Summary: H.R.85 — 96th Congress (1979-1980)All Information (Except Text)

Bill summaries are authored by CRS.

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Passed House amended (09/19/1980)

(Measure passed House, amended, roll call #571 (288-11))

Comprehensive Oil and Hazardous Substances Pollution Liability and Compensation Act- =Title I: Oil Pollution Liability, Compensation, and Fund= - Declares that there is in the Treasury of the United States a fund known as the Comprehensive Oil Pollution Liability Trust Fund established in title V of this Act. Provides that, in addition to the processing and settlement of claims, the fund is immediately available to pay specified removal costs arising out of or directly resulting from an oil pollution incident. Authorizes the Secretary of Transportation to issue regulations designating the person or persons who may obligate available money in the fund for such purposes.

Permits claims for damages for economic loss, incurred 180 days or more after the effective date of this Act, to be asserted for: (1) removal costs; (2) injury to, or destruction of, real or personal property; (3) injury to, or destruction of, natural resources; and (4) loss of profits or impairment of earning capacity due to injury or destruction of real or personal property or natural resources to the extent that such damages were sustained during the two-year period beginning on the date the claimant first suffered such loss. Specifies the potential claimants who have standing to assert claims involving each such type of damage.

Imposes joint, several, and strict liability on the owners and operators of each pollution source. Specifies liability limits, except in cases of gross negligence or willful misconduct, for ships and other vessels. Directs the Secretary of Transportation to establish limits on the liability of classes of facilities used for transporting, producing, processing, storing, or transferring oil.

Requires owners or operators of vessels over 300 tons (including foreign vessels) and owners or operators of offshore facilities to establish and maintain evidence of financial responsibility in an amount sufficient to satisfy applicable liability limits. Permits any owner or operator of more than one vessel or offshore facility to establish financial responsibility only to meet the maximum liability of the largest of such vessels or facilities, as the case may be. Provides for the enforcement of such financial responsibility requirements.

Requires, in the case of an owner who is the holder of a leasehold interest or permit for the exploration of oil offshore, that evidence of financial responsibility established for the leasehold to meet specified maximum liability cover the liability of such owner for all facilities located on the leasehold.

Provides that where an offshore facility is owned or operated by more than one person, evidence of financial responsibility may be established by any one of the owners or operators or in consolidated form. Requires owners or operators of each tank motor vehicle operated on highways and transporting oil in bulk, with a water capacity more than 3,500 gallons, to establish and maintain, in accordance with regulations issued by the Secretary, evidence of financial responsibility in such amounts as the Secretary shall establish, up to $1,000,000.

Limits the total liability of any guarantor, under this title, to the aggregate amount which such guarantor has provided as evidence of financial responsibility (except in cases of bad faith by a guarantor in negotiating, or failing to negotiate, a settlement of any claim).

Specifies procedures whereby the Secretary shall designate and advertise pollution sources.

Directs the Secretary to advertise claims to be presented initially to the owner or operator, or to such person's guarantor, in instances in which: (1) the owner and operator of a vessel or facility designated by the Secretary deny such vessel's or facility's involvement; (2) the source of the discharge is a public vessel; or (3) the Secretary is unable to designate the pollution source.

Permits claimants either to present a claim to the fund or to bring an action in an appropriate United States court if liability is denied or the claim is not settled within a specified period.

Sets forth procedures for the disposition and appeal of claims submitted to the fund.

Requires both the plaintiff and the defendant in a court action brought against an owner, operator, or guarantor to forward copies of all pleadings to the fund. Permits the fund to intervene in such actions.

Subrogates any person or government entity, including the fund, paying compensation, to all the claimant's claims and rights under this Act. Specifies procedures for and the measure of recovery in actions brought by the fund against owners, operators, or guarantors of alleged pollution sources.

Grants U.S. district courts exclusive original jurisdiction over all controversies arising under this title, without regard to the citizenship of the parties or the amount in controversy.

Declares that the rights and remedies under this Act shall be exclusive with respect to economic loss caused by oil pollution (but does not preclude State imposition of taxes or fees to finance the purchase and prepositioning of oil pollution cleanup and removal equipment).

