BILL REQ. #:  H-1363.1 

READ FIRST TIME 02/10/11.   

     AN ACT Relating to establishing an oil transfer fee to fund oil spill prevention, preparedness, response, and restoration programs; amending RCW 90.56.010 and 88.46.090; adding new sections to chapter 90.56 RCW; creating a new section; prescribing penalties; and providing an effective date.

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

NEW SECTION.  Sec. 1   The legislature finds that:
     (1) Washington's waters, including Puget Sound, the Strait of Juan de Fuca, the state's west coast, the Columbia river, and other diverse water bodies and watercourses are irreplaceable environmental, economic, and cultural assets;
     (2) Oil spills can severely pollute Washington waters, thereby endangering the environment, impairing the economy, and disrupting local and regional cultures;
     (3) Washington's oil spill prevention, preparedness, response, and restoration programs must be adequately funded to effectively protect Washington waters from the potentially calamitous consequences of oil spills; and
     (4) Facilities and vessels that transfer or handle oil in bulk on or near Washington's waters, creating risks of oil spills, should pay a modest oil transfer fee to adequately fund state oil spill prevention, preparedness, response, and restoration programs.

Sec. 2   RCW 90.56.010 and 2007 c 347 s 6 are each amended to read as follows:
     The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Best achievable protection" means the highest level of protection that can be achieved through the use of the best achievable technology and those staffing levels, training procedures, and operational methods that provide the greatest degree of protection achievable. The director's determination of best achievable protection shall be guided by the critical need to protect the state's natural resources and waters, while considering (a) the additional protection provided by the measures; (b) the technological achievability of the measures; and (c) the cost of the measures.
     (2) "Best achievable technology" means the technology that provides the greatest degree of protection taking into consideration (a) processes that are being developed, or could feasibly be developed, given overall reasonable expenditures on research and development, and (b) processes that are currently in use. In determining what is best achievable technology, the director shall consider the effectiveness, engineering feasibility, and commercial availability of the technology.
     (3) "Board" means the pollution control hearings board.
     (4) "Cargo vessel" means a self-propelled ship in commerce, other than a tank vessel or a passenger vessel, three hundred or more gross tons, including but not limited to, commercial fish processing vessels and freighters.
     (5) "Bulk" means material that is stored or transported in a loose, unpackaged liquid, powder, or granular form capable of being conveyed by a pipe, bucket, chute, or belt system.
     (6) "Committee" means the preassessment screening committee established under RCW 90.48.368.
     (7) "Covered vessel" means a tank vessel, cargo vessel, or passenger vessel.
     (8) "Department" means the department of ecology.
     (9) "Director" means the director of the department of ecology.
     (10) "Discharge" means any spilling, leaking, pumping, pouring, emitting, emptying, or dumping.
     (11)(a) "Facility" means any structure, group of structures, equipment, pipeline, or device, other than a vessel, located on or near the navigable waters of the state that transfers oil in bulk to or from a tank vessel or pipeline, that is used for producing, storing, handling, transferring, processing, or transporting oil in bulk.
     (b) A facility does not include any: (i) Railroad car, motor vehicle, or other rolling stock while transporting oil over the highways or rail lines of this state; (ii) underground storage tank regulated by the department or a local government under chapter 90.76 RCW; (iii) motor vehicle motor fuel outlet; (iv) facility that is operated as part of an exempt agricultural activity as provided in RCW 82.04.330; or (v) marine fuel outlet that does not dispense more than three thousand gallons of fuel to a ship that is not a covered vessel, in a single transaction.
     (12) "Fund" means the state coastal protection fund as provided in RCW 90.48.390 and 90.48.400.
     (13) "Having control over oil" shall include but not be limited to any person using, storing, or transporting oil immediately prior to entry of such oil into the waters of the state, and shall specifically include carriers and bailees of such oil.
