Leaking storage tanks

March 1, 2014

Less than a penny per gallon. That’s how much Michigan motorists pay at the pump to ensure the gas going into our tanks isn’t leaking into the ground from underground storage tanks before filling up our own vehicles. That equates to about $50 million every year that is collected by the state to repair leaking underground storage tanks and the contamination associated with them.

Why then, nearly a quarter century after the 7/8-cent per gallon fee was introduced, are there as many leaking underground storage tank (LUST) sites that still need cleanup action in the Birmingham/Bloomfield area as there are gas stations operating in the community?

The Michigan Department of Environmental Quality (DEQ) places the number of LUST sites in the state at more than 7,200, with as many as 300 new sites discovered each year. Locally, the DEQ has records on 32 active cases in the Birmingham/Bloomfield area where gasoline, diesel fuel or another type of petroleum-based fluid has been released from an underground storage tank.

“There are a lot of old releases,” said Dennis Eagles, who oversees the LUST program under the DEQ’s Remediation and Redevelopment Division. “When gas stations were more plentiful and had more individual owners, they operated on budgets that were fairly marginal, at best. When they had releases, they didn’t have the funds to clean it up. A lot of those have gone orphan, or they don’t have the money to address them.”

Releases, or leaks, typically happen when an aging tank begins rusting or corroding, which then allows the fluid inside to leak out into the ground. Older metal tanks are typically replaced with fiberglass tanks. Federal regulations require gas stations to replace faulty tanks and to install monitoring systems that can detect leaks.

The property owner where an underground storage tank is located at the time of the release is typically responsible for any actions required to address the problem. Because the liability rests with whoever caused the release, as well as any party that may have contributed to the original or subsequent releases, the responsibility may lie with more than one party. Even when the appropriate party is identified, the cost associated with cleanup may inhibit taking action. Those actions may include removal of a tank and contaminated soil, as well as monitoring of potential contamination of soils and ground water. Clean-up costs can range from about $50,000 on the low end of the spectrum, to upwards of $1 million, with the average cost estimated near $400,000.

“From a state standpoint; let’s say if an older couple owns a gas station, we do a cost evaluation on the funding they have and make a determination that they either are or aren’t a viable party,” Eagles said. “If we make that determination, we can use state money to do it. But in large part, there’s a large number of (still active) sites because we can only work on a certain number, and there are 200 to 300 new releases each year.”

In total, the number of underground storage tanks in the state – about 18,777 – far exceeds the number of leaking underground storage tanks, which total a little less than half, at 7,202. Of the more than 18,000 tanks in existence, the DEQ estimates about 95 percent are in use, while 5 percent are temporarily out-of-service. About 62 percent of the tanks are considered “low risk,” based on the age and type of construction. The remaining are likely to need replacement in the next five to 10 years, according to the DEQ.

DEQ records indicate about 9,200 releases have occurred at the state’s 7,200 sites, meaning it’s not uncommon for one tank, once it becomes faulty, to have more than one release before it is replaced.

To help gas station owners address the problem of leaking underground storage tanks, the Michigan legislature, in 1988, created the Michigan Underground Storage Tank Financial Assurance Fund (MSUTFA), which was funded by a gas fee at the pump. The program was stopped in 1995 when the fund ran out of money. Since then, the number of LUST site cleanups have dropped by about 80 percent. Despite the discontinuation of the program, the 7/8-cent per gallon fee on all refined petroleum products sold or imported into Michigan was reauthorized in 2004, and the fund was renamed the Refined Petroleum Fund. While the fee collects about $50 million per year, about $850 million from the fund has been used to fund operations other than LUST sites.

“It has been used for various things,” Eagles said. “The Department of Agriculture has used it to pay for programs. It’s also been used for bond debt. It generates about $50 million (annually). Right now they are working on trying to get some of that money available to clean up sites. There is some talk and serious moves to get about $20 million a year set aside for owners and operators (of contaminated sites) to tie into it and use it to clean up releases.”

In 2010, the state legislature began an effort to address what has been viewed as an unacceptably low rate of LUST site closures in the state. Lawmakers introduced a package of bills which were subsequently passed and enacted. A number of changes went into effect in 2012, including how sites are addressed and the type of action and information needed to close a LUST case within the DEQ, as well as efforts to restore funding to LUST closure actions.

