By Libby Casey
Alaska’s Senators have introduced a bill that would boost the amount of money oil companies are taxed to pay for spill disasters. Their legislation comes as B-P struggles to plug and clean up a massive oil spill in the Gulf of Mexico.
The Senators want to grow the Oil Spill Liability Trust Fund to $10-Billion by raising the fees oil companies pay on each barrel by one penny.
Currently oil companies pay 8 cents per barrel – it would go up to 9 cents, which Senator Mark Begich says is a small price to pay.
When you think about the price of a barrel, 85 Dollars a barrel, it’s a small amount of money to ensure we have a trust fund set up to deal with these types of spill, and it’s not the taxpayer, it’s the industry.
Republican Senator Lisa Murkowski pushed an increase in the tax back in 2005, and was already working to boost it again – she says it’s needed to keep up with the times and the expense of clean-ups.
I think it’s important to ensure you’ve got a fund that is of consequence in the event you have a disaster like we see unfolding before us in the Gulf. So this is one of the measures you’ll see come before the Senate as we look to address the situation in the Gulf.
Murkowski says the Alaskan senators are looking at it from the perspective of what was experienced in Alaska in the aftermath of the Exxon Valdez oil spill. Their bill would also remove the sunset provisions in the current law so the fund does not expire as planned in seven years, allowing it to be used into the future.
The Oil Spill Liability Trust Fund currently contains about $1.6 Billion. It was first established by Congress in the 1980s, but was not actually activated until after the Exxon Valdez oil spill in 1989.
Meanwhile Democrats in the House and Senate have introduced a bill that would boost the amount of money oil companies would have to personally pay for economic damages from $75-million to $10-Billion. They’re calling it the “Big Oil Bailout Prevention Act.” It could be made retro-active, so if passed, it would affect B-P and the current oil spill crisis in the Gulf of Mexico.
Senator Murkowski says it does make sense to increase the liability cap. But she’s concerned the amount Democrats are proposing may be too high:
I’m not certain that 10 billion is where you place that limit. If you do so, you may be in the situation where you put the smaller independent operators in the Gulf out of business, so that the only ones who can continue to operate would be the Exxons and the BPs.
Senator Begich says he hasn’t yet read the legislation that would raise the cap on oil companies’ liability, but plans to look it over. He says there will be a lot of legislation in the next few weeks related to the Gulf spill.
What we want to be careful we’re not doing emotional legislation, we’re doing good, sound long term policy that ensures we continue to have a healthy oil and gas, renewable, alternative industry for our country, and making sure we have a strong energy policy that gets us off foreign oil.
Begich says his next priority will be getting more money funneled to NOAA, the National Oceanic and Atmospheric Administration, so it can do more oil spill research and technology development.