|SAME AS||SAME AS S06543|
|COSPNSR||Silver, Farrell, Lupardo, Glick, Kavanagh, Zebrowski, Cymbrowitz, Latimer, Jaffee, Titone, Schimel, Abinanti, Colton, Castelli, Gottfried, Lentol, Brennan, Englebright, Galef, Dinowitz, Millman, Magnarelli, Markey, Paulin, Cusick, Reilly, Benedetto, Rosenthal, Maisel, Bronson, Roberts, Castro, Rivera P, Quart|
|MLTSPNSR||Braunstein, Cahill, Hooper, Losquadro, McEneny, Murray, Nolan, Russell|
|Add Art 23 Title 29 Part 1 SS23-2901 - 23-2903, Part 2 SS23-2904 - 23-2910, Part 3 SS23-2914 - 23-2928, Part 4 SS23-2931 - 23-2936, amd S23-1903, En Con L; add S92-t, St Fin L|
|Establishes the natural gas production contamination response and compensation program and creates the New York natural gas production contamination damage recovery and remediation fund.|
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STATE OF NEW YORK ________________________________________________________________________ 8572 2011-2012 Regular Sessions IN ASSEMBLY September 13, 2011 ___________ Introduced by M. of A. SWEENEY, SILVER, FARRELL, LUPARDO, GLICK, KAVANAGH, ZEBROWSKI, CYMBROWITZ, LATIMER, JAFFEE, TITONE, SCHIMEL, ABINANTI, COLTON, CASTELLI, GOTTFRIED, LENTOL, BRENNAN, ENGLEBRIGHT, GALEF, DINOWITZ, MILLMAN, MAGNARELLI, MARKEY, PAULIN, CUSICK, REILLY, BENEDETTO, ROSENTHAL, MAISEL, BRONSON, ROBERTS -- Multi-Sponsored by -- M. of A. CAHILL, LOSQUADRO, McENENY, MURRAY, NOLAN, RUSSELL -- (at request of the State Comptroller) -- read once and referred to the Committee on Environmental Conservation AN ACT to amend the environmental conservation law, in relation to establishing the natural gas production contamination response and compensation program; and to amend the state finance law, in relation to creating the New York natural gas production contamination damage recovery and remediation fund The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Article 23 of the environmental conservation law is amended 2 by adding a new title 29 to read as follows: 3 TITLE 29 4 NATURAL GAS PRODUCTION CONTAMINATION RESPONSE 5 AND COMPENSATION PROGRAM 6 Part 1. General Provisions. 7 2. Natural gas production contamination cleanup and decontam- 8 ination. 9 3. Liability; third party compensation. 10 4. Miscellaneous. 11 PART 1 12 GENERAL PROVISIONS 13 Section 23-2901. Legislative intent. 14 23-2902. Purposes. 15 23-2903. Definitions. 16 § 23-2901. Legislative intent. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD13305-04-1A. 8572 2 1 The legislature finds and declares that New York's lands and waters 2 constitute a unique and delicately balanced resource; that the 3 protection and preservation of these lands and waters promotes the 4 health, safety and welfare of the people of this state; that the state 5 is the trustee, for the benefit of its citizens, of all natural 6 resources within its jurisdiction; and that contamination from incidents 7 or accidents that result from natural gas production pose a threat to 8 the economy and environment of this state. The legislature intends by 9 the passage of this title to exercise the powers of this state to 10 provide strict liability for damage sustained within this state as a 11 result of contamination caused by natural gas production, require prompt 12 cleanup and decontamination of any affected real or personal property, 13 and establish a fund for the payment of remediation costs of contam- 14 ination and timely and adequate compensation to any persons damaged by 15 such contamination. 16 § 23-2902. Purposes. 17 It is the purpose of this title to ensure a clean environment and 18 healthy economy for the state by providing for the remediation of any 19 contamination associated with natural gas production which may result in 20 damage to lands, waters or natural resources of the state by authorizing 21 the department of environmental conservation to respond quickly to such 22 contamination and effect prompt cleanup and decontamination of such 23 contamination, giving first priority to protecting public health and 24 minimizing environmental damage, and by providing for strict liability 25 for damage sustained within the state as a result of such contamination. 26 § 23-2903. Definitions. 27 For the purposes of this title, unless the context clearly indicates 28 otherwise, the following terms shall have the following meanings: 29 1. "Administrator" means the chief executive, within the department of 30 audit and control, of the New York natural gas production contamination 31 damage recovery and remediation fund established in section ninety-two-t 32 of the state finance law; 33 2. "Claim" means, for purposes of part three of this title, any claim 34 of the fund or any claim by an injured person who is not responsible for 35 the contamination seeking compensation for cleanup and decontamination 36 costs incurred or damages sustained as a result of contamination that 37 results from natural gas production; 38 3. "Cleanup and decontamination" means activities undertaken to perma- 39 nently eliminate, remove, abate, control or monitor health and/or envi- 40 ronmental hazards or potential hazards in connection with natural gas 41 production; 42 4. "Cleanup and decontamination costs" means all costs associated with 43 the cleanup and decontamination of contamination including relocation 44 costs pursuant to section 23-2907 of this title incurred by the state or 45 its political subdivisions or their agents or any person with approval 46 of the department; 47 5. "Contamination" means any damage to any property or the environ- 48 ment, including, but not limited to, a public or private water supply, 49 any threat to public health, or any hazardous condition that prevents 50 the use of property or that requires relocation of people or property to 51 prevent harm resulting from natural gas production, or the release of 52 any substance used in or associated with processes related to natural 53 gas production, including, but not limited to, the development of 54 natural gas wells; activities associated with drilling, stimulating, 55 completing, or operating a natural gas well; activities associated with 56 the construction or operation of facilities for the collection and/orA. 8572 3 1 processing of natural gas or for the transmission of natural gas from 2 gas wells to consumers of natural gas; and the transportation of materi- 3 als associated with a natural gas well site or natural gas production; 4 6. "Environment" means any water including, but not limited to, a 5 stream, pond, lake, river, water course, aquifer, wetland or reservoir, 6 any land