Washingtom, May 6--Legislation proposing a trust fund of $108 billion to pay asbestos injury claims is close to introduction even without complete agreement from labor and industry groups, Sen. Orrin Hatch said on Tuesday.
Hatch, the Utah Republic who chairs the Senate Judiciary Committee, said he would make every effort in the coming days to get the parties to accept that amount to compensate asbestos victims, cap liability for companies and relieve U.S. courts of thousands of lawsuits.
"I think its' going to have to be around $108 billion, that's what I'd like to make it," he told reporters.
"We'll reach a point where I've got to say, 'we go.' They're either going to go with us or not, and if they don't we'll just have to see what happens on the (Senate) floor," said Hatch who hopes to introduce the bill next week.
Asbestos was widely used for fireproofing and insulation until the 1970s, when scientists concluded that inhaled fibers could be linked to cancer and other diseases.
Defendant companies, insurers and unions have been negotiating with Hatch; the committee's ranking Democrat Patrick Leahy of Vermont; and other lawmakers, to try to craft a legislative solution to the soaring number of asbestos lawsuits that have driven dozens of companies into bankruptcy.
Hatch said labor union would have to come down to his $108 billion figure while asbestos companies would have to raise their figure. "It's a fair way to do it," Hatch said.
A week ago, Hatch said labor unions had suggested the fund should be some $120 billion, while the business community favored a smaller fund of about $90 billion.
Potential asbestos liability costs are enormous. Tillinghast-Towers Perrin, an actuarial consulting firm, says cumulative liability could reach $200 billion.
Among companies that have filed for bankruptcy protection in recent years because of asbestos liability claims are building materials company Owens Corning and auto parts supplier Federal-Mogul Corp.
Others, such as oilfield services and construction giant Halliburton Co. have crafted settlements with plaintiffs.
Hatch's proposal would send asbestos claims before a special tribunal that would then allocate payments from the proposed trust fund, which would be funded by asbestos companies and insurers.
Payments into the asbestos fund would be tax deductible, "if I have my way," Hatch said, adding that payments from the fund to victims would not be taxable either.
Hatch said he did not want the federal government to act as a backstop for the fund, despite demands by labor for such a role in case the fund runs out of money.
"Properly managed, that ($108 billion) should be enough to take care of the problems," he said.
Hatch also indicated a willingness to examine tax breaks for companies that have already made their own settlement plans with plaintiffs. "We'll have to look at that, but right now I'm worried about getting a bill for the prospect of the future," Hatch said.
