AN ACT Relating to liability requirements for nuclear operations; amending RCW 81.80.190; adding new sections to chapter 43.200 RCW; and adding a new section to chapter 70.98 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. A new section is added to chapter 43.200 RCW to read as follows:

(1) The director of the department of ecology shall periodically review the potential for bodily injury and property damage in the packaging, shipping, transporting, treatment, storage, and disposal of commercial low-level radioactive materials under licenses or permits issued by the state.

(2) The director shall, upon the completion of each review, determine by rule the minimum amount of liability coverage that is adequate to protect the state and its citizens from all claims, suits, losses, damages, or expenses on account of injuries to persons and property damage arising or growing out of the packaging, shipping, transporting, treatment, storage, and disposal of commercial low-level radioactive materials.

(3) The director shall require the maximum amount of liability coverage available from private sources, including insurance, surety bonds, corporate guarantees, and other acceptable instruments, unless the director determines that a lesser amount is adequate to protect the state and its citizens pursuant to this section.

(4) In making the determination, the director shall consider:

(a) The nature and purpose of the activity and its potential for injury and damages to or claims against the state and its citizens;

(b) The current and cumulative manifested volume and radioactivity of material being packaged, transported, buried, or otherwise handled;

(c) The location where the material is being packaged, transported, buried, or otherwise handled, including the proximity to the general public and geographic features such as geology and hydrology, if relevant; and

(d) The legal defense cost, if any, that will be paid from the required liability coverage amount.

(5) The director may establish different levels of required liability coverage for various classes of license or permit holders.

(6) The director shall establish by rule the instruments or mechanisms by which a person may demonstrate liability coverage as required by sections 2 and 3 of this act. Any instrument or mechanism approved as an alternative to liability insurance shall provide the state and its citizens with a level of financial protection at least as great as would be provided by liability insurance.

(7) The director shall complete the first review and determination, and report the results to the legislature, by December 1, 1987. At least every five years thereafter, the director shall conduct a new review and determination and report its results to the legislature.

NEW SECTION. Sec. 2. A new section is added to chapter 43.200 RCW to read as follows:

(1) The department of ecology shall require that any person who holds or applies for a license or permit under this chapter (a) indemnify and hold harmless the state from claims, suits, damages, or expenses on account of injuries to or death of persons and property, arising or growing out of any operations and activities for which the person holds the license or permit, and any necessary or incidental operations, and (b) demonstrate that the person has and maintains liability coverage for the operations for which the state has been indemnified and held harmless pursuant to this section. The agency shall require coverage in an amount determined by the director of the department of ecology pursuant to section 1 of this act.

(2) The department of ecology shall suspend the license or permit of any person required by this section to hold and maintain liability coverage who fails to demonstrate compliance with this section. The license or permit shall not be reinstated until the person demonstrates compliance with this section.

(3) The department of ecology shall require (a) that any person required to maintain liability coverage maintain with the agency current copies of any insurance policies, certificates of insurance, or any other documents used to comply with this section, (b) that the agency be notified of any changes in the insurance coverage or financial condition of the person, and (c) that the state be named as an insured party on any insurance policy used to comply with this section.

NEW SECTION. Sec. 3. A new section is added to chapter 70.98 RCW to read as follows:

(1) The radiation control agency shall require that any person who holds or applies for a license or permit under this chapter (a) indemnify and hold harmless the state from claims, suits, damages, or expenses on account of injuries to or death of persons and property, arising or growing out of any operations or activities for which the person holds the license or permit, and any necessary or incidental operations, and (b) demonstrate that the person has and maintains liability coverage for the operations for which the state has been indemnified and held harmless pursuant to this section. The agency shall require coverage in an amount determined by the director of the department of ecology pursuant to section 1 of this act.

(2) The radiation control agency shall suspend the license or permit of any person required by this section to hold and maintain liability coverage who fails to demonstrate compliance with this section. The license or permit shall not be reinstated until the person demonstrates compliance with this section.

(3) The radiation control agency shall require (a) that any person required to maintain liability coverage maintain with the agency current copies of any insurance policies, certificates of insurance, or any other documents used to comply with this section, (b) that the agency be notified of any changes in the insurance coverage or financial condition of the person, and (c) that the state be named as an insured party on any insurance policy used to comply with this section.

NEW SECTION. Sec. 4. A new section is added to chapter 43.200 RCW to read as follows:

The provisions of this act shall not have the effect of reducing the level of liability coverage required under any law, regulation, or contract of the state before December 31, 1987, or the effective date of the first determination made pursuant to section 1 of this act, if earlier.

Sec. 5. Section 81.80.190, chapter 14, Laws of 1961 and RCW 81.80.190 are each amended to read as follows:

The commission shall in the granting of permits to "common carriers" and "contract carriers" under this chapter require such carriers to either procure and file liability and property damage insurance from a company licensed to write such insurance in the state of Washington, or deposit such security, for such limits of liability and upon such terms and conditions as the commission shall determine to be necessary for the reasonable protection of the public against damage and injury for which such carrier may be liable by reason of the operation of any motor vehicle.

In fixing the amount of said insurance policy or policies, or deposit of security, the commission shall give due consideration to the character and amount of traffic and the number of persons affected and the degree of danger which the proposed operation involves.

If the commission is notified of the cancellation, revocation, or any other changes in the required insurance or security of a common carrier or contract carrier with a permit to transport radioactive or hazardous materials, the commission shall immediately notify the state radiation control agency of the change.

NEW SECTION. Sec. 6. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.