Spill Cleanups: Who Pays? : A Tax Is Being Considered; Others Argue for User Fees Passed On in Prices of Products.


Among the many nagging questions prompted by the chemical spill that has blighted the upper Sacramento River, one could have especially long-lasting reverberations: Who will pay for the cleanup of this accident and similar ecological nightmares?

Already, lawsuits have been filed to begin sorting out financial responsibility for the spill. Government agencies are burrowing into near-empty coffers to meet the immediate needs of the sullied fisherman’s paradise.

But more fundamentally, environmentalists, some politicians and regulators are citing the accident as the latest proof of the need for change in how the costs of protecting nature are borne.


The answer, they say, is taxes or other fees that force manufacturers--and, ultimately, consumers--to pay up front for the environmental costs of everything from pesticides to the ordinary packaging that crowds the nation’s landfills.

Such fees, they argue, would lower the use of materials such as those that spilled in the scenic river and make safer alternatives more competitive.

“Many of us are using (the spill) as an example that there has got to be a better way,” said Erik Olson, an attorney with the National Wildlife Federation.

Environmental disasters, after all, seldom come cheap. The problem has always been in getting all the responsible parties to face up to the costs.

In the case of Southern Pacific Transportation Co., the relatively small spill of an estimated 12,000 gallons of pesticide--in just the wrong place--will prove extremely expensive.

Beyond the cleanup costs, demands will be made on Southern Pacific to make good the losses of affected businesses and to restore the environment. But the railroad argues that that isn’t fair.

As a common carrier, officials say, Southern Pacific must carry whatever legal loads are presented to it. The makers and users of the commodities--not the carrier--should bear the costs of accidents, the railroad contends.

“We have felt rather victimized ourselves,” Southern Pacific Vice Chairman Robert F. Starzel said.

There will be plenty of expense to share in restoring 45 miles of the Sacramento River. “No doubt that that’s a multimillion-dollar package,” said Douglas Wheeler, secretary for resources in the California Department of Conservation.

Sorting out the burden will be a costly legal swamp. The first of an expected wave of lawsuits has been filed, including a class-action suit by Melvin Belli’s San Francisco law firm against Southern Pacific Railroad and Amvac Chemical Corp., the City of Commerce company that manufactures the pesticide. The environmental groups Greenpeace and the National Toxics Campaign have also let area residents know that they can recover damages from the spill.

Meanwhile, the state and federal agencies that would probably be sued--those charged with overseeing restoration of the area’s natural resources under the federal Superfund law--are studying the railroad’s cleanup plan.

Virtually no one in the maze is happy about the way environmental damages are paid for now.

“We’re having to rob Peter to pay Paul,” Wheeler said. The state, he noted, has no funds budgeted for cleanups, but has nonetheless gone ahead and spent the necessary funds.

“Now we’ll have the long and arduous process of reclaiming them from Southern Pacific, or whomever Southern Pacific decides may also be liable,” Wheeler said.

Federal regulators have similar complaints; many blame Reagan Administration budget cuts for lack of enough funds even to take polluters to court.

“This is a bitter, bitter pill for many agencies,” Olson said, “because they know if they could build their cases, there would be millions and millions of dollars out there to restore the environment.”

Historically, many polluters have cleaned up spills but not restored destroyed wildlife and habitat. Until a federal agency hauled 15 companies into court last year for polluting Santa Monica Bay, the federal government had never asked industry to pay for such restoration.

Meanwhile, at Superfund toxic-waste sites, shaky companies routinely go belly up when faced with an expensive cleanup, leaving taxpayers to foot the bill.

In the long run, environmentalists contend, a better solution is to make the prices of products that can have a negative effect on the environment better reflect those now-"hidden” costs. Such costs would, for instance, include the expense of restoring the trout population of the Sacramento River or the price of burying a polystyrene coffee cup in an urban landfill.

“User pays--that’s the only responsible way to handle these things,” said Susan Cooper, a staff ecologist with the Washington-based National Coalition Against the Misuse of Pesticides. “And if everyone yells and screams because it is so expensive, then they should look at what they’re doing, because it is expensive.”

The California Legislature pioneered the concept last year with legislation creating an offshore oil-spill response fund, which is used to prevent as well as respond to accidents.

The law provided for a $100-million fund by imposing a 25-cent tax on every barrel of oil transported into the state. That adds 0.0064 cents a gallon to gasoline prices at the pump, according to the state’s office of Oil Spill Prevention and Response.

The Sacramento River episode has prompted the drafting of a parallel bill that would address inland spills of toxic materials. Sen. Mike Thompson (D-St. Helena) intends to introduce the bill when the Senate reconvenes.

Others, however, argue for fees on ecology-threatening products themselves, with an emphasis on cutting risk by reducing their use.

An early example of that approach: Big California utilities since the mid-1980s have collected a few cents a month from ratepayers to build the state’s Nuclear Decommissioning Trust Fund, which will be used to dismantle the state’s nuclear power plants at the end of their useful lives.

Iowa’s pesticide law is also seen as a trailblazing effort that in just one year has cut use of the most common pesticide in the state by 40%.

The state charges pesticide manufacturers 0.01% of their gross annual sales in the state; retailers and commercial applicators pay a fee of 0.02% of their sales. From the $500 million in pesticides sold annually in Iowa, a $3-million fund is created--not to clean up spills, but to study alternative pest-control methods.

Chemical manufacturers, understandably, take exception to paying for studies of replacements for their products. They prefer the current reliance on university-based research centers, combined with improved mechanisms for responding to accidents as they occur.

“We think that the marketplace has always worked very well to encourage farmers to judiciously use our products,” said Jay Vroom, president of the National Agricultural Chemicals Assn.

Bearing the Cost of Environmental Damage

The Sacramento River toxic spill has revived discussion of ways to build the environmental costs of dangerous products into their price tags. Already, makers and users of ecology-threatening materials are being asked on a number of fronts to pay in advance for the potential damage the goods may cause. Some examples:

* Gasoline in California costs an extra 0.0064 cents a gallon to maintain a $100-million oil-spill response fund.

* A few cents a month are tacked on to Californians’ electric bills to pay the eventual costs of decommissioning the state’s nuclear power plants.

* Pesticide users and manufacturers pay fees based on their annual sales in Iowa to underwrite state-sponsored research on alternative pest-control methods.

* Swedish taxes on pesticides have cut use of the products by 50% during the past decade.