The US Coast Guard’s National Pollution Funds Center (NPFC) was set up in 1991 to help protect America’s environment by making sure that oil carriers have the financial ability to pay for the cleanup costs of any spills that might occur. They do this by implementing Title 1 of the Oil Pollution Act (OPA) of 1990 and administering the Oil Spill Liability Trust Fund (OSLTF).
The NPFC makes sure that oil carriers can meet the potential costs of an oil spill by issuing COFRs. COFRs are issued after a vessel owner demonstrates their ability to pay for all potential clean up costs and damages if an oil spill were to happen. Any vessel over 300 tons must have a COFR to be allowed to operate in US waters.
When an oil spill happens the NPFC provides immediate funding and financial assistance to federal responders so that they can tackle the problem immediately, either by overseeing the cleanup activities of the Responsible Party or by cleaning up themselves.
When the Responsible Party for the oil spill is either unknown or refuses to pay, claimants can apply to the NPFC for payment from the OSLTF. Claimants can claim compensation for:
NPFC directly bills the polluter after it has accurately assessed the full costs of the cleanup and associated damages. If payment is not received in a timely manner the polluter will have difficulty in obtaining the necessary COFRs it needs to continue it’s operations, making the NPFC an effective organization for holding polluters directly responsible for the exact costs incurred by their oil spill.