Legislature(1999 - 2000)

05/12/1999 01:52 PM JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
CSSB 110(RLS) AM - HAZARDOUS SUBST. RELEASE:  GOVT ENTITY                                                                       
                                                                                                                                
CHAIRMAN KOTT announced the next item of business is CS FOR SENATE                                                              
BILL NO. 110(RLS) am, "An Act relating to liability for the release                                                             
of hazardous substances involving certain property acquired by a                                                                
governmental entity; relating to making a determination as to when                                                              
a hazardous substance release has occurred; relating to liability                                                               
of a party other than the party responsible for the initial release                                                             
of a hazardous substance; and providing for an effective date."                                                                 
                                                                                                                                
Number 0840                                                                                                                     
                                                                                                                                
ELIZABETH HAGEVIG, Legislative Administrative Assistant to Senator                                                              
Gary Wilken, Alaska State Legislature, came before the committee                                                                
and read the following sponsor statement:                                                                                       
                                                                                                                                
     Senate Bill 110 will assist municipalities in performing                                                                   
     their statutory duty to enforce liens for delinquent                                                                       
     property taxes.  Tax foreclosure is a mandatory process                                                                    
     leading to the taking of a tax deed that places the title                                                                  
     to a tax delinquent property in the municipality's name.                                                                   
     Some properties with delinquent taxes are contaminated.                                                                    
     Municipalities are concerned that they may be held liable                                                                  
     for preexisting contamination of foreclosed land with                                                                      
     significant environmental remediation costs.                                                                               
                                                                                                                                
     The federal Comprehensive Environmental Response,                                                                          
     Compensation and Liability Act (CERCLA) exempts by                                                                         
     definition state and local governments who acquire                                                                         
     property through "bankruptcy, foreclosure, tax                                                                             
     delinquency, abandonment, or similar means."  However,                                                                     
     the state law which addresses liability for damage caused                                                                  
     by the release of hazardous substances, AS 46.03.822,                                                                      
     does not precisely mirror the federal law.  Senate Bill                                                                    
     110 will amend AS 46.03.822 to ensure that federal and                                                                     
     state laws are similar in this respect.  The municipality                                                                  
     may therefore have title to the contaminated property                                                                      
     without involuntary exposure or cleanup.                                                                                   
                                                                                                                                
     Changes in the Senate also recognized the need to extend                                                                   
     this courtesy to innocent land owners who are not                                                                          
     directly responsible for contaminating the property that                                                                   
     they have acquired.                                                                                                        
                                                                                                                                
MS. HAGEVIG provided and distributed copies of proposed Amendment                                                               
1:                                                                                                                              
                                                                                                                                
     Page 2, line 19, following "entity":                                                                                       
                                                                                                                                
          Insert "A hazardous substance release shall be determined                                                             
          to have occurred as provided in this section."                                                                        
                                                                                                                                
     Page 2, line 21, following "leaching":                                                                                     
                                                                                                                                
          Insert "or migration"                                                                                                 
                                                                                                                                
     Page 3, lines 4-10:                                                                                                        
                                                                                                                                
          Delete all material.                                                                                                  
                                                                                                                                
          Insert "costs under this section, a person who acquires                                                               
          a facility and who, upon discovering a release or                                                                     
          threatened release on, in, or at the facility that                                                                    
          occurred before acquisition of the facility, who had no                                                               
          reason to know that a hazardous substance was disposed of                                                             
          on, in, or at the facility, and who, upon discovering the                                                             
          release or threatened release, acted in accordance with                                                               
          (b)(2) of this section to begin operations to contain and                                                             
          clean up the hazardous substance, may not be held liable                                                              
          under this section unless the person has caused or                                                                    
          contributed to the release or threatened release of the                                                               
          hazardous substance, in which case, the person is subject                                                             
          to liability under this section in the same manner as any                                                             
          other person.  For purposes of this subsection, 'caused                                                               
          or contributed to the release or threatened release of                                                                
          the hazardous substance'                                                                                              
                                                                                                                                
