Bill Text: NY S08703 | 2023-2024 | General Assembly | Amended

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Bill Title: Requires the owner or operator of a vessel to establish and maintain with the department evidence of financial responsibility sufficient to meet the amount of liability.

Spectrum: Partisan Bill (Democrat 4-0)

Status: (Introduced) 2024-06-06 - SUBSTITUTED BY A9213A [S08703 Detail]

Download: New_York-2023-S08703-Amended.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                         8703--A
            Cal. No. 1215

                    IN SENATE

                                      March 1, 2024
                                       ___________

        Introduced  by  Sens. HINCHEY, KRUEGER, MAY, SEPULVEDA -- read twice and
          ordered printed, and when printed to be committed to the Committee  on
          Environmental  Conservation  --  committee  discharged  and  said bill
          committed to the Committee on Rules -- ordered  to  a  third  reading,
          amended  and  ordered  reprinted,  retaining its place in the order of
          third reading

        AN ACT to amend the navigation law, in relation to  financial  responsi-
          bility for the liability of a major facility or vessel

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Paragraph (e) of subdivision 3 of section 181 of the  navi-
     2  gation  law,  as amended by chapter 584 of the laws of 1992 and subpara-
     3  graphs (ii) and (iii) as amended by chapter 585 of the laws of 1992  and
     4  as further amended by section 104 of part A of chapter 62 of the laws of
     5  2011, is amended and a new paragraph (f) is added to read as follows:
     6    (e) (i) The owner or operator of a vessel shall establish and maintain
     7  with  the  department evidence of financial responsibility sufficient to
     8  meet the amount of liability established pursuant to  paragraph  (a)  of
     9  this  subdivision.  A  person may not cause or permit the operation of a
    10  vessel in the state until the person has furnished  to  the  department,
    11  and  the department has approved such evidence. The owner or operator of
    12  any vessel which demonstrates financial responsibility pursuant  to  the
    13  requirements of the Federal Oil Pollution Act of 1990 (33 U.S.C. 2701 et
    14  seq.),  shall be deemed to have demonstrated financial responsibility in
    15  accordance with this paragraph.
    16    (ii) The commissioner  in  consultation  with  the  superintendent  of
    17  financial  services  may  promulgate  regulations requiring the owner or
    18  operator of a major facility other than a vessel to establish and  main-
    19  tain  evidence  of  financial  responsibility in an amount not to exceed
    20  twenty-five dollars plus an annual inflation adjustment,  determined  by
    21  the  commissioner  from  the increase in the consumer price index in the
    22  one-year period ending on the March thirty-first prior to such inflation
    23  adjustment effective on the ensuing September first, per  incident,  for
    24  each barrel of total petroleum storage capacity at the facility, subject

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD14222-03-4
        S. 8703--A                          2