including, but not limited to, a land surface or subsurface, 7 air, fish, wildlife, biota and all other natural resources; 8 7. "Fund" means the New York natural gas production contamination 9 damage recovery and remediation fund established by section ninety-two-t 10 of the state finance law; 11 8. "Natural gas production" or "gas production" means all activities 12 associated with the exploration and production of natural gas, includ- 13 ing, but not limited to, (a) development of natural gas wells; (b) 14 activities associated with drilling, stimulating, completing, or operat- 15 ing a natural gas well; (c) activities associated with the construction 16 or operation of facilities for the collection and transmission of 17 natural gas from gas wells to consumers of natural gas; and (d) the 18 transportation of materials associated with a natural gas well site or 19 natural gas production whether or not such gas is re-injected into the 20 subsurface of the earth, from a geological formation and the transporta- 21 tion of such natural gas to another location; 22 9. "Owner" or "operator" means with respect to natural gas production 23 any person owning or operating by lease, contract or other form of 24 agreement any natural gas production sites, facilities, equipment, or 25 development rights; with respect to abandoned or derelict sites, facili- 26 ties, equipment, or development rights, the person who owned or operated 27 such sites, facilities, equipment or development rights immediately 28 prior to such abandonment, or the owner, or operator at the time of 29 contamination; 30 10. "Person" means public or private corporations, companies, associ- 31 ations, societies, firms, partnerships, joint stock companies, individ- 32 uals, the United States, the state of New York and any of its political 33 subdivisions or agents. 34 PART 2 35 NATURAL GAS PRODUCTION CONTAMINATION 36 CLEANUP AND DECONTAMINATION 37 Section 23-2904. Contamination caused by natural gas production; prohi- 38 bition. 39 23-2905. Cleanup and decontamination of contamination caused by 40 natural gas production. 41 23-2906. Notification by persons responsible for contamination. 42 23-2907. Cleanup and decontamination of prohibited contam- 43 inations. 44 23-2908. Emergency natural gas production contamination control 45 network and emergency natural gas production contam- 46 ination relocation network. 47 23-2909. Right to enter and inspect. 48 23-2910. Registry of reports of contamination. 49 § 23-2904. Contamination caused by natural gas production; prohibition. 50 Contamination of the environment caused by natural gas production is 51 prohibited. 52 § 23-2905. Cleanup and decontamination of contamination caused by 53 natural gas production. 54 1. The commissioner shall promulgate regulations governing the cleanup 55 and decontamination of any contamination resulting from natural gas 56 production.A. 8572 4 1 2. No person shall supervise, aid or participate in any cleanup or 2 decontamination method which is inconsistent with any rule or regulation 3 promulgated pursuant to this section. 4 § 23-2906. Notification by persons responsible for contamination. 5 Any person responsible for causing contamination shall immediately 6 notify the department pursuant to rules and regulations established by 7 the department, but in no case later than two hours after the contam- 8 ination. Failure to so notify shall make such person liable pursuant to 9 the penalty provisions of section 23-2932 of this title. 10 § 23-2907. Cleanup and decontamination of prohibited contaminations. 11 1. Any person causing contamination prohibited by section 23-2904 of 12 this part shall immediately undertake to contain such contamination. 13 Notwithstanding the above requirement, the department, pursuant to regu- 14 lations promulgated for such purpose, may undertake the decontamination 15 of such contamination and may retain agents and contractors who shall 16 operate under the direction of such department for such purpose. 17 2. (a) Upon the occurrence of contamination resulting from natural gas 18 production, pursuant to regulations promulgated for such purpose, the 19 department shall respond promptly and proceed to cleanup and remove the 20 contamination in accordance with environmental priorities or may, at its 21 discretion, direct the person responsible for such contamination to 22 promptly cleanup and remove the contamination. The department shall be 23 responsible for cleanup and decontamination or, as the case may be, for 24 retaining agents and contractors who shall operate under the direction 25 of that department for such purposes. Implementation of cleanup and 26 decontamination procedures of each contamination shall be conducted in 27 accordance with environmental priorities and procedures established by 28 the department. 29 (b) Section eight of the court of claims act or any other provision of 30 law to the contrary notwithstanding, the state shall be immune from 31 liability and action with respect to any act or omission done in the 32 discharge of the department's responsibility pursuant to this title; 33 provided, however, that this subdivision shall not limit any liability 34 which may otherwise exist for unlawful, willful or malicious acts or 35 omissions on the part of the state, state agencies, or their officers, 36 employees or agents or for contamination in violation of section 23-2904 37 of this part. 38 3. Any unexplained contamination caused by natural gas production 39 within state jurisdiction or contamination caused by natural gas 40 production occurring beyond state jurisdiction that for any reason pene- 41 trates within state jurisdiction shall be removed by or under the direc- 42 tion of the department. Except for those expenses incurred by the party 43 causing such contamination, any expenses incurred in the decontamination 44 of contamination shall be paid promptly from the New York natural gas 45 production contamination damage recovery and remediation fund pursuant 46 to section ninety-two-t of the state finance law and any reimbursements 47 due such fund shall be collected in accordance with the provisions of 48 such section. 49 4. Cleanup and decontamination of contamination and actions to mini- 50 mize damage from such contamination shall be, to the greatest extent 51 possible, permanent remedies to the contamination, in accordance with 52 applicable federal and state environmental laws, rules and regulations. 