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excuse himself or herself from any person who has ceased to be a Board consideration of such activity by the Member or officer shall inure to the Board of Trustees.
benefit of the heirs, executors, and ad(c) If at any time there is a tie vote ministrators of such a person. The in the consideration of any matter by right of indemnification hereinabove the Board of Trustees, the member provided for shall not be exclusive of designated by the Secretary with long any rights to which any Board est service on the Board shall break Member or officer of the Fund may the tie by voting twice.
otherwise be entitled by law. (d) The Board of Trustees by a ma
[42 FR 31789, June 23, 1977, as amended at jority vote shall select an Administra
45 FR 1026, Jan. 4, 1980) tor to direct the day-to-day operations of the Fund.
$ 29.4 General powers. (e) The Board of Trustees shall hold
The Fund shall have such powers as meetings every six months, or more frequently when necessary to consider
may be necessary and appropriate for pressing matters, including pending
the exercise of the powers herein speclaims under § 29.9.
cifically and impliedly conferred upon (f)(1) Each Board Member and offi
the Fund and all such incidental cer of the Fund now or hereafter serv
powers as are customary in non-profit ing as such, shall be indemnified by
corporations generally, including but the Fund against any and all claims
not limited to the following: and liabilities to which he has or shall
(a) By resolution of the Board of become subject by reason of serving or
Trustees, the Fund shall adopt a corhaving served as such Board Member
porate seal. or officer, or by reason of any action
(b) The Fund may sue and be sued alleged to have been taken, omitted, or
in its corporate name and may employ neglected by him as such Board counsel to represent it. Member or officer; and the Fund shall (c) The Fund shall be a resident of
bimburse each such person for all the State of Alaska with its principal legal expenses reasonably incurred by place of business in Alaska, and him in connection with any such claim Board of Trustees shall establish a or liability: Provided, however, That business office or offices as deemed no such person shall be indemnified necessary for the operation of the against, or be reimbursed for any ex Fund. penses incurred in connection with, (d) In any civil action for the recovany claim or liability arising out of his ery of damages resulting from an inciown willful misconduct or gross negli- dent the Fund shall waive personal jugence.
risdiction upon being furnished with a (2) The amount paid to any officer copy of the summons and complaint in or Board Member by way of indemnifi the action. cation shall not exceed his actual li (e) The Board of Trustees of the abilities and actual, reasonable, and Fund, by a majority of those present necessary expenses incurred in connec- and voting, shall adopt and may tion with the matter involved. Ex- amend and repeal by-laws governing penses incurred in defending a civil or the performance of its statutory criminal action, suit, or proceeding duties. may be paid by the Fund in advance of (f) The Fund shall do all things necthe final disposition of such action, essary and proper in conducting its acsuit, or proceeding as authorized by tivities as Trustee including (1) receipt the Board in the specific case upon re of fee collections pursuant to section ceipt of an undertaking by or on 204(c)(6) of the act; (2) payment of behalf of the Board Member or officer costs and expenses reasonably necesto repay such amount if it shall ulti- sary to the administration of the Fund mately be determined that he is not as well as costs required to satisfy entitled to be indemnified by the Fund claims against the Fund; (3) investas authorized herein.
ment of all sums not needed for ad(3) The indemnification provided by ministration and the satisfaction of this section shall continue as to a claims in income producing securities
as hereinafter provided; and (4) seek ing recovery of any monies to which it is entitled as subrogee under circumstances set forth in section 204(c)(8) of the act.
(g) The Fund shall determine the character of and the necessity for its obligations and expenditures, and the manner in which they shall be incurred, allowed, and paid. The Board : of Trustees shall establish an annual budget, subject to the approval of the Secretary.
(h) All costs and expenses reasonably necessary to the administration of the Fund, including costs and expenses incident to the termination, settlement, or payment of claims, are properly chargeable as expenses and payable out of fees or other income of the Fund. [42 FR 31789, June 23, 1977, as amended at 43 FR 27841, June 27, 1978)
$ 29.5 Officers and employees.
