FINAL BILL REPORT

SSB 6575

                              C 82 L 90

BYSenate Committee on Energy & Utilities (originally sponsored by Senators Benitz and Williams; by request of Department of Ecology)

Revising liability requirements for nuclear operations.

Senate Committee on Energy & Utilities

House Committe on Energy & Utilities

SYNOPSIS AS ENACTED

BACKGROUND:

Legislation enacted in 1986 requires firms with state licenses or permits for packaging, shipping, transporting, treating, storing, or disposing of commercial low-level nuclear materials to bear the risk of potential injury or damage by (1) holding the state harmless from injuries or damage, and (2) maintaining liability insurance in an amount to be determined by the Department of Ecology by December 1, 1987.  Persons applying for such licenses or permits must demonstrate compliance with the insurance requirements.  Both the Department of Ecology and the Department of Health are required to suspend the license or permit of any person that fails to demonstrate compliance, and not reinstate it until insurance is obtained.  The department is directed to require the maximum amount of liability coverage available from private sources.

After a number of studies and reports, the Department of Ecology has concluded that no additional liability coverage should be required at this time because (1) existing coverage is adequate under general liability policies, (2) coverage is already required in sufficient amounts under other regulatory authority (e.g., federal Motor Carrier Act), (3) available insurance is costly and economically unfeasible for small companies, and (4) the risk to the state from accidents is small.  Based on these conclusions, it is felt that the mandatory nature of the existing language should be modified to require additional liability insurance for the state's licensees and permittees only when future studies indicate a need for it.  The law requires such studies and a report by Ecology to the Legislature every five years.

SUMMARY:

The Director of Ecology and the Secretary of Health are separately responsible for determining (1) the appropriate amount of liability coverage that they may require to be maintained by their respective permittees or licensees, and (2) whether to exempt from such requirements any class of, or individual, permittees or licensees where such an exemption will pose neither a significant risk to persons or property nor a substantial financial risk to the state.  All licensees or permittees must indemnify and hold the state harmless from any claims or damages arising out of their authorized activities.  The Departments of Ecology and Health are to study and report to the Energy and Utilities Committees of both houses of the Legislature no later than December 1, 1990, on methods by which licensees and permittees who are otherwise unable to obtain liability coverage may obtain such coverage.

VOTES ON FINAL PASSAGE:

     Senate   40    0

     House 97  0 (House amended)

     Senate   38    0 (Senate concurred)

EFFECTIVE:June 7, 1990