               (1)  does not include the failure to prevent the                                                                 
               passive leaching or migration at or from a facility                                                              
               of a hazardous substance in the air, land, or water                                                              
               that had first been released into the environment                                                                
               by a person other than the person that acquired the                                                              
               facility;                                                                                                        
                                                                                                                                
               (2)  after the ownership or control of the facility                                                              
               has been acquired by the person includes                                                                         
                                                                                                                                
                    (A)  the spilling, leaking, pumping, pouring,                                                               
                    emptying, injecting, escaping, or dumping of a                                                              
                    hazardous substance from barrels, tanks,                                                                    
                    containers, or other closed receptacles; or                                                                 
                                                                                                                                
                    (B)  the abandonment or discarding of barrels,                                                              
                    tanks, containers, or other closed receptacles                                                              
                    containing a hazardous substance."                                                                          
                                                                                                                                
Number 1011                                                                                                                     
                                                                                                                                
LARRY DIETRICK, Acting Director, Division of Spill Prevention and                                                               
Response, Department of Environmental Conservation, came before the                                                             
committee to testify.  He thanked the sponsors, and the "folks"                                                                 
from Fairbanks, for their assistance in clarifying the language.                                                                
He said both the Department of Environmental Conservation and the                                                               
Department of Law support the proposed language in the amendment                                                                
and the legislation.                                                                                                            
                                                                                                                                
Number 1061                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN asked whether this is going to cause people to                                                             
find this as a way out of their obligations.                                                                                    
                                                                                                                                
MR. DIETRICK replied the department doesn't believe so.  The number                                                             
of superfund sites have to be ranked high nation wide to be dubbed                                                              
a superfund site on the national list.  For example, Alaska Pulp in                                                             
Sitka, in which case the state intervened to take over, was closed                                                              
out of that site so the state wouldn't have to deal with the EPA                                                                
[Environmental Protection Act].  The department is comfortable with                                                             
that.                                                                                                                           
                                                                                                                                
Number 1118                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN said, "Let's back off from the superfund site,                                                             
something real serious though."                                                                                                 
                                                                                                                                
MR. DIETRICK asked Representative Green is his question whether or                                                              
not there is a potential loophole here.                                                                                         
                                                                                                                                
REPRESENTATIVE GREEN replied in the affirmative.                                                                                
                                                                                                                                
MR. DIETRICK added that they are comfortable with the language and                                                              
that a loophole has not been created.                                                                                           
                                                                                                                                
Number 1156                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI referred to page 1, lines 9 and 10, of the                                                             
proposed amendment, and asked Mr. Dietrick whether he is confirming                                                             
that the release had to occur before an innocent third party came                                                               
into ownership of property.                                                                                                     
                                                                                                                                
REPRESENTATIVE JAMES said she is troubled with the language in the                                                              
proposed amendment which refers to a person who acquires a facility                                                             
and finds that there was a release or threatened release, and that                                                              
person had no reason to know about that beforehand.  She read the                                                               
following text and inquired as to the location of (b)(2).                                                                       
                                                                                                                                
     ...and who upon discovering the release or threatened release,                                                             
     acted in accordance with (b)(2) of this section to begin                                                                   
     operations to contain and clean up the hazardous substance,                                                                
     may not be held liable under this section unless the person                                                                
     has caused or contributed to the release or threatened release                                                             
     of the hazardous substance...                                                                                              
                                                                                                                                
Number 1286                                                                                                                     
                                                                                                                                
MS. HAGEVIG replied, "We're not letting them off the hook to say,                                                               
'Well, just because you know it's there, and if the barrels are                                                                 
continuing to leak on the property it doesn't mean you don't have                                                               
to take action to try and stop it."                                                                                             
                                                                                                                                
Number 1335                                                                                                                     
                                                                                                                                
REPRESENTATIVE JAMES said what further disturbs her is that it                                                                  
continues to say, "may not be held liable under this section unless                                                             
the person has caused or contributed to the release or threatened                                                               
release of the hazardous substance," and in the effort to clean up,                                                             
that might happen.  She added that seems to discourage somebody                                                                 
from cleaning it up because that might happen.  It's like a trap of                                                             
some sort.                                                                                                                      
                                                                                                                                