     (14) "Marine facility" means any facility used for tank vessel wharfage or anchorage, including any equipment used for the purpose of handling or transferring oil in bulk to or from a tank vessel.
     (15) "Navigable waters of the state" means those waters of the state, and their adjoining shorelines, that are subject to the ebb and flow of the tide and/or are presently used, have been used in the past, or may be susceptible for use to transport intrastate, interstate, or foreign commerce.
     (16) "Necessary expenses" means the expenses incurred by the department and assisting state agencies for:
     (a) Investigating the source of the discharge;
     (b) Investigating the extent of the environmental damage caused by the discharge;
     (c) Conducting actions necessary to clean up the discharge;
     (d) Conducting predamage and damage assessment studies; and
     (e) Enforcing the provisions of this chapter and collecting for damages caused by a discharge.
     (17) "Oil" or "oils" means oil of any kind that is liquid at atmospheric temperature and any fractionation thereof, including, but not limited to, crude oil, petroleum, gasoline, fuel oil, diesel oil, biological oils and blends, oil sludge, oil refuse, and oil mixed with wastes other than dredged spoil. Oil does not include any substance listed in Table 302.4 of 40 C.F.R. Part 302 adopted August 14, 1989, under section 101(14) of the federal comprehensive environmental response, compensation, and liability act of 1980, as amended by P.L. 99-499.
     (18) "Offshore facility" means any facility located in, on, or under any of the navigable waters of the state, but does not include a facility any part of which is located in, on, or under any land of the state, other than submerged land.
     (19) "Onshore facility" means any facility any part of which is located in, on, or under any land of the state, other than submerged land, that because of its location, could reasonably be expected to cause substantial harm to the environment by discharging oil into or on the navigable waters of the state or the adjoining shorelines.
     (20)(a) "Owner or operator" means (i) in the case of a vessel, any person owning, operating, or chartering by demise, the vessel; (ii) in the case of an onshore or offshore facility, any person owning or operating the facility; and (iii) in the case of an abandoned vessel or onshore or offshore facility, the person who owned or operated the vessel or facility immediately before its abandonment.
     (b) "Operator" does not include any person who owns the land underlying a facility if the person is not involved in the operations of the facility.
     (21) "Passenger vessel" means a ship of three hundred or more gross tons with a fuel capacity of at least six thousand gallons carrying passengers for compensation.
     (22) "Person" means any political subdivision, government agency, municipality, industry, public or private corporation, copartnership, association, firm, individual, or any other entity whatsoever.
     (23) "Ship" means any boat, ship, vessel, barge, or other floating craft of any kind.
     (24) "Spill" means an unauthorized discharge of oil or hazardous substances into the waters of the state.
     (25) "Tank vessel" means a ship that is constructed or adapted to carry, or that carries, oil in bulk as cargo or cargo residue, and that:
     (a) Operates on the waters of the state; or
     (b) Transfers oil in a port or place subject to the jurisdiction of this state.
     (26) "Waters of the state" includes lakes, rivers, ponds, streams, inland waters, underground water, salt waters, estuaries, tidal flats, beaches and lands adjoining the seacoast of the state, sewers, and all other surface waters and watercourses within the jurisdiction of the state of Washington.
     (27) "Worst case spill" means: (a) In the case of a vessel, a spill of the entire cargo and fuel of the vessel complicated by adverse weather conditions; and (b) in the case of an onshore or offshore facility, the largest foreseeable spill in adverse weather conditions.
     (28) "Fee payer" means a facility or tank vessel that is subject to the risk-based oil spill prevention and response service transfer fee imposed pursuant to section 3 of this act.
     (29) "Nonrecreational vessel" means a vessel that is not a recreational vessel as defined in this section.
     (30) "Recreational vessel" means a vessel owned and operated solely for pleasure and not for monetary gain, or a vessel leased, rented, or chartered to another for operation for pleasure and not for monetary gain.
     (31) "Risk-based oil spill prevention and response service transfer fee" or "oil transfer fee" means the fee imposed upon a facility or tank vessel pursuant to section 3 of this act.