53 5. The department, in consultation with the state comptroller and the 54 attorney general, shall develop a standard contract form to be used when 55 contracting services for the cleanup and decontamination of a contam- 56 ination.A. 8572 5 1 6. Whenever the department acts to remove contamination or contracts 2 to secure prospective decontamination services, the department is 3 authorized to draw upon the money available in the fund, paid out on the 4 audit and warrant of the comptroller. Such moneys shall be used to pay 5 promptly for all cleanup and decontamination costs incurred by the 6 department. Whenever the department acts to remove contamination or 7 contracts to secure prospective decontamination services to address 8 contamination that is associated with an owner or operator, it shall 9 first draw on the bond or other financial security required by paragraph 10 (c) of subdivision three of section 23-2915 of this title paid out on 11 the audit and warrant of the comptroller. If such bond or financial 12 security is insufficient to fully discharge cleanup and decontamination 13 costs, the department is authorized to draw on money available in the 14 fund, paid out on the audit and warrant of the state comptroller. 15 7. (a) Nothing in this section is intended to preclude cleanup and 16 decontamination by any person threatened by such contamination, who, as 17 soon as is reasonably possible, coordinates and obtains approval for 18 such actions with ongoing state or federal operations and appropriate 19 state and federal authorities. Notwithstanding any other provision of 20 law to the contrary, the liability of any contractor for such person, 21 where such person obtains approval from appropriate state and federal 22 authorities for such cleanup and decontamination, and the liability of 23 any person providing services related to the cleanup or decontamination 24 of contamination, under contract with the department, for any injury to 25 a person or property caused by or related to such services shall be 26 limited to acts or omissions of the person during the course of perform- 27 ing such services which are shown to have been the result of negligence, 28 gross negligence or reckless, wanton or intentional misconduct. Notwith- 29 standing any other provisions of law, when (i) a verdict or decision in 30 an action or claim for injury to a person or property caused by or 31 related to such services is determined in favor of a claimant in an 32 action involving a person performing such services and any other person 33 or persons jointly liable, and (ii) the liability of the person perform- 34 ing such services is found to be fifty percent or less of the total 35 liability assigned to all persons liable, and (iii) the liability of the 36 person performing such services is not based on a finding of reckless 37 disregard for the safety of others, or intentional misconduct, then the 38 liability of the person performing such services to the claimant for 39 loss relating to injury to property and for non-economic loss relating 40 to injury to a person shall not exceed the equitable share of the person 41 performing such services determined in accordance with the relative 42 culpability of each person causing or contributing to the total liabil- 43 ity for such losses; provided, however, that the culpable conduct of any 44 person not a party to the action shall not be considered in determining 45 any equitable share herein if the claimant proves that with due dili- 46 gence the claimant was unable to obtain jurisdiction over such person in 47 said action. As used in this section, the term "non-economic loss" 48 includes, but is not limited to, pain and suffering, mental anguish, 49 loss of consortium or other damages for non-economic loss. However, 50 nothing in this subdivision shall be deemed to alter, modify or abrogate 51 the liability of any person performing such services for breach of any 52 express warranty, limited or otherwise, or an express or implied warran- 53 ty under the uniform commercial code, or to an employee of such person 54 pursuant to the workers' compensation law, or to relieve from any 55 liability any person who is responsible for contamination in violation 56 of section 23-2904 of this part.A. 8572 6 1 (b) No action taken by any person to contain or remove contamination 2 shall be construed as an admission of liability for such contamination. 3 No person who gratuitously renders assistance in containing or removing 4 contamination shall be liable for any civil damages to third parties 5 resulting solely from acts or omissions of such person in rendering such 6 assistance except for acts or omissions of gross negligence or willful 7 misconduct. In the course of cleanup and decontamination, no person 8 shall discharge any detergent or other substance into the waters of this 9 state without prior authorization of the commissioner. 10 (c) A person may, without admission of responsibility for a contam- 11 ination and with the consent of the commissioner, commence clean up and 12 decontamination of the contamination and upon the recommendation of the 13 commissioner of health and with the consent of the fund undertake the 14 relocation of persons affected by contamination. Upon determination by 15 the fund that the person is not responsible for the contamination, the 16 person shall be reimbursed by the fund for the actual and necessary 17 expenses incurred. 18 8. Notwithstanding any other provision of law to the contrary, includ- 19 ing but not limited to section 15-108 of the general obligations law, 20 every person providing cleanup, decontamination of contamination or 21 relocation of persons pursuant to this section shall be entitled to 22 contribution from any other responsible party. 23 § 23-2908. Emergency natural gas production contamination control 24 network and emergency natural gas production contamination 25 relocation network. 26 The commissioner shall, by regulation, establish an emergency natural 27 gas production contamination control network and an emergency natural 28 gas production contamination relocation network. 29 § 23-2909. Right to enter and inspect. 30 The department is hereby authorized to enter and inspect any property 31 or premises for the purpose of inspecting sites, facilities, or equip- 32 ment and investigating either actual or suspected sources of contam- 33 ination or violation of this title or any rule or regulation promulgated 34 pursuant to this title. The department is further authorized to enter on 35 property or premises in order to assist in the cleanup or decontam- 36 ination of the contamination. Any information relating to secret proc- 37 esses or methods of manufacture shall be kept confidential. 