42 U.S.C. § 9608 — Financial responsibility

Page 7753 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 9608 store, replace, or acquire the equivalent of such natural resources by the State. The measure of damages in any action under subparagraph (C) of subsection (a) shall not be limited by the sums which can be used to restore or replace such resources. There shall be no double re- covery under this chapter for natural resource dam- ages, including the costs of damage assessment or res- toration, rehabilitation, or acquisition for the same re- lease and natural resource’’ for ‘‘Sums recovered shall be available for use to restore, rehabilitate, or acquire the equivalent of such natural resources by the appro- priate agencies of the Federal Government or the State government, but the measure of such damages shall not be limited by the sums which can be used to restore or replace such resources’’. Pub. L. 99–499, § 207(c)(2)(D), which directed the inser- tion of ‘‘or the Indian tribe’’ after ‘‘State government’’, could not be executed because the prior amendment by section 107(d)(2) of Pub. L. 99–499, struck out third sen- tence referring to ‘‘State government’’. Subsec. (f)(2). Pub. L. 99–499, § 107(d)(1), added par. (2). Subsec. (g). Pub. L. 99–499, § 107(e), amended subsec. (g) generally. Prior to amendment, subsec. (g) read as follows: ‘‘Each department, agency, or instrumentality of the executive, legislative, and judicial branches of the Federal Government shall be subject to, and com- ply with, this chapter in the same manner and to the same extent, both procedurally and substantively, as any nongovernmental entity, including liability under this section.’’ Subsec. (h). Pub. L. 99–499, § 127(e), inserted ‘‘, under maritime tort law,’’ after ‘‘with this section’’ and in- serted ‘‘or the absence of any physical damage to the proprietary interest of the claimant’’ before the period at end. Subsec. (i). Pub. L. 99–499, § 207(c)(3), inserted ‘‘or In- dian tribe’’ after ‘‘State’’. Subsec. (j). Pub. L. 99–499, § 207(c)(4), inserted ‘‘or In- dian tribe’’ after first reference to ‘‘State’’. Subsec. (k)(5), (6). Pub. L. 99–499, § 201, added pars. (5) and (6). Subsec. (l). Pub. L. 99–499, § 107(f), added subsec. (l). Subsec. (l)(3). Pub. L. 99–514 substituted ‘‘Internal Revenue Code of 1986’’ for ‘‘Internal Revenue Code of 1954’’, which for purposes of codification was translated as ‘‘title 26’’ thus requiring no change in text. Subsec. (m). Pub. L. 99–499, § 107(f), added subsec. (m). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1996 AMENDMENT Amendment by Pub. L. 104–208 applicable with re- spect to any claim that has not been finally adju- dicated as of Sept. 30, 1996, see section 2505 of Pub. L. 104–208, set out as a note under section 6991b of this title. EFFECT ON CONCLUDED ACTIONS Pub. L. 107–118, title I, § 103, Jan. 11, 2002, 115 Stat. 2360, provided that: ‘‘The amendments made by this title [amending this section and section 9622 of this title] shall not apply to or in any way affect any settle- ment lodged in, or judgment issued by, a United States District Court, or any administrative settlement or order entered into or issued by the United States or any State, before the date of the enactment of this Act [Jan. 11, 2002].’’ CENTRAL HAZARDOUS MATERIALS FUND Pub. L. 110–161, div. F, title I, Dec. 26, 2007, 121 Stat. 2116, as amended by Pub. L. 111–88, div. A, title I, Oct. 30, 2009, 123 Stat. 2924, provided in part: ‘‘That here- after, notwithstanding 31 U.S.C. 3302, sums recovered from or paid by a party including any fines or pen- alties, shall be credited to this account, to be available until expended without further appropriation: Provided further, That hereafter such sums recovered from or paid by any party are not limited to monetary pay- ments and may include stocks, bonds or other personal or real property, which may be retained, liquidated, or otherwise disposed of by the Secretary and which shall be credited to this account.’’ Similar provisions were contained in the following prior appropriation acts: Pub. L. 109–54, title I, Aug. 2, 2005, 119 Stat. 518. Pub. L. 108–447, div. E, title I, Dec. 8, 2004, 118 Stat. 3041. Pub. L. 108–108, title I, § 310, Nov. 10, 2003, 117 Stat. 1243. Pub. L. 108–7, div. F, title I, Feb. 20, 2003, 117 Stat. 218. Pub. L. 107–63, title I, Nov. 5, 2001, 115 Stat. 416. Pub. L. 106–291, title I, Oct. 11, 2000, 114 Stat. 923. Pub. L. 106–113, div. B, § 1000(a)(3) [title I], Nov. 29, 1999, 113 Stat. 1535, 1501A–136. Pub. L. 105–277, div. A, § 101(e) [title I], Oct. 21, 1998, 112 Stat. 2681–231, 2681–233. Pub. L. 105–83, title I, Nov. 14, 1997, 111 Stat. 1544. Pub. L. 104–208, div. A, title I, § 101(d) [title I], Sept. 30, 1996, 110 Stat. 3009–181, 3009–182. Pub. L. 104–134, title I, § 101(c) [title I], Apr. 26, 1996, 110 Stat. 1321–156, 1321–157; renumbered title I, Pub. L. 104–140, § 1(a), May 2, 1996, 110 Stat. 1327. Pub. L. 103–332, title I, Sept. 30, 1994, 108 Stat. 2500. RECOVERY OF COSTS Pub. L. 104–303, title II, § 209, Oct. 12, 1996, 110 Stat. 3681, provided that: ‘‘Amounts recovered under section 107 of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. 