Looking Backwards: How Do You Get Paid?1

Abstract

ABSTRACT While a number of factors play a significant role in an oil spill response, of critical interest to every participant is money: how much and who pays! A responsible party clearly cares about the ultimate cost figure for a response; its insurer is very interested in that figure but may have quite a different view on its obligations. Contractors and subcontractors want to be paid fully and promptly, as do third parties who may suffer damages. The Federal On-Scene Coordinator (FOSC), the Oil Spill Liability Trust Fund (OSLTF or the Fund), and insurers become key players after the event in cost recovery and payment for damages. Despite these sometimes conflicting interests, every response participant can benefit from understanding the standards applied by payors. Based on the standards and procedures for making claims, the participant can create a system that helps in collecting costs or damages. This paper briefly describes the sources of funding, and the standards and process for submitting claims for response costs and damages related to spills in U.S. waters. It then offers suggestions and tools for documenting decisions and costs in a way that enhances the ability to get paid.