(a) The Administrator is the Chief Executive Officer of the Fund and is responsible for carrying out all executive and administration functions as authorized by the Board of Trustees in accordance with the Act including the receipt and verification of fees collected from Owners of oil pursuant to $ 29.6(a), the investment of Fund assets in securities according to guidelines approved by the Board of Trustees and the Secretary, and the disbursement of such assets in payment of expenses and approved claims.
(b) The Fund may employ such other persons as may be necessary to carry out its functions. $ 29.6 Financing, acounting, and audit.
(a) (1) The Operator of the pipeline shall collect a fee of five cents per barrel from the Owner of the oil at the time it is loaded on a vessel at the terminal facilities of the pipeline. Such fees shall be transferred forthwith to the Fund for receipt and verification by the Administrator. Collection of fees shall cease at the end of the month following the month in which $100,000,000 has been accumulated in the Fund from any source. Collection of fees shall be resumed when the accumulation falls below $100,000,000. The Administrator shall
notify the pipeline carriers by the fifteenth of the month whether fees are to be collected during the following month.
(2) The value of the Fund shall be the current market value of the Fund on the day at the end of each month or other agreed upon accounting period, when the value is to be determined.
(b) Costs of administration shall be paid from the money received by the Fund, and all sums not needed for administration and the satisfaction of claims shall be invested in accordance with $29.11. The interest on and the proceeds from the sale of any obligations held in the Fund shall be credited to and form a part of the Fund. Income from such securities shall be added to the principal of the Fund if not used for costs of administration or settlement of claims.
(c) At the end of each month, or other agreed upon accounting period, the Operator of the pipeline shall privide the Fund with a statement of the respective volumes of crude oil transported by the Operator of the pipeline and delivered to vessels, the amount of fees charged and collected, and the Owners from whom such fees were collected. The Administrator shall provide a copy of the statement to the Owners, and to the State of Alaska.
(d) The Fund shall undertake an annual accounting.
(e) The Fund shall be audited annually by the Comptroller General, in coordination with the Administrator and the Secretary. Authorized representatives of the Comptroller General and the Secretary shall have complete access, for purposes of the audit or otherwise, to all books, accounts, financial records, reports. files, and other papers, things, or property belonging to or in use by the Fund and they shall be afforded full facilities for verifying among other things, transactions with the balances on securities held by depositories, fiscal agents, and custodians. A report of each audit made by the Comptroller General Shall be submitted to the Congress.
8 29.7 Imposition of strict liability.
regulations promulgated pursuant to (a) Notwithstanding the provisions
such act (46 CFR Part 543). Notwithof any other law, where a vessel is en
standing inconsistent language in such gaged in any segment of transporta
act, financial responsibility in the tion between the terminal facilities of
amount of $14,000,000 for all such vesthe pipeline and ports under the juris sels must be established. diction of the United States, and is (2) The certificate obtained in accarrying oil which has been transport. cordance with this subsection shall be ed through the Trans-Alaska Pipeline carried on board the vessel, and a copy System, the owner and operator of the shall be filed with the Fund. No oil vessel (jointly and severally), and the may be loaded on any vessel which has Fund established by section 204(c) of not been issued a valid certificate the act, shall be strictly liable without which is still in effect at the time of regard to fault in accordance with that loading. section for all damages, including clean-up costs, sustained by any $29.8 Notification and advertisement. person or entity, public or private, in
(a) The person in charge of a vessel, cluding residents of Canada, as a
as soon as he has knowledge of an inciresult of any discharge of oil from
dent in which the vessel is involved, such vessel. Strict liability under this
shall immediately notify the Fund of section shall cease when the oil has
the incident using the fastest available first been brought ashore at a port
method of communication. Notificaunder the jurisdiction of the United States.
tion under this section is in addition to (b) Strict liability shall not be im
any notification required of the owner posed under this part if the owner or
or operator of the vessel under section
311 (b)(5) of the Federal Water Polluoperator of the vessel, or the Fund, can prove that the damages were
tion Control Act Amendments of 1972 caused by an act of war or by the neg
and the regulations of the U.S. Coast ligence of the United States or other
Guard promulgated pursuant to such
Act (33 CFR 153.203). governmental agency. Strict liability shall not be imposed under the act
(b) When the Fund receives informawith respect to the claim of a damaged
tion pursuant to paragraph (a) of this party if the owner or operator of the
section or otherwise of an incident, vessel, or the Fund, can prove that the
the Fund shall, where possible, desigdamage was caused by the negligence
nate the source or sources of oil polluof such damaged party.