Part of the 2012 legislative reforms to the program included the formation of an underground storage tank system cleanup advisory board, which was created to make recommendations to the DEQ and the state legislature on the development of a cleanup program, funded from the Refined Petroleum Fund, to assist owners and operators in financing corrective action required under Part 213 of the state’s Natural Resources and Environmental Protection Act (NREPA), as it relates to leaking underground storage tanks. The purpose of Part 213 is to provide a process to remedy sites posing a threat to public health, safety or welfare, or the environment as a result of releases from underground storage tanks.

The advisory board, according to its latest report, published in 2013, recommended that all of the annual funding to the Refined Petroleum Fund be restored to the state’s underground storage tank programs in order to: (1) provide financial responsibility for owners and operators to address future releases; (2) fund a reimbursement program to provide assistance to qualified owners and operators undertaking corrective action to address known historical releases; and (3) conduct corrective action to mitigate imminent and substantial threats to public health or the environment at leaking underground storage tank sites where no liable or viable owner or operator is identified or able to undertake corrective actions, which are known as “orphan sites.”

The 2012 changes to Part 213 of the state’s environmental protection act require DEQ to adopt “risk-based corrective action” processes developed by the American Society of Testing and Materials as the basis for addressing contaminated properties. The new change is intended to make cleanup of properties more feasible than the former, stricter regulations.

“That allows more options on what a party needs to do to have closure on a site,” Eagles said. “They have to have a conceptual site model, which is basically a picture of where the contamination is, where it is moving and the risk it might present.”

The legislative changes also modify time frames for reports required to be submitted by owners or operators responsible for leaking underground storage tank releases. If the required reports, which are to document corrective actions taken at a leaking underground storage tank sites, are not audited by the DEQ within specified timeframes, they are considered approved by operation of law. Overall, the amendments intend to provide more cost effective and efficient closures of LUST releases while maintaining acceptable protectiveness of human health.

The recent changes also repealed the DEQ’s obligation to evaluate and annually update a list of consultants and workers conducting clean-up work. Instead, the owner or operator of a site is now responsible for assuring the consultant meets a minimum qualification required under the state’s environmental protection law.

The legislative changes enacted in 2012 extend the collection of the Refined Petroleum Fee (RPF) to December 31, 2015. Further, Governor Rick Snyder’s budget has cut off some of the raiding from the RPF, allowing more to be used for its intended purpose.

Eagles said funding was noticeable last year.

“We got about $20 million to work on these sites, and we used a couple million to go out and investigate the old sites to see if there’s a risk there, and how serious it is. It’s not a full scale investigation. It’s like a ‘triage’ investigation.”

In order to “triage” a site, the department first tries to obtain permission from the current property owner in writing in order to investigate the site. Investigators then inspect the site and look for signs of contamination. The department then looks to see what actions need to be taken to close the site. In some cases, the pollution is so old that much may have already degraded and additional action isn’t needed.

“In the first year we did it, there were about 208 sites where we did this,” Eagles said. “At about 46 or 47 percent of those, we determined we could close the site because there wasn’t a risk. At about 10 percent of the sites, we determined there was sufficient risk to take some action in the near future. Then there was a middle band, where there’s some risks that don’t have to be addressed immediately.”

The changes enacted in 2012, in addition to additional funds being made available for the inspection of the sites, has resulted in an uptick in the number of LUST sites being investigated and subsequently closed. However, funding remains significantly below the levels needed to correctly address the problem.

“It’s really is an uphill battle,” said Paul Owens, southeast Michigan district supervisor for the DEQ’s Remediation and Redevelopment Division. “We do what we can to take action with the state funding that is available, but what we really need is more compliance out there. We have a pretty low compliance rate, with more sites out of compliance than in. It’s tough to get that under control.”

LUST sites that are considered out of compliance may be categorized as “inactive” cases, or those in which a release has been reported and no additional information or action was taken. Others are “stopped” cases, in which some action and information had been done and reported to the DEQ, but had been stopped for some reason. An active site is considered in compliance if appropriate action is continuing; and a site is “closed” when all actions and monitoring are complete.

Of the 32 open cases in the Birmingham, Bloomfield Hills, and Bloomfield Township areas, 12 are classified as “inactive” status; 17 are “stopped” status; two are on “active” status; and one site is considered “new.”

“If they haven’t submitted anything for a year, it may be inactive or stopped status,” Owens said. “We don’t always have the resources to follow up on all of them, but we try to look at the ones that present the biggest threats. There are definitely a significant number that aren’t moving forward the way they should. A lot of that has to do with the responsible parties going through bankruptcy or running out of money.”

