Hearings of House Subcommittee on Energy and Air Quality - The Energy Policy Act of 2005: Ensuring Jobs for Our Future with Secure and Reliable Energy
HEARINGS OF HOUSE SUBCOMMITTEE ON ENERGY AND AIR QUALITY - THE ENERGY POLICY ACT OF 2005: ENSURING JOBS FOR OUR FUTURE WITH SECURE AND RELIABLE ENERGY
February 16, 2005
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Mr. Gonzalez. Thank you very much. My question--and I am hoping everyone is listening to what the Chairman is trying to tell everyone, because I really believe there can be a compromise. My question will go to Mr. Olson, and then I will have a question for Mr. Slaughter, because it is about MTBE.
I guess the troublesome aspect of this is I know that there is a problem; however, if you have a product that is manufactured, that is sanctioned and certified by the EPA, pursuant to applicable law, and then the use of it somehow contaminates and cases damages, it is really hard under most common-law, statutory, regulatory, administrative theories of responsible behavior, to tie it into the manufacturer.
I guess the most troublesome aspect of what you have indicated was it will only be the mom-and-pop convenience stores and such. If they were the ones that were negligent, ill-advised, or whatever, they won't have any deep pocket. But that has never driven legal thought or theory in this country. I know it is convenient--we always look for deep pockets and see if we can get the nexus--but this is a really a stretch. And generally, you know, I often oppose what comes under guise of tort reform and such, but when it comes--this is absolute. This is beyond strict liability, and I failed to see that. So I would like for you to clarify the statement that--you know, if we don't have this kind of liability, then we won't have anyone that will have the financial means to address the damages and the remedial expenses. But is that the whole logic of your thought and that is we should incur liability, simply because you have the ability to address the problem that has been created by someone else's negligence?
Mr. Olson. Well, the short answer is no. The major case that addressed this issue, which was the Tahoe case, and I would like submit to the record the special verdict that came out in that case. It is only about 4 or 5 pages long. What they found was that several of the members of the petroleum industry acted with malice in not disclosing, in not warning, in failing to address the issue and provide that information to the public and to the folks in the chain of commerce.
So it is not just an issue of who has a deep pocket; it is also a finding and I think this is being repeated across the country that the industry acted in a manner that was inappropriate. In this case, they found the industry acted with malice in not disclosing those risks that they knew about and weren't being fully disclosed to rest of the public. So I think that was the basis of it, and this ought to be left up to the courts to decide, rather than Congress stepping up and saying ``we are just going to resolve this once and for all.'' We think it ought to be up to the courts to decide, and you know, Democrats and Republicans at the State level and at the local level are addressing this very difficult issue, and many Republicans, as well as Democrats, decided they will go forward with this litigation on behalf of local water supplies that are contaminated because of the problem.
Mr. Gonzalez. The problem that we have, of course--and I understand it varies from State to State and what has happened in California, Connecticut, New York and so on. But if you have this patchwork and piece-meal approach, then we don't have a national energy policy that is going to make any sense, if we allow the essential part or provision of it to be frustrated by interpretation of a particular liability law. So again, I appreciate what you are saying, but I think what Chairman Barton is saying--well, let us address the concern that you have. How do we remediate? How do we address the damage and such? And Mr. Slaughter, the remaining time I have, I would just address to you, would you like to respond to anything that Mr. Olson may have said or any--or the statement that Mr. Barton had or my question?
Mr. Slaughter. Well, thanks, Mr. Gonzalez. What I would say: the South Lake Tahoe case was not a final judgment case. It didn't go to a final judgment; it was settled, and is not precedent. That was a partial finding in that case. But 96 percent of the underground storage tank spills are cleaned up and paid for by private funds, and through responsible parties, State insurance funds, and private insurance--96 percent. And the MTBE situation is no different from any other UST underground storage tank situation. Ninety-six percent will be paid for by responsible parties. Four percent, where responsible parties cannot be located, will be paid for through the underground storage tank fund that was set up by Congress in 1986, specifically for purposes like that. That is only 4 percent, Mr. Gonzalez.
I mean the important thing here is to say there is problem; responsible parties, where they are determined, are cleaning up that problem. There is a vast amount of remediation work going as we speak. So we have got people here who are trying to inflate a situation and set up a liability situation that, as you rightly point out, is based only upon the fact that some parties obeyed the law and helped make the Clean Air Act Amendment for a formulated gas program actually work.
Mr. Gonzalez. Thank you very much.
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