CSHB 322(FIN) am(efd fld): "An Act relating to penalties for discharges of oil and other pollution violations; and relating to oil spill response plans for commercial motor vehicles transporting crude oil."
00 CS FOR HOUSE BILL NO. 322(FIN) am(efd fld) 01 "An Act relating to penalties for discharges of oil and other pollution violations; and 02 relating to oil spill response plans for commercial motor vehicles transporting crude 03 oil." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 46.03.758(a) is amended to read: 06 (a) The legislature finds that 07 (1) [RECENT INFORMATION DISCLOSES THAT] the discharge of 08 oil may cause significant short and long-term damage to the state's environment; even 09 minute quantities of oil released to the environment may cause high mortalities among 10 larval and juvenile forms of important commercial species, may affect salmon 11 migration patterns, and may otherwise degrade and diminish the renewable resources 12 of the state; 13 (2) the exact nature and extent of oil pollution can be neither 14 documented with certainty nor precisely quantified on a spill-by-spill basis; however,
01 in light of the magnitude of harm that [WHICH] may be caused by oil discharges, and 02 the vital importance of commercial, sport, and subsistence fishing, tourism, and the 03 state's natural abundance and beauty to the economic future of the state and its quality 04 of life, it is the judgment of the legislature that substantial civil penalties should be 05 imposed for the discharge of oil in order to provide a meaningful incentive for the safe 06 handling of oil and to ensure [INSURE] that the public does not bear substantial 07 losses from oil pollution for which, because of its subtle, long-term, or unquantifiable 08 nature, compensation would not otherwise be received; and 09 (3) the handling of oil in large quantities is a hazardous undertaking 10 that poses a significant threat to the economy and environment of the state, which can 11 be substantially reduced only by the taking of rigorous safety precautions involving 12 considerable expense; conversely, persons handling oil in smaller amounts pose a 13 correspondingly lower risk to the economy and environment of the state, and are 14 capable of safe oil handling practices at correspondingly lower costs; in order to 15 provide an incentive that is effective, [BUT NOT PUNITIVE,] it is necessary and 16 appropriate that the assessment of [CIVIL] penalties for discharges of small quantities 17 of oil be left for case-by-case [JUDICIAL] determination, while ensuring, through the 18 penalty provisions of this section, that the handling of oil in large quantities occurs in 19 a manner that will not impair the renewable resources of the state. 20 * Sec. 2. AS 46.03.758(b) is amended to read: 21 (b) The [NO LATER THAN THE 10TH DAY AFTER THE CONVENING 22 OF THE SECOND SESSION OF THE TENTH ALASKA LEGISLATURE, THE] 23 department shall establish in [SUBMIT TO THE LEGISLATURE] regulations 24 [ESTABLISHING] the following schedule of fixed penalties for discharges of oil: 25 (1) subject to (2) of this subsection, the penalties for the following 26 categories of receiving environments may not exceed 27 (A) $40 [$10] per gallon of oil that [WHICH] enters an 28 anadromous stream or other freshwater environment with significant aquatic 29 resources; 30 (B) $10 [$2.50] per gallon of oil that [WHICH] enters an 31 estuarine, intertidal or confined saltwater environment; and
01 (C) $4 [$1] per gallon of oil that [WHICH] enters an 02 unconfined saltwater environment, public land or freshwater environment 03 without significant aquatic resources; 04 (2) for discharges of oil that are caused by the gross negligence or 05 intentional act of the discharger, or when the court finds that the discharger did not 06 take reasonable measures to contain and clean up the discharged oil, the penalty shall 07 be determined by multiplying the penalty established under (1) of this subsection by a 08 factor of five. 09 * Sec. 3. AS 46.03.758 is amended by adding a new subsection to read: 10 (m) The department shall, every 10 years, increase the amounts of the civil 11 penalties authorized in (b) of this section by a percentage equal to the percentage of 12 increase in all items of the Consumer Price Index for all urban consumers for 13 Anchorage, Alaska. The index for January of 2018 is the reference base index. 14 * Sec. 4. AS 46.03.759(a) is amended to read: 15 (a) A person who is found to be liable under any other state law for an 16 unpermitted discharge of crude oil in excess of 18,000 gallons is, in addition to 17 liability for any other penalties or for damages or the cost of containment and cleanup, 18 liable to the state in a civil action for a civil penalty, up to a maximum of 19 $500,000,000, in the amount of 20 (1) $16 [$8] per gallon of crude oil discharged for the first 420,000 21 gallons discharged; and 22 (2) $25 [$12.50] per gallon of crude oil discharged for amounts 23 discharged in excess of 420,000 gallons. 24 * Sec. 5. AS 46.03.759 is amended by adding new subsections to read: 25 (h) For the purpose of determining the volume of discharged crude oil under 26 this section, the department shall include the produced water, if any, that was mixed 27 with the discharged crude oil at the time of the discharge. 28 (i) The department shall, every 10 years, increase the amounts of the civil 29 penalties authorized in (a) of this section by a percentage equal to the percentage of 30 increase in all items of the Consumer Price Index for all urban consumers for 31 Anchorage, Alaska. The index for January of 2018 is the reference base index.
