Senate panel approves bill to funnel oil-spill penalty money to Gulf

A Senate committee approved legislation Wednesday that would direct billions of dollars in fines from last year’s oil spill to Gulf Coast states to help restore the region.

Passage of the bill is a win for Gulf Coast lawmakers, who have been working for months to develop a bill that would ensure their states, not the federal treasury, receive the majority of money from penalties imposed on BP and the other companies deemed responsible for last year’s massive oil spill.

The Senate Environment and Public Works Committee approved the bill on a voice vote Wednesday and Sen. Barbara Boxer (D-Calif.), the chairwoman of the panel, said she hoped leadership would bring the legislation to the floor quickly.

“We think this is a good bill that needs to be addressed very, very quickly,” Boxer said.

The legislation mandates that 80 percent of Clean Water Act penalties eventually imposed on BP or other companies deemed responsible for the spill go to five Gulf states.

BP and the other companies deemed responsible for the spill face billions of dollars in penalties. If BP is deemed negligent under the Clean Water Act by the courts, the company will have to pay $1,000 for every barrel of oil spilled into the Gulf. If the courts find that BP was grossly negligent, the company will have to pay $4,200 per barrel.

Last year's spill spewed about 4.9 million barrels of oil into the Gulf, meaning BP could face fines ranging from $5.4 billion to $21.1 billion.

You can read more about the bill here.