38 § 23-2910. Registry of reports of contamination. 39 1. The department shall maintain and post on a publicly available 40 internet website a registry of all reports of contamination pursuant to 41 section 23-2906 of this part. Reports shall be added to the registry on 42 an ongoing basis as soon as possible after the date on which they are 43 reported, but no later than thirty days after such date. Such registry 44 shall include, but not be limited to, the following items: 45 (a) a general description of the site consisting of: 46 (i) the name, if any, of the site and the address of the site, includ- 47 ing the town and county; 48 (ii) the contamination at the site, including, but not limited to, a 49 description of the natural gas production activity resulting in contam- 50 ination, the date on which this activity occurred and all inspections, 51 tests and other measures employed in assessing the contamination; 52 (iii) the owner or operator of the natural gas production activity at 53 the time of contamination; and 54 (iv) the name of the current owner of the site; 55 (b) an assessment by the department of harm to the environment result- 56 ing from contamination at the site;A. 8572 7 1 (c) an assessment prepared by the department of health of public 2 health problems at the site resulting from contamination at the site; 3 and 4 (d) a description of cleanup and contamination activities undertaken 5 at the site. 6 2. Periodically, but no less than annually, the department shall 7 update the registry to reflect the status of cleanup and decontamination 8 measures. 9 3. When a permanent remedy of contamination has been achieved, the 10 department may, at the request of the site owner, remove the name of the 11 site owner and the site address information except for the town and 12 county of the site from the registry. All other items shall remain as 13 permanent records on the registry. 14 PART 3 15 LIABILITY; THIRD PARTY COMPENSATION 16 Section 23-2914. Administrator of the New York natural gas production 17 damage recovery and remediation fund. 18 23-2915. Liability. 19 23-2916. Environmental lien. 20 23-2917. Environmental lien notice; contents. 21 23-2918. Filing of notice of environmental lien; filing of 22 release. 23 23-2919. Enforcement of environmental lien. 24 23-2920. Amounts received to satisfy lien. 25 23-2921. Claims against the fund. 26 23-2922. Settlements. 27 23-2923. Settlements when source of contamination is unknown. 28 23-2924. Hearings for persons on claims filed with the adminis- 29 trator. 30 23-2925. Subrogation of rights. 31 23-2926. Awards exceeding current balance. 32 23-2927. Claims against insurers. 33 23-2928. Application of title. 34 § 23-2914. Administrator of the New York natural gas production damage 35 recovery and remediation fund. 36 The state comptroller shall appoint and supervise an administrator of 37 the New York natural gas production damage recovery and remediation fund 38 for the purposes of this part referred to as "the fund". The administra- 39 tor shall be the chief executive of the fund and shall have the follow- 40 ing powers and duties: 41 1. To represent the state in meetings with the alleged person respon- 42 sible for a contamination and claimants concerning liability for the 43 contamination and amount of the claims; 44 2. To determine if hearings are needed to settle particular claims 45 filed by injured persons; 46 3. To convene hearings; 47 4. To certify the amount of claims and names of claimants to the state 48 comptroller; and 49 5. To disburse moneys from the fund for cleanup and decontamination 50 costs pursuant to a certification of claims by the commissioner. 51 § 23-2915. Liability. 52 1. Any person who has caused contamination shall be strictly liable, 53 without regard to fault, for all cleanup and decontamination costs and 54 all direct and indirect damages, no matter by whom sustained, as defined 55 in this section. In addition to cleanup and decontamination costs and 56 damages, any such person who is notified of such contamination and whoA. 8572 8 1 did not undertake relocation of persons residing in the area of the 2 contamination in accordance with paragraph (c) of subdivision seven of 3 section 23-2907 of this title, shall be liable to the fund for an amount 4 equal to two times the actual and necessary expense incurred by the fund 5 for such relocation pursuant to regulations authorized by section 6 23-2908 of this title. 7 2. The fund shall be strictly liable, without regard to fault, for all 8 cleanup and decontamination costs and all direct and indirect damages, 9 no matter by whom sustained, including, but not limited to: 10 (a) Cleanup and decontamination costs including, but not limited to 11 the cost of restoring, repairing, or replacing any real or personal 12 property damaged or destroyed by contamination, any income lost from the 13 time such property is damaged to the time such property is restored, 14 repaired or replaced, any reduction in value of such property caused by 15 such contamination by comparison with its value prior thereto; 16 (b) The cost of restoration and replacement, where possible, of any 17 natural resource damaged or destroyed by contamination; 18 (c) Loss of income or impairment of earning capacity due to damage to 19 real or personal property, including natural resources destroyed or 20 damaged by contamination; provided that such loss or impairment exceeds 21 ten percent of the amount which claimant derives, based upon income or 22 business records, exclusive of other sources of income, from activities 23 related to the particular real or personal property or natural resources 24 damaged or destroyed by such contamination during the week, month or 25 year for which the claim is filed; 26 (d) Loss of tax revenue by the state or local governments for a period 27 of one year due to damage to real or personal property proximately 28 resulting from contamination; and 29 (e) Interest on loans obtained or other obligations incurred by a 30 claimant for the purpose of ameliorating the adverse effects of a 31 contamination pending the payment of a claim in full as provided by this 32 title. 33 3. (a) The owner or operator which has caused contamination shall be 34 strictly liable for the full amount of cleanup and decontamination costs 35 and damages, without regard to fault, subject to the defenses enumerated 36 in subdivision four of this section, for all cleanup and decontamination 37 costs and all direct and indirect damages paid by the fund. 38 (b) (i) The commissioner in consultation with the superintendent of 39 financial services shall promulgate regulations requiring the owner or 40 operator of a drilling site to establish and maintain evidence of finan- 41 cial responsibility. 