Bill S7718-2013

Relates to requiring petroleum bulk storage facilities to provide a surety to be used in the case of a necessary cleanup and decontamination

Relates to requiring petroleum bulk storage facilities to provide a surety to be used in the case of a necessary cleanup and decontamination.

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  • Jun 2, 2014: REFERRED TO ENVIRONMENTAL CONSERVATION

Memo

BILL NUMBER:S7718

TITLE OF BILL: An act to amend the environmental conservation law, in relation to global financial surety

PURPOSE OR GENERAL IDEA OF BILL:

To require petroleum bulk storage facilities to provide a surety to be used in the case of a necessary cleanup and decontamination.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1: amends the environmental conservation law by adding a new section 17-1019.

Section 2: effective date

JUSTIFICATION:

The Petroleum Storage Surety bill is in response to recent accidents resulting in substantial financial losses to both public and private entities due to injuries, loss of life, damages and clean up costs, all as a result of explosions and spills from improper handling of volatile and toxic crude oil shipments. This bill would apply to crude oil stored at all bulk storage facilities in New York State and require financial security to meet all responsibilities for cleanup and decontamination costs associated with the release of such oil.

The transport of crude oil by rail has increased exponentially nationwide over the past five years, from over 9,000 carloads of crude oil in 2008 to over 400,000 in 2013, and the need for storage facilities has expanded accordingly. There is a heightened awareness of safety issues related to the transportation and storage of crude oil and the Petroleum Surety bill is one attempt to address the negative impacts of mishandling and improper storage of crude oil Rail transportation of crude oil is regulated by federal law whereas bulk storage of crude oil is governed by state law.

It is necessary that financial surety measures be put in place to ensure that the public is not burdened with the big costs resulting from crude oil accidents. This may include evidence of insurance, a letter of credit, or a bond from a corporate surety licensed to do business in New York State.

The Petroleum Storage Surety bill will ensure that any bulk petroleum storage facility has the necessary financial security to balance the risk of any accident occurring that is directly related to storing crude oil.

PRIOR LEGISLATIVE HISTORY:

New Bill.

FISCAL IMPLICATIONS:

None to the state.

EFFECTIVE DATE:

This act shall take effect on the sixtieth day after it shall have become a law.


Text

STATE OF NEW YORK ________________________________________________________________________ 7718 IN SENATE June 2, 2014 ___________
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 environmental conservation law, in relation to global financial surety THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. The environmental conservation law is amended by adding a new section 17-1019 to read as follows: S 17-1019 FINANCIAL SECURITY. 1. FOR THE PURPOSES OF THIS SECTION, THE FOLLOWING TERMS SHALL BE DEFINED AS FOLLOWS: A. "CLEANUP AND DECONTAMINATION" MEANS ACTIVITIES UNDERTAKEN TO PERMA- NENTLY ELIMINATE, REMOVE, ABATE, CONTROL OR MONITOR HEALTH AND/OR ENVI- RONMENTAL HAZARDS OR POTENTIAL HAZARDS. B. "CLEANUP AND DECONTAMINATION COSTS" MEAN ALL COSTS ASSOCIATED WITH THE CLEANUP AND DECONTAMINATION OF CONTAMINATION INCLUDING RELOCATION COSTS INCURRED BY THE STATE OR ITS POLITICAL SUBDIVISIONS OR THEIR AGENTS OR ANY PERSON WITH APPROVAL OF THE DEPARTMENT. C. "CONTAMINATION" MEANS ANY DAMAGE TO ANY PROPERTY OR THE ENVIRON- MENT, INCLUDING, BUT NOT LIMITED TO, A PUBLIC OR PRIVATE WATER SUPPLY, ANY THREAT TO PUBLIC HEALTH, OR ANY HAZARDOUS CONDITION THAT PREVENTS THE USE OF PROPERTY OR THAT REQUIRES RELOCATION OF PEOPLE OR PROPERTY TO PREVENT HARM RESULTING FROM THE RELEASE OF ANY SUBSTANCE. D. "ENVIRONMENT" MEANS ANY WATER INCLUDING, BUT NOT LIMITED TO, A STREAM, POND, LAKE, RIVER, WATER COURSE, AQUIFER, WETLAND, OR RESERVOIR, ANY LAND INCLUDING, BUT NOT LIMITED TO, A LAND SURFACE OR SUBSURFACE, AIR, FISH, WILDLIFE, BIOTA AND ALL OTHER NATURAL RESOURCES. 2. IN ADDITION TO ANY OTHER EXISTING REQUIREMENTS, THE DEPARTMENT SHALL REQUIRE ALL PETROLEUM BULK STORAGE FACILITIES THAT STORE BAKKEN CRUDE OIL OR BITUMEN CRUDE OIL TO PROVIDE FINANCIAL SECURITY TO MEET ALL RESPONSIBILITIES FOR CLEANUP AND DECONTAMINATION COSTS ASSOCIATED WITH THE RELEASE OF SUCH OIL. FINANCIAL SECURITY MAY BE EVIDENCED BY ONE OR A COMBINATION OF THE FOLLOWING METHODS ACCEPTABLE TO THE COMMISSIONER IN CONSULTATION WITH THE SUPERINTENDENT OF FINANCIAL SERVICES: EVIDENCE OF
INSURANCE, GUARANTEE, LETTER OF CREDIT, OR A BOND FROM A CORPORATE SURE- TY LICENSED TO DO BUSINESS AS SUCH IN THE STATE. SUCH FINANCIAL SECURITY SHALL REMAIN IN FULL FORCE AND EFFECT FOR THE DURATION OF THE REGISTRA- TION. IF THE FINANCIAL SECURITY SHALL FOR ANY REASON BE CANCELLED, WITH- IN SEVEN DAYS AFTER RECEIVING NOTICE THEREOF, A VALID REPLACEMENT SHALL BE PROVIDED UNDER THE SAME CONDITIONS. FAILURE TO PROVIDE A REPLACEMENT WITHIN SUCH PERIOD SHALL RESULT IN THE IMMEDIATE SUSPENSION OF THE FACILITY'S REGISTRATION BY THE DEPARTMENT. NO PERSON SHALL ENGAGE IN THE STORAGE OF BAKKEN CRUDE OIL OR BITUMEN CRUDE OIL WITH AN API GRAVITY EQUAL OR LESS THAN TEN WITHOUT COMPLYING WITH THIS REQUIREMENT. S 2. This act shall take effect on the sixtieth day after it shall have become a law.

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