     1  to  a  maximum  of  one  million dollars per incident per facility in an
     2  aggregate not to exceed two million dollars  plus  an  annual  inflation
     3  adjustment,  determined  by  the  commissioner  from the increase in the
     4  consumer  price index in the one-year period ending on the March thirty-
     5  first prior to  such  inflation  adjustment  effective  on  the  ensuing
     6  September  first,  per facility per year; provided, however, that if the
     7  owner or operator establishes to the satisfaction  of  the  commissioner
     8  that  a  lesser amount will be sufficient to protect the environment and
     9  public  health,  safety  and  welfare,  the  commissioner  shall  accept
    10  evidence of financial responsibility in such lesser amount. In determin-
    11  ing  the  sufficiency of the amount of financial responsibility required
    12  under this section, the commissioner and the superintendent of financial
    13  services shall take into consideration facility size, storage  capacity,
    14  throughput, proximity to environmentally sensitive areas, type of petro-
    15  leum handled, and other factors relevant to the risks posed by the class
    16  or  category  of facility, as well as the availability and affordability
    17  of pollution liability insurance. Any regulations  promulgated  pursuant
    18  to  this  subparagraph  shall  not  take effect until forty-eight months
    19  after the effective date of this section.
    20    (iii) Financial responsibility under this paragraph may be established
    21  by any one or a combination of the following methods acceptable  to  the
    22  commissioner  in  consultation  with  the  superintendent  of  financial
    23  services: evidence of insurance,  surety  bonds,  guarantee,  letter  of
    24  credit,  qualification as a self-insurer, or other evidence of financial
    25  responsibility, including certifications which qualify under the Federal
    26  Oil Pollution Act of 1990 (33 U.S.C. 2701 et seq.).
    27    (iv) The liability of a third-party insurer providing proof of  finan-
    28  cial  responsibility  on  behalf  of  a person required to establish and
    29  maintain evidence of financial  responsibility  under  this  section  is
    30  limited to the type of risk assumed and the amount of coverage specified
    31  in  the  proof  of financial responsibility furnished to and approved by
    32  the department. For the purposes of this section, the term  "third-party
    33  insurer" means a third-party insurer, surety, guarantor, person furnish-
    34  ing  a  letter  of  credit,  or other group or person providing proof of
    35  financial responsibility on  behalf  of  another  person;  it  does  not
    36  include  the  person required to establish and maintain evidence of such
    37  financial responsibility.
    38    (f) (i) Acceptance of proof of financial responsibility shall expire:
    39    (1) one year from its issuance for self-insurance;
    40    (2) on the effective date of a change in the surety  bond,  guarantee,
    41  insurance  agreement,  letter  of  credit,  or  other proof of financial
    42  responsibility; or
    43    (3) on the expiration or cancellation of the surety  bond,  guarantee,
    44  insurance  agreement,  letter  of  credit,  or  other proof of financial
    45  responsibility.
    46    (ii) The person whose proof of financial responsibility is accepted by
    47  the department under this section shall notify the department  at  least
    48  thirty days before the effective date of a change, expiration or cancel-
    49  lation  in  the  surety  bond, guarantee, insurance agreement, letter of
    50  credit, or other proof  of  financial  responsibility.  Application  for
    51  renewal  of  acceptance  of proof of financial responsibility under this
    52  section must be filed at least thirty days before the  date  of  expira-
    53  tion.
    54    (iii)  The department, after notice and hearing, may revoke acceptance
    55  of proof of financial responsibility if it determines that:
    56    (1) acceptance was procured by fraud or misrepresentation; or
        S. 8703--A                          3

     1    (2) a change of circumstance has occurred other than a  change  speci-
     2  fied in clauses one through three of subparagraph (i) of this paragraph,
     3  which would have warranted denial of the application.
     4    (iv) Upon acceptance and approval of proof of financial responsibility
     5  under  this  section,  the  department  shall  issue  to the applicant a
     6  certificate stating that the state's financial  responsibility  require-
     7  ments  have been satisfied. The certificate must include the name of the
     8  major facility, vessel, or pipeline for which it is issued and the expi-
     9  ration date of the certificate.
    10    § 2. The navigation law is amended by adding a new  section  181-f  to
    11  read as follows:
    12    §  181-f.  Railroad  financial  preparedness.  1. The department shall
    13  annually require a railroad company that transports  crude  oil  in  the
    14  state  to  submit information relating to the railroad company's ability
    15  to pay in the event of a discharge involving the transport of crude oil.
    16  The information submitted to the department must include a statement  of
    17  whether  the  railroad  has  the ability to pay for discharges resulting
    18  from a  reasonable worst case discharge as determined by the  department
    19  pursuant to rules and regulations. For the purposes of this section:
    20    a.  "Crude oil" shall mean any naturally occurring hydrocarbons coming
    21  from the earth that are liquid at twenty-five degrees  Celsius  and  one
    22  atmosphere of pressure including, but not limited to, crude oil, bitumen
    23  and  diluted  bitumen, synthetic crude oil, and natural gas well conden-
    24  sate.
    25    b. "Railroad" shall have the same meaning as provided  in  subdivision
    26  twenty-four of section two of the transportation law.
    27    c.  "Railroad  company"  shall  have  the  same meaning as provided in
    28  subdivision twenty-five of section two of the transportation law.
    29    d. "Street railroad" shall have the same meaning as provided in subdi-
    30  vision twenty-nine of section two of the transportation law.
    31    2. The department shall make such information available on its  public
    32  website  not  later  than  February first of each year. In addition, the
    33  department shall also provide recommendations to the legislature on  how
    34  to address any financial deficiencies identified by railroad companies.
    35    § 3. This act shall take effect on the one hundred twentieth day after
    36  it shall have become a law.