SENATE BILL REPORT

SB 5315

BYSenators Bender, Conner, DeJarnatt, Talmadge, Owen, Metcalf, Vognild, Murray, Bauer, Niemi, Kreidler, McMullen and Sutherland

Prescribing financial responsibility for vessels that spill oil.

Senate Committee on Environment & Natural Resources

Senate Hearing Date(s):February 8, 1989; March 1, 1989

Majority Report:  That Substitute Senate Bill No. 5315 be substituted therefor, and the substitute bill do pass.

      Signed by Senators Metcalf, Chairman; Amondson, Vice Chairman; Benitz, Kreidler, Owen, Patterson, Sutherland.

Senate Staff:Gary Wilburn (786-7453)

                  March 1, 1989

AS REPORTED BY COMMITTEE ON ENVIRONMENT & NATURAL RESOURCES, MARCH 1, 1989

BACKGROUND:

The cleanup of oil spills from vessels is commonly a cooperative effort between state and federal response authorities.  The federal Clean Water Act requires that vessels over 300 gross tons maintain evidence of financial responsibility to meet the liability to the United States to which the vessel could be subjected for cleanup of oil or hazardous substance spills.  Liability under that act includes cleanup costs, civil penalties, and the cost of restoration or replacement of natural resources.  In the case of vessels other than inland oil barges, minimum coverage must be maintained of $150 per gross ton or $250,000, whichever is greater. 

The state Water Pollution Control Act prohibits the discharge of oil or other pollutants to state waters, and authorizes the Department of Ecology to respond to oil spills.  That act provides for liability by those causing the spills for the state's cleanup costs, for damages to natural resources, and for civil penalties.  There is no state law which requires vessels to maintain liability insurance to cover an oil or hazardous substance spill.

SUMMARY:

Any vessel over 300 gross tons that transports oil or other hazardous substances and uses Washington State waters must establish evidence of financial responsibility to meet liability to the state for actual cleanup costs, civil penalties, and natural resource damages.  Financial responsibility must be for either $1 million or $150 per gross ton of vessel, whichever is greater, and may be established through insurance, surety bonds, self-insurance, or other method approved by the Department of Ecology.

The Secretary of Transportation is to suspend the privilege of operating the vessel in state waters where such financial responsibility is not maintained.  The owner or operator of a vessel not in compliance with the act may be subject to civil penalties not exceeding $10,000.  Claims by the state may be brought directly against the insurer.

EFFECT OF PROPOSED SUBSTITUTE:

The hazardous substances included under the act are those which are designated for purposes of the financial responsibility requirement of the federal Clean Water Act.  Barges or tank vessels transporting oil as cargo must maintain evidence of financial responsibility on board and file it with the Department of Transportation.  Other vessels must carry the certificate issued by the United States Coast Guard which evidences compliance with the federal requirements for financial responsibility.

Appropriation:    none

Revenue:    none

Fiscal Note:      none requested

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

Senate Committee - Testified: Randy Ray, Northwest Tourboat Association (con); Senator Rick Bender (pro); Greg Sorlie, Department of Ecology (pro); Charles Helget, ARCO (pro)