$9.1-Million Settlement Reached in O.C. Oil Spill : Coastline: Funds will compensate government and businesses and pay for cleanup, pollution mitigation.

HUNTINGTON BEACH — Five years to the day after a 400,000-gallon oil spill fouled 15 miles of Orange County coast, government officials Tuesday announced nearly $9.1 million in lawsuit settlements that will help pay for damage from one of the worst environmental disasters in county history.

BP America--the U.S. subsidiary of British Petroleum Co.--and a petroleum industry fund will compensate government agencies and private businesses for losses suffered when the 80,000-ton oil tanker American Trader ran over its own anchor while trying to moor off Huntington Beach, sending ashore waves of crude oil that killed hundreds of birds and marine animals. A host of lawsuits and new state legislation aimed at protecting the coast followed.

“Today’s settlement is a victory for the people of California and the environment they live in,” said Lois Schiffer, assistant U.S. attorney general for environmental and natural resources.

Added Tom Mays, mayor of Huntington Beach at the time of the spill: “I think it’s finally come to an end. It was just a matter of time. I’m glad it’s finally over.”

Under one of three separate accords, BP America, which owned the oil and chartered the tanker, agreed to spend $3.89 million to restore, create and protect wildlife habitats for brown pelicans and other species in undetermined locations.

The company will also fund a fish hatchery in a Carlsbad lagoon, support ocean and coastal pollution mitigation projects and repay various agencies for cleanup and revenue lost during the spill.

Under a second settlement, the Trans-Alaska Pipeline Liability Fund--created by Congress in 1973 to pay for damage from Alaskan pipeline oil spills and funded with a nickel-per-barrel tax on oil--will contribute $3 million to a trust fund for future environmental mitigation and restoration projects.

And in a third agreement, both groups will pay $2.175 million to about 190 private businesses and individuals--most of them commercial fishing operators--who suffered economic losses from the spill.

“I can’t believe we really won,” said Norman Nitta, manager of the Seacliff Motel in Laguna Beach. He said the motel suffered as much as $70,000 in losses during the spill from guests who tracked oil and tar into driveways, stairways and rooms.

BP America spokesman John Andes called the overall settlement “fair compensation for the damages that were done. The settlement is earmarked for specific projects, most of which are directly in (environmental) restoration, which is what this was all about.”

Sylvia Cano Hale, a state deputy attorney general who participated in the negotiations, agreed. “We are very happy” about the settlement, she said. “It satisfied our goal of obtaining fair compensation for natural resource injury.”

But Pierce Flynn, spokesman for the San Clemente-based Surfrider Foundation, a nonprofit organization that seeks to safeguard the quality of ocean water, questioned the size of the payments.

“Does it pay to pollute if you are a big corporation?” he asked. “Is it cheaper to go ahead and pay the fine and the subsequent lawsuits rather than to retool and build safer tankers or deliver to a safer port?”

The spill sparked a host of lawsuits by local, state and federal agencies, three of which were partially settled by the agreements announced Tuesday. The accords, which still must be approved by judges in state and federal courts, do not end the legal wrangling over the spill, but conclude the major conflicts arising from it.

The lawsuits were filed on behalf of the cities of Huntington Beach and Newport Beach as well as Orange County and the Orange County Flood Control District. Other plaintiffs included the state Department of Fish and Game, the state Department of Parks and Recreation, the California Regional Water Quality Control Board, the State Coastal Conservancy and the State Lands Commission.

The compensation package--hammered out during hundreds of hours of negotiations involving dozens of representatives of local, state and federal agencies--is in addition to the $12 million BP America paid shortly after the spill to clean up the damage and compensate other private parties who suffered losses in Orange County’s worst oil spill.

Three other companies named in the lawsuits--Golden West Refining Co., operator of the offshore terminal; American Trading Transportation Company, owner of the tanker, and Brandenburger Marine Inc., provider of the ship’s pilot--have not yet settled.

But Gail C. Hutton, Huntington Beach’s city attorney, predicted that Tuesday’s agreement will put pressure on them to do so.

“We’ve gone a quantum leap toward final resolution of these 5-year-old lawsuits,” Hutton said.

The spill, coupled with the much larger 1989 Exxon Valdez disaster in Alaska, also spurred the fight for stricter laws on oil tanker operations and provided important lessons in spill cleanups.

The state Legislature approved a bill that established a $100-million emergency cleanup fund and created full-time teams of oil-spill wardens and biologists.

In 1990, Congress required all new tankers to be double-hulled beginning in 1995 and authorized the Coast Guard to evaluate installing vessel radar systems in busy ports.

Huntington Beach Mayor Victor Leipzig, who was the coordinator for the volunteer response team that rescued sea birds, said he was pleased with the settlements. “It’s been five years, for goodness’ sake,” he said. “We’re delighted we’ve gotten this far.”

“We expect a sizable recovery for the loss of recreation uses,” Hutton added. “We expect an early final settlement and we will be happy to have it behind us.”

Times staff writer David Reyes and correspondent Debra Cano contributed to this report.

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Settling the Spill

BP America will pay nearly $3.89 million for the damage caused by a 1990 oil spill off Huntington Beach. Another $3 million from the Trans-Alaska Pipeline Liability Fund, established by Congress and funded by oil companies, will go into an environmental trust fund. And nearly $2.2 million from both organizations will compensate about 190 private businesses that suffered losses in the spill.

Where BP America’s money is headed:

* $2,484,567: Restoration, creation and protection of wildlife habitat suitable for brown pelicans and other impacted species

* $400,000: Fish hatchery program at Agua Hedionda Lagoon, Carlsbad

* $300,000: Ocean and coastal pollution mitigation and monitoring projects to be administered by the Southern California Coastal Water Research Project

* $79,680: Revenue losses incurred by the state Department of Parks and Recreation

* $630,000: Response costs of the state and local governments

Source: California Department of Justice