tion and shall immediately notify the (c) Strict liability for all claims aris
owner and operator of such source ing out of any one incident shall not
designation. In making the designaexceed $100,000,000. The owner and
tion, the Fund may ask the assistance operator of the vessel shall be jointly
and cooperation of the U.S. Coast and severally liable for the first Guard. $14,000,000 of such claims that are al
(c)(1) In all cases where there is any lowed. The Fund shall be liable for the likelihood of damages from an incibalance of the claims that are allowed dent, the Fund shall advertise the desup to $100.000.000. If thee total claims ignation, if such designation has been allowed exceed $100,000,000, they made, the procedures by which claims shall be reduced proportionately. The may be presented, and the informaunpaid portion of any claim may be as tion which must be included in such serted and adjudicated under other ap
claims. plicable Federal or State law.
(2) The Fund shall establish, subject (d)(1) Each owner or operator of a to the approval of the Secretary, univessel shall obtain from the Federal form procedures and forms for adverMaritime Commission a “Certificate of tisement under this section. Financial Responsibility (Alaska Pipe- (d) Advertisement under this section line)” demonstrating compliance with shall commence no later than fifteen the provisions of section 311(p) of the days from the date of the designation Federal Water Pollution Control Act, under paragraph (b) of this section, as amended (33 U.S.C. 1321(p)), and and in any event no later than twenty
days from the date the Fund learns of mence an action in court against the the incident. The advertisement shall owner or operator or to present the continue for a period of not less than claim to the Fund, that election to be thirty days.
irrevocable and exclusive. [42 FR 31789, June 23, 1977, as amended at
(d) In the case of a claim transmit43 FR 27841, June 27, 1978)
ted in accordance with paragraph
(b)(2) of this section, any person in$ 29.9 Claims, settlement and adjudica. tending to pay or settle any such claim
shall notify the Fund of such inten(a)(1) Claims in accordance with this
tion, and of all terms of the intended section may be submitted by any dam
settlement, at least twenty days before aged party, his duly authorized agent,
such payment or settlement is made or his successor in interest.
final. Whenever the Fund objects, for (2) Claims submitted in accordance
any reason, to the intended payment with this section must contain the fol
or settlement, it may request modificalowing information:
tion of such payment or settlement, or (i) A detailed statement of the cir it may seek appropriate relief in Fedcumstances, if known, by which the
eral District Court in order to halt or claimed loss occurred.
modify such payment or settlement. (ii) A detailed listing of damages in (e) In the case of a claim transmitted curred, categorized according to the in accordance with paragraph (b)(2) of type of damage involved (§ 29.1(d)), this section, where full and adequate and including a monetary claim for compensation is unavailable, either beeach type of damage listed.
cause the claim exceeds the (iii) Where documentation, where $14,000,000 limit of liability, or beavailable, of all monetary claims as cause the owner, operator, or guaranserted.
tor is financially incapable of meeting (b)(1) All claims arising out of an in his obligations in full, a claim for the cident shall be initially presented to amount not compensated may be prethe Fund.
sented to the Fund. (2) Where designation under (f) Where any part of the first $ 29.8(b)(1) has been accomplished and $14,000,000 of claims arising from an where the owner or operator does not incident is paid by the Fund, for any deny the designation, the Fund shall reason, the owner and operator of the transmit all related claims to the vessel involved shall be liable to the owner or operator. The Fund shall Fund for such amount paid in accordtransmit such claims within 5 days ance with section 204(c)(3) of the Act. after their receipt by the Fund.