42 (ii) Financial responsibility under this paragraph may be established 43 by any one or a combination of the following methods acceptable to the 44 commissioner in consultation with the superintendent of financial 45 services: evidence of insurance, surety bonds, guarantee, letter of 46 credit, qualification as a self-insurer, or other evidence of financial 47 responsibility. 48 (iii) The liability of a third-party insurer providing proof of finan- 49 cial responsibility on behalf of a person required to establish and 50 maintain evidence of financial responsibility under this section is 51 limited to the type of risk assumed and the amount of coverage specified 52 in the proof of financial responsibility furnished to and approved by 53 the department. For the purposes of this section, the term "third-party 54 insurer" means a third-party insurer, surety, guarantor, person furnish- 55 ing a letter of credit, or other group or person providing proof of 56 financial responsibility on behalf of another person; it does notA. 8572 9 1 include the person required to establish and maintain evidence of such 2 financial responsibility. 3 (c) Any owner or operator engaging in or seeking to engage in natural 4 gas production shall provide a bond or other financial security accepta- 5 ble to the department in an amount established by rule or regulation in 6 consultation with the administrator of the fund conditioned on perform- 7 ance of such owner's or operator's cleanup and decontamination responsi- 8 bilities in the event of contamination as defined in this section. The 9 bond shall be in an amount sufficient to fully discharge such owner's or 10 operator's cleanup and decontamination responsibilities. The failure of 11 any owner or operator to prevent prohibited contamination shall be 12 deemed a breach of the responsibilities of this title and entitle the 13 department to claim the proceeds of the bond or other financial security 14 authorized by this paragraph. In the event the department acts or 15 remove contamination or contracts to secure prospective decontamination 16 services pursuant to subdivision six of section 23-2907 of this title to 17 address contamination that is associated with an owner or operator, the 18 department shall draw on the bond or other financial security authorized 19 by this paragraph to pay promptly for cleanup and decontamination costs 20 incurred by such department. 21 4. (a) The only defenses that may be raised by a person responsible 22 for causing contamination are: (i) an act or omission caused solely by 23 war, sabotage, or governmental negligence or (ii) an act or omission of 24 a third party other than an employee or agent of the person responsible, 25 or a third party whose act or omission occurs in connection with a 26 contractual relationship with the person responsible, if the person 27 responsible establishes by a preponderance of the evidence that the 28 person responsible exercised due care with respect to the natural gas 29 concerned, taking into consideration the characteristics of natural gas 30 and in light of all relevant facts and circumstances; and 31 (b) took precautions against the acts or omissions of any such third 32 party and the consequences of those acts or omissions. These defenses 33 shall not apply to a person responsible who refuses or fails to (i) 34 report the contamination, or (ii) provide all reasonable cooperation and 35 assistance in cleanup and decontamination activities undertaken on 36 behalf of the fund by the department. In any case where a person respon- 37 sible for contamination establishes by a preponderance of the evidence 38 that the contamination and the resulting cleanup and decontamination 39 costs were caused solely by an act or omission of one or more third 40 parties as described in this paragraph, the third party or parties shall 41 be treated as the person or persons responsible for the purposes of 42 determining liability under this title. 43 (c) Nothing set forth in this subdivision shall be construed to hold a 44 lender liable to the state as a person responsible for the contamination 45 caused by natural gas production at a site in the event: (i) such lend- 46 er, without participating in the management of such site, holds indicia 47 of ownership primarily to protect the lender's security interest in the 48 site, or (ii) such lender did not participate in the management of such 49 site prior to a foreclosure, and such lender: 50 (1) forecloses on such site; and 51 (2) after foreclosure, sells, re-leases (in the case of a lease 52 finance transaction), or liquidates such site, maintains business activ- 53 ities, winds up operations, or takes any other measure to preserve, 54 protect or prepare such site for sale or disposition; provided however, 55 that such lender shall take actions to sell, re-lease (in the case of a 56 lease finance transaction), or otherwise divest itself of such site atA. 8572 10 1 the earliest practicable, commercially reasonable time, on commercially 2 reasonable terms, taking into account market conditions and legal and 3 regulatory requirements. 4 (d) This exemption shall not apply to any lender that has caused or 5 contributed to the contamination caused by natural gas production from 6 or at the site. 7 The terms "participating in management," "foreclosure," "lender" and 8 "security interest" shall have the same meaning as those terms are 9 defined in paragraph (c) of subdivision one of section 27-1323 of this 10 chapter. 11 5. Any claim by any injured person for the costs of cleanup and decon- 12 tamination and direct and indirect damages based on the strict liability 13 imposed by this section may be brought directly against the person who 14 has caused contamination, provided, however, that damages recoverable by 15 any injured person in such a direct claim based on the strict liability 16 imposed by this section shall be limited to the damages authorized by 17 this section. 18 § 23-2916. Environmental lien. 19 1. The fund shall have a lien for the costs incurred by the fund for 20 the cleanup and decontamination of contamination and for the payment of 21 claims for direct and indirect damages as a result of contamination upon 22 real property located within the state: 23 (a) owned by a person liable to the fund for such costs under section 24 23-2915 of this part at the time a notice of environmental lien is 25 filed; and 26 (b) upon which the contamination occurred. 