U.S. Representative Rick Larsen (WA-02) sent the following letter to the Chairman of the House Committee on Transportation and Infrastructure calling for changes to the current oil spill pollution and response laws. The House Committee on Transportation and Infrastructure has jurisdiction over our nation’s oil spill response and prevention laws, such as the Oil Pollution Act of 1990 and the Clean Water Act. Larsen has been a member of this committee since 2001.
“This Deepwater Horizon oil spill is the worst environmental catastrophe that our nation has ever faced. It raises significant concerns regarding the future of offshore drilling in the United States.
“As federal agencies work to contain and clean up this spill, it is clear that our current regulations and safety standards for offshore drilling need serious scrutiny and improvement.
“We need to ensure that any future offshore drilling will live up to oil companies’ claims of safety and reliability.
“This week, I called for major revisions to our current oil spill pollution and response laws, which, in the wake of this catastrophe, are proving to be horribly inadequate.
“First, our laws should make it clear that oil companies are fully responsible for any spills or leaks they cause. Congress must act to lift the liability caps in the Oil Pollution Act in order to match the potential magnitude of spills and leaks.
“Second, the Oil Spill Liability Trust Fund must be replenished and the per barrel fee raised to match the increased hazard of deep sea drilling.
“I am committed to investigating the impacts of this massive environmental disaster and examining the best ways to strengthen our nation’s oil spill response and prevention laws.
“As a representative from the Puget Sound, I understand how devastating an oil spill would be to a coastal region. I want to do everything possible to prevent an oil spill from occurring in Puget Sound and other areas of the country.
“I join my Washington state colleagues in cosponsoring legislation to ban drilling off the coast of our state and other states on the Pacific Coast. The ‘drill here, drill now’ mantra should not apply to the Washington state coast or the Puget Sound. The Deepwater Horizon disaster has made the waters of the Gulf murkier and need for a ban on West Coast drilling clearer.
The text of the letter follows:
June 16, 2010
Dear Chairman Oberstar and Chairman Cummings:
The Deepwater Horizon oil spill is a major human and environmental disaster of potentially unprecedented proportions. As the Transportation and Infrastructure Committee has held hearings on the spill, it has become clear to me that our nation’s current oil spill pollution and response laws are inadequate to address a major offshore oil spill. I am encouraged that the Committee plans to mark up a bill to address these shortcomings. As you develop legislation to respond to the Deepwater Horizon oil spill, I encourage your consideration of the following policy changes:
Raise the $75 million cap for natural resource damages caused by an oil spill from an offshore facility. The current liability cap for offshore facilities in the Oil Pollution Act (OPA) has proven to be grossly inadequate to cover the damage caused by a major offshore oil spill. I urge you to raise the cap to a level that matches the potential magnitude of spills and encourages oil companies to better internalize the risk of an oil disaster.
Significantly increase the per-barrel tax to match the increased hazard of deep sea drilling. The current per-barrel tax does not support an Oil Spill Liability Trust Fund that is large enough to cover the costs of responding to a medium-sized spill, let alone a massive spill like what is occurring in the Gulf. Unfortunately, we cannot assume that every oil company will be able to cover all costs of a major spill. Therefore it is essential to significantly increase the size of the Oil Spill Liability Trust Fund. I also encourage you to raise the per incident caps and eliminate the 2017 sunset on the per-barrel tax.
Raise the financial responsibility requirement to reflect the high costs of cleaning up large spills. Under OPA, offshore facilities are not required to demonstrate their financial capability to meet liabilities exceeding $150 million, even though they are liable for all clean up costs and up to $75 million in damages. Oil companies must prove they are fully able to pay for any spills or leaks they cause.
Leave the current vessel liability framework in place. The current vessel liability framework under OPA has proven effective in covering the cost of responding to spills and leaks. There are clear limits to the amount of oil that can be discharged from a tank vessel, and the current liability framework recognizes this fact. There is no need to punish tugboat and barge operators, commercial fisherman and other vessel owners for BP’s mistakes.
I also understand that Speaker Pelosi has asked all chairmen to develop a legislative response to the Deepwater Horizon oil spill. I support the following additional policy changes outside the jurisdiction of the Transportation and Infrastructure Committee:
Hold BP accountable for their commitment to create an independent $20 billion fund. Congress must ensure that BP follows through on its promise to create an independent fund to pay claims to those affected by the oil spill. This fund must be truly independent and pay claims in a swift and fair manner. The $20 billion amount should also be a floor, not a ceiling.
Support the President’s action to place a temporary hold on new deepwater drilling. We need to take a step back and make sure that any future drilling will actually live up to the claims of safety and reliability that have been made by oil companies for the last several years. I look forward to seeing the results of the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling.
Split the Minerals Management Service (MMS) into two separate agencies to prevent conflicts of interest. I support the President’s proposal to split the MMS into two agencies – one to issue leases and one to ensure that oil companies are following regulations and drilling safely. I also encourage you to ensure that the MMS has the appropriate resources to protect workers and the environment.
Remove the tax deduction for punitive damages. It is outrageous that BP is allowed to take a tax deduction on any punitive damages it may pay in the future – meaning that taxpayers ultimately pay about 40 percent of these costs. This loophole should be closed so that BP is required to fully pay for the damage they have caused.
Require deepwater oil rigs to install acoustic blowout preventers that can remotely shut off the flow of oil. This technology is required in other countries such as Brazil and Norway, but is not required in the United States. We must force oil companies to take all possible safety precautions in order to prevent this tragedy from happening again.
Thank you for your consideration of these policy changes. I look forward to working with you and my colleagues on the Transportation and Infrastructure Committee to strengthen our nation’s oil spill response and prevention laws.