Statewide, the DEQ has 31 open cases where releases are considered hazardous. The remaining releases are categorized as either class 1, class 2, class 3 or class 4 sites, with class 1 posing the greatest risk and class 4 sites approaching closure. Statewide, there are 1,282 class 1 sites; 1,584 class 2 sites; 2,374 class 3 sites; and 999 class 4 sites. The number of unclassified sites in the state is about 2,995.

Terri Golla, project manager for the DEQ’s Remediation and Redevelopment Division’s Southeast Michigan District, said she isn’t aware of any hazardous or class 1 sites in the Birmingham/Bloomfield area. However, there are sites where the amount of known information is limited.

Owners of a LUST site may be able to submit a baseline environmental assessment to the DEQ. The assessment provides basic information about the site, and it protects a potential purchaser of the property so that they aren’t held liable for the contamination on the property. Golla said a site may be considered inactive if it has had such an assessment done.

“The liability lies with whoever caused the release, or whoever contributed, so there could be more than one party,” Golla said. “Property owners can transfer use and say that the contamination was there when they bought it.”

In instances where heavy contamination is found, the owner of the property may be required to conduct some mitigation, even if the use is changed.

For the public, the fallout remains significant. Leaking fluid may contaminate soil, poison groundwater or result in vapor releases from beneath the surface. In some cases, the amount and type of release is so old that it breaks down naturally.

“Most of the time, if it gets into the groundwater, it could migrate faster, so if there are drinking water wells nearby, it could be a problem,” Golla said. “In Birmingham and Bloomfield, it’s not as much of a drinking water issue. It could be a vapor issue, but usually petroleum vapors aren’t as bad as, say, a dry cleaner. But you could still have an issue. Usually, it has to be pretty heavily contaminated.”

In general, the inclusion of a property as an open LUST site in the DEQ’s database doesn’t necessarily indicate a health hazard. Some sites that have been identified as open LUST sites maintain monitoring systems and have been redeveloped for new purposes, such as restaurants. Experts say they would eat at those new sites. Contamination at other sites is less known.

For instance, the DEQ’s database lists 1100 Derby, in Birmingham, as the location of a 20,000 gallon heating oil tank which leaked in 1988. The DEQ’s database lists the site as Derby Middle School, although the current address of the school is 1300 Derby. The school likely encompasses the property. Additional information about the site wasn’t available, Golla said, as the DEQ doesn’t consider heating oil tanks part of the LUST program.

A similar lack of information is found in a case file regarding a 1990 release at Quarton Elementary School at Chesterfield and Oak streets in Birmingham. Golla said the file doesn’t contain any information, and nothing has been submitted by the owner of the property, which is Birmingham Public Schools.

Other local property owners have cleared themselves of responsibility, such as the site of a former gas station at 33801 Woodward in Birmingham, which was subsequently made into Neighborhood Hardware store and recently closed and sold. Golla said the property owner there has submitted a baseline environmental assessment, therefore alleviating themselves of responsibility.

“There was contamination there, but we aren’t sure who the liable party is,” she said. “There was a former tank system there, which isn’t there anymore. So there is probably contaminated soil or groundwater, which was noted in the report.”

Other reports are more detailed. Jax Kar Wash, 34745 Woodward Avenue in Birmingham, was the site of groundwater contamination from a LUST. According to Golla, the depth of the contamination was between 3 and 12 feet deep in water that flowed to the east of the location. The last report from the site was submitted in 2005, and a baseline assessment has since been submitted, so the current owner, Bruce Milen, president of Jax Kar Wash, isn’t liable for submitting further information.

“When the properties are sold, it’s hard to track down a liable party,” Golla said. “The person that is liable, they have to pay for a consultant to do the work.”

The lack of a responsible party is one of the roadblocks to closing a LUST site that might be nearing closure in the DEQ’s database. In order to speed the process, and to better assess the threat of such sites, the DEQ triage of sites may help speed the process.

“Usually we try to triage a site where we don’t have any information or very minimal information,” Golla said. “If its a class 1 and nothing is being done, then we better evaluate it. Some we don’t find anything (on the site) because it’s so old, so we can close out the files, too. If there is a risk, we put it on a list for a state cleanup if there isn’t a liable party. Every site is different. It depends on how much is released, but the financial issue is the biggest problem.”

 

 

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