Document ID: USCG-2021-0178-0005
Agency: uscg
Document Type: Supporting & Related Material
Title: 
Posted Date: 2022-04-25T04:00Z

Supporting Statement 
                                      for
                                       
 CERTIFICATES OF FINANCIAL RESPONSIBILITY UNDER THE OIL POLLUTION ACT OF 1990
                                       
                          OMB CONTROL NO.:  1625-0046
COLLECTION INSTRUMENTS:  Instruction, CG-5585, CG-5586, CG-5586-1, CG-5586-2, CG-5586-3, and CG-5586-4.

A. Justification.

 Circumstances that make the collection of information necessary.
This information collection is "reporting" in nature and is used by the Coast Guard's National Pollution Funds Center (NPFC) to establish compliance with 33 CFR 138.110, the Oil Pollution Act of 1990 (OPA, 33 U.S.C. § 2716), and the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA, 42 U.S.C. § 9608).  This authority is delegated by the Secretary to the Coast Guard via the Department of Homeland Security Delegation No. 0170.1, Revision No. 01.2. (II)(82).

 By whom, how, and for what purpose the information is to be used.
The information collection requirements described in this supporting statement are necessary to provide evidence of a respondent's ability to pay for removal costs and damages associated with discharges or substantial threats of discharges of hazardous material or oil into the navigable waters, adjoining shorelines or the exclusive economic zone of the United States.  The requirements are imposed generally on operators and financial guarantors of tank vessels over 100 gross tons and all vessels over 300 gross tons.

 Consideration of the use of improved information technology.
Electronic submission of Certificates of Financial Responsibility (COFR) applications (form CG-5585) and electronic payment (credit cards) are now available using the Internet.  NPFC receives approximately 75% of this collection directly from insurers through our COFR mailbox. NPFC currently receives approximately an additional20% of this collection electronically through ECOFR, primarily from its United States' applicants.  
The NPFC has automated this process as much as possible.  Using E-COFR first time COFR applicants use the electronic system, they must also mail the required signatures, but all subsequent transactions can be completed electronically.  The NPFC has researched using digital signatures to fully automate this process, but the current lack of technology and funding does not make this approach feasible.
In addition, NPFC has a small percentage of customers, particularly international and/or infrequent users, who prefer to submit paper forms.  The NPFC accepts electronic payment from major U.S. credit cards; international customers who do not hold these cards or any customers who prefer to use an alternative payment method would therefore need to submit paperwork authorizing payment.  It is easier for these customers to submit the entire application in paper rather than half in paper and half electronically.  Similarly, customers who expect to need only a one-time application may not find it expedient to go through the online enrollment process.
The NPFC has not automated any of the CG-5586 series of forms because it only receives approximately 10 of these forms annually.  Because of this low volume, it is not cost effective to automate these forms at this time. 

 Efforts to identify duplication.  Why similar information cannot be used.
No other entity provides the service required.  NPFC is the only authority for the issuance of COFRs.

 Methods to minimize the burden to small businesses if involved.
This information collection does not have an impact on small businesses or other small entities.
 
 Consequences of the Federal program if collection were conducted less frequently.
If the collection is not conducted or is conducted less frequently, the NPFC could not ensure that the respondents could pay for removal costs and damages associated with an oil or hazardous substance incident, as is required by statute and regulation.

 Explain any special circumstances that would cause the information collection to be conducted in a manner inconsistent with 5 CFR 1320.5(d)(2).
 Respondents might be required to report information to the agency more often than quarterly if they desire a COFR more frequently.
 There is no requirement that respondents prepare a written response to a collection of information in fewer than 30 days after receipt of it.
 There is no requirement that respondents submit more than an original and two copies of any document.
 There is no requirement that respondents retain records other than health, medical, government contract, grant-in-aid, or tax records for more than 3 years.
 There is no statistical survey involved.
 There are no special circumstances that would cause an information collection to be conducted in a manner that includes a pledge of confidentiality that is not supported by the authority established in statute or regulation, that is not supported by disclosure and data security policies that are consistent with the pledge, or which unnecessarily impedes sharing of data with other agencies for compatible confidential use.
 The only confidential information that may be required is company financial data, which would be submitted if the respondent chooses to obtain a COFR by means of self-insurance or financial guaranty method.  Should respondents not wish to disclose this information, they could use an alternative method to obtain a COFR (e.g., insurance from a commercial provider). 
 Outside consultation for this collection effort.
   A 60-day Notice will be published in the Federal Register to obtain public comment on these collections.  

