July 25 2011

When Restoration is Not Restoration

by Natasha Bhushan (Legal Department Intern)

The 1989 Exxon Valdez disaster had at least one positive side effect. It led Congress to pass the  Oil Pollution Act of 1990 (“OPA”), which aims to make the public and environment whole for injuries to natural resources and natural-resource services resulting from an oil spill. Under the OPA, BP is liable for all damages to natural resources resulting from last year’s massive oil spill in the Gulf of Mexico.

In April of this year, BP and appointed government agencies (“trustees”) executed an agreement entitled “Framework for Early Restoration Addressing Injuries Resulting from the Deepwater Horizon Oil Spill.” Pursuant to the agreement, BP will provide $1 billion to address injuries to natural resources caused by the spill. Each of the trustees—Louisiana, Alabama, Florida, Mississippi, Texas, the National Oceanic and Atmospheric Administration, and the Department of the Interior—will receive $100 million for early restoration projects .  The remaining $300 million will go to the federal trustee agencies for projects submitted by the states. If the early restoration projects are successful, BP will receive credits to offset its total natural resource damage liability.

Early restoration is an emerging tool of the OPA’s natural resource damage assessment  (“NRDA”) process. NRDA is a three-step process trustees must use to determine the type and amount of restoration needed to compensate the public for harm to natural resources that occur as the result of a spill. The steps are:

1) Preliminary assessment to determine whether injury has occurred;
2) Injury assessment to quantify injuries, and restoration planning to identify possible restoration projects; and
3) Restoration implementation, during which time trustees work with the public to select and implement restoration projects.

Unlike traditional restoration projects, early restoration projects can be implemented before the third step of the NRDA process. This means that the trustees for the BP spill, who are currently in the second stage of NRDA, can implement early restoration projects right now. The potential advantage of this scheme is that restoration can be achieved faster, but the scheme also raises a significant problem.

The problem is that early restoration projects do not require any scientific support that they meet the definition of “restoration.” The NRDA regulations define restoration as actions taken to return injured natural resources and services to the condition they would have been in had the spill not occurred or actions that compensate the public for losses suffered between the oil spill and the future date of resource recovery. The fact that traditional restoration projects must be based on scientific findings made during the first two steps of the NRDA process, is a built-insafeguard that the projects are designed to meet the requirements of restoration. Without this safeguard in place, as is the case in the current early restoration process, trustees are free to pursue “pet projects”—projects that are economically beneficial to private contractors and landowners, but useless or even counterproductive to natural resource recovery. Many of Florida’s proposed beach nourishment projects arguably fall within this category.

The lack of scientific basis required for early restoration projects also presents a problem for public involvement. Although the trustees have asked for public input in the early restoration process, the trustees have not yet released a comprehensive report on the current status of their ongoing the damage assessment. In the absence of specific information about the injuries arising from the spill, there is no way for the public to provide informed and thoughtful comments about whether proposed restoration projects will remedy, or even address, the injuries.

It is up to the public to urge the trustees to release information about the ongoing damage assessment process, and demand that early restoration projects be based on their preliminary scientific findings. This is the only way to ensure that the early restoration funds are being used in a manner consistent with the OPA—in the public interest and for environmental recovery.


by Legal Intern Natasha Bhushan