Number 1380                                                                                                                     
                                                                                                                                
ANNETTE KREITZER, Legislative Assistant, to Senator Loren Leman,                                                                
Alaska State Legislature, came before the committee to testify. She                                                             
noted that when the bill left the Senate, they thought there was                                                                
agreement with all the parties who were concerned with it and then                                                              
Craig Tillery, Assistant Attorney General [Environmental Section,                                                               
Civil Division, Department of Law] reviewed the bill and alerted                                                                
DEC to some concerns.  She noted that they have been working with                                                               
all the parties including Virgil Norton [private citizen from                                                                   
Kenai] to craft something that satisfies all the parties.  She                                                                  
further explained the language in proposed Amendment 1, directly                                                                
correlates with the language that protects the municipalities so                                                                
basically, everybody is in the same boat.                                                                                       
                                                                                                                                
MS. KREITZER directed the committees' attention to page 1, line 17,                                                             
and read the following text:                                                                                                    
                                                                                                                                
     For purposes of this subsection, "caused or contributed to the                                                             
     release or threatened release of the hazardous substance" does                                                             
     not include the failure to prevent the passive leaching or                                                                 
     migration at or from a facility of a hazardous substance in                                                                
     the air, land, or water that had first been released into the                                                              
     environment by a person other than the person that acquired                                                                
     the facility...                                                                                                            
                                                                                                                                
MS. KREITZER further stated their goal was to try to meet the                                                                   
concerns of DEC, Mr. Norton's concerns and the concerns of Senators                                                             
who already voted on this bill as well as the Department of Law.                                                                
                                                                                                                                
REPRESENTATIVE GREEN asked whether Mr. Norton's concerns were                                                                   
addressed.                                                                                                                      
                                                                                                                                
MS. KREITZER replied yes.  Although he would have preferred the                                                                 
other language, he indicated that he can live with this language.                                                               
                                                                                                                                
Number 1499                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN made a motion to adopt proposed Amendment 1,                                                               
LS0360\SA.3, Cook, 5/12/99.  There being no objection, it was so                                                                
adopted.                                                                                                                        
                                                                                                                                
REPRESENTATIVE ROKEBERG asked whether the title needs to be                                                                     
amended.                                                                                                                        
                                                                                                                                
REPRESENTATIVE MURKOWSKI added that did come up in discussion and                                                               
deferred the question to Ms. Hagevig.                                                                                           
                                                                                                                                
MS. HAGEVIG noted that she spoke with Tam Cook [Director, Legal and                                                             
Research Services Division, Legislative Affairs Agency] who                                                                     
indicated that although this has not been tested in court, in her                                                               
opinion these changes will not change the title of the bill.                                                                    
                                                                                                                                
Number 1589                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG asked whether the amendment is extending it                                                             
to other people that are not [indisc.--simultaneous speech].                                                                    
                                                                                                                                
UNIDENTIFIED SPEAKERS unanimously replied private folks.                                                                        
                                                                                                                                
REPRESENTATIVE ROKEBERG asked whether this meets EPA standards.                                                                 
                                                                                                                                
UNIDENTIFIED SPEAKER replied yes.                                                                                               
                                                                                                                                
CHAIRMAN KOTT called an at-ease at 5:55 p.m. and called the                                                                     
committee back to order at 5:56 p.m.                                                                                            
                                                                                                                                
Number 1621                                                                                                                     
                                                                                                                                
VIRGIL NORTON testified via a cell phone from Kenai.  He said:                                                                  
                                                                                                                                
