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Liability insurance program would guard public

As the debate over hydraulic fracturing in New York State rages on, many opinions have been expressed but few practical proposals have emerged. Having spent a decade of my professional life as part of a team working for the Environmental Protection Agency (Region II) giving advice to local governments on how to address remediation of environmentally contaminated "brownfields," my experience may be useful to the hydrofracking debate.

I recall asking the environmental engineer who, years earlier, had run the entire cleanup operation at Love Canal why -- if we had the scientific knowledge to make PCBs (the toxins we were fighting) -- couldn't we "unmake" them? His reply was, "We can. We do have the scientific knowledge to 'unmake' them -- but the cost would be horrific."

As is so often the case in American life, money is at the core of the issue; someone's financial gain is being traded off against the losses of others who suffer the consequences. I do not pretend to understand the engineering of hydraulic fracturing, but I do know something about public policy. I offer here a suggestion on how we might proceed.

Once we reach a point where we actually understand hydrofracking, the solution would be for the New York State Department of Environmental Conservation to require drillers to post a performance bond as a condition of licensure. Until then, why not simply require each driller in New York to present a certificate of liability insurance satisfactory to the state? Since the private sector claims to have expertise in "risk management," let's insist it use it.

If environmental risk is minimal, then the cost of liability insurance would be also. Indeed, as the risks approach zero, so should the cost of insurance. Drillers needn't fear disclosure of their corporate secret formulae for drilling techniques or chemical mixtures. Patent and copyright protection, plus threat of lawsuit for breach of contract, would protect industrial secrets.

The governor and Legislature cannot be unaware of the past public costs of environmental disasters. Although no comprehensive summary of the total costs of Love Canal has ever been prepared, as far as I have been able to determine the direct cleanup costs of Love Canal approximated $400 million (unadjusted for inflation). Legal expenses totaled another $227 million, and New York paid out another $24 million to reimburse homeowners for lost property value. This does not include either the cost of direct medical expenses or the inestimable cost of loss of quality of human life to individuals and families.

Before we permit private business interests to embark upon yet another pursuit of profits, it is worth considering a more enlightened approach to public policy -- and one that, I hasten to add, imposes almost no burden on the public purse.


Alfred D. Price is associate professor of urban and regional planning at the University at Buffalo.