If BP's victims were hoping for relief from the Legislature this year, they will be disappointed.
A special state tax exemption for individuals affected by last year's Gulf oil disaster has been placed on hold by the House Ways and Means Committee. Chairman Hunter Greene, R-Baton Rouge, refers to the holdup as the "bone pile" because the delay may be permanent. Such is the fate of all legislation that would cost the state money this year.
If the fiscal picture brightens, Greene says bills from the bone pile might advance before the current legislative session's final day on June 23. Time is short. "I certainly feel sympathy for this situation," Greene says. "I think this is one of those bills we have to take a closer look at."
The tax break (House Bill 620) is among the few remaining measures that could offer some relief to victims of BP's 2010 disaster in the Gulf. It would exempt from state income taxes any payments for lost wages and income, such as those resulting from a lawsuit against BP or awarded from the Gulf Coast Claims Facility (GCCF), which is beginning to shutter offices in Louisiana.
"Most of these people have been kicked around by four hurricanes and now they're suffering because of the oil spill," says the bill's author, Rep. Damon Baldone, D-Houma. "We don't need to kick them again by forcing them to pay taxes on this money." Baldone adds that many of his constituents have exhausted their savings trying to stay afloat, and a "shocking number" of them are facing foreclosure.
Greg Albrecht, the Legislature's chief economist, says the explosion of the Deepwater Horizon and the resulting pollution and federal drilling moratorium were "extraordinary enough" for the Legislative Fiscal Office to avoid ascribing a price tag to the bill. He notes that so far this year, BP or the GCCF have paid $14.7 million in relief payments, which would be exempt from income taxation under Baldone's bill.
Greene says that figure was high enough for him to move to shelve the bill, at least temporarily.
Then there's the fight led by Rep. Patrick Connick, R-Marrero, who's trying to help coastal residents, particularly cleanup workers, recover money for medical conditions they suffered — and may suffer in the future — as a result of the disaster. After a hearing that kept lawmakers at the Capitol late into the evening June 1, his bill was stripped of nearly all its substantive language. Supporters say the maneuver means victims will face huge challenges trying to address future medical issues.
In many respects, the debate over Connick's bill had all the makings of a classic tort reform showdown, pitting trial lawyers against big business. The measure sought to make "null, void and unenforceable" all settlements and releases executed by BP that, in turn, let the energy giant off the hook for latent illnesses or diseases that could be medically connected to the BP spill. "Today we have word that we still have oil at the base of the Gulf and plumes are out there," Connick told the House Civil Law Committee. "I had people from my district that were just covered with dispersant."
Connick faced two main arguments, the chief one tort reform. The Louisiana Association of Business and Industry (LABI) and others cited the bill's retroactivity. "This is going to make it very difficult for anyone to settle a lawsuit in this state," says Chuck McMains, a former state lawmaker from Baton Rouge and spokesman for the U.S. Chamber Institute for Legal Reform.
Others argued that the measure was not needed. "Couldn't we just have the state sue BP for any medical needs and costs that might come up?" asked Rep. John LaBruzzo, R-Metairie.
Rep. Neil Abramson, D-New Orleans, amended the bill to provide that all waivers obtained by BP will be governed by Louisiana law, which may or may not help victims. "I'm not sure this bill does anything at all," Abramson says. "I think these kinds of claims are already protected."
Connick and others countered that victims need additional protections. "[The amendment] would gut the bill and it would not protect those folks who need to be tested," he says.
With the Deepwater rig explosion more than a year old, doing nothing sounds like the worst idea. But with only three weeks left in the session, lawmakers will be challenged to do anything else.
Jeremy Alford can be reached at email@example.com.