Washington–Both supporters and opponents of the Senate proposal for a $140 billion federal asbestos trust fund are pointing to a recent report by the Congressional Budget Office as evidence for or against the legislation.

The CBO prepared its report at the request of Senate Judiciary Committee Chairman Arlen Specter, R-Pa., as a follow-up to a consulting firm study of S. 852, which would establish the $140 billion trust fund for asbestos exposure victims. The study was done by the Washington-based firm of Bates White LLC.

In its analysis, the CBO found that the Bates White Report "contains no new information that would cause CBO to revise its cost estimate."

Sen. Specter and Senate Judiciary Ranking Member Sen. Pat Leahy, D-Vt., said in a joint statement that the CBO's findings supported their position that the fund would be a practical solution to the asbestos litigation problem.

"Despite the allegations made by an opposition-sponsored study, the non-partisan Congressional Budget Office for the second time has reaffirmed its previous analyses that the Specter-Leahy bill can sufficiently compensate asbestos victims," the two senators said.

The Coalition for Asbestos Reform, a coalition of small and medium-sized businesses and their insurers opposed to S. 852, noted, however, that the CBO also said "the proposed trust fund might or might not have adequate resources to pay all valid claims. There is a significant likelihood that the fund's revenues would fall short of the amount needed to pay valid claims, debt service and administrative costs."

Additionally, the group noted the CBO's acknowledgement that the revenues for the proposed asbestos trust fund could be significantly less than $140 billion, and that numerous uncertainties still exist within the legislation.

"The uncertainties outlined in this report show that this proposed legislation is based on speculation and guesswork and is not ready for consideration by the full Senate," said Thomas O'Brien, chairman of the Coalition for Asbestos Reform.

Mr. O'Brien added: "There is no way anyone can know what the overall impact of this legislation will be. One thing we do know, however, is that it is a $140 billion tax primarily levied on small and medium-sized businesses–including those in our coalition–and that it will not solve the problem. In fact, it will make things worse."

In addition, the Coalition noted the results of a recent Government Accountability Office study showing that prior government-run compensation programs have typically expanded beyond their original intent and cost more than estimated.