S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  4551

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                             April 12, 2011
                               ___________

Introduced  by Sen. GRISANTI -- read twice and ordered printed, and when
  printed to be committed to the Committee on Environmental Conservation

AN ACT to amend the navigation law, in relation to increasing  liability
  for the discharge of petroleum

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Subdivision 3 of section 181  of  the  navigation  law,  as
amended by chapter 584 of the laws of 1992, subparagraphs (ii) and (iii)
of  paragraph  (e)  as  amended  by  chapter 585 of the laws of 1992, is
amended to read as follows:
  3. (a) The owner or operator of a major facility or vessel  which  has
discharged  petroleum shall be strictly liable, without regard to fault,
subject to the defenses enumerated in subdivision four of this  section,
for  all  cleanup  and removal costs and all direct and indirect damages
paid by the fund. However, the cleanup and removal costs and direct  and
indirect damages which may be recovered by the fund with respect to each
incident shall not exceed:
  (i) for a tank vessel, the greater of:
  (1) [one] TWO thousand [two hundred] dollars per gross ton; or
  (2)  (A)  in  the  case  of a vessel greater than three thousand gross
tons, [ten] SIXTEEN million dollars; or
  (B) in the case of a vessel [or] OF three thousand gross tons or less,
[two] THREE million dollars;
  (ii) for any other vessel subject to the liability limits set forth in
the Federal Oil Pollution Act of 1990 (33 U.S.C.  2701  et  seq.),  [six
hundred]  ONE  THOUSAND  dollars  per  gross ton or [five] EIGHT hundred
thousand dollars, whichever is greater;
  (iii) for any other vessel not subject to  the  liability  limits  set
forth in the Federal Oil Pollution Act of 1990 (33 U.S.C. 2701 et seq.),
[three] FIVE hundred dollars per gross ton for each vessel;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09196-01-1

              

S. 4551                             2

  (iv) for a major facility that is defined as an "onshore facility" and
covered  by  the  liability  limits  established  under  the Federal Oil
Pollution Act of 1990 (33 U.S.C. 2701 et  seq.),  [three]  FIVE  hundred
fifty  million  dollars. This liability limit shall not be considered to
increase  the  liability  above the federal limit of three hundred fifty
million dollars per incident[.];
  (v) for a major facility not covered  in  subparagraph  (iv)  of  this
paragraph, [fifty] SEVENTY-FIVE million dollars.
  (b)  The liability limits established in subparagraphs (i) and (ii) of
paragraph (a) of this subdivision shall not be  considered  to  increase
liability  above  the  federal  limits  for  tank  vessels or vessels as
defined in the Federal Oil Pollution Act of  1990  (33  U.S.C.  2701  et
seq.).
  (c)  (i)  The  department  shall  establish, by regulation, a limit of
liability under this subdivision of less than [three] FIVE hundred fifty
million dollars but not less than [eight] TWELVE  million  dollars,  for
major  facilities  defined as "onshore facilities" under the Federal Oil
Pollution Act of 1990 (33 U.S.C. 2701  et  seq.),  taking  into  account
facility  size,  storage  capacity,  throughput,  proximity  to environ-
mentally sensitive areas, type of petroleum handled, and  other  factors
relevant to risks posed by the class or category of facility.
  (ii) The department shall establish, by regulation, a limit of liabil-
ity  under  this  subdivision of [fifty] SEVENTY-FIVE million dollars or
less for major facilities other than vessels that  are  not  defined  as
"onshore  facilities"  under  the  Federal Oil Pollution Act of 1990 (33
U.S.C. 2701 et seq.), taking into account facility size, storage capaci-
ty, throughput, proximity to environmentally sensitive  areas,  type  of
petroleum  handled,  and  other  factors  relevant to risks posed by the
class or category of facility.
  (d) The provisions of paragraph (a)  of  this  subdivision  shall  not
apply  and  the owner or operator shall be liable for the full amount of
cleanup and removal costs and damages  if  it  can  be  shown  that  the
discharge  was the result of (i) gross negligence or willful misconduct,
within the knowledge and privity of the owner,  operator  or  person  in
charge,  or  (ii)  a  gross  or  willful violation of applicable safety,
construction or operating standards or  regulations.  In  addition,  the
provisions  of  paragraph (a) of this subdivision shall not apply if the
owner or operator fails or refuses:
  (1) to report the discharge as required by section one hundred  seven-
ty-five of this article and the owner or operator knows or had reason to
know of the discharge; or
  (2)  to provide all reasonable cooperation and assistance requested by
the federal on-scene coordinator or the commissioner or his designee  in
connection with cleanup and removal activities.
  (e) (i) The owner or operator of a vessel shall establish and maintain
with  the  department evidence of financial responsibility sufficient to
meet the amount of liability established pursuant to  paragraph  (a)  of
this subdivision. The owner or operator of any vessel which demonstrates
financial responsibility pursuant to the requirements of the Federal Oil
Pollution  Act of 1990 (33 U.S.C. 2701 et seq.), shall be deemed to have
demonstrated financial responsibility in accordance with this paragraph.
  (ii) The commissioner  in  consultation  with  the  superintendent  of
insurance  may promulgate regulations requiring the owner or operator of
a major facility other than a vessel to establish and maintain  evidence
of  financial  responsibility  in  an amount not to exceed [twenty-five]
FORTY dollars, per incident, for each barrel of total petroleum  storage

S. 4551                             3

capacity  at  the  facility,  subject  to  a  maximum of one million SIX
HUNDRED dollars per incident per facility in an aggregate not to  exceed
[two]  THREE  million  dollars per facility per year; provided, however,
that  if  the  owner  or operator establishes to the satisfaction of the
commissioner that a lesser amount will  be  sufficient  to  protect  the
environment  and  public  health,  safety  and welfare, the commissioner
shall accept evidence of financial responsibility in such lesser amount.
In determining the sufficiency of the amount of financial responsibility
required under this section, the commissioner and the superintendent  of
insurance shall take into consideration facility size, storage capacity,
throughput, proximity to environmentally sensitive areas, type of petro-
leum handled, and other factors relevant to the risks posed by the class
or  category  of facility, as well as the availability and affordability
of pollution liability insurance. Any regulations  promulgated  pursuant
to  this  subparagraph  shall  not  take effect until forty-eight months
after the effective date of this section.
  (iii) Financial responsibility under this paragraph may be established
by any one or a combination of the following methods acceptable  to  the
commissioner  in  consultation  with  the  superintendent  of insurance:
evidence of insurance, surety bonds, guarantee, letter of credit, quali-
fication as a self-insurer, or other evidence of financial  responsibil-
ity,  including  certifications  which  qualify  under  the  Federal Oil
Pollution Act of 1990 (33 U.S.C. 2701 et seq.).
  (iv) The liability of a third-party insurer providing proof of  finan-
cial  responsibility  on  behalf  of  a person required to establish and
maintain evidence of financial  responsibility  under  this  section  is
limited to the type of risk assumed and the amount of coverage specified
in  the  proof  of financial responsibility furnished to and approved by
the department. For the purposes of this section, the term  "third-party
insurer" means a third-party insurer, surety, guarantor, person furnish-
ing  a  letter  of  credit,  or other group or person providing proof of
financial responsibility on  behalf  of  another  person;  it  does  not
include  the  person required to establish and maintain evidence of such
financial responsibility.
  S 2. This act shall take effect immediately.