HB 269-HAZARDOUS SUBSTANCE RELEASE LIABILITY  8:41:05 AM CHAIR RALPH SEEKINS announced HB 269 to be up for consideration. JANE PIERSON, Staff to Representative Jay Ramras, introduced the bill. She explained that HB 269 is meant to address a United States Supreme Court decision in the case of Cooper Industries v. Aviall Services. The US Supreme Court found that a responsible party who cleans up a contaminated property couldn't bring a contribution action against another responsible party until such time as it has been sued by the state or federal government or has entered into a formal administrative settlement of liability. The Aviall decision puts into question the rights of Alaskans who conduct voluntary cleanups on contaminated property against other potentially responsible parties. Voluntary cleanups form the majority of environmental cleanups and relieve a substantial burden from the state. 8:42:49 AM MS. PIERSON summarized the right to contribution actions provides incentives for voluntary cleanups by allowing parties to recover some of the costs from other responsible parties that fail to assist with remediation. HB 269 would clarify language in AS 46.03.822(j) thereby ensuring that responsible parties that conduct voluntary cleanups may bring contributions actions against other responsible parties. 8:43:51 AM SENATOR GENE THERRIAULT asked Ms. Pierson to summarize the written decision of the US Supreme Court. MS. PIERSON explained the decision stated that it was a timing issue of when contribution claims could be started. The Court said they couldn't be started until such time as the state or federal government had formally sued. The problem is that instead of bringing other responsible parties in from the beginning, it is now uncertain when they can be brought into the action. SENATOR THERRIAULT asked whether other responsible parties could be brought in voluntarily before a suit occurred. MS. PIERSON said yes. The owner would pay to clean up the property and the courts would get involved only if there was a disagreement. 8:45:33 AM SENATOR HOLLIS FRENCH said he read several pages of the US Supreme Court opinion in the Aviall case. It was a statutory cause of action and because the statute didn't authorize a contribution action before there was a lawsuit, there couldn't be a contribution action unless there was a lawsuit and that means there is no such thing as a voluntary agreement to clean up a spill. It was a very narrow and legalistic view of what Congress had done and because Congress didn't specify that two parties could voluntarily get together and do the cleanup, a party cannot sue to bring in another party, he explained. SENATOR THERRIAULT asked for a definition of "contribution action." SENATOR FRENCH posed a hypothetical situation of a gas station owner who has a leaky tank and sells the business to a new owner. The new owner is aware of the leaky tank and two years later gets sued to clean it up. A "contribution action" is when the new owner forces the help of the previous owner to do the cleanup. The statute wouldn't allow the new owner to sue the previous owner unless the new owner had been sued first. Because the statute does not authorize it, the statute must be fixed to allow for a voluntary contribution claim. CHAIR SEEKINS said he understood it to be that a private party that has not been sued under the Comprehensive Environmental Response Compensation and Liability Act (CERCLA) may not obtain contribution from other liable parties. 8:51:24 AM SENATOR HUGGINS asked Ms. Pierson how the sponsor discovered the need for the bill. MS. PIERSON advised the committee that it came as a request from the attorney general's office. BRECK TOSTAVIN, Senior Assistant Attorney General, Department of Law (DOL), informed the committee that their interpretation of the Aviall decision was correct. The concern with that decision in regard to state law is that AS 46.03.822 is patterned after CERCLA. That decision creates an uncertainty of whether the Alaska Supreme Court would interpret a case in the same way that the US Supreme Court did. The concern is that they could interpret it to require the state to actually sue a responsible party to allow that responsible party to bring in others for a contribution action. The voluntary cleanup process in Alaska occurs in a forward process. When contamination is found, the Department of Environmental Conservation (DEC) sends out notifications to the responsible parties who hire consultants and then engage in the voluntary cleanup. They then seek to recover costs from other responsible parties. HB 269 would keep the current process in place. The Aviall decision conflicts with the Laidlaw decision [Federal Deposit Insurance Corporation v. Laidlaw Transit] where the Alaska Supreme Court said that a lawsuit was not required for a contribution action. The Court said a formal administrative action initiated by the DEC was enough to trigger rights to a contribution action. The bill clarifies that the timing of the contribution right is triggered by the potential liability determination by the DEC. 8:55:02 AM CHAIR SEEKINS reiterated that a person could bring a contribution action once that person receives a notice of potential liability determination from the DEC. An administrative action gives the authority to go after a contribution action on another potentially responsible party. MR. TOSTAVIN agreed. Once a party receives notification and begins to incur expenses associated with the cleanup, they have the contribution action right. CHAIR SEEKINS noted there was no one else signed up to testify and so he closed public testimony. SENATOR FRENCH expressed support for the bill. 8:57:15 AM SENATOR HUGGINS moved to adopt version G as the working document before the committee. Hearing no objections, the motion carried. SENATOR HUGGINS moved to adopt the Senate Judiciary Standing Committee letter of intent. Hearing no objections, the motion carried. SENATOR THERRIAULT moved SCS HB 269(JUD) from committee with individual recommendations and the attached fiscal notes and the letter of intent. Hearing no objections, the motion carried.