27 2. An environmental lien shall attach when: 28 (a) cleanup and decontamination costs and damage costs are incurred by 29 the fund; 30 (b) the person referred to in subdivision one of this section fails to 31 pay such costs within ninety days after a written demand therefor by the 32 administrator is mailed by certified or registered mail, return receipt 33 requested; and 34 (c) a notice of environmental lien is filed as provided in section 35 23-2918 of this part; provided, however, that a copy of the notice of 36 environmental lien is served upon the owner of the real property subject 37 to the environmental lien within thirty days of such filing in accord- 38 ance with the provisions of section eleven of the lien law. 39 3. An environmental lien shall continue against the real property 40 until: 41 (a) the claim or judgment against the person referred to in subdivi- 42 sion one of this section for cleanup and decontamination costs and 43 damage costs is satisfied or becomes unenforceable; 44 (b) the lien is released by the administrator pursuant to this subdi- 45 vision; 46 (c) the lien is discharged by payment of moneys into court; or 47 (d) the lien is otherwise vacated by court order. 48 Upon the occurrence of any of the foregoing, except where the lien is 49 vacated by court order, the administrator shall execute the release of 50 an environmental lien and file the release as provided in section 51 23-2918 of this part. The administrator may release an environmental 52 lien where: 53 (i) a legally enforceable agreement satisfactory to the administrator 54 has been executed relating to cleanup and decontamination costs and 55 damage costs or reimbursing the fund for cleanup and decontamination 56 costs and damage costs; orA. 8572 11 1 (ii) the attachment or enforcement of the environmental lien is deter- 2 mined by the administrator not to be in the public interest. 3 4. An environmental lien is subject to the rights of any other person, 4 including an owner, purchaser, holder of a mortgage or security inter- 5 est, or judgment lien creditor, whose interest is perfected before a 6 lien notice has been filed as provided in section 23-2918 of this part. 7 § 23-2917. Environmental lien notice; contents. 8 A notice of environmental lien must state: 9 1. That the lienor is the New York natural gas production contam- 10 ination damage recovery and remediation fund; 11 2. The name of the record owner of the real property on which the 12 environmental lien has attached; 13 3. The real property subject to the lien, with a description thereof 14 sufficient for identification; 15 4. That the real property described in the notice is the property upon 16 which contamination occurred and that cleanup and decontamination costs 17 and damage costs have been incurred by the lienor as a result of such 18 contamination; 19 5. That the owner is potentially liable for cleanup and decontam- 20 ination costs and damage costs pursuant to section 23-2915 of this part; 21 and 22 6. That an environmental lien has attached to the described real prop- 23 erty. 24 § 23-2918. Filing of notice of environmental lien; filing of release. 25 1. A notice of environmental lien shall be filed within six years from 26 the time a disbursement is made by the fund for cleanup and decontam- 27 ination costs and damage costs incurred by the fund in the clerk's 28 office of the county where the property is situated. If such property is 29 situated in two or more counties, the notice of environmental lien shall 30 be filed in the office of the clerk of each of such counties. The notice 31 of lien shall be indexed by the county clerk in accordance with the 32 provisions of section ten of the lien law. 33 2. A release of an environmental lien shall be filed in the clerk's 34 office of each county where the notice of environmental lien was filed 35 and shall be indexed in the manner prescribed for indexing environmental 36 liens. 37 § 23-2919. Enforcement of environmental lien. 38 An environmental lien may be enforced against the property specified 39 in the notice of environmental lien, and an environmental lien may be 40 vacated or released, as prescribed in article three of the lien law; 41 provided, however, that nothing in this article or in article three of 42 the lien law shall affect the right of the fund to bring an action to 43 recover cleanup and decontamination costs and damage costs under section 44 23-2915, 23-2926, 23-2927 or 23-2928 of this part. 45 § 23-2920. Amounts received to satisfy lien. 46 Amounts received by the administrator to satisfy all or part of an 47 environmental lien shall be deposited in the state treasury and credited 48 to the natural gas production damage recovery and remediation fund. 49 § 23-2921. Claims against the fund. 50 Claims shall be filed with the administrator not later than three 51 years after the date of discovery of damage nor later than ten years 52 after the date of the incident which caused the damage. The administra- 53 tor shall prescribe appropriate forms and procedures for such claims, 54 which shall include a provision requiring the claimant to make a sworn 55 verification of the claim to the best of his knowledge. Any person who 56 knowingly gives or causes to be given any false information as a part ofA. 8572 12 1 any such claim shall, in addition to any other penalties herein or else- 2 where prescribed, be guilty of a misdemeanor punishable by a fine of up 3 to one thousand dollars or up to one year imprisonment. Upon receipt of 4 any claim, the administrator shall as soon as practicable inform all 5 affected parties of the claim. 6 § 23-2922. Settlements. 7 The administrator shall attempt to promote and arrange a settlement 8 between the claimant and the person responsible for the contamination. 9 If the source of the contamination can be determined and liability is 10 conceded, the claimant and the alleged person responsible for the 11 contamination may agree to a settlement which shall be final and binding 12 upon the parties and which will waive all recourse against the fund. 13 § 23-2923. Settlements when source of contamination is unknown. 14 If the source of the contamination is unknown or cannot be determined, 15 the claimant and the administrator shall attempt to arrange a settlement 16 of any claim against the fund. The administrator is authorized to enter 17 and certify payment of such settlement subject to such proof and proce- 18 dures contained in regulations promulgated by the administrator. 