01 * Sec. 6. AS 46.03.760(a) is amended to read: 02 (a) A person who violates or causes or permits to be violated a provision of 03 this chapter other than AS 46.03.250 - 46.03.313, or a provision of AS 46.04 or 04 AS 46.09, or a regulation, a lawful order of the department, or a permit, approval, or 05 acceptance, or term or condition of a permit, approval, or acceptance issued under this 06 chapter or AS 46.04 or AS 46.09 is liable, in a civil action, to the state for a sum to be 07 assessed by the court of not less than $2,000 [$500] nor more than $400,000 08 [$100,000] for the initial violation, nor more than $25,000 [$5,000] for each day after 09 that on which the violation continues, and that shall reflect, when applicable, 10 (1) reasonable compensation in the nature of liquidated damages for 11 any adverse environmental effects caused by the violation, which shall be determined 12 by the court according to the toxicity, degradability, and dispersal characteristics of 13 the substance discharged, the sensitivity of the receiving environment, and the degree 14 to which the discharge degrades existing environmental quality; 15 (2) reasonable costs incurred by the state in detection, investigation, 16 and attempted correction of the violation; 17 (3) the economic savings realized by the person in not complying with 18 the requirement for which a violation is charged; and 19 (4) the need for an enhanced civil penalty to deter future 20 noncompliance. 21 * Sec. 7. AS 46.03.760(d) is amended to read: 22 (d) In addition to liability under (a) and (c) [(a) - (c)] of this section, a person 23 who violates or causes or permits to be violated a provision of AS 46.03.740 - 24 46.03.750 is liable to the state, in a civil action brought under AS 46.03.822, for the 25 full amount of actual damages caused to the state by the violation, including 26 (1) direct and indirect costs associated with the abatement, 27 containment, or removal of the pollutant; 28 (2) restoration of the environment to its former state; 29 (3) amounts paid as grants under AS 29.60.510 - 29.60.599 and as 30 emergency first response advances and reimbursements under AS 46.08.070(c); and 31 (4) all incidental administrative costs.
01 * Sec. 8. AS 46.03.760(e) is amended to read: 02 (e) A person who violates or causes or permits to be violated a provision of 03 AS 46.03.250 - 46.03.313, 46.03.460 - 46.03.475, AS 46.14, or a regulation, a lawful 04 order of the department, or a permit, approval, or acceptance, or term or condition of a 05 permit, approval, or acceptance issued under AS 46.03.250 - 46.03.313, 46.03.460 - 06 46.03.475, AS 46.14, or under the program authorized by AS 46.03.020(12), is liable, 07 in a civil action, to the state for a sum to be assessed by the court of not less than 08 $1,000 [$500] nor more than $200,000 [$100,000] for the initial violation, nor more 09 than $25,000 [$10,000] for each day after that on which the violation continues, and 10 that shall reflect, when applicable, 11 (1) reasonable compensation in the nature of liquidated damages for 12 any adverse environmental effects caused by the violation, that shall be determined by 13 the court according to the toxicity, degradability and dispersal characteristics of the 14 substance discharged, the sensitivity of the receiving environment, and the degree to 15 which the discharge degrades existing environmental quality; for a violation relating to 16 AS 46.14, the court, in making its determination under this paragraph, shall also 17 consider the degree to which the discharge causes harm to persons or property; for a 18 violation of AS 46.03.463, the court, in making its determination under this paragraph, 19 shall also consider the volume of the graywater, sewage, or other wastewater 20 discharged; this paragraph may not be construed to limit the right of parties other than 21 the state to recover for personal injuries or damage to their property; 22 (2) reasonable costs incurred by the state in detection, investigation, 23 and attempted correction of the violation; 24 (3) the economic savings realized by the person in not complying with 25 the requirement for which a violation is charged; and 26 (4) the need for an enhanced civil penalty to deter future 27 noncompliance. 28 * Sec. 9. AS 46.03.760(f) is amended to read: 29 (f) An owner, agent, employee, or operator of a commercial passenger vessel, 30 as defined in AS 43.52.295, who falsifies a registration or report required by 31 AS 46.03.460 or 46.03.475 or who violates or causes or permits to be violated a
