Revision: March 27, 2014, midnight
SB 325-FN-LOCAL – AS INTRODUCED
2014 SESSION
06/04
SENATE BILL 325-FN-LOCAL
AN ACT relative to oil spill preparedness and response.
SPONSORS: Sen. Woodburn, Dist 1; Sen. Odell, Dist 8; Sen. Fuller Clark, Dist 21; Sen.?Watters, Dist 4; Sen. Reagan, Dist 17; Rep. Suzanne Smith, Graf 8; Rep.?Hammon, Coos 5
COMMITTEE: Energy and Natural Resources
This bill modifies several provisions relative to the administration of oil discharge or spillage in water.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
14-2763
06/04
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Fourteen
AN ACT relative to oil spill preparedness and response.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Utility Property Tax; Administration; Deposits. Amend RSA 83-F:7, I to read as follows:
I. The commissioner shall collect the taxes, interest, additions to tax and penalties imposed under this chapter and shall pay over to the state treasurer [for deposit in the education trust fund established by RSA 198:39 the amount of the funds collected.]:
(a) For deposit in the education trust fund established in RSA 198:39, the amount of funds collected except those specified in subparagraph (b).
(b) For deposit in the oil pollution control fund established in RSA 146-A:11-a, the amount of funds collected beginning January 1, 2014 from all utilities owning or possessing utility property used for the production, supply, distribution, transmission, or transportation of crude petroleum and refined petroleum products or combinations thereof.
2 Oil Discharge or Spillage; Definitions; Oil Terminal Facility. Amend RSA 146-A:2, IV to read as follows:
IV. “Oil terminal facility” means any facility of any kind and its related appurtenances located within the boundaries of this state that is used or capable of being used for pumping, handling, transferring, transporting, processing, refining or storing oil;
3 Oil Discharge and Spillage; Definitions; Facility. Amend RSA 146-A:2, IX to read as follows:
IX. “Facility” means a location, including structures or land, at which oil is subjected to treatment, storage, processing, refining, pumping, transfer, transporting, or collection;
4 Oil Discharge and Spillage; Definitions; Wholesale Terminal Facility. Amend RSA 146-A:2, XI to read as follows:
XI. “Wholesale terminal facility” means any facility of any kind and its related appurtenances that is primarily a wholesale distributor of oil products and that is used or capable of being used for pumping, handling, transferring, transporting, processing, refining, or storing oil.
5 Personnel. Amend RSA 146-A:11 to read as follows:
146-A:11 Personnel. The department of environmental services shall establish and maintain at ports within the state, and counties where oil pipelines are located, and other places as it shall determine, such employees and equipment as in its judgment may be necessary to carry out RSA?146-A. Inspection and enforcement employees of the department of environmental services in their line of duty pursuant to RSA 146-A shall have the powers of a constable under RSA 104:9.
6 Oil Pollution Control Fund. Amend RSA 146-A:11-a, I to read as follows:
I. There is hereby established the New Hampshire oil pollution control fund. This nonlapsing, revolving fund shall, at a minimum, pay the salaries and expenses of the persons specified in RSA 146-A:11, except as the legislature may otherwise determine, as well as the costs to implement the provisions of RSA 146-A which include, but are not limited to, the salaries and expenses of additional personnel to the extent that such salaries and expenses are incurred in implementing the provisions of this chapter, and the other costs of containment or removal or corrective measures deemed necessary by the department of environmental services as a result of an actual or potential oil discharge into or onto the surface water or groundwater of the state. Moneys from the fund shall be used to mitigate the adverse effects of oil discharges including, but not limited to, provision of emergency water supplies to persons affected by such pollution, and, where necessary as determined by the department of environmental services, the establishment of an acceptable source of potable water to injured third parties. Not more than 10 percent of the moneys in the fund shall be allocated annually for research programs dedicated to the development and improvement of preventive and cleanup measures concerning such oil discharges. [In addition, up to $100,000 of such 10 percent shall be allocated annually to the Piscataqua River Cooperative to train and equip personnel in oil spill response.] In the event of an oil discharge, the department of environmental services may expend, with the approval of governor and council, such additional sums as are necessary to clean up the discharge except that the total amount expended may not exceed the balance in the New Hampshire oil pollution control fund. Income derived from the oil pollution control fund shall only be used for those administrative costs needed to implement RSA 146-A and any other costs cited in this section.
7 License Required. Amend RSA 146-A:11-b, I(c) and II to read as follows:
(c) “Oil” means petroleum products and their by-products including, but not limited to, crude, motor fuels, aviation fuels, and [any oil] all other liquid hydrocarbons regardless of specific gravity which are used for heating, processing, or generating electricity. The term “oil” shall not include natural gas, liquified petroleum gas, or synthetic natural gas regardless of derivation or source.
