Assembly Passes Tough Offshore Oil Damage Bill

SACRAMENTO — A bill that would hold oil companies fully responsible for any damage caused by their offshore operations narrowly passed the Assembly on Thursday.

The measure was sent to the Senate on a 43-26 vote, picking up just two more votes than needed for passage in the 80-member chamber.

The bill declares that firms involved in pumping and drilling for oil and natural gas off California’s coastline will be held “absolutely liable without regard to fault” for any damage caused by their operations.

“It shifts the burden of proof from the damaged parties to the oil companies,” said Assemblyman Sam Farr (D-Carmel), author of the bill.

Assemblyman Tom McClintock (R-Thousand Oaks), usually a strong supporter of the offshore oil industry, spoke in favor of the legislation.

“This bill provides for a streamline approach to instantly assign responsibility in the unlikely event of a disaster,” he said.

The measure would impose liability responsibilities within the California coastal zone--the area extending three miles out to sea from the coastline--at least as stringent as those in federal waters beyond the three-mile limit.

In addition, the bill would go a step beyond federal requirements by holding companies responsible for oil spills and other damages resulting from earthquakes, tsunamis, rough seas and other “act of God” natural disasters.

Farr said the legislation would enable coastal landowners, cities and counties to recover all financial damages, including revenue from lost tourist taxes.

Opponents, including Assemblymen Gil Ferguson (R-Newport Beach) and Don Rogers (R-Bakersfield), who maintain the offshore oil industry is safe and needs no further regulation, criticized the legislation. They particularly objected to the measure’s description of offshore operations as an “inherently ultra-hazardous procedure” in which accidents are “inevitable.”

“We have in operation oil exploration under the most stringent conditions in the world,” Ferguson said.

Assembly Speaker Willie Brown (D-San Francisco), calling the California coastline “a treasured commodity,” used his opponents’ arguments to strengthen his own.

“If offshore oil drilling is perfectly safe, then obviously (oil and natural gas companies) shouldn’t reject this bill,” he reasoned.

“Even under the best of circumstances, offshore drilling is unusually hazardous,” Brown said. “An individual engaged in the business ought to be prepared to stand 100% behind any accident that he or she causes.”

Ferguson and Rogers contended that the bill is an “anti-Proposition-51” measure. Ferguson said the measure was “designed to nullify Proposition 51.”

But Farr told reporters later that his bill would have no effect on Proposition 51, the initiative that if approved by voters June 3 would limit certain defendants’ liability for “pain and suffering” damages in personal injury lawsuits. The initiative would not alter existing laws regarding actual financial damages, however. Farr, noting that his bill deals only with actual financial damages, said, “There should be no fear for Proposition 51.”

The measure’s next stop is the Senate Judiciary Committee, where it is expected to be strongly opposed by oil companies. The oil companies generally ignored the measure in the Assembly, which tends to be more receptive to environmental concerns, “but they are going to come off the wall in the Senate,” Farr predicted.

“It makes sense for California to protect itself,” said Farr, “and this bill calls the bluff of the oil industry.”