     I'm testifying to draw your attention to the very heart                                                                    
     of the innocent land owner defense as it currently is set                                                                  
     out in AS 46.03.822.  This is a strict liability statute                                                                   
     in that it affects every property owner in Alaska, and                                                                     
     strict liability is no-fault liability created by statute                                                                  
     because it defines obligations and responsibilities to                                                                     
     escape liability for someone taking the innocent land                                                                      
     owner defense.  And my interest in SB 110 is really                                                                        
     threefold.  Number 1, I wanted to prevent any                                                                              
     misinterpretation of the existing innocent land owner                                                                      
     defense or to color the statute because my in-laws are                                                                     
     going to court and I think they're going to be the test                                                                    
     case of the statute as it exists so I don't really oppose                                                                  
     what the local government entities are trying to do to                                                                     
     obtain total immunity but I didn't want the existing                                                                       
     statute (indisc.) colored it - if it worked as to effect                                                                   
     the statute as it's written today.  And number 2. I                                                                        
     wanted to, in the work that I helped do over on the                                                                        
     Senate side, my intention was to clearly define the word                                                                   
     'relief' and thereby strengthen the innocent land owner                                                                    
     defense.  And number 3. I wanted to always make sure that                                                                  
     we're establishing liability relating to cost recovery                                                                     
     issues squarely on the person responsible for the spill                                                                    
     or the release into the environment.  And in short, I                                                                      
     support the version that's already crafted that the                                                                        
     Senate - after several days finally passed 20-yeas and                                                                     
     0-nays.  But the current definition of 'relief' contains                                                                   
     key words 'into the environment'.  An example of that is,                                                                  
     once a person introduces a contaminate into the                                                                            
     environment this person is liable to all others who would                                                                  
     be affected and all others have a liability to stop or                                                                     
     attempt to stop the spread or migration of a contaminant                                                                   
     but they would direct their cost recovery efforts to the                                                                   
     liable person as the person that was responsible for the                                                                   
     spill...                                                                                                                   
                                                                                                                                
[Mr. Norton's cellphone was inadvertently disconnected.]                                                                        
                                                                                                                                
REPRESENTATIVE ROKEBERG asked who submitted Amendment 1 and whether                                                             
the committee can add to it.                                                                                                    
                                                                                                                                
REPRESENTATIVE JAMES replied all parties involved.                                                                              
                                                                                                                                
Number 1777                                                                                                                     
                                                                                                                                
MR. NORTON continued.  "Anyway, the issue here is liability both in                                                             
cost recovery and the obligations that are obligatory in the                                                                    
statute to act responsibly to avoid incurring a liability for                                                                   
someone taking the innocent land owner to defense and that's why I                                                              
support the version as it currently exists in the Senate version of                                                             
SB 110.  I will reluctantly support the House Judiciary's version                                                               
if that's the only way it's going to go..."  [Mr. Norton was                                                                    
disconnected again.]                                                                                                            
                                                                                                                                
CHAIRMAN KOTT told Mr. Norton that the House Judiciary Standing                                                                 
Committee has reviewed the amendment and has adopted it as part of                                                              
the package.                                                                                                                    
                                                                                                                                
MR. NORTON continued.  "If you've done that then so be it.  I                                                                   
actually like what was already there because - but we'll have to                                                                
revisit this I suppose at another date, but I like the way it was                                                               
originally wrote [written] because we defined 'relief' and it's an                                                              
issue that concerns every property owner in Alaska.  I wanted the                                                               
liability directed only to the person that commits the act not just                                                             
somebody that has a deep pocket."                                                                                               
                                                                                                                                
REPRESENTATIVE ROKEBERG asked whether adopting an amendment to                                                                  
include that definition would work.                                                                                             
                                                                                                                                
REPRESENTATIVE JAMES replied no.                                                                                                
                                                                                                                                
MR. NORTON added, "I don't mean to offend the Alaska Department of                                                              
Law but they're not exactly world-renowned for their legal                                                                      
opinions."                                                                                                                      
                                                                                                                                
REPRESENTATIVE ROKEBERG referred to the amendment and asked how can                                                             
there be a threatened release on something before an acquisition.                                                               
                                                                                                                                
REPRESENTATIVE JAMES answered that there could be a barrel of                                                                   
something with a hole at the top and nothing has leaked out yet.                                                                
                                                                                                                                
Number 1996                                                                                                                     
                                                                                                                                
REPRESENTATIVE JAMES moved to report CSSB 110 (JUD) out of                                                                      
committee with individual recommendations and the accompanying zero                                                             
fiscal note.  There being no objection, it was so moved from the                                                                
House Judiciary Standing Committee.                                                                                             
                                                                                                                                

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