HOUSE BILL REPORT

2SSB 5268

BYSenate Committee on Ways & Means (originally sponsored by Senators Benitz, Saling, Hayner, Warnke, Owen, Smith, Smitherman, Amondson, Stratton, Matson, Nelson, Craswell, Sellar, Sutherland, Madsen, Johnson and von Reichbauer)

Regarding low-level radioactive waste surcharge.

House Committe on Energy & Utilities

Majority Report:  Do pass with amendments. (12)

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

House Staff:Fred Adair (786-7113)

AS REPORTED BY COMMITTEE ON ENERGY & UTILITIES MARCH 29, 1989

BACKGROUND:

The commercial low-level radioactive waste disposal facility at Hanford is one of three in the nation.  Concern over a lack of other sites led to federal legislation to force regions throughout the country to form compacts and develop new disposal sites.  Washington is currently the host member of one of those compacts which also includes Alaska, Hawaii, Idaho, Montana, Oregon and Utah.

Host states were authorized to assess surcharges on each cubic foot of waste delivered for disposal from outside the compact region.  These surcharges began in 1986 at $10 per cubic foot, rose to $20 per cubic foot in 1988, and will rise to $40 per cubic foot in 1990.  The state retains 75 percent of these funds, which are deposited in the general fund.  The remaining 25 percent are transferred to the United States Department of Energy to aid regions or states developing new sites.  These surcharges will end after December 31, 1992 when all disposal facilities may cease accepting out-of-region waste.

The Hanford site received approximately 400,000 cubic feet of waste in 1988, of which approximately 275,000 arrived from outside the region.

The Hanford disposal facility is on land subleased from the state.  The state leases the land from the federal government and this land must eventually be returned.  A perpetual maintenance account has been established to assure that adequate funds are available to address the ongoing care of the site.  It is presently being funded by a perpetual care and maintenance fee of $1.75 per cubic foot of waste disposed.  The fund presently contains approximately $16.8 million.

A site closure fund, administered by the Department of Ecology, was created by an amendment to the sublease.  Concern has been raised that if a significant amount of additional funds are needed for this account, the state and waste generators from this region could bear a disproportionate share of these costs.

SUMMARY:

BILL AS AMENDED:  A perpetual maintenance fund is created in the state treasury.  This fund contains a site closure account and a perpetual surveillance and maintenance account.  Existing balances held in the treasury are to be transferred to these accounts.  Funds in the site closure account are to be exclusively for reimbursement of the site operator's decommissioning and closure costs under the terms of its license and sublease with the state.  Funds in the perpetual surveillance and maintenance account are to be used exclusively for the state's post-closure surveillance and maintenance obligations under its lease and perpetual care agreement with the federal government.

The state general fund receives 65 percent of surcharge revenues retained by the state and the perpetual maintenance fund receives 35 percent.  Additionally, fees for waste management up to $2.75 per cubic feet of waste disposed may be collected until December 31, 1992.  All moneys to be placed in the perpetual maintenance fund shall be placed in the site closure account until that account's balance reaches $10 million.  If this total is reached before December 31, 1992, the state shall discontinue fees for waste management and shall direct all surcharge receipts retained by the state to the general fund.  If the $10 million total is not reached by December 31, 1992, the Department of Ecology on or about this date shall adjust the fee for waste management to a level predicted to bring the site closure account to a balance of $10 million by December 31, 1995.

This act shall not take effect unless the business and occupation tax imposed on the site operator is reduced below 30 percent.

AMENDED BILL COMPARED TO SECOND SUBSTITUTE:  The formula for apportioning the surcharge is changed.  The provisions concerning the fee for waste management are added as is the $10 million threshold.  Also, the link to reducing the B&O tax is added.

Fiscal Note:      Available.

House Committee ‑ Testified For:    Terry Husseman and Max Power, Department of Ecology; Barry Bede, U.S. Ecology, Inc.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    Additional funds are needed in the site closure account.  It is desired to reach a balance of $10 million by December 31, 1992.  Alternative approaches to bolstering the site closure account were presented and discussed.  Concern was expressed that total cost to a waste generator not be raised so that waste volume not be unduly diminished.  Pro and con arguments on the link with the B&O tax linkage were presented.

House Committee - Testimony Against:      None Presented.