9607) for any response action taken by the Secretary in sup- port of the civil works program of the Department of the Army and any other amounts recovered by the Sec- retary from a contractor, insurer, surety, or other per- son to reimburse the Department of the Army for any expenditure for environmental response activities in support of the Army civil works program shall be cred- ited to the appropriate trust fund account from which the cost of such response action has been paid or will be charged.’’ COORDINATION OF TITLES I TO IV OF PUB. L. 99–499 Any provision of titles I to IV of Pub. L. 99–499, im- posing any tax, premium, or fee; establishing any trust fund; or authorizing expenditures from any trust fund, to have no force or effect, see section 531 of Pub. L. 99–499, set out as a note under section 1 of Title 26, In- ternal Revenue Code. § 9608. Financial responsibility (a) Establishment and maintenance by owner or operator of vessel; amount; failure to obtain certification of compliance (1) The owner or operator of each vessel (ex- cept a nonself-propelled barge that does not carry hazardous substances as cargo) over three hundred gross tons that uses any port or place in the United States or the navigable waters or any offshore facility, shall establish and main- tain, in accordance with regulations promul- gated by the President, evidence of financial re- sponsibility of $300 per gross ton (or for a vessel carrying hazardous substances as cargo, or $5,000,000, whichever is greater) to cover the li- ability prescribed under paragraph (1) of section 9607(a) of this title. Financial responsibility may be established by any one, or any combination, of the following: insurance, guarantee, surety bond, or qualification as a self-insurer. Any bond filed shall be issued by a bonding company authorized to do business in the United States. In cases where an owner or operator owns, oper- ates, or charters more than one vessel subject to this subsection, evidence of financial responsi- bility need be established only to meet the max- Page 7754 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 9608 imum liability applicable to the largest of such vessels. (2) The Secretary of the Treasury shall with- hold or revoke the clearance required by section 60105 of title 46 of any vessel subject to this sub- section that does not have certification fur- nished by the President that the financial re- sponsibility provisions of paragraph (1) of this subsection have been complied with. (3) The Secretary of Transportation, in accord- ance with regulations issued by him, shall (A) deny entry to any port or place in the United States or navigable waters to, and (B) detain at the port or place in the United States from which it is about to depart for any other port or place in the United States, any vessel subject to this subsection that, upon request, does not produce certification furnished by the President that the financial responsibility provisions of paragraph (1) of this subsection have been com- plied with. (4) In addition to the financial responsibility provisions of paragraph (1) of this subsection, the President shall require additional evidence of financial responsibility for incineration ves- sels in such amounts, and to cover such liabil- ities recognized by law, as the President deems appropriate, taking into account the potential risks posed by incineration and transport for in- cineration, and any other factors deemed rel- evant. (b) Establishment and maintenance by owner or operator of production, etc., facilities; amount; adjustment; consolidated form of re- sponsibility; coverage of motor carriers (1) Beginning not earlier than five years after December 11, 1980, the President shall promul- gate requirements (for facilities in addition to those under subtitle C of the Solid Waste Dis- posal Act [42 U.S.C. 6921 et seq.] and other Fed- eral law) that classes of facilities establish and maintain evidence of financial responsibility consistent with the degree and duration of risk associated with the production, transportation, treatment, storage, or disposal of hazardous sub- stances. Not later than three years after Decem- ber 11, 1980, the President shall identify those classes for which requirements will be first de- veloped and publish notice of such identification in the Federal Register. Priority in the develop- ment of such requirements shall be accorded to those classes of facilities, owners, and operators which the President determines present the highest level of risk of injury. (2) The level of financial responsibility shall be initially established, and, when necessary, adjusted to protect against the level of risk which the President in his discretion believes