01 provision of AS 46.03.250 - 46.03.314, 46.03.460 - 46.03.490, AS 46.14, or a 02 regulation, a lawful order of the department, or a permit, approval, or acceptance, or 03 term or condition of a permit, approval, or acceptance issued under AS 46.03.250 - 04 46.03.314, 46.03.460 - 46.03.490, or AS 46.14 is liable, in a civil action, to the state 05 for a sum to be assessed by the court of not less than $10,000 [$5,000] nor more than 06 $200,000 [$100,000] for the initial violation, nor more than $25,000 [$10,000] for 07 each day after that on which the violation continues, and that shall reflect, when 08 applicable, 09 (1) reasonable compensation in the nature of liquidated damages for 10 any adverse environmental effects caused by the violation, that shall be determined by 11 the court according to the toxicity, degradability, and dispersal characteristics of the 12 substance discharged, the sensitivity of the receiving environment, and the degree to 13 which the discharge degrades existing environmental quality; for a violation relating to 14 AS 46.14, the court, in making its determination under this paragraph, shall also 15 consider the degree to which the discharge causes harm to persons or property; this 16 paragraph may not be construed to limit the right of parties other than the state to 17 recover for personal injuries or damage to their property; 18 (2) reasonable costs incurred by the state in detection, investigation, 19 and attempted correction of the violation; 20 (3) the economic savings realized by the person in not complying with 21 the requirement for which a violation is charged; and 22 (4) the need for an enhanced civil penalty to deter future 23 noncompliance. 24 * Sec. 10. AS 46.03.760(g) is amended to read: 25 (g) As used in this section, "economic savings" means the economic benefit 26 of noncompliance [THAT SUM WHICH A PERSON WOULD BE REQUIRED TO 27 EXPEND FOR THE PLANNING, ACQUISITION, SITING, CONSTRUCTION, 28 INSTALLATION AND OPERATION OF FACILITIES NECESSARY TO EFFECT 29 COMPLIANCE] with the standard violated. When determining an "economic 30 savings," the court may consider 31 (1) deferred and avoided costs of compliance with the standard
01 violated; 02 (2) a competitive advantage gained by noncompliance with the 03 standard violated; and 04 (3) income derived as a result of noncompliance with the standard 05 violated from operations that were not authorized or permitted. 06 * Sec. 11. AS 46.03.760 is amended by adding new subsections to read: 07 (h) When assessing the need for an enhanced civil penalty to deter future 08 noncompliance under this section, the court may take into consideration 09 (1) the seriousness of the violation; 10 (2) the degree of culpability of the person; 11 (3) the history of previous violations of the person; 12 (4) other penalties assessed for the same violation; 13 (5) good faith efforts made by the person to comply with applicable 14 requirements and to minimize or mitigate the effects of the violations; 15 (6) the economic effect of the violation on the person; and 16 (7) other factors as justice may require. 17 (i) The department shall, every 10 years, increase the daily civil penalty caps 18 in (a), (e), and (f) of this section by a percentage equal to the percentage of increase in 19 all items of the Consumer Price Index for all urban consumers for Anchorage, Alaska. 20 The index for January of 2018 is the reference base index. 21 * Sec. 12. AS 46.03 is amended by adding a new section to read: 22 Sec. 46.03.762. Administrative penalties for discharges of oil and crude oil. 23 (a) In addition to the actions available under AS 46.03.758 - 46.03.760, the department 24 may assess an administrative penalty against a person who causes or permits a serious 25 discharge or repeat discharges of oil not permitted under applicable state or federal 26 law. 27 (b) An administrative penalty assessed under this section may not be less than 28 $500 nor more than $10,000 for each violation. When assessing a penalty under this 29 section, the department shall consider 30 (1) the effect of the discharge on the public health or the environment; 31 (2) reasonable costs incurred by the state in the detection,
