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CURRENT ISSUE

DEEPWATER HORIZON SPILL
How long will the political fall out from the spill delay plans to expand U.S. offshore drilling

Hardly at all
For 1-2 years
For longer than 2 years

May 12, 2010

Obama sends oil spill bill proposal to Congress

President Obama has sent Congress a legislative package that, says a White House statement, will enable the Deepwater Horizon Oil Spill response to continue expeditiously, speed assistance to people affected by this spill, and strengthen and update the oil spill liability system to better address catastrophic events. Immediate Funding

The bill would permit the Coast Guard to obtain one or more advances -- up to $100 million each -- from the Principal Fund within the Oil Spill Liability Trust Fund to underwrite Federal response activities taken in connection with the Deepwater Horizon incident.

Among other things, the legislation would provide $29 million for the Secretary of the Interior for additional inspections, enforcement, studies and other activities that are outside of those recoverable from the responsible parties or the Oil Spill Liability Trust Fund. In addition, the bill would extend the time allowed by statute for the Minerals Management Service to review and approve oil and gas lessee exploration plans to allow additional time for the required review.

The Administration's proposal enables the President to trigger and mobilize, in partnership with states, new forms of assistance - such as Unemployment and Nutrition Aid -- if the claims process established by the Oil Pollution Act is not sufficient to meet the needs of affected individuals. It also enables the government to recoup the expenses of providing these services from the responsible parties.

The bill would, for any single incident, raise the statutory expenditure limitation for the Oil Spill Liability Trust Fund from $1 billion to $1.5 billion and the cap on natural resource damage assessments and claims from $500 million to $750 million. The proposal would also raise the caps on liability for responsible parties. The Administration looks forward to working with the Congress to develop levels for the various caps that provide for substantial, and proportional, increases.

The Administration proposes to increase the tax that oil companies pay to finance the Oil Spill Liability Trust Fund from 8 cents per barrel (per 42 gallons) to 9 cents per barrel starting this year.


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