Senate rejects reinstatement of industry Superfund tax

April 7, 2003
The US Senate, on a 56-43 vote Mar. 25, rejected efforts to revive an expired "Superfund" toxic waste tax on industry. Before 1995, oil and chemical companies were charged a fee on their products that went to a special cleanup trust fund; the excise tax on crude was 9.7¢/bbl. Superfund taxes also included a corporate environmental tax of 0.12% on taxable income over $2 million.

The US Senate, on a 56-43 vote Mar. 25, rejected efforts to revive an expired "Superfund" toxic waste tax on industry. Before 1995, oil and chemical companies were charged a fee on their products that went to a special cleanup trust fund; the excise tax on crude was 9.7¢/bbl. Superfund taxes also included a corporate environmental tax of 0.12% on taxable income over $2 million.

"Today, the Republicans have sent a message loud and clear: They stand with the corporate polluters and not with American families," amendment sponsor Sen. Frank Lautenberg (D-NJ) said after the vote. "My amendment would force the oil and chemical companies that made these messes to pay for a portion of the cleanup, instead of passing the entire bill on to the taxpayers."

Democrats and some moderate Republicans have been seeking to reimpose the tax, saying the fund badly needs the $15-16 billion over 10 years that a new tax would generate.

The White House does not support a new tax, and congressional Republican leaders say they don't want to even debate the idea of a tax until the Superfund system is reformed.

Senate Environment and Public Works Committee Chairman James Inhofe (R-Okla.) said the tax unfairly penalized companies that follow sound environmental practices and abide by the law.

"Under existing law, identifiable and viable parties responsible for contamination at specific Superfund sites already pay for cleanup costs. This tax would have applied to everyone, regardless of culpability," he said.

The White House budget request for the 2004 fiscal year now before Congress calls for increasing spending on Superfund cleanups by $150 million, with money going to clean 10-15 sites.

The fund used to contain $3.6 billion, but after years of cleanups, the account is only expected to hold $28 million by December 2003.

The American Petroleum Institute says Superfund needs to be reformed because the rules are confusing and burdensome. The association also thinks reform should not include a new tax on oil because it has already paid more than its fare share in the existing fund. Congress may consider new rules this year.

"The petroleum industry contributed more than half of that tax revenue to support the program (57%), yet its estimated share of the potential liability for cleaning up Superfund sites is less than 10%," according to the API web site.

Environmental groups warn that without the tax, polluters won't be held liable for future sites and the taxpayer will be left to pay the tab.