19 § 23-2924. Hearings for persons on claims filed with the administrator. 20 1. The administrator shall grant a hearing when persons alleged to be 21 responsible for the contamination contest the validity or amount of 22 damage claims or claims for cleanup and decontamination costs presented 23 by injured persons to the fund for payment or when injured persons who 24 have filed a claim against the fund contest the validity or amount of 25 the settlement proposed by the administrator. 26 2. One hearing may be granted to hear and determine all claims arising 27 from or related to a common contamination. 28 3. The burden of proof with respect to the validity or amount of 29 damage claims or claims for cleanup and decontamination costs shall be 30 upon the persons contesting such claims or the claimants contesting the 31 settlement proposed by the administrator. 32 4. At least twenty days notice of such hearing shall be given by the 33 administrator to the claimants and, if known, the alleged person respon- 34 sible for the contamination. 35 5. Upon the return day of such notice the person so notified shall 36 file with the administrator a statement setting forth the position of 37 the person so notified. Pertinent and relevant testimony of witnesses 38 shall be received in support of or opposition to such statement. The 39 claimants or alleged persons responsible for the contamination may 40 appear in person or by attorney, present witnesses, submit evidence and 41 be given full opportunity to be heard. 42 6. The administrator shall have the power to order testimony under 43 oath and may subpoena attendance and testimony of witnesses and the 44 production of such documentary materials pertinent to the issues 45 presented at the hearing. Each person appearing at the hearing may be 46 represented by counsel. 47 7. Within sixty calendar days from the close of such hearing and after 48 due consideration of the written and oral statements and testimony and 49 arguments filed pursuant to this section, or on default in appearance on 50 said return day, the administrator shall make his final determination on 51 the validity or amount of the damage claims or claims for cleanup and 52 decontamination costs filed by the injured persons. The administrator 53 shall notify the claimant and, if known, the alleged person responsible 54 for the contamination thereof in writing by registered mail. 55 8. Determinations made by the administrator after such hearing shall 56 be final and conclusive. Any action for judicial review shall be filedA. 8572 13 1 pursuant to the provisions of article seventy-eight of the civil prac- 2 tice law and rules. 3 9. Upon a determination by the administrator that provides for an 4 award to the claimants, the administrator shall certify the amount of 5 the award and the name of the claimant to the state comptroller, who 6 shall pay the award from the fund. In any case in which a person respon- 7 sible for the contamination seeks judicial review, reasonable attorney's 8 fees and costs shall be awarded to the claimant if the determination of 9 the administrator is affirmed. 10 § 23-2925. Subrogation of rights. 11 Payment of any cleanup costs or damages by the fund arising from a 12 single incident shall be conditioned upon the administrator acquiring by 13 subrogation all rights of the claimant to recovery of such costs or 14 damages from the person responsible for the contamination or other 15 responsible party. The administrator shall then seek satisfaction from 16 the person responsible for the contamination or other responsible party 17 in the supreme court if the person responsible for the contamination or 18 other responsible party does not reimburse the fund. In any such suit, 19 except as provided by section 23-2915 of this part, the administrator 20 need prove only that an unlawful contamination occurred which was the 21 responsibility of the person responsible for the contamination or other 22 responsible party. The administrator is hereby authorized and empowered 23 to compromise and settle the amount sought for costs and damages from 24 the person responsible for the contamination or other responsible party 25 and any penalty arising under this title. 26 § 23-2926. Awards exceeding current balance. 27 In the event that the total awards for a specific occurrence exceed 28 the current balance of the fund, the immediate award shall be paid on a 29 prorated basis, and all claimants paid on a prorated basis shall be paid 30 as determined by the administrator, a pro rata share of all moneys 31 received by the fund until the total amount of the proven damages is 32 paid to the claimant or claimants. The administrator may also provide 33 through regulation to fix the priority for the payment of claims based 34 on extreme hardship. 35 § 23-2927. Claims against insurers. 36 Any claims for costs of cleanup and decontamination, civil penalties 37 or damages by the state and any claim for damages by any injured person, 38 may be brought directly against the bond, the insurer, or any other 39 person providing evidence of financial responsibility. 40 § 23-2928. Application of title. 41 For purposes of cleanup and decontamination of any public or private 42 ground water supply system contaminated by any contamination occurring 43 either before or after the effective date of this title, all relevant 44 provisions of this title shall apply. 45 PART 4 46 MISCELLANEOUS 47 Section 23-2931. Joint rules and regulations. 48 23-2932. Enforcement of title; penalties. 49 23-2933. Availability of additional remedies. 50 23-2934. Construction. 51 23-2935. Reports. 52 23-2936. Effect of federal legislation. 53 § 23-2931. Joint rules and regulations. 54 The commissioner and the state comptroller are authorized to adopt, 55 amend, repeal, and enforce such rules and regulations pursuant to theA. 8572 14 1 state administrative procedure act, as they may deem necessary to accom- 2 plish the purposes of this title. 3 § 23-2932. Enforcement of title; penalties. 4 Any person who knowingly gives or causes to be given any false infor- 5 mation as a part of, or in response to, any claim made pursuant to this 6 title for cleanup and decontamination costs, direct or indirect damages 7 resulting from contamination, or who otherwise violates any of the 8 provisions of this title or any rule promulgated thereunder or who fails 9 to comply with any duty created by this title shall be liable to a 10 penalty of not more than twenty-five thousand dollars for each offense 11 in a court of competent jurisdiction. If the violation is of a continu- 12 ing nature each day during which it continues shall constitute an addi- 13 tional, separate and distinct offense. 