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CURRENT ISSUE

JONES ACT AND GULF SPILL
Is the Jones Act slowing Gulf Spill clean-up efforts?

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July 28, 2010

Tide of offshore spill legislation washes around Washington

If you throw enough stuff at the wall, some of it will stick. In the wake of the Deepwater Horizon tragedy, members of Congress have generated many pages of legislation in response. How much of it will ever make it into law remains to be seen. But it seems clear that something will emerge that will do for offshore drilling what OPA 90 did for tankers after the Exxon Valdez disaster.

One measure already signed by President Obama is S. 3473 to permit the Coast Guard to obtain one or more advances from the Oil Spill Liability Trust Fund, to underwrite federal response activities related to the BP/Deepwater Horizon Oil Spill. Previously, the Coast Guard could only withdraw up to $100 million from the fund to finance emergency response efforts after an accident and that money is about to run out. BP is required to repay these funds. The trust fund, created by the Oil Pollution Act of 1990, is funded by an 8-cent fee paid by the oil companies on each barrel of oil.

Much more legislation is in the hopper.

Speaker Nancy Pelosi yesterday released a statement yesterday on the House introduction of the oil spill response package, which will be considered on the floor later this week.

The package includes: the revised Consolidated Land, Energy, and Aquatic Resources (CLEAR) Act, estimated by the non-partisan Congressional Budget Office to reduce the deficit by $5.3 billion over the next five years; and the Offshore Oil and Gas Worker Whistleblower Protection Act:

"In the wake of the BP disaster, Congress must act on its commitment to protect America's families and businesses, rebuild the Gulf Coast, hold oil companies accountable, and work to ensure that a spill of this kind never happens again. This week, the House will vote on an oil spill response package to achieve these goals and keep our promise to the American people," said the Speaker.

"The updated CLEAR Act includes strong new safety measures, restores the Gulf Coast, protects local residents and taxpayers, reforms the agency charged with overseeing oil drilling, and holds the oil industry responsible for cleanup costs and recovery. This is good for our families, our environment, and the health of our natural resources. And today, the independent CBO told us that it's good for our budget - saving taxpayers more than $5 billion in the next five years.

"The other piece of this package - the Offshore Oil and Gas Worker Whistleblower Protection Act - protects workers who put the people's interest first, speak up, and inform state and federal government authorities of violations or practices that endanger the public.

"This package, along with the other measure the House has passed, forms a powerful response to the tragedy in the Gulf. We look forward to working with Members of Congress on both sides of the aisle to enact this package and do right by the people of the Gulf Coast."

RECENT LEGISLATION

Last week, the House passed two bills from the Science and Technology Committee:

H.R. 2693, the Oil Pollution Research and Development Program Reauthorization Act, which will modify oil drilling research, development to further innovation technologies and methods to prevent, detect, recover and mitigate oil discharges.

H.R. 5716, the Safer Oil and Natural Gas Drilling Technology Research and Development Program, which makes safety and accident prevention and mitigation a key priority in deepwater drilling research and development.

Last month, the House passed H.R. 5503, the SPILL Act , to reform maritime liability laws - Death on the High Seas Act (1920), Jones Act (1920) and the Limitation on Liability Act (1851) - to ensure that the families of those killed or injured in the BP Spill and other such tragedies are justly compensated for their losses.

The House has also passed legislation (H.R. 5481) to give subpoena power to the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling.

The American Jobs and Closing Tax Loopholes Act, passed by the House will protect coastal economies by making oil companies pay to strengthen the solvency of the Oil Spill Liability Trust Fund--instead of passing the bill on to taxpayers. That measure will raise the fee oil companies pay per barrel and increase the current $1 billion cap on individual claims against the fund to $5 billion, and increase the $500 million cap on natural resource damage assessments to $2.5 billion. Currently, the trust fund has a balance of roughly $1.6 billion.


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