The California Water Boards' Annual Performance Report - Fiscal Year 2014-15

FUND: UNDERGROUND STORAGE TANK CLEANUP FUND

MEASUREMENTS  - Data last updated on:  08-11-2016 (2:17 pm)

WHAT THE MEASURE IS SHOWING

Underground Storage Tanks (USTs) that leaked in the past continue to cause groundwater impacts and pose a threat to public health, safety and the environment. There are currently approximately 11,674 UST site cleanups deemed eligible to be covered by the UST Cleanup Fund (USTCF), of which 2,631 are currently covered by active USTCF claims. Not all UST site cleanups are eligible for USTCF reimbursement. The claims awaiting activation may never be activated, depending on the amount of funding the USTCF receives through its lifetime. Many UST site cleanups may be low risk, but progress is lagging and these cases have not been completed for various reasons. Completion and closure of appropriate cases will make funds and oversight staff time available for remaining higher-priority cases. The USTCF has historically provided approximately $200 million annually to investigate and remediate contaminated petroleum UST sites, and the USTCF has over 4,069 claims on its Priority List waiting for funding. AB1182, passed in 2009, temporarily increases the fee on motor fuels stored in USTs. The cash infusion from this fee increase allowed the USTCF to unsuspend most claims that were suspended in 2008. The increased funding from AB1182 will be primarily used to pay backlogged costs that claimants have incurred, but have not yet been reimbursed for by the USTCF due to the 2008-2009 revenue shortage. AB1182 allowed the USTCF to better balance its revenues with projected payment demand on active claims. Funding for the USTCF was originally extended to January 1, 2016 (by SB 1161), and recently extended to January 1, 2026 (by SB 445). A focus on completing cleanups will enable financial assistance to be provided to a greater number of cases. Since its inception, the USTCF has paid in part or in full approximately 11,700 claimants in excess of $2.5 billion. Of the almost 11,700 cases deemed eligible for reimbursement, 9,043 have been closed and 2,631 remained active as of June 30, 2015. Considering the number of claims on the Priority List and the limited amount of funding projected for future years, it is possible that not all sites will be funded before the program sunsets.

WHY THIS MEASURE IS IMPORTANT

The USTCF Program provides financial assistance to owners and operators for cleanup of soil and groundwater contamination caused by leaking petroleum USTs. Leaking petroleum USTs are a significant source of impacts to groundwater and may pose potential threats to health and safety, such as exposure from impacts to soil and or groundwater, contamination of drinking water aquifers, contamination of public or private drinking water wells, and inhalation of vapors. Federal and state laws require every owner and operator of a petroleum UST to maintain financial responsibility to pay for any damages arising from their UST operations. The USTCF provides financial assistance to owners and operators for costs associated with the cleanup of contamination caused by leaking petroleum USTs. A 2009-2010 reduction in revenues resulted in substantial delays in reimbursement of corrective action costs to USTCF claimants. Various process and program improvements implemented in 2009-2010 have significantly reduced these delays in payment. Various other improvements are being implemented to control claim costs and balance the USTCF revenue and expenditures: A) Water Board staff review new claim applications to determine if claimants meet the regulatory and statutory eligibility requirements; B) determine eligibility for placement on Priority List and issuance of a Letter of Commitment (LOC); C) review agreements to assign USTCF claims to otherwise ineligible parties; D) review reimbursement requests for compliance with the USTCF's cost control guidelines, and provide technical support to staff and claimants; E) review site case histories of claims open more than five years to independently check the progress of sites and claim closures; F) process reimbursement requests as efficiently as possible; G) review settlement agreements to determine if claimants have already received reimbursement for costs also submitted to the USTCF for reimbursement resulting in a double payment to claimants; and h) Audit claims that have been closed, and reopen claims that have newly discovered contamination associated with the previous occurrence. Since the USTCF Program began operations in 1991, the Water Boards have paid over $2.5 billion to individuals and small businesses to help them cover the cost of cleaning up their gas stations and other leaking UST sites. Another $500 million has been paid to local governments and large businesses. The USTCF is supported by fees paid by tank owners to the State Board of Equalization (BOE) (see pie chart below).

TECHNICAL CONSIDERATIONS

• Data Source: UST Cleanup Fund SCUFFIS Database.
• Unit of Measure: Number of projects and monetary amount expressed in current US dollars.
• Data Definitions: Definitions of Each Program
• References: Information About the USTCF Program
  Public Performance Audit Report
  Legislative Annual Reports
  List of Active Claims

GLOSSARY

Claimant

A party who is eligible to apply to the USTCF. The assignee of a USTCF claim must demonstrate the priority and eligibility of the Assignee. See the UST Assignment of Claim Information & Guide.

Claim

A submittal to the USTCF for reimbursement of costs incurred due to an occurrence.

( Page last updated:  2/22/16 )