since graduating from La Salle University in 1948 as a chemistry major. That’s right, chemistry. He began his career as a copy boy at the Philadelphia Inquirer, before moving on to United Press International in Philadelphia, Charleston, W.Va., Baltimore and Washington. After 14 years, Carlo joined Traffic World magazine and stayed on for 23 years, retiring as editor in 1990. A majority of Carlo’s time at Traffic World was spent covering the maritime community and he continued on in the maritime field while freelancing throughout his “retirement.” He is married and has three children and eight grandchildren.

Categories: Maritime News