By Jared Allen - 05/06/10 09:52 PM EDT
Key lawmakers on Thursday acknowledged that their proposal to increase to $10 billion the liability cap on companies responsible for offshore spills may not go far enough to ensure that BP bears the full cost of economic damages.
Calling a $10 billion liability cap "much more appropriate" than the current $75 million ceiling, House Speaker Nancy Pelosi (D-Calif.) on Thursday left open the possibility that BP's liability could exceed that, even with a new liability cap in place, if the results of the spill that began on April 20 are viewed as multiple incidents.
"This spill can do great ecological damage to the Gulf states and, of course, it affects fisheries industry, tourism and the rest, and this $10 billion goes a long way to addressing that," Pelosi said during her weekly press conference. "Depending on how many incidents are involved in this particular — these particular spills, it may be more than one $10 billion liability, but you will be hearing more about that as the committees take that up."
House authors of that legislation also acknowledged that their $10 billion figure was somewhat arbitrary, and not meant to set an ultimate limit.
"We wanted to put forth a substantial and meaningful increase in the cap to make sure that taxpayers are not on the hook for the damage caused by the oil companies," said Rep. Paul Hodes (D-N.H.), one of the original co-sponsors of the legislation, called the Big Oil Bailout Prevention Act.
Hodes said he was "certainly amenable to discussing the number" and possibly revising it upward, especially as the consequences of the spill become more evident.
Cost estimates of the spill — including the cost of containment and cleanup and the overall economic impact — have varied wildly, but are already in the tens or hundreds of billions of dollars, according to some industry analysts. The economic damages a company must pay are in addition to direct cleanup costs.
Rep. Lois Capps (D-Calif.), another co-sponsor of the liability bill, said she wants to "carefully watch" the legislation as it makes its way through House and Senate committees, including Energy and Commerce, on which she sits.
"I want to make sure it's high enough," she said of any new cap.
Rep. Rush Holt (D-N.J.), a lead sponsor of the House version of the bill, said he was unaware of any "second-guessing of that amount" by fellow lawmakers, but acknowledged the likelihood that $10 billion wouldn’t cover the full liability costs for damages.
"You want to strike a balance between a reasonable ability to pay and the amount of the expenses," he said. "This is not the only mechanism for recovery of expenses and damages."
Democratic leadership aides on Thursday suggested that a thorough committee review of Holt's bill could also buy more time to better assess the high end of the eventual economic impact. Lawmakers are intent on BP being fully responsible.
As efforts to contain the spill continued Thursday, with some progress reported, a bipartisan delegation of nine members of the House Energy and Commerce Committee, led by Energy Independence and Global Warming Chairman Edward Markey (D-Mass.), was scheduled to arrive in Hopedale, La., on Friday as part of an investigation into the causes of the rig collapse and subsequent spill. The group will also assess the containment and cleanup efforts.
This story was updated at 9:35 p.m. on May 6.