Sets penalties for persons failing to comply with specified provisions in this Act.

Authorizes appropriations for fiscal years 1980 and thereafter to carry out the provisions of this title.

Directs the Secretary to submit an annual report to Congress on the administration of this title, with recommendations for legislative changes to improve such administration.

=Title II: Effective Dates; Savings Provision; Conforming Amendments= - Specifies the effective dates of specified provisions of this Act. Amends specified laws, including the Deepwater Port Act of 1974, the Federal Water Pollution Control Act, and the Trans-Alaska Pipeline Act, to conform with the provisions of this Act.

Requires pro rata rebates to owners of oil when: (1) the amount of actual claims settled is less than the amount of claims certified against the Trans-Alaska Pipeline Liability Fund (TAP fund); or (2) any TAP fund surplus is not used as an advanced payment to the Comprehensive Oil Pollution Liability Fund.

Amends the Federal Water Pollution Control Act to provide that the Secretary of the Army shall make any determination with respect to specified provisions applying to certain navigable waters.

Repeals Title III-Offshore Oil Spill Pollution Fund, of the Outer Continental Shelf Lands Act Amendments of 1978 and provides for the transfer of such Fund's assets and liabilities to the Comprehensive Fund established by title V of this Act. Abolishes the Trans-Alaska Pipeline Liability Fund and requires the transfer of all its assets to such Comprehensive Fund. Abolishes the Deepwater Port Liability Fund.

Prohibits the obligation or other expenditure of any monies in the Fund for any of the administrative expenses of the Environmental Protection Agency.

=Title III: Hazardous Substances Liability, Compensation, and Fund= - Amends title III of the Federal Water Pollution Control Act to redefine terms to conform with title I of this Act.

Defines ship to mean either of the following types of vessels carrying oil (other than petroleum, crude oil, or any fraction or residue therefrom) or a hazardous substance in bulk as cargo or in residue: (1) a self-propelled vessel, or (2) a non-self-propelled vessel other than an inland oil barge.

Provides that claims of damages for economic losses, incurred on or after the effective date of this Act, and arising out of or directly resulting from the discharge of oil (other than petroleum, crude oil, or any fraction or residue therefrom) or hazardous substances in violation of specified "harmful quantity" levels, may be asserted for: (1) removal costs; (2) injury to, or destruction of, real or personal property; (3) injury to, or destruction of natural resources; and (4) loss of profits or impairment of earning capacity due to injury or destruction of real or personal property or natural resources, to the extent that such damages were sustained during the two-year period beginning on the date the claimant first suffered such loss.

Provides that, in any case where the discharge of a hazardous substance is not in violation of specified provisions of the Federal Water Pollution Control Act (i.e., has not reached a "harmful quantity level"): (1) all removal costs for such discharge shall be paid from the fund established under title V of this Act; and (2) no other person shall be liable for any parts of such costs.

Permits a foreign claimant to assert such claims to the same extent as a U.S. claimant if: (1) the discharge occurs in the navigable waters, the territorial sea or the adjacent shoreline of a foreign country of which the claimant is resident; (2) the claimant is not otherwise compensated; (3) the substance was discharged from a vessel located adjacent to or within the navigable waters or discharged in connection with activities under the Outer Continental Shelf Lands Act or the Deepwater Port Act; and (4) the foreign country provides a comparable remedy for U.S. claimants, or recovery is authorized by a treaty or executive agreement between the United States and the foreign country involved.