is appropriate based on the payment experience of the Fund, commercial insurers, courts settle- ments and judgments, and voluntary claims sat- isfaction. To the maximum extent practicable, the President shall cooperate with and seek the advice of the commercial insurance industry in developing financial responsibility require- ments. Financial responsibility may be estab- lished by any one, or any combination, of the following: insurance, guarantee, surety bond, letter of credit, or qualification as a self-insurer. In promulgating requirements under this sec- tion, the President is authorized to specify pol- icy or other contractual terms, conditions, or defenses which are necessary, or which are unac- ceptable, in establishing such evidence of finan- cial responsibility in order to effectuate the pur- poses of this chapter. (3) Regulations promulgated under this sub- section shall incrementally impose financial re- sponsibility requirements as quickly as can rea- sonably be achieved but in no event more than 4 years after the date of promulgation. Where possible, the level of financial responsibility which the President believes appropriate as a final requirement shall be achieved through in- cremental, annual increases in the require- ments. (4) Where a facility is owned or operated by more than one person, evidence of financial re- sponsibility covering the facility may be estab- lished and maintained by one of the owners or operators, or, in consolidated form, by or on be- half of two or more owners or operators. When evidence of financial responsibility is estab- lished in a consolidated form, the proportional share of each participant shall be shown. The evidence shall be accompanied by a statement authorizing the applicant to act for and in be- half of each participant in submitting and main- taining the evidence of financial responsibility. (5) The requirements for evidence of financial responsibility for motor carriers covered by this chapter shall be determined under section 31139 of title 49. (c) Direct action (1) Releases from vessels In the case of a release or threatened release from a vessel, any claim authorized by section 9607 or 9611 of this title may be asserted di- rectly against any guarantor providing evi- dence of financial responsibility for such ves- sel under subsection (a). In defending such a claim, the guarantor may invoke all rights and defenses which would be available to the owner or operator under this subchapter. The guarantor may also invoke the defense that the incident was caused by the willful mis- conduct of the owner or operator, but the guarantor may not invoke any other defense that the guarantor might have been entitled to invoke in a proceeding brought by the owner or operator against him. (2) Releases from facilities In the case of a release or threatened release from a facility, any claim authorized by sec- tion 9607 or 9611 of this title may be asserted directly against any guarantor providing evi- dence of financial responsibility for such facil- ity under subsection (b), if the person liable under section 9607 of this title is in bank- ruptcy, reorganization, or arrangement pursu- ant to the Federal Bankruptcy Code, or if, with reasonable diligence, jurisdiction in the Federal courts cannot be obtained over a per- son liable under section 9607 of this title who is likely to be solvent at the time of judgment. In the case of any action pursuant to this paragraph, the guarantor shall be entitled to invoke all rights and defenses which would have been available to the person liable under Page 7755 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 9609 section 9607 of this title if any action had been brought against such person by the claimant and all rights and defenses which would have been available to the guarantor if an action had been brought against the guarantor by such person. (d) Limitation of guarantor liability (1) Total liability The total liability of any guarantor in a di- rect action suit brought under this section shall be limited to the aggregate amount of the monetary limits of the policy of insurance, guarantee, surety bond, letter of credit, or similar instrument obtained from the guar- antor by the person subject to liability under section 9607 of this title for the purpose of sat- isfying the requirement for evidence of finan- cial responsibility. (2) Other liability Nothing in this subsection shall be con- strued to limit any other State or Federal statutory, contractual, or common law liabil- ity of a guarantor, including, but not limited to, the liability of such guarantor for bad faith either in negotiating or in failing to negotiate the settlement of any claim. Nothing in this subsection shall be construed, interpreted, or applied to diminish the liability of any person under section 9607 of this title or other appli- cable law. (Pub. L. 96–510, title I, § 108, Dec. 11, 1980, 94 Stat. 2785; Pub. L. 99–499, title I, §§ 