PaintSquare.com
      | Connect Follow us on Twitter Like us on Facebook
About | Subscribe | Advertise
  

 

Download our free BWater Works Coating Systems eResource Book

Paint and Coatings Industry News

Main News Page


Coatings Industry Wins CA Lead Fee Appeal

Tuesday, November 2, 2010

Comment | More

A California Court of Appeals panel has again denied Shell Oil’s attempt to shift millions of dollars in fees for lead prevention to the coatings industry.

At issue is the fee structure that supports California’s Childhood Lead Poisoning Prevention Program. The gasoline industry bears about 85% of those costs, and the coating industry carries 15%. Shell contended that the paint and coating industry “is mainly responsible for childhood lead poisoning” and thus should pay more.

Tax or Fee?

Equilon Enterprises LLC, doing business as Shell Oil Products, had sought a refund of the more than $3.9 million it paid for 2002 under the fee structure established by the Childhood Lead Poisoning Prevention Act of 1991. The oil company also sought a reallocation of the program’s cost that would shift more of the fee to the coatings industry.

Shell argued that the fee amounted to “an unconstitutional tax, because it does not bear a reasonable relationship to the industry’s responsibility for cases of childhood lead poisoning in California,” according to the appellate panel decision issued Friday (Oct. 29).

A trial court upheld the fee in 2008, concluding that it was a legitimate regulatory fee and not a tax.  The American Coatings Association joined the state of California in supporting the verdict of the trial court.

A Question of Proportion

Shell also contended that any fee should be proportional to the gasoline industry’s responsibility for cases of childhood lead poisoning, rather than its responsibility for environmental lead contamination.  The appellate panel disagreed, saying that the fee was constitutional as long as there was a reasonable basis for it.

“Here, there was a reasonable basis for the department to allocate the lead program fee in the manner it did, based on the gasoline industry’s responsibility for contaminating the environment with lead,” the panel ruled.

“The department was not obligated to allocate the fee based on responsibility only for those specific instances in which exposure to environmental lead contamination has actually resulted in childhood lead poisoning.”

Sinclair Paint Challenge

The program fees were previously challenged by the paint industry. In 1997, the Sinclair Paint Co. sought a refund of nearly $98,000 in fees it had paid to the program.

In that case, the legality of the fees was upheld, although the paint company received a refund because the appeals court said Sinclair had not had an opportunity to prove whether the amount it actually paid bore a reasonable relationship to the social or economic “burdens” that its operations generated.

The court said Sinclair “should be permitted to attempt to prove” any such contention at trial. 

Reasonable Basis

In the Shell ruling, the appellate panel said that the California Supreme Court decision in Sinclair Paint "supports our conclusion that the [social or economic] 'burden' the lead program addresses is environmental lead contamination, rather than just childhood lead poisoning."

California's Childhood Lead Poisoning Prevention Act of 1991 has assessed fees of approximately $18 million a year on the petroleum and coatings industries over the past 12 years to underwrite the costs of running the state's lead poisoning prevention program, according to ACA.

   

Tagged categories: Environmental Protection; Lead; Protective coatings

Comment from Catherine Brooks, (12/5/2010, 5:50 PM)

Using fees for organizations who ignore known dangerous health risks to pay for public education on prevention is a good way to go. The more consumers on any level are informed with facts, the more "Buyer beware" will work.


Comment Join the Conversation:

Sign in to our community to add your comments.

SSPC: The Society for Protective Coatings
http://www.sspc.org/

Join SSPC and Enhance
Your Career !


Wasser High-Tech Coatings Inc.
Wasser Coatings Protect

Wasser Coatings offer a complete range of Moisture Cure Urethane (NEPCOAT approved) systems in addition to Polyurea membranes and linings(NSF).
www.wassercoatings.com


Thermion Inc
Buy Back Program

We are offering $5,000
credit for your old Model
This drive system is
being discontinued by
the manufacturer.
More information at
thermioninc.com
877.884.3428


International Paint LLC
Rapid cure, high temperature lining

AkzoNobel introduces Enviroline 405HTR, an ultra-low VOC lining. 405HTR offers rapid return to service, and excellent chemical resistance at high temperatures.


Binks/DeVilbiss
Built for Tough Jobs

From Epoxies to Urethanes to other high solid coatings, the new Binks Airless 75 delivers a great finish using an ergonomic design. Visit binks.com for more information.


Sidewinder/Persyst Enterprises, Inc.
The Sidewinder Model M2 Solvent Recycler

Combat the rising cost of gunwash, thinners, acetone & more while drastically reducing waste disposal coat.


Harsco
BLACK BEAUTY® App

Download the free app for BLACK BEAUTY® Abrasives. Explore all the features from the palm of your hand.
Toll Free: 1-888-733-3646


PPG Protective and Marine Coatings Group
Industrial strength performance in ONE can.

Now get the durability and protection of two components in one can: Amercoat® ONE, PSX® ONE and Sigmadur ONE.


Novatek Corporation
Dustless Coatings Removal

Strip it, clean it, and profile it,
all dust free! High production
rates and Blast like finishes.
Comply with new lead
standards.


Carboline Company
Fireproofing Solutions

Pyroclad® X1 Thermo-Lag® Pyrocrete® – protecting against hydrocarbon and jet fires, explosions, and cryogenic spills.

 
 
 
Technology Publishing

The Technology Publishing Network

The Journal of Protective Coatings & Linings (JPCL) PaintSquare
Durability + Design Paint BidTracker

 
EXPLORE:      JPCL   |   PaintSquare News   |   Interact   |   Buying Guides   |   Webinars   |   Resources   |   Classifieds
REGISTER AND SUBSCRIBE:      Free PaintSquare Registration   |   Subscribe to JPCL   |   Subscribe to PaintSquare News
MORE:      About PaintSquare.com   |   Privacy policy   |   Terms & conditions   |   Site Map   |   Search   |   Contact Us
 

© Copyright 2000-2015, Technology Publishing / PaintSquare, All rights reserved
2100 Wharton Street, Suite 310, Pittsburgh PA 15203-1951; Tel 1-412-431-8300; Fax 1-412-431-5428; E-mail webmaster@paintsquare.com