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— John Adams (1735–1826) Instructions to His Son Johnny
 The Biography of John Adams by David Mccullough (P. 19)

Consumer Price Index Adjustments of the Oil Pollution Act of 1990 Limit of Liability for Offshore Facilities

Presidential Executive Orders
E.O. 12630—Takings Implication Assessment
According to Executive Order 12630, this final rule does not have significant takings implications. The rulemaking is not a governmental action capable of interfering with constitutionally protected property rights. A Takings Implication Assessment is not required.
E.O. 12866—Regulatory Planning and Review
The Office of Management and Budget (OMB) has not reviewed this rulemaking under section 6(a)(3) of E.O. 12866. BOEM does not believe this rulemaking constitutes a “significant regulatory action” under E.O. 12866 based on the following:
(1) These provisions simply adjust the offshore facility limit of liability for damages by the CPI. This rule will likely not have an annual effect of $100 million or more on the economy. It will likely also not adversely affect in a material way the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities. The new offshore facility limit of liability increases the pollution liability of offshore facility responsible parties and may result in increased costs if damages exceed $75 million. If damages from an offshore facility oil spill exceed $75 million, the higher limit of liability ($133.65 million) in this rule will impose greater nominal costs on the responsible parties. In constant 1990 dollars, the limit of liability for offshore facilities implemented by this final rule is the same as established in OPA and preserves the “polluter pays” principle. The infrequent occurrence of large oil spills from offshore facilities suggests that the compliance costs from this increase in the limit of liability are likely to be immaterial to the operating costs for offshore facility responsible parties over time.
(2) This final rule would not create a serious inconsistency or otherwise interfere with an action taken or planned by another agency. BOEM has coordinated with the Coast Guard and the Department of Justice on this rulemaking.
(3) This final rule would not alter the budgetary effects of entitlements, grants, user fees, or loan programs or the rights or obligations of their recipients.
(4) This final rule does not raise any novel legal or policy issues. OPA requires the offshore facility limit of liability to be adjusted for inflation not less than every three years to reflect significant increases in the CPI.

E.O. 12988—Civil Justice Reform
This final rule complies with the requirements of E.O. 12988. Specifically, this rule:
(a) Meets the criteria of section 3(a) requiring that all regulations be reviewed to eliminate errors and ambiguity and be written to minimize litigation; and
(b) Meets the criteria of section 3(b)(2) requiring that all regulations be written in clear language and contain clear legal standards.

E.O. 13045—Protection of Children From Environmental Health Risks and Safety Risks
BOEM has analyzed this final rule under E.O. 13045, Protection of Children from Environmental Health Risks and Safety Risks. This final rule is not an economically significant rule and an analysis of environmental health risks is therefore not required. Regardless, this is an administrative rule and it does not create any environmental risk to health or any risk to safety that may disproportionately affect children.

E.O. 13132—Federalism
Under the criteria in E.O. 13132, this final rule does not have federalism implications. This final rule does not have substantial direct effects on the relationship between the Federal and State governments. This final rule will not affect the role of State and local governments with respect to their offshore facility activities. A Federalism Assessment is not required.

E.O. 13175—Consultation and Coordination With Indian Tribal Governments
This final rule does not have tribal implications under E.O. 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. Under the criteria in E.O. 13175, we evaluated this final rule and determined that it has no substantial direct effects on federally recognized Indian tribes.

E.O. 13211—Effects on the Nation’s Energy Supply
BOEM has analyzed this final rule under E.O. 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use.” BOEM has determined that it is not a “significant energy action” under that order. This final rule is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under E.O. 13211.

E.O. 13563—Improving Regulation and Regulatory Review

E.O. 13563 requires that our regulatory system protect public health, welfare, safety, and our environment while promoting economic growth, innovation, competitiveness, and job creation. It must be based on the best available science. It must allow for public participation and an open exchange of ideas. It must promote predictability and reduce uncertainty. It must identify and use the best, most innovative and least burdensome tools for achieving regulatory ends. It must take into account benefits and costs, both quantitative and qualitative. It must ensure that regulations are accessible, consistent, written in plain language, and easy to understand. It must measure, and seek to improve, the actual results of regulatory requirements.

This E.O. is supplemental to and reaffirms the principles, structures, and definitions governing contemporary regulatory review that were established in E.O. 12866. As stated in that E.O., and to the extent permitted by law, each agency must, among other things: (1) Propose or adopt a regulation only upon a reasoned determination that its benefits justify its costs (recognizing that some benefits and costs are difficult to quantify); (2) tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives, taking into account, among other things, and to the extent practicable, the costs of cumulative regulations; (3) select, in choosing among alternative regulatory approaches, those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive benefits; and equity); (4) to the extent feasible, specify performance objectives, rather than specifying the behavior or manner of compliance that regulated entities must adopt; and (5) identify and assess available alternatives to direct regulation, including providing economic incentives to encourage the desired behavior, such as user fees or marketable permits, or providing information with which choices can be made by the public.
The increased offshore facility limit of liability for damages in this rulemaking is required by statute (OPA). This rulemaking does not amend the OSFR requirements in 30 CFR part 553. BOEM does not believe that OSFR insurance premiums will be significantly impacted by this rulemaking. BOEM solicited comments on that issue; however, no comments were received. The limit of liability increase is necessary to ensure that the deterrent effect and the “polluter pays” principle embodied in OPA’s liability provisions are preserved.


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