II. Any person who imports or causes to be imported oil into the state, except those using [oil pipelines,] railroads[,] and highways to transport oil products between states other than New?Hampshire or for international transport of oil products, shall be licensed by the department of safety under this chapter. The annual fee for the license shall be $.00125 per gallon of oil imported into this state. The fee shall be paid monthly by such person to the department of safety. The department of safety shall deposit the first $100,000 of fees paid in each fiscal year into the general fund. The remainder shall be deposited into the oil pollution control fund administered by the department of environmental services. Imposition of the fee shall be based on the records of the person and certified as accurate to the department of safety.
II-a. Any person who imports or causes to be imported oil into the state using pipelines, including those that transport oil between states other than New Hampshire or for international transport of oil products, shall be licensed by the department of safety under this chapter. The annual fee for the license shall be $2.00 per barrel of daily pipeline capacity utilized, based upon average usage during the previous calendar year. The fee shall be paid monthly by such person to the department of safety. The department of safety shall deposit the fees paid into the oil pollution control fund administered by the department of environmental services. Imposition of the fee shall be based on the records of the person and certified as accurate to the department of safety.
8 Effective Date. This act shall take effect 60 days after its passage.
LBAO
14-2763
01/14/14
325-FN-LOCAL - FISCAL NOTE
AN ACT relative to oil spill preparedness and response.
FISCAL IMPACT:
The Department of Safety states this bill, as introduced, will increase state restricted expenditures by $41,000 in FY 2015, $8,500 in FY 2016, $4,000 in FY 2017, and $8,800 in FY 2018. The Department of Environmental Services states this bill may increase state restricted revenue and expenditures by an indeterminable amount in FY 2015 and each year thereafter. The Department of Revenue Administration states this bill will decrease state education trust fund revenue and increase state restricted revenue by $75,000 in FY 2015 and each year thereafter, and increase state restricted expenditures by an indeterminable amount in FY 2015 and each year thereafter. There is no fiscal impact on county and local revenue or expenditures.
METHODOLOGY:
The Department of Safety states this bill requires pipeline operators to be licensed by the Department and establishes an annual fee for the license of $2.00 per barrel of the daily pipeline capacity, with the expectation that fee revenue be directed to the oil pollution control fund. The Department states this bill also directs the property tax for all utilities owning or possessing utility property used for the production, supply, distribution, transmission, or transportation of crude petroleum and refined petroleum products, or combinations thereof, shall be deposited into the oil pollution control fund instead of the education trust fund. The Department states there is only one 238 mile pipeline system that goes through New Hampshire. The pipeline runs from South Portland, Maine through New Hampshire and Vermont to Montreal, Quebec. It is estimated the pipeline transports approximately 152,207 barrels per day. Based on this amount, annual license fee revenue would be $304,414 ($2.00 per barrel per day * 152,207 barrels) annually or approximately $25,368 monthly. The Department states that RSA 146-A:11-b,III allows for an import credit for all oil which is transferred out of state during the reporting period. As this pipeline merely goes through New Hampshire, all oil imported is also exported therefore there is no impact on revenue. The Department states it will have increased expenditures associated with the need to create a new license registration form, create a tax return, modify reports in the Automated Fuel Tax System and interface with the statewide accounting system. The Department estimates in FY 2015 it will cost approximately $41,000 to make the programming changes to its Automated Fuel Tax System to implement this bill, with annual maintenance costs of $4,000 in FY 2016 through FY 2018. In addition, the Department will need to conduct field audits to certify returns are accurate for this new license type. The Department anticipates conducting the field audits in FY 2016 at a cost of $4,500 and in FY 2018 at a cost of $4,800, then every three to four years thereafter. In summary, the Department states this bill will increase oil pollution control fund expenditures by $41,000 in FY 2015, $8,500 in FY 2016, $4,000 in FY 2017, and $8,800 in FY 2018.
The Department of Environmental Services states this bill removes the exemption from the $0.00125 per gallon oil import fee for oil transported via a pipeline. The Department states one company transports oil via a pipeline through New Hampshire to Canada at a rate of approximately 150,000 barrels per day. The Department states though the bill assesses a new $2.00 per barrel fee on the average daily pipeline capacity used for a year, there is the potential for a full credit under RSA 146-A:11-b,III for oil transferred out of state. The Department assumes the company transporting the oil via the pipeline through New Hampshire to Canada would seek the credit, resulting in no additional revenue. If the credit does not apply, then the potential exists to increase revenue to the oil pollution control fund by approximately $300,000 (150,000 average daily barrels * $2.00 per barrel). The Department is not able to determine the increase in expenditures from the fund due to the uncertainty around the revenue.
The Department of Revenue Administration states this bill will direct approximately $75,000 of utility property tax derived from the production, supply, distribution, transmission or transportation of petroleum from the education trust fund to the oil pollution control fund. This redirected revenue is approximately 0.22% of the yearly average of $33 million of utility property tax revenue. The Department is not able to quantify expenditures from the oil pollution control fund but assumes an increase with the increased revenue.