September 1997
LEGISLATIVE COMMITTEES BEGIN HEARINGS

Interim meetings of House and Senate Legislative Committees began this month in Tallahassee, including those concerned with water and natural resources issues. Between Legislative Sessions, Committees focus on specific subject matter as interim projects for in-depth study. A summary of two interim projects appears in this issue.

Civil Immunity for Petroleum Tank Owners

In 1986 the Legislature extended immunity from civil actions involving damages from petroleum storage systems to the owners and operators of the tanks. Immunity from civil actions is now provided to an owner/operator whose petroleum storage system is in compliance with DEP rules as contained in chapter 17-61, Florida Administrative Code.

The provision of ss. 376.313(4), FS, that extends immunity is set to expire on October 1, 1998, and is scheduled for a "sunset review" during the coming Session. The Senate staff report is part of the normal sunset process and clarifies immunity as it currently exists and makes recommendations for the future of the statute.

The report found that immunity from civil damages for owners or operators of petroleum storage systems benefits both the industry and the citizens of Florida. By encouraging compliance ahead of schedule, the immunity may prevent further damage from a leaking site or diminish the possibility of new discharges. Because owners or operators are more inclined to report discharges without fear of liability, remedial action likely occurs sooner. The provision providing immunity is an important provision in abating potential litigation. Finally, the immunity and its effect on litigation may promote the entry of new insurers in the market place and generate competitive rates.

BACKGROUND

The integrity of Florida's ground waters and inland surface waters is of great concern. Due to the significant number of petroleum storage systems in Florida, discharges have occurred throughout the state. Petroleum storage systems, however, are a necessary part of the industry's effort to provide fuel for the population of Florida. While citizens enjoy the advantages of convenient storage sites for an important resource like fuel, there are a large number of aging, leaking facilities that pose threats to the environment.

Once the large number of leaking sites was recognized in 1986, comprehensive legislation was enacted to provide for cleaning up contaminated sites, improving management of current sites and ensuring that owners or operators who attempt to comply with the law would not be penalized. The immunity currently provided in law appears reasonable in view of the need for convenient fueling stations throughout the state as well as comprehensive environmental regulation of petroleum storage systems.

The law provides that in any civil action brought after July 1, 1986, against the owner or operator of a petroleum storage system for damages arising from a petroleum storage system discharge, the normal liability provisions do not apply if it can be shown that:

  • The alleged damages resulted solely from a discharge from a petroleum storage system which was installed or maintained in a manner consistent with the construction, operation and maintenance standards established for such systems under DEP rules.

  • A leak detection system of monitoring wells were installed and operating in a manner consistent with the technical requirements of DEP rules.

  • All inventory, record keeping, and reporting requirements of DEP rules were met and being complied with.


FINDINGS

The staff report found that immunity from civil actions likely encourages compliance ahead of