NEW SECTION.  Sec. 3   A new section is added to chapter 90.56 RCW to read as follows:
     (1) Except as otherwise provided in this section, the department is authorized and directed to collect a risk-based oil spill prevention and response service transfer fee each time any oil is transferred on, over, or near the waters of the state due to any of the following occurrences:
     (a) A transfer from a facility to a nonrecreational vessel;
     (b) A transfer from a tank vessel to a nonrecreational vessel; or
     (c) A transfer from a tank vessel to a facility.
     (2) The risk-based oil spill prevention and response service transfer fee must be imposed on the transferor, and paid to the department, based on the volume of oil transferred by the transferor over an identified reporting period as provided in section 4 of this act. However, the department may allow a facility receiving oil from a tank vessel to pay the oil transfer fee for the tank vessel.
     (3)(a) Except as provided in section 4 of this act, the oil transfer fee is to be collected at a rate of 0.0003 dollars per gallon of oil transferred.
     (b) The department may authorize the oil transfer fee to be paid on a per barrel basis if the director of the department concludes that a per barrel collection creates administrative streamlining for the department or for the transferor. If the department collects the fee on a per barrel basis, then the per barrel amount must be proportional to the amount established in (a) of this subsection.
     (4) A single transfer during any twenty-four hour period of less than one hundred gallons of oil to a facility or nonrecreational vessel is exempt from payment of the oil transfer fee established in this section.
     (5) Facilities and tank vessels receiving oil from a foreign flagged tank vessel must inform the transferor in writing of the vessel's responsibilities under this section.
     (6) The oil transfer fee collected under this section must be deposited into the oil transfer account as provided in section 6 of this act.

NEW SECTION.  Sec. 4   A new section is added to chapter 90.56 RCW to read as follows:
     (1) The department is authorized and directed to, by rule, adjust the risk-based oil spill prevention and response service transfer fee imposed by section 3 of this act biennially by a percentage rate that is less than or equal to the fiscal growth factor established pursuant to RCW 43.135.025 for the then current biennium. The department may only use this authority if the department finds that an increase in the oil transfer fee is necessary due to inflation to maintain the economic value of the fee collected.
     (2) At least ninety days prior to the effective date of a change to the oil transfer fee, the department shall:
     (a) Provide the public with notice of the change on its internet site; and
     (b) Provide fee payers with notice of the change by first-class mail, which is considered provided when mailed, or, with prior agreement of the recipient, electronic mail, which is considered provided when sent.

NEW SECTION.  Sec. 5   A new section is added to chapter 90.56 RCW to read as follows:
     (1) Fee payers must submit oil transfer fees imposed pursuant to section 3 of this act to the department on a schedule to be determined by the department. However, the department may not require fee payers to submit payment more often than once a calendar quarter. If practicable, the department shall align the collection of the oil transfer fee with any other reporting documents a fee payer may be required to provide to the department.
     (2) The department shall develop an oil transfer fee submittal form requiring a fee payer to, at a minimum, provide its business or corporate name, contact information, the quarter for which a fee is being paid, total gallons subject to the fee, and the calculated fee amount. An oil transfer fee submittal form must be signed and dated by a formally authorized representative of the fee payer.
     (3) Fee payers must retain detailed records for each transfer subject to the oil transfer fee for three years. The department may audit the records of a fee payer. The department must limit the audit to records necessary to verify the date of oil transfer, the quantity of oil transferred, and the recipient of the oil.
     (4) If the department does not receive an oil transfer fee from a fee payer on the schedule developed by the department under this section, the department must assess a late charge of five hundred dollars per every thirty days payment is tardy and assess interest at the rate of one percent per calendar month on the unpaid balance until full payment is received. Late charges and assessed interest must be deposited into the oil transfer account created in section 6 of this act.
     (5) Failure of a fee payer to pay an oil transfer fee within ninety days of a due date may result in the assessment of penalties against the fee payer pursuant to RCW 88.46.090.

