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The Vermont Commissioner of Financial Regulation told lawmakers Wednesday that he opposes a proposed law that would make it easier for victims of toxic pollution to prevail in court against polluters who harm them.

Vermont currently enjoys some of the lowest insurance rates in the country, but a bill called S. 197, which holds polluters strictly liable for injuries and illnesses resulting from toxic pollution, could jeopardize that ranking, Commissioner Michael Pieciak told members of the House Committee on Judiciary.

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Pieciak said the bill could significantly raise the cost of insurance for some companies, or could cause insurance companies to refuse to cover some companies altogether.

If insurance companies refuse to insure companies that emit toxic pollutants, Pieciak said, the bill could end up doing more harm than good. Some companies could choose to operate without insurance, he said, and some “may very well decide to do business in another location” if the bill becomes law.

The real estate industry is also opposed to the bill, said Ray Ault, a commercial real-estate agent and past president of both the Vermont Association of Realtors and the Rutland Region Chamber of Commerce.

Even the perception that Vermont companies might face an increased standard of liability for toxic pollution could harm the state’s real-estate markets, Ault said.

The bill, he said “will undoubtedly put Vermont… at a competitive disadvantage” against other states with regard to commercial and industrial real estate, he said.

Under the bill, companies would be liable for any harm done in the release of harmful chemicals into the environment, even if state permits allowed the pollution, and even if polluters were not aware of harm until after the fact.

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The bill also assigns joint and several liability, which means that if several companies were involved in similar acts of polluting the environment, each polluter could be held responsible for the harm caused by all.

The bill S. 197 was introduced early in the session by Sen. Dick Sears and Sen. Brian Campion, both of Bennington and both Democrats, on behalf of constituents who for years unknowingly had been drinking water contaminated by perfluorooctanoic acid (PFOA), produced by former Teflon-product manufacturer Chemfab.

Chemfab, which is now owned by French multinational chemical firm Saint-Gobain, is being sued by affected Bennington residents who are seeking funds to pay for medical monitoring. Their legal case has illustrated how difficult that can be.

Emily Joselson, an attorney representing the Bennington residents, told the judiciary committee Wednesday that there’s more at stake than insurance rates and real estate.

Her own clients, having discovered years ago that Chemfab had poisoned their wells, are still in court hoping that Saint-Gobain will be required to pay for medical monitoring to detect illnesses resulting from Chemfab’s industrial toxicants, she said.

With or without S.197, she said, Vermonters will always face an uphill battle when they try to force businesses to pay for harms their pollution causes. Most Vermonters don’t have the resources to effectively fight for compensation for their injuries, she said.

“These suits are really difficult to bring, and really expensive, and really easy to lose,” Joselson said.

An attorney who often represents people harmed by polluters, Joselson said S. 197 would offer a small but meaningful improvement in the law for Vermonters who through no fault of their own suffer harm from toxic pollution.

It’s a matter of justice for Vermonters who otherwise would be unable to afford protracted legal battles, Ken Rumelt, a professor at Vermont Law School, told lawmakers.

“If you’re harmed, and someone else did it and they were in a position to prevent it from happening, and you’ve done nothing wrong, the other side should be liable, period,” Rumelt said.

That’s what S. 197’s strict liability provision would establish, he said.

Rumelt and Joselson urged lawmakers not to adopt, as part of the law, a list of harmful chemicals that pollutants must appear on in order for Vermonters to make strict-liability claims against polluters.

The current version of S. 197 would only allow strict liability claims for toxic chemicals that are included in a list put out by the Environmental Protection Agency.

Such lists inevitably include chemicals listed after they had already caused widespread harm, Joselson said. For instance, the PFOA that poisoned hundreds of Bennington residents wasn’t known to be toxic until years after the Chemfab plant closed, in part because its manufacturer illegally hid documents, from regulators and from the public, that indicated there were hazards, Joselson said.

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Instead, lawmakers should simply place the onus on business owners to take responsibility for the effects of their pollution, if they’re releasing toxic chemicals into the environment, Rumelt said.

“Let’s say, ‘Ok, you know you’re dealing with chemicals that are harmful, if it gets out to the public there’s a chance people will get hurt, and it’s up to you to decide whether that risk is worth it,’” he said.

Farmers and farm pollution are generally exempted from the liability provisions in S. 197 as it is currently written.

House judiciary committee members made no decision on S. 197 Wednesday; they will take up the bill again for further consideration on Friday.

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