GASTON & ASSOCIATES

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Environmental Business News Current Environmental Issues                      November 2004

All Appropriate Inquiry Update

The California Underground Storage Tank Cleanup Fund

UST Fund Reimburses Eligible Tank Owners

Leaking Tank Compliance Costs Reimbursed

Check the UST Fund Website

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 Gaston and Associates Environmental Consulting 

20 Truman, Suite 108   

Irvine, CA 92620  

    Phone: 949-2620440        Fax: 949-262-0750

web: GastonAssociates.com

 © Gaston and Associates2005

 Previous issues of this newsletter have discussed the new All Appropriate Inquiry (AAI) guidelines for conducting Phase I Environmental Site Assessments being developed by the federal EPA.  The proposed rule was recently signed by the EPA Administrator Mike Leavitt and published in the Federal register on August 26, 2004. 

 According to a recent EPA Fact Sheet, “the proposed rule would establish specific regulatory requirements for conducting all appropriate inquiries into the previous ownership, uses, and environmental conditions of a property for the purpose of qualifying for certain landowner liability protections under CERCLA."  The text of the proposed rule and the preamble are provided on the EPA website at http://www.epa.gov/swerosps/bf/aai/proposed_rule.pdf

 EPA will accept public comment on the proposed rules until November 30, 2004.  Instructions on how to submit comments are included in the preamble of the rule.  A public meeting to present comments on the proposed rule will be held in San Francisco on November 18, 2004.  The San Francisco public meeting will take place from 2:00 to 4:00 PST and will be held at the Park Hyatt San Francisco Hotel at Embarcadero Center. The hotel is located at 333 Battery Street, San Francisco, California 94111.  Information on the planned public comment meeting is provided at the EPA website at http://www.epa.gov/swerosps/bf/regneg.htm  

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Beginning with this issue, we will commence a series to discuss the California Underground Storage Tank (UST) Reimbursement Fund.  For many individual underground tank owners, the UST Fund is the funding source to enable the owners to comply with local oversight agency requirements for site assessment and cleanup and avoid what would otherwise cause devastating financial impairment to these small and important businesses; the independent gasoline station owner and operator. 

The series will starts with a brief overview of the Fund and its intended purpose and will be followed followed by discussions of various aspects of the UST Fund, including the initial application process, submission of claims for reimbursement, the Fund’s claim review process, assignment of claimant as part of a real property ownership transfer, audits and appeals, problems that have been encountered with the Fund in trying to obtain reimbursement of expenditures, and litigation against the Fund.  It is hoped that this series will provide insight into the operations and activities of the CA UST Fund, an important part of the state's UST cleanup activities.

The CA UST Fund was established by the Barry Keene Underground Storage Tank Cleanup Fund Act of 1989 and is codified in Chapter 6.75 of the California Health and Safety Code, §25299.10 et seq.  The implementing regulations are found in the CA Code of Regulations, Title 23, §2803 et seq.  This law authorized the California Water Resources Board to create and administer a program that would reimburse UST owners and operators for expenses incurred in response to requirements of local oversight agencies to assess and cleanup sites with contaminated soil and groundwater resulting from leaking USTs.  Eligibility for reimbursement was limited to those applicants who met specified requirement. 

According to the guidelines, in order to be eligible to file a claim with the Fund, the applicant (or claimant) must be a current or past owner or operator of the UST from which an unauthorized release of petroleum has occurred, and be required to undertake corrective action as directed by the regulatory agency.  Other eligibility requirements include compliance with applicable state UST permitting requirements and regulatory agency cleanup orders.

The costs of UST removal are specifically excluded, but all other costs associated with site assessments, soil and groundwater sampling and reporting, corrective action implementation, and verification monitoring, are all eligible for reimbursement.  As of September 30, 2004, 14,483 applications have been approved by the Fund, with 4,787 currently active claims and a total of $1.619  billion in claims paid.   

Fund revenue originates from a per-gallon fee on each gallon of petroleum placed into an underground storage tank.  This fee began on January 1, 1991, has increased over time, and is presently twelve mils ($0.012) per gallon.  The fee currently generates in excess of $180 million annually from petroleum products that include, gasoline, diesel, aviation fuel, lubrication oils, heating oils, and solvents.   

The California Water Resources Control Board maintains a website http://www.swrcb.ca.gov/cwphome/ustcf/index.html which includes much information about the UST Fund, including applications, answers to frequently asked questions, and the text of the implementing laws and regulations.

                                                                 -Will Gaston

If you do not wish to receive this document, please contact Lauren Tozzer at (949) 262-0440 or email her at lauren@gastonassociates.com.

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This material is provided for information purposes only and is not intended as and cannot be considered to be legal advice. Before taking any action based on this information you should consult your legal counsel.