Makes jointly, severally, and strictly liable for all damages for which such claims may be asserted the owner and operator of a vessel, other than a public vessel, or a facility which is the source of a discharge of oil (other than petroleum, crude oil, or any fraction or residue therefrom) or a hazardous substance, or poses a threat of such a discharge in circumstances that justify the incurrence of removal costs. Limits the amount of such liability to: (1) $150 per gross ton, for a vessel other than a ship or an inland oil barge; (2) the greater of $150,000 or $150 per gross ton, for an inland oil barge; (3) the greater of $250,000 or $300 per gross ton (up to a maximum of $30,000,000), for a ship; (4) $50,000,000 for a deepwater port subject to the Deepwater Port Act of 1974 (including the liability of the owner or operator of such port for a discharge from a ship moored there); (5) the total of removal costs plus $50,000,000 (reduced to no less than $35,000,000 plus removal costs if the Secretary of Transportation determines that the higher limitation would have a significant adverse effect on small businesses or a significant anticompetitive impact), for an offshore facility operated under the authority of the Outer Continental Shelf Lands Act; or (6) $50,000,000 or a lesser limit established by the Secretary by regulation, taking into account the size, type, location, storage and handling capacity of a facility, for facilities other than deep water ports or offshore facilities subject to such Acts. Requires that such limits be comparable to those for ships, but that the limitation for any tank motor vehicle operated on highways transporting such substances, in bulk, with a water capacity of more than 3,500 gallons be not less than $5,000,000 in any case. Sets forth circumstances in which there is no such liability, or reduced liability.

Provides that the Hazardous Substances Pollution Liability Trust Fund established under title V of this Act is liable without limitation for all damages for which a claim may be asserted under such title to the extent that the loss is not otherwise compensated. Sets forth circumstances in which such Fund is not liable or is liable only for removal costs.

Provides that such Fund is also available to pay for removal costs for the removal of in-place toxic pollutants which are present in the navigable waterways of the United States on the effective date of this Act, but only to the extent that such removal is approved in advance by the Administrator of the Environmental Protection Agency. Limits the amount available for such purposes from such Fund to $10,000,000. Prohibits the placement of pollutants thus removed in any landfill unless the Administrator first determines that such disposal in such landfill would provide a higher standard of protection of the public health, safety, and welfare than any other method of disposal.

Provides that no indemnification, hold harmless, or similar agreement shall be effective to transfer from the owner or operator of a facility to any other person the liability imposed under this title.

Provides that no action, except those provided by this title, may be brought in any Federal, State, or local court for damages for an economic loss described in this title for which a claim may be asserted under this title. Provides that no person may be required to contribute to any fund, the purpose of which is to compensate for a loss which is compensable under title V of this Act, or to establish or maintain evidence of financial responsibility relating to the satisfaction of a claim for such a loss. Declares that such restrictions shall not: (1) preclude a State from imposing a tax or fee upon any person or the specified oil or hazardous substances to finance purchase and prepositioning of such specified substances, pollution cleanup and removal equipment; nor (2) prohibit an action by such Fund to recover compensation paid under this title.

Directs the Administrator, upon receiving information of a discharge in violation of this title, to designate, where possible, the source of the discharge and notify the owners, operators, and guarantors, who are then required to advertise the designation and the procedures by which claims may be presented to them. Directs the Administrator to so advertise, if such parties fail to do so, at their expense. Directs the Administrator to advertise or otherwise notify potential claimants of procedures by which claims may be presented to such Fund in cases where: (1) owner, operator, and guarantor all deny a designation within five days after notification; (2) the source of the pollution was a public vessel; or (3) the Administrator is unable to designate the source or sources.

Permits claimants, if liability is denied or the claim is not settled within 60 days, to elect irrevocably to commence an action in court or to present the claim to such Fund (or submit the dispute to the Administrator for decision by an administrative law judge or panel).

Allows specified claims for uncompensated damages to be presented to such Fund. Permits claimants, when a claim is presented to such Fund and such Fund denies liability or does not settle the claim within 60 days, to elect irrevocably to submit the dispute to the Administrator or to commence a court action. Directs the Administrator to utilize the services or private insurance and claims adjusting organizations or State agencies, where adequate, in processing claims against the fund. Limits the period for presentation of claims to within three years from the date of discovery of the economic loss or within six years of the date of the discharge, whichever is earlier.

Provides that any person or governmental entity, including such Fund, compensating any claimant for an economic loss shall be subrogated to all rights, claims, and causes of action such claimant has under this title. Authorizes the Attorney General, upon request of the Administrator, to commence an action on behalf of such Fund for compensation paid by such Fund to any claimant.

Prohibits any part of monies in such fund to be obligated or otherwise expended for any of the administrative expenses of the EPA.

