DON BRUNELL: Lawmakers aim at petroleum industry

Some state lawmakers plan to hit petroleum producers with more than $1.2 billion in new costs during the next decade to pay for new water pollution programs.

Some state lawmakers plan to hit petroleum producers with more than $1.2 billion in new costs during the next decade to pay for new water pollution programs. If refiners are forced to absorb those extra costs, they will become job killers right in the middle of a recession. If the industry passes the costs on to consumers, they will amount to a hidden four cent per gallon increase in our state’s gas tax – already one of the highest in the nation.

In 1972, Congress decided to toughen our water pollution laws. At President Nixon’s urging, it created the Environmental Protection Agency and gave the states additional powers to clean up our streams, lakes and underground aquifers.

It was a massive and expensive undertaking and one of the biggest debates was over who would pay for new treatment programs and facilities.

Congress decided to attack the point sources first. Those sources – factories, mills, farms and sewer systems – were easier to identify, affix responsibility and regulate. Since then, industries, farms and local taxpayers have spent billions on pollution controls and cleanup. As a result, our air and water is much cleaner.

Now, the focus has shifted to non-point sources – contamination from nondistinct sources, such as stormwater runoff.

As rain falls from our roofs, runs across parking lots and city streets, and drains from our yards, it collects chemicals, metals, exhaust particulates and fertilizer – pollution we all contribute to. The bone of contention, as it has been the case during the last 45 years, is deciding who pays for the massive new systems required to clean up that polluted stormwater.

For some state lawmakers, the oil industry is the easiest target – and far safer politically than taxing individual voters. Some legislators want to impose a $1.50 per barrel fee on oil refineries in our state – about $1.2 billion over the next decade – even though the studies to date can’t confirm the content and source of pollution. Those new studies won’t be done until June, long after the lawmakers adjourn and go home.

There are some major problems with this concept.

First, to impose a tax before the studies are concluded is a mistake, especially when petroleum products are identified as just one of 14 sources of contamination.

Second, is this a tax or a fee? If this is indeed a fee as supporters contend, it should be based on some sort of logic or factual basis. Without the results of the new study, it’s hard to make that case. If it is a tax, then it can’t be used for stormwater cleanup, because our state constitution requires that gas taxes be used only to build and maintain roads.

Third, if the state’s refineries attempt to absorb the extra costs rather than pass them on to drivers through higher gas prices, it will be a huge economic hit. Currently, the industry employs 5,000 people directly and 20,000 indirectly.

In our state alone, the refiners have spent more than $1 billion upgrading their plants to meet tougher environmental standards and this would be another blow to Washington’s fragile manufacturing sector, commuters, farmers and businesses producing products to deliver to suppliers and people at grocery stores.

Finally, there is a fundamental unfairness in sticking an industry with the costs of a societal problem because they are an easier political target.

The State Department of Ecology and the environmental watchdog group Puget Sound Partnership agree that the original studies vastly overstated the contribution of petroleum products to our stormwater contamination. To charge forward before the corrected information is available and charge them with the entire tab is just plain wrong.

Don Brunell is president of the Association of Washington Business.

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