Tax Relief Act of 2005

TAX RELIEF ACT OF 2005

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EXXON VALDEZ OIL SPILL LITIGATION

Ms. MURKOWSKI. Mr. President, I engage Mr. Grassley in a colloquy concerning income averaglng to recipients of punitive damages awards in the Exxon Valdez oil spill case, Case Number A89-095-CV (HRH). Specifically, I would like to address how this will affect those who engage in commercial fishing in Alaska as their occupation.

Mr. GRASSLEY. Mr. President, I would be happy if Ms. Murkowski explained this issue in further detail.

Ms. MURKOWSKI. As all of us know, the Exxon Valdez ran aground in March of 1989, spilling 11 million gallons of oil into Prince William Sound in Alaska. A class action jury trial was held in federal court in Anchorage, AK, in 1994. The plaintiffs included 32,000 fishermen among others whose livelihoods were gravely affected by this disaster. The jury awarded $5 billion in punitive damages to the plaintiff class. The punitive damage award has been on repeated appeal by the Exxon Corporation since 1994. Many of the original plaintiffs, possibly more than 1,000 people, have already died.

Once the punitive damage award of the Exxon Valdez litigation is settled, many fishermen will receive payments to reimburse them for fishing income lost due to the environmental consequences of the Exxon Valdez oil spill. It is estimated that the eventual settlement may be $6.75 billion or more.

Fishermen already are eligible for income averaging of any fishing income. Section 1301 of the Internal Revenue Code allows fishermen to average fishing income over a 3-year period of time. Therefore, I want it to be clear that any commercial fishermen receiving punitive damages under the aforementioned Exxon Valdez oil spill case should be allowed to average their income over a 3-year period.

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