(a) A person may not operate a nontank vessel within the waters of the state or cause or permit the transfer of oil to or from a nontank vessel unless the person has furnished to the department and the department has approved proof of financial ability to respond to damages meeting the requirements of AS 46.04.040. Proof of financial responsibility required under this subsection is subject to adjustment of dollar amounts under AS 46.04.045 and is established, for a nontank vessel that carries

(1) predominantly persistent product, at $300 per incident for each barrel of oil storage capacity on the vessel or $5,000,000, whichever is greater; and

(2) predominantly nonpersistent product, at $100 per incident for each barrel of oil storage capacity on the vessel or $1,000,000, whichever is greater.

(b) A person may not transport oil by railroad tank car or cause or permit the transfer of oil to or from a railroad tank car unless the person has furnished to the department and the department has approved proof of financial ability to respond to damages meeting the requirements of AS 46.04.040. Proof of financial responsibility required under this subsection is subject to adjustment of dollar amounts under AS 46.04.045 and is established at

(1) $300 per incident for each barrel of persistent product based on the maximum amount of persistent product storage capacity of any train on the railroad; and

(2) $100 per incident for each barrel of nonpersistent product based upon the maximum amount of nonpersistent product storage capacity of any train on the railroad or $1,000,000, whichever is greater.

(c) For purposes of AS 46.04.030(k), response planning standards apply to nontank vessels and railroad tank cars as follows:

(1) for a nontank vessel,

(A) containment and control of 15 percent of the maximum oil capacity of the nontank vessel within 48 hours; and

(B) cleanup of the discharge within the shortest possible time consistent with minimizing damage to the environment; and

(2) for a railroad tank car,

(A) containment and control of 15 percent of the maximum oil capacity of a train on the railroad within 48 hours; and

(B) cleanup of the discharge within the shortest possible time consistent with minimizing damage to the environment.

(d) Notwithstanding the requirements of AS 46.04.040(e) and (l) and 46.04.047, for purposes of (a) of this section, an applicant may provide evidence of financial responsibility by proof of entry of the nontank vessel in a protection and indemnity association or proof of coverage with another insurer that

(1) is financially solvent and has a favorable history of claim handling;

(2) provides coverage against pollution risks in at least the amount of the financial responsibility required under (a) of this section without any requirement for a special endorsement;

(3) does not agree to be subject to direct action in court or to appointment of an agent for service of process; and

(4) in the case of a protection and indemnity association or group of insureds, is not authorized by the Department of Commerce, Community, and Economic Development to sell insurance in the state so long as it is not listed by the Department of Commerce, Community, and Economic Development as being disapproved for use in the state.

(e) The requirements of this section do not apply to a nontank vessel operating in the waters of the state if the nontank vessel

(1) is engaged in innocent passage; for purposes of this paragraph, a nontank vessel is engaged in innocent passage if its operation in state waters, irrespective of whether it is a United States or foreign-flag vessel, would constitute innocent passage under the Convention on the Territorial Sea and the Contiguous Zone, April 29, 1958, 15 U.S.T. 1606, or the United Nations Convention on the Law of the Sea 1982, December 10, 1982, U.N. Publication No. E 83.V.5, 21 I.L.M. 1261 (1982), were the vessel a foreign-flag vessel;

(2) enters state waters because of imminent danger to the crew, or in an effort to prevent an oil spill or other harm to public safety or the environment, and are inapplicable only until the vessel is able to leave state waters as soon as it may do so without imminent risk of harm to the crew, public safety, or the environment; or

(3) enters state waters after the United States Coast Guard has determined that the vessel is in distress, and are inapplicable only until the vessel is able to leave state waters as soon as it may do so without imminent risk of harm to the crew, public safety, or the environment.

(f) On and after May 26, 2003, a person may not operate a nontank vessel within the waters of the state or cause or permit the transfer of oil to or from a nontank vessel unless the department has approved an oil discharge prevention and contingency plan covering that nontank vessel and the person is in compliance with the plan.

(g) The oil discharge prevention and contingency plan for a nontank vessel required by (f) of this section must include

(1) vessel-specific information;

(2) a response plan consisting of

(A) initial notification procedures;

(B) a certification that the applicant for the nontank vessel contingency plan is a member of, or has a contract with, an oil spill response organization that is an oil spill primary response action contractor with a response action plan approved by the department as meeting the response planning standards of (c)(1) of this section for the maximum oil capacity of the nontank vessel; and

(C) a certification that the applicant for the nontank vessel contingency plan has contracted with an oil spill primary response action contractor providing incident management team services; and

(3) a prevention plan certification stating that the nontank vessel for which contingency plan approval is made complies with applicable federal and International Maritime Organization requirements.

(h) In lieu of the requirements

(1) of (g)(2)(B) of this section, a person may comply with the requirement of (g)(2)(B) of this section by demonstrating, to the satisfaction of the department, that the person is maintaining an oil spill response plan and equivalent equipment, personnel, and resources to enable the person to meet the requirements of this section; and

(2) of (g)(2)(C) of this section, a person may comply with the requirement of (g)(2)(C) of this section by demonstrating, to the satisfaction of the department, that the person is maintaining an incident management team in order to implement a planned response to a release or threatened release of oil from its nontank vessel.

(i) The provisions of AS 46.04.030(d) - (l), (n), (o), and (r) apply to a nontank vessel, to a nontank vessel contingency plan required by this section, and to a person applying for and holding an approved nontank vessel contingency plan.

(j) On and after June 12, 2003, a person may not transport oil by railroad tank car or cause or permit the transfer of oil to or from a railroad tank car unless the department has approved an oil discharge prevention and contingency plan covering the transportation of oil by railroad tank cars by the railroad and the person is in compliance with the plan.

(k) The provisions of AS 46.04.030(d) - (l), (n), (o), and (r) apply to a railroad tank car, to a railroad tank car contingency plan required by this section, and to a person applying for and holding an approved railroad tank car contingency plan.

(l) The department shall adopt regulations under AS 46.04.070 to implement

(1) the requirements of response planning standards under (c) of this section;

(2) the requirements of (f) - (i) of this section as applicable to nontank vessels; and

(3) the requirements of (j) and (k) of this section as applicable to railroad tank cars.