NEW SECTION.  Sec. 6   A new section is added to chapter 90.56 RCW to read as follows:
     (1) The oil transfer account is created in the state treasury. All receipts from the risk-based oil spill prevention and response service transfer fee imposed by section 3 of this act and all late charges and assessed interest collected pursuant to section 5 of this act must be deposited in the account. Moneys in the account may be spent only after appropriation.
     (2) Moneys in the oil transfer account must be used exclusively to fund oil spill prevention, preparedness, response, and restoration activities authorized in this chapter and in chapters 88.46, 88.40, and 90.48 RCW including, but not limited to:
     (a) Reviewing and approving facility and vessel oil spill prevention and contingency plans;
     (b) Conducting oil spill drills, inspections, investigations, natural resource damage assessments, enforcement, litigation, studies, and related work;
     (c) Conducting oil spill prevention and oil transfer plan reviews, inspections, and investigations;
     (d) Routine responses to spills resulting from oil transfers not otherwise covered under RCW 90.56.500;
     (e) Developing rules and policies related to oil transfers;
     (f) Administering the oil transfer fee imposed pursuant to section 3 of this act;
     (g) Conducting interagency coordination, public outreach and education, management and staff development, and appropriate travel relating to oil transfers; and
     (h) Purchasing goods, services, and equipment relating to oil transfers.

Sec. 7   RCW 88.46.090 and 2000 c 69 s 9 are each amended to read as follows:
     (1) Except as provided in subsection (4) of this section, it shall be unlawful for a covered vessel to enter the waters of the state without an approved contingency plan required by RCW 88.46.060, a spill prevention plan required by RCW 88.46.040, or financial responsibility in compliance with chapter 88.40 RCW and the federal oil pollution act of 1990. The department may deny entry onto the waters of the state to any covered vessel that does not have a required contingency or spill prevention plan or financial responsibility.
     (2) Except as provided in subsection (4) of this section, it shall be unlawful for a covered vessel to transfer oil to or from an onshore or offshore facility that does not have an approved contingency plan required under RCW 90.56.210, a spill prevention plan required by RCW 90.56.200, or financial responsibility in compliance with chapter 88.40 RCW and the federal oil pollution act of 1990.
     (3) The director may assess a civil penalty of up to one hundred thousand dollars against the owner or operator of a vessel who is in violation of subsection (1) or (2) of this section. Each day that the owner or operator of a covered vessel is in violation of this section shall be considered a separate violation.
     (4) It shall not be unlawful for a covered vessel to operate on the waters of the state if:
     (a) A contingency plan, a prevention plan, or financial responsibility is not required for the covered vessel;
     (b) A contingency plan and prevention plan has been submitted to the department as required by this chapter and rules adopted by the department and the department is reviewing the plan and has not denied approval; or
     (c) The covered vessel has entered state waters after the United States coast guard has determined that the vessel is in distress.
     (5) Any person may rely on a copy of the statement issued by the department to RCW 88.46.060 as evidence that the vessel has an approved contingency plan and the statement issued pursuant to RCW 88.46.040 as evidence that the vessel has an approved spill prevention plan.
     (6) Except for violations of subsection (1) or (2) of this section, any person who violates the provisions of this chapter ((or)), rules or orders adopted or issued pursuant ((thereto,)) to this chapter, or requirements regarding the risk-based oil spill prevention and response service transfer fee as provided in section 5 of this act shall incur, in addition to any other penalty as provided by law, a penalty in an amount of up to ten thousand dollars a day for each violation. Each violation is a separate offense, and in case of a continuing violation, every day's continuance is a separate violation. Every act of commission or omission which procures, aids, or abets in the violation shall be considered a violation under the provisions of this subsection and subject to penalty. The penalty amount shall be set in consideration of the previous history of the violator and the severity of the violation's impact on public health and the environment in addition to other relevant factors. The penalty shall be imposed pursuant to the procedures set forth in RCW 43.21B.300.

NEW SECTION.  Sec. 8   This act takes effect October 1, 2011. The department of ecology may not use the authority provided in section 4 of this act until the 2013-2015 biennium.

NEW SECTION.  Sec. 9   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.