14 § 23-2933. Availability of additional remedies. 15 Nothing in this title shall be deemed to preclude the pursuit of any 16 other civil or injunctive remedy by any person. The remedies provided in 17 this title are in addition to those provided by existing statutory or 18 common law, but no person who receives compensation for damages or 19 cleanup and decontamination costs pursuant to any other state or federal 20 law shall be permitted to receive compensation for the same damages or 21 cleanup and decontamination costs under this title. 22 § 23-2934. Construction. 23 This title, being necessary for the general health, safety and welfare 24 of the people of this state, shall be liberally construed to affect its 25 purposes. 26 § 23-2935. Reports. 27 The commissioner and the administrator shall make an annual report to 28 the legislature and the governor which shall describe the quantity and 29 degree of contamination caused by natural gas production, the costs and 30 damages paid by and recovered for the fund, and the economic and envi- 31 ronmental impact on the state as a result of the administration of this 32 title. 33 § 23-2936. Effect of federal legislation. 34 If the United States congress enacts legislation providing compen- 35 sation in the event of contamination caused by natural gas production, 36 the commissioner shall determine to what degree such legislation 37 provides the needed protection for our citizens, businesses and environ- 38 ment and shall make the appropriate recommendations to the legislature 39 for amendments to this title. 40 § 2. Section 23-1903 of the environmental conservation law is amended 41 by adding a new subdivision 3 to read as follows: 42 3. The commissioner is hereby authorized to establish a surcharge 43 pursuant to regulation on the permit fees on gas wells, authorized by 44 subdivision one of this section, to be credited to the New York natural 45 gas production contamination damage recovery and remediation fund estab- 46 lished in section ninety-two-t of the state finance law. The surcharge 47 shall be established to provide sufficient funds to meet the obligations 48 of the fund. 49 § 3. The state finance law is amended by adding a new section 92-t to 50 read as follows: 51 § 92-t. New York natural gas production contamination damage recovery 52 and remediation fund. 1. There is hereby established in the joint 53 custody of the state comptroller and the commissioner of taxation and 54 finance a special fund to be known as the "the New York natural gas 55 production contamination damage recovery and remediation fund".A. 8572 15 1 2. The fund shall consist of revenues collected by the department of 2 environmental conservation pursuant to subdivision 3 of section 23-1903, 3 section 23-2915, section 23-2920, and section 23-2932 of the environ- 4 mental conservation law and all other moneys appropriated, credited or 5 transferred thereto from any other fund or source pursuant to law. 6 3. Moneys in the fund shall be kept separate and not commingled with 7 any other moneys in the custody of the commissioner of taxation and 8 finance and the state comptroller. 9 4. Moneys of the fund, following appropriation by the legislature, may 10 be expended for the following purposes: 11 (a) damages as defined in section 23-2915 of the environmental conser- 12 vation law; 13 (b) research on the prevention and the effects of contamination from 14 natural gas production on the environment and on the development of 15 improved cleanup and decontamination operations; provided, however, that 16 the cost of such research shall not exceed the amount of interest which 17 is credited to this fund; 18 (c) general administration of the fund, equipment and personnel costs 19 of the department of environmental conservation, the state comptroller 20 and any other state agency related to the enforcement of title twenty- 21 nine of article twenty-three of the environmental conservation law; 22 (d) research and demonstration programs concerning the causes and 23 abatement of contamination from natural gas production; provided, howev- 24 er, that the cost of such research and demonstration programs shall not 25 exceed the amount of interest which is credited to this fund. 26 5. The comptroller may invest and reinvest any moneys in such fund in 27 obligations in which the comptroller is authorized to invest pursuant to 28 the provisions of section ninety-eight-a of the state finance law. Any 29 income or interest derived from such investment shall be included in the 30 fund. 31 6. Moneys, shall be payable from the fund on the audit and warrant of 32 the comptroller on vouchers approved and certified by the comptroller 33 and the commissioner of environmental conservation. 34 7. The administrator of the fund, as established in section 23-2914 of 35 the environmental conservation law, shall recover to the fund moneys 36 disbursed for the following purposes: 37 a. costs incurred by the fund in the cleanup and decontamination of 38 contamination when the person responsible for causing a contamination 39 has failed to promptly clean up and remove the contamination to the 40 satisfaction of the department of environmental conservation; 41 b. costs incurred by the fund in the payment of claims for direct and 42 indirect damages, as defined in section 23-2915 of the environmental 43 conservation law; and 44 c. all penalties assessed pursuant to title twenty-nine of article 45 twenty-three of the environmental conservation law. 46 § 4. Severability. If any clause, sentence, paragraph, section or part 47 of this act shall be adjudged by any court of competent jurisdiction to 48 be invalid, the judgment shall not affect, impair, or invalidate the 49 remainder thereof, but shall be confined in its operation to the clause, 50 sentence, paragraph, section or part thereof directly involved in the 51 controversy in which the judgment shall have been rendered. 52 § 5. This act shall take effect on the one hundred twentieth day after 53 it shall have become a law; provided, however, that effective immediate- 54 ly, the addition, amendment and/or repeal of any rule or regulation 55 necessary for the implementation of this act on its effective date is 56 authorized to be made and completed on or before such date.