Flashback: In 2000, Vitter Proposed Legislation To Reduce Criminal Liability Of Oil Companies For Spills

Vitter2 This week, Attorney General Eric Holder announced that the Obama administration had opened criminal and civil investigations into the companies involved in the massive Gulf oil spill. Officials said they were looking into potential violations of the Oil Pollution Act [OPA] of 1990, the Clean Water Act, and the Endangered Species Act, among other laws.

But if Sen. David Vitter (R-LA) had his way, BP and its partners would have been off the hook for violations of all but the weakest of these laws. In July 2000, when Vitter was in the House, he introduced a bill that would make penalties under the OPA “the exclusive criminal penalties” for oil spills:

(a) IN GENERAL- Notwithstanding any other provision or rule of law, sections 4301(c) and 4302 of the Oil Pollution Act of 1990 (Public Law 101-380; 104 Stat. 537) and the amendments made by those sections provide the exclusive criminal penalties for any action or activity that may arise or occur in connection with a discharge of oil or a hazardous substance referred to in section 311(b)(3) of the Federal Water Pollution Control Act (33 U.S.C. 1321(b)(3)).

Fortunately, the bill — which attracted only two cosponsorsnever made it out of committee. If it had become law, BP and the other companies would be exempted from more stringent criminal penalties under the other environmental laws. It would also potentially exempt BP from any workplace safety violations on the rig or during the cleanup.

The Outer Continental Shelf Lands Act (OCSLA), which governs offshore oil and gas exploration, provides for much stricter punishments than the OPA, such as ten years imprisonment to “[a]ny person who knowingly and willfully (1) violates any
provision of this Act.” Meanwhile, criminal negligence under the Clean Water Act is punishable by fines of up to “$50,000 per day, 3 years’ imprisonment, or both.” And under the Endangered Species Act, BP could be fined $13,000 for each endangered animal killed, while “Significant Habitat Modification or Degradation” can carry much stronger penalties including one year imprisonment. These punishments would be on top of the cleanup costs assessed under the OPA. The OPA deals mainly with cleanup costs — not punitive damages — and only allows for imprisonment if a company fails to notify authorities about a spill. It also caps a company’s liability at $75 million.

More recently, Vitter has introduced a bill to raise the OPA’s $75 million cap. But while other senators have proposed caps of $10 billion, Vitter’s bill would limit a company’s liability to the amount of its profit in the last four quarters, or $150 million, whichever is greater. This is allegedly to protect small companies with small profits, but if a big company like BP happened have a bad year and made little or no profit, they would be responsible for only the $150 million.

As The Daily Kingfish pointed out, this is exactly the case with Andarko, the oil company which owns 25 percent of the lease in the Deepwater Horizon well:

BP doesn’t own the entirety of the lease, it only owns 65% of it. Another company, Anadarko, owns 25% of the lease. In the last 4 quarters, Anadarko has lost $135 million, so they would face no more than $150 million in liability, despite the fact that they hold an estimated $50 billion in assets.

BP has already spent nearly a billion dollars on spill cleanup, and could end up spending as much as $37 billion, so a $150 million cap is paltry.

Andarko’s PAC makes few contributions, but has been a consistent supporter of Vitter. The company gave him $10,000 in 2004 — by far the largest of only four contributions made that year — and gave him another $4,000 this year. Their only other contribution this year was $500 to a state senate candidate in Texas.

All together, oil and gas companies have given Vitter nearly $400,000 since 2005, and their investment appears to have been a smart one.