 Explain any decision to provide any payment or gift to respondents.
There is no offer of monetary or material value for this information collection.

 Describe any assurance of confidentiality provided to respondents.
There are no assurances of confidentiality provided to the respondents for this information collection.  This information collection request is covered by the National Pollution Funds Center Pollution Response Funding, Liability, and Compensation System (NPFC PRFLACS) Privacy Impact Assessment (PIA) and Marine Information for Safety and Law Enforcement (MISLE) and Law Enforcement (ULE) System of Records Notice (SORN).  Links to the NPFC PRFLACS PIA and MISLE and ULE SORN are provided below:  
 https://www.dhs.gov/sites/default/files/publications/privacy_pia_007_uscg_npfc_2009.pdf 
 https://www.govinfo.gov/content/pkg/FR-2009-06-25/html/E9-14906.htm 
 https://www.regulations.gov/document?D=DHS-2016-0074-0001 

 Additional justification for any questions of a sensitive nature.
There are no questions of sensitive language.

 Estimates of reporting and recordkeeping hour and cost burdens of the collection of information.
This information collection utilizes six CG-forms that need to be completed by respondents. Initially all respondents need to complete Application for Vessel Certification of Financial Responsibility (CG-5585) and Insurance Guaranty Form (CG-5586), then every year respondents may complete varies supplementary form.  
Types of respondents are:
 Vessel operators:
 New applicants that do not self insure need only to complete the CG-5585
 The approximately 900 United States operators and 9,000 foreign operators must renew their COFRs every 3 years.  Therefore, for the purposes of this information collection budget, we have assumed that a third of them renew each year.
 Financial Guarantors
 Only one applicable GC-5586 is completed by either a guarantor, self insurer and insurer per operator.
 The almost 100 guarantors, including self-insurers, must submit required affidavits and financial documentation every year to maintain approval to provide acceptable evidence of financial responsibility.
            
            

                                                                  Annual Burden
                                                                               
Number of Respondents
Operator Respondents
                                                                          3,300
                                                                               
Financial Guarantor Respondents
                                                                            100
                                                                               
Burden
Reporting Hours per Response
                                                                              1
                                                                               
Recordkeeping Hours per Response
                                                                              0
                                                                               
Hour Burden
                                                                          3,400
                                                                               
Cost (assuming $26.04 per hour)
                                                                        $88,500
                                                                               

                                                                               
                                                                               
Total Burden Hours (Year 2 and Beyond)
                                                                          3,400
Total Cost (Year 1 Only)
                                                                       $348,900
Total Cost (Year 2 and Beyond)
                                                                        $88,500
 Estimates of annualized capital and start-up costs.
There are no record keeping, capital, start-up or maintenance costs associated with this information collection.

 Cost to Federal Government.
Five Marine Insurance Examiners, most of which are GS-13, spend about 40% of their time on this information collection.  
Number of Marine Insurance Examiners
                                                                              5
Annual Hours per Examiner
                                                                            768
Cost (assuming $66 per hour) per Examiner
                                                                        $50,688
Total Annual Government Cost Burden
                                                                      $ 253,440

 Explain the reasons for the change in burden.
   There is no change to the burden estimate.  The reporting requirements, and the methodology for calculating burden, remain unchanged.
    
 For collections of information whose results are planned to be published for statistical use, outline plans for tabulation, statistical analysis and publication.
This information collection will not be published for statistical purposes.  The NPFC provides a public search function on its COFR Web site on approved vessel COFRs. The Web site is automatically updated daily from the COFR database, which NPFC maintains through this information collection.

In addition, NPFC posts graphs and tables on various types of insurers and methods of financial responsibility on its COFR Web site.  These are generated from its COFR database and posted on a monthly basis. 

 Explain the reasons for seeking not to display the expiration date for OMB approval of the information of collection.
USCG will not display the expiration date on the forms, due to the fact that the forms that are generated through our ECOFR system require programming changes to update the dates. The programming can take time to be accomplished by OSC.

 Explain each exception to the certification statement.
USCG does not request an exception to the certification of this information collection.

B.  Collection of Information Employing Statistical Methods.

This information collection does not employ statistical methods.