The Fund shall commence an action in (3) Where the Fund is unable to des- court or pursue any other reasonable ignate the source or sources of dis means to recover such amount from charge under $29.8(b), all related the owner, operator, and guarantor. claims shall be processed and adjudi. Where the owner, operator and guarcated by the Fund.
antor all deny liability for a claim (c) In the case of a claim transmitted without any reasonable basis for doing under paragraph (b)(2) of this section so, the Fund may request that the not submitted to arbitration under Federal Maritime Commission revoke paragraph (h) of this section, and in the applicable Certificate of Financial which:
Responsibility and prohibit the guar(1) The owner, operator or guaran antor from providing evidence of fitor to whom the claim is presented nancial responsibility in the future. denies all liability for the claim, for (g) The Fund may settle or comproany reason, or
mise any claim presented to it for ad(2) The claim is not settled by any judication in accordance with paraperson by payment to the claimant graphs (b)(3) and (c) of this section, within ninety days of the date upon provided that all claims not submitted which the claim was presented to the to arbitration under paragraph (h) of owner or operator or upon which ad this section shall be settled and paid vertising was commenced, whichever is within 120 days of the date upon later, the claimant may elect to com- which the claim was so presented to
the Fund, or upon whch advertising (1) The Fund may use the facilities was commenced, whichever is later and services of private insurance and
(h) A disputed claim may be submit claims adjusting organizations in adted to binding arbitration, if the par- ministering this part and may contract ties to the dispute so agree, under to pay compensation for those faciliterms and procedures agreed to by the ties and services. parties. The Fund shall be afforded an (m) Any claimant aggrieved by the opportunity to participate as a party Fund's decision on a claim under this in the arbitration, and if it does so it section may appeal the decision in the shall be bound by the results of the ar- appropriate Federal District Court. bitration. (i) No claim may be presented, nor
[42 FR 31789, June 23, 1977, as amended at any action be commenced, for dam- 43 FR 27841, June 27, 1978) ages recoverable under this part unless
$ 29.10 Subrogation. that claim is presented to or that action is commenced against, the If the Fund pays compensation to owner, operator, or guarantor, or any claimant, the Fund shall be subroagainst the Fund, as to their respec- gated to all rights claims and causes of tive liabilities, within three years from action which that claimant has to the the date of discovery of the damages extent permitted by law. caused by an incident, or within six years of the date of the incident caus- & 29.11 Investment. ing the damages, whichever is earlier.
(a) The monies accumulated in the (j)(1) The Board of Trustees, by a
Fund shall be prudently invested in majority vote, shall decide to allow or
the following types of income-producdeny claims or settlements presented
ing obligations having a high degree of to the Fund in accordance with this
reliability and security, or in such section. In its discretion the Board
other obligations as the Secretary may may delegate the authority to settle
approve: classes of claims to the Administrator.
(1) Fixed income securities issued by (2)(i) Where a claim is presented to
the United States or any of its agenthe Fund by or on behalf of any
cies, at the same interest rates and person having a close business, personal or governmental association with
terms available to private investors;
and any member of the Board of Trustees, such as to create a conflict of interest
(2) Fixed income securities or obligaor the appearance of such conflict of
tions issued by a corporation or issued interest on the part of such member of
or guaranteed by a State or local govthe Board of Trustees, the member in
ernment or any political subdivision, volved shall excuse himself or herself
agency or instrumentality thereof, from any consideration of such claim.
provided such obligations having a (ii) Where a claim presented to the
rating by Standard and Poors, or Fund has previously been presented to
Moody, of “A” or better, or an equivaan owner or operator pursuant to
lent rating, or provided further that § 29.9(b)(2), and such owner or opera
the security or obligation is of the tor has a close business, personal or
same priority as another security or governmental association with any
obligation of the same issuer which member of the Board of Trustees,
has been rated “A” or better, and prosuch as to create a conflict of interest
vided that the portfolio has an overall or the appearance of a conflict of in- rating of “AA”. Provided, however, terest on the part of such member of That no securities or obligations of the Board of Trustees, the member in the permittees or their affiliates or of volved shall excuse himself or herself any investment advisor or custodian to from any consideration of such claim.
nsideration of such claim the Fund, or their affiliates may be (k) The Fund, subject to the approv- purchased or held by the Fund. al of the Secretary, shall establish uni- (3) Time certificates of deposit and form procedures and standards for the commercial paper provided that the appraisal and settlement of claims commercial paper has a rating of against the Fund.
either Al or P1 or both.