01 investigation, and attempted correction of the discharge; 02 (3) any previous history of compliance or noncompliance by the 03 person with this chapter, AS 46.04, AS 46.09, and AS 46.14; 04 (4) the need to deter future discharges; and 05 (5) the volume, extent, and seriousness of the discharge, including the 06 potential for the discharge to threaten public health or the environment. 07 (c) If a person fails to pay an administrative penalty assessed under this 08 section, the department may bring an action to collect the penalty. The amount of the 09 penalty is not subject to review by the court in an action to collect the penalty 10 described in this section. 11 (d) In a collection action under (c) of this section, the court shall award the 12 prevailing party full reasonable attorney fees and costs incurred in the collection 13 action. 14 (e) Action under this section by the department does not limit or otherwise 15 affect the authority of the department to otherwise enforce this chapter, AS 46.04, 16 AS 46.08, AS 46.09, AS 46.14, or regulations adopted under those statutes, or to 17 recover damages, restoration expenses, investigation costs, court costs, attorney fees, 18 or other necessary expenses. The court shall set off against a judicial civil assessment 19 subsequently awarded under AS 46.03.758, 46.03.759, or 46.03.760 an amount 20 ordered to be paid under this section by the same person for the same discharge. 21 (f) For the purpose of determining the volume of discharged oil under this 22 section, the department shall include the produced water, if any, that was mixed with 23 the discharged oil at the time of the discharge. 24 (g) The department shall, every 10 years, increase the amounts of the 25 administrative penalties authorized in (b) of this section by a percentage equal to the 26 percentage of increase in all items of the Consumer Price Index for all urban 27 consumers for Anchorage, Alaska. The index for January of 2018 is the reference base 28 index. 29 (h) In this section, 30 (1) "discharge" means entry of oil into or on the water or public land of 31 the state, regardless of causation, except discharges into an enclosed and impervious
01 oil spill containment area; 02 (2) "oil" means crude oil, petroleum, and any substance refined from 03 petroleum. 04 * Sec. 13. AS 46.03.900 is amended by adding a new paragraph to read: 05 (38) "produced water" means water that is the byproduct of the 06 exploration, extraction, development, production, refining, processing, or disposal of 07 energy-related products. 08 * Sec. 14. AS 46.04 is amended by adding a new section to read: 09 Sec. 46.04.057. Oil spill response plans for commercial motor vehicles. (a) 10 If a person is required to submit an oil spill response plan under federal law, the 11 person may not operate a commercial motor vehicle transporting crude oil on a 12 highway or road maintained by the state unless the person has submitted to the 13 department, and the department has received, the oil spill response plan required under 14 federal law. The person shall submit the oil spill response plan to the department 15 electronically. 16 (b) Failure of a holder of a response plan submitted to the department under 17 this section to comply with the plan or to have access to the quality or quantity of 18 resources identified in the plan or to respond with those resources within the shortest 19 possible time in the event of a spill is a violation of this chapter for purposes of 20 AS 46.03.760(a), 46.03.765, 46.03.790, and any other applicable law. If the holder of 21 a response plan submitted to the department under this section fails to respond to and 22 conduct cleanup operations of an unpermitted discharge of crude oil with the quality 23 and quantity of resources identified in the plan and in a manner required under the 24 plan, the holder is strictly liable, jointly and severally, for the civil penalty assessed 25 under AS 46.03.758, 46.03.759, or 46.03.760 against any other person for that 26 discharge. 27 (c) In this section, "commercial motor vehicle" has the meaning given in 28 AS 19.10.399. 29 * Sec. 15. AS 46.03.758(c) and 46.03.760(b) are repealed. 30 * Sec. 16. The uncodified law of the State of Alaska is amended by adding a new section to 31 read:
01 TRANSITION: REGULATIONS. The Department of Environmental Conservation 02 may adopt regulations necessary to implement the changes made by this Act. The regulations 03 take effect under AS 44.62 (Administrative Procedure Act), but not before January 1, 2019.