108, 127(c), Oct. 17, 1986, 100 Stat. 1631, 1692.) Editorial Notes REFERENCES IN TEXT The Solid Waste Disposal Act, referred to in subsec. (b)(1), is title II of Pub. L. 89–272, Oct. 20, 1965, 79 Stat. 997, as amended generally by Pub. L. 94–580, § 2, Oct. 21, 1976, 90 Stat. 2795. Subtitle C of the Solid Waste Dis- posal Act is classified generally to subchapter III (§ 6921 et seq.) of chapter 82 of this title. For complete classi- fication of this Act to the Code, see Short Title note set out under section 6901 of this title and Tables. This chapter, referred to in subsec. (b)(2), (5), was in the original ‘‘this Act’’, meaning Pub. L. 96–510, Dec. 11, 1980, 94 Stat. 2767, known as the Comprehensive Envi- ronmental Response, Compensation, and Liability Act of 1980, which is classified principally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under section 9601 of this title and Tables. The Federal Bankruptcy Code, referred to in subsec. (c)(2), probably means a reference to Title 11, Bank- ruptcy. CODIFICATION In subsec. (a)(2), ‘‘section 60105 of title 46’’ substituted for ‘‘section 4197 of the Revised Statutes of the United States’’ on authority of Pub. L. 109–304, § 18(c), Oct. 6, 2006, 120 Stat. 1709, which Act enacted section 60105 of Title 46, Shipping. In subsec. (b)(5), ‘‘section 31139 of title 49’’ substituted for ‘‘section 30 of the Motor Carrier Act of 1980, Public Law 96–296’’ on authority of Pub. L. 103–272, § 6(b), July 5, 1994, 108 Stat. 1378, the first section of which enacted subtitles II, III, and V to X of Title 49, Transportation. AMENDMENTS 1986—Subsec. (a)(1). Pub. L. 99–499, § 127(c)(1), inserted ‘‘to cover the liability prescribed under paragraph (1) of section 9607(a) of this title’’ after ‘‘whichever is great- er)’’. Subsec. (a)(4). Pub. L. 99–499, § 127(c)(2), added par. (4). Subsec. (b)(2). Pub. L. 99–499, § 108(a), inserted provi- sions relating to evidence of financial responsibility and authority of the President regarding establishment of that evidence. Subsec. (b)(3). Pub. L. 99–499, § 108(b), substituted ‘‘as quickly as can reasonably be achieved but in no event more than 4 years’’ for ‘‘over a period of not less than three and no more than six years’’. Subsec. (c). Pub. L. 99–499, § 108(c), amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: ‘‘Any claim authorized by section 9607 or 9611 of this title may be asserted directly against any guar- antor providing evidence of financial responsibility as required under this section. In defending such a claim, the guarantor may invoke all rights and defenses which would be available to the owner or operator under this subchapter. The guarantor may also invoke the defense that the incident was caused by the willful misconduct of the owner or operator, but such guarantor may not invoke any other defense that such guarantor might have been entitled to invoke in a proceeding brought by the owner or operator against him.’’ Subsec. (d). Pub. L. 99–499, § 108(c), amended subsec. (d) generally. Prior to amendment, subsec. (d) read as follows: ‘‘Any guarantor acting in good faith against which claims under this chapter are asserted as a guar- antor shall be liable under section 9607 of this title or section 9612(c) of this title only up to the monetary limits of the policy of insurance or indemnity contract such guarantor has undertaken or of the guaranty of other evidence of financial responsibility furnished under this section, and only to the extent that liability is not excluded by restrictive endorsement: Provided, That this subsection shall not alter the liability of any person under section 9607 of this title.’’ § 9609. Civil penalties and awards (a) Class I administrative penalty (1) Violations A civil penalty of not more than $25,000 per violation may be assessed by the President in the case of any of the following— (A) A violation of the requirements of sec- tion 9603(a) or (b) of this title (relating to notice). (B) A violation of the requirements of sec- tion 9603(d)(2) of this title (relating to de- struction of records, etc.). (C) A violation of the requirements of sec- tion 9608 of this title (relating to financial responsibility, etc.), the regulations issued under section 9608 of this title, or with any denial or detention order under section 9608 of this title. (D) A violation of an order under section 9622(d)(3) of this title (relating to settlement agreements for action under section 9604(b) of this title). (E) Any failure or refusal referred to in section 9622(l) of this title (relating to viola- tions of administrative orders, consent de- crees, or agreements under section 9620 of this title). (2) Notice and hearings No civil penalty may be assessed under this subsection unless the person accused of the violation is given notice and opportunity for a hearing with respect to the violation. (3) Determining amount In determining the amount of any penalty assessed pursuant to this subsection, the