Limits the total liability under this title of any guarantor to the aggregate amount which such guarantor has provided as evidence of financial responsibility (except in cases of bad faith by a guarantor in negotiating, or failing to negotiate, a settlement of any claim).

Declares that nothing in this Act or the amendments made by this Act shall be construed to authorize any Federal officer, employee, department, agency, or instrumentality to prohibit, control, or otherwise regulate the use of any groundwaters.

Declares that nothing in this title or in the amendments made by this title, other than the application of these provisions to removal costs, shall be applicable to the use or the supervision of use of any pesticide by any person who is a "private applicator" as defined by the Federal Insecticide, Fungicide, and Rodenticide Act. Subjects the use of pesticides by any such person, except in the case of removal costs, to specified provisions of the Federal Water Pollution Control Act as in effect prior to the effective date of this title. Requires that assertions of claims for damages for economic loss incurred on or after the effective date of this title as the result of the use or the supervision of use of a pesticide by such a private applicator be in accordance with the provisions of this title and the amendments made by this title, except that the Hazardous Substance Pollution Liability Trust Fund shall be the sole source liable for the payment of such claims.

=Title IV= - Sets forth procedures for Congressional oversight of rules or regulations promulgated or repromulgated under authority of this Act.

=Title V: Environmental Revenue Act of 1980= - Environmental Revenue Act of 1980 - Amends the Internal Revenue Code of 1954 to provide for environmental excise taxes on petroleum and certain chemicals.

Imposes an excise tax (the "petroleum tax"), for fiscal years 1981 through 1985, of 1.3 cents a barrel on: (1) crude oil received at a U.S. refinery, to be paid by the operator; (2) petroleum products entered into the United States for consumption, use, or warehousing, to be paid by the person entering such product; and (3) any domestic crude oil used in or exported from the United States which has not been taxed under (1), to be paid by the person using or exporting such crude oil. Exempts from such tax domestic crude oil used, on the premises where it was produced, for extracting oil or natural gas.

Defines 'crude oil' to include crude oil condensates and natural gasoline. Defines 'petroleum product' to include crude oil. Defines 'United States' to include: (1) the 50 States, the District of Columbia, the Commonwealth of Puerto Rico, any possession of the United States, the Commonwealth of the Northern Mariana Islands, and the Trust Territory of the Pacific Islands; (2) the Outer Continental Shelf; and (3) foreign trade zones of the United States.

Provides that only one such petroleum tax shall be imposed on any petroleum product.

Imposes an excise tax on certain chemicals, for fiscal years 1981 through 1985, of $1.18 a ton on specified petrochemical feedstocks and 31 cents a ton on specified inorganic substances, when sold or used by the manufacturer, producer, or importer thereof.

Provides for a refund or credit if a taxable chemical was used in the manufacture or production of any other taxable chemical.

Lists substances to be considered "specified petrochemical feedstocks" or "specified inorganic substances." Provides that any substance listed as a "specified petrochemical feedstock" for which a principal use is use as a fuel shall be treated as a "specified petrochemical feedstock" only if it is used otherwise than as a fuel (and, for purposes of the excise tax on certain chemicals, the person so using it shall be treated as the manufacturer thereof).

Establishes the Comprehensive Oil Pollution Liability Trust Fund in the Treasury of the United States. Transfers to such fund amounts determined by the Secretary of the Treasury to be equivalent to: (1) the amounts received in the Treasury under the petroleum excise tax under the Internal Revenue Code of 1954, as amended by this title: (2) the amounts recovered or collected on behalf of such fund under title I of this Act; and (3) any penalties imposed under title I of this Act or under oil and hazardous substances liability provisions of the Federal Water Pollution Control Act insofar as these related to petroleum oils. Makes amounts in such fund available only to pay claims for compensable damages recognizable under title I of this Act (including costs incurred by the United States by reason of such claims).

Establishes the Hazardous Substance Pollution Liability Trust Fund in the Treasury of the United States. Transfers to such fund amounts determined by the Secretary to be equivalent to: (1) the amounts received in the Treasury under the chemical excise tax of the Internal Revenue Code of 1954, as amended by this title; (2) the amounts recovered or collected on behalf of such fund under oil and hazardous substances liability provisions of the Federal Water Pollution Control Act; and (3) any penalties imposed under such provisions of such Act insofar as these relate to substances other than petroleum oils. Makes amounts in such fund available only to pay claims for compensable damages recognizable under such provisions of such Act (including costs incurred by the United States by reason of such claims).

Defines "compensable damages" as damages asserted for: (1) removal costs; (2) injury to, or destruction of, real or personal property; (3) injury to, or destruction of, natural resources; and (4) loss of profits or impairment of earning capacity due to injury to, or destruction of, real or personal property or natural resources, but only: (a) if gross income from activities which utilize such property or natural resources for the taxable year during which such loss first occurs in more than 25 percent of total gross income from all sources for specified periods; and (b) to the extent that such damages were sustained during the two-year period beginning on the day when such loss of opportunity was first suffered.

Restricts interest payable out of both such trust funds. Provides for certain interfund loans, under specified conditions, including the maintenance of a minimum balance of $30,000,000 in the lending fund. Directs the Secretary of the Treasury to consult with the Secretary of Transportation, in the case of the Oil Pollution Trust Fund, and with the Administrator of the Environmental Protection Agency, in the case of the Hazardous Substance Trust Fund, concerning such interfund loans.

Limits payment of claims by such funds by requiring a minimum balance of $30,000,000 in each fund, with claims to be paid in the order in which they were finally determined.

Limits U.S. liability for payment of claims under this Act to the amounts in the trust funds established under this title. Prohibits such trust funds from borrowing any money from the general fund of the Treasury, other than a first year authorization of appropriations to each trust fund, as repayable advances, of necessary sums up to $75,000,000 for each, until September 30, 1981.

Sets forth administrative provisions for such trust funds, including method of transfer, management, and investment.

Coordinates this title with other provisions in this Act. Provides that nothing in this Act other than this title shall authorize: (1) the establishment of any fund; (2) the payment out of any Trust Fund created by this title; (3) the levy or collection of any fee; or (4) the imposition of any requirement with respect to the procedure applicable to rules and regulations prescribed under this title.

Provides that, to the extent not inconsistent with this title: (1) any reference in titles I and II of this Act to a fund shall be deemed to refer to the Comprehensive Oil Pollution Liability Trust Fund established by this title; and (2) any reference in title III of this Act to a fund shall be deemed to refer to the Hazardous Substance Pollution Liability Trust Fund established by this title.

Provides that, if the balance in any fund is to be transferred to any Trust Fund established by this title, then any claim arising before October 1, 1980, which would have been payable out of the other fund shall be payable out of such Trust Fund.

Provides that if the Secretary of the Treasury determines that there is: (1) a Trans-Alaska Pipeline (TAP) Liability Fund surplus, then the amount of such surplus shall be treated as an advance payment of the petroleum excise tax on crude oil first transported through the TAP after the date of such determination; or (2) a TAP fund deficit, then the petroleum excise tax on such crude oil shall be increased by two cents per barrel until the total amount of such increased tax equals such deficit. Bases such TAP fund surplus or deficit on whether the amount transferred to the Comprehensive Oil Pollution Liability Trust Fund from the TAP Liability Fund is greater or lesser than the total amount of claims which the Secretary of the Interior certifies as outstanding against the TAP Liability Fund at the time of such transfer.

Directs the Secretary of the Treasury, in consultation with the Secretary of Transportation, the Administrator of the Environmental Protection Agency, the Secretary of Commerce, and the United States Trade Representative, to conduct a study: (1) on the feasibility of: (a) taxes based on the frequency of hazardous substances pollution and the resulting degree of harm to the environment; and (b) adjustments in the amount of taxes on different modes of transportation to reflect different risks of pollution; (2) on an exemption from the chemical excise taxes for feedstocks when used as a fuel; and (3) on the impact of the petroleum and chemical excise taxes on the U.S. balance of trade. Directs the Secretary of the Treasury to submit a report on the results of such study, with recommendations, to the Congress by January 1, 1985.