HOUSE BILL REPORT

HB 2956

BYRepresentatives Nelson, Miller, Jesernig, Sprenkle, May, Grant, Cooper, Hankins, Dellwo, Baugher, R. Meyers, Rust, Brooks, Holland, Appelwick, Moyer, Ballard, Prince, Bennett, Dorn, Jacobsen, Valle, Crane, Brumsickle, Ebersole, Fuhrman, Van Luven, Horn, Rector and Silver; by request of Office of Financial Management

Revising provisions for the management of low-level radioactive waste.

House Committe on Energy & Utilities

Majority Report:  The substitute bill be substituted therefor and the substitute bill do pass.  (13)

      Signed by Representatives Nelson, Chair; H. Myers, Vice Chair; Hankins, Ranking Republican Member; Bennett, Brooks, Cooper, Gallagher, Jacobsen, Jesernig, May, R. Meyers, Miller and S. Wilson.

House Staff:Fred Adair (786-7113)

Rereferred House Committee on Revenue

Majority Report:  The substitute bill by Committee on Energy and Utilities be substituted therefor and the substitute bill do pass.  (11)

      Signed by Representatives Wang, Chair; Pruitt, Vice Chair; Holland, Ranking Republican Member; Horn, Assistant Ranking Republican Member; Appelwick, Fraser, Grant, Haugen, Phillips, Rust and Silver.

House Staff:      Robin Appleford (786-7093)

AS REPORTED BY COMMITTEE ON REVENUE FEBRUARY 3, 1990

BACKGROUND:

Federal law states that low-level radioactive waste, the less hazardous kind, is to be managed by states or groups of states formed into interstate compacts.  Washington is in the seven state northwest compact and is the host state for the disposal site (located on the Hanford Reservation near Richland).

In order to prompt states to set up their own or regional disposal arrangements, the same federal law allows host states to levy an out of state (or region) surcharge on waste received from other states (states outside the northwest compact) for disposal.  All out of region surcharge receipts go into the general fund.

Perpetual care and closure accounts have been established as insurance against the state having expenses for site closure or post-closure surveillance.  The care account is approximately sufficient, but the closure account is below estimated closure cost.  One dollar and seventy-five cents per cubic foot of waste disposed is charged and directed into the fund containing both of these accounts.  Current law requires that inputs to the fund now go to the closure account until December 31, 1992.

The Department of Health regulates the disposal site operator.  A surveillance fee, keyed to waste disposed, is charged to pay the cost of regulation.  As these moneys are keyed to a declining volume of waste disposed, the amount is becoming progressively more inadequate to support the cost of regulation.

The site operator has for a number of years sought reduction of the business and occupation tax for the disposal operation, which is uniquely high at 30 percent.

SUMMARY:

SUBSTITUTE BILL:  On the effective date of the act, the business and occupation tax is reduced to 15 percent.  If prescribed conditions are met the rate is later reduced to 10 and still later to 5 percent.

The first $10 per cubic foot of the out of region surcharge shall be directed to the closure account.

After 1992, out of region waste may be accepted for disposal only from the Rocky Mountain Compact states - Wyoming, Colorado, New Mexico and Nevada, and from the states of North Dakota and South Dakota.

It is clarified from earlier state legislation that it is intended that interest generated by both accounts in the perpetual maintenance fund shall be directed into the closure account until December 31, 1992.  (Thereafter, the interest, as well as any other moneys bound for the fund, may be routed to either of the accounts, as determined by the Department of Ecology.)

Beginning January 1, 1993, the Department of Ecology may impose a site closure fee if necessary to bring the closure account to a sufficient balance.

The surveillance fee to pay regulation costs is raised from four percent in three annual steps to seven percent in 1992.

The Utilities and Transportation Commission and the site operator, assisted by other state agencies and parties, shall study whether the disposal price should be regulated.  Results shall be reported to the Legislature by December 1, 1990.  Regulated prices may not be placed in effect before January 31, 1993.

SUBSTITUTE BILL COMPARED TO ORIGINAL:  After 1992, the Washington representative to the Northwest Interstate Compact shall approve access of wastes to the state's facility only for the six aforementioned states rather than from possibly any state.

CHANGES PROPOSED BY COMMITTEE ON REVENUE: None.

Appropriation:    $30,000 is appropriated from the general fund to the commission for conduct of the study.

Fiscal Note:      Available.

Effective Date:The bill contains an emergency clause and takes effect immediately.

House Committee ‑ Testified For:    (Energy and Utilities)  Dan Silver, Governor's Office; Terry Husseman, Department of Ecology; Eric Slagle, Department of Health; and Barry Bede, U.S. Ecology, Inc.

(Revenue)  Dan Silver, Governor's Office; Barry Bede, US Ecology, Inc.; and Terry Husseman, Department of Ecology.

House Committee - Testified Against:      (Energy and Utilities) No one.

(Revenue) No one.

House Committee - Testimony For:    (Energy and Utilities)  The bill derives from two endeavors:  1) A review by state agencies of the low-level radioactive waste situation was conducted over the year by state agencies; and 2) Settlement of a lawsuit brought by the site operator, U.S. Ecology, against the state concerning the business and occupation tax.  The bill is part of the settlement.

Representatives from Colorado and Nevada came to the governor's office concerning a contract between the Northwest Interstate Compact and the Rocky Mountain Interstate Compact.  The volume of waste generated by Rocky Mountain states has averaged under 4,000 cubic feet per year, much too low to merit building a separate disposal site.  The same is true for North and South Dakota, which have averaged 100 or less cubic feet per year.  It would be the responsible thing to do to accept wastes from these six states, but make it clear that other states should make their own arrangements.  This combining sets a responsible example for the other states.

Financial provisions in the bill are designed to accelerate inputs into the closure account in order to bring it up to an acceptable level in the near future.

(Revenue)  This bill is an attempt to resolve issues that have been before the Legislature for a number of years.  The site closure fund has not been adequately funded in the past, and generators of out-of-region waste should bear some of the costs of closing and decommissioning the site.  When out-of-region waste is no longer accepted after 1992, operation of the site may become a monopoly activity.  The state may need to regulate operation of the site to protect the public interest.

House Committee - Testimony Against:      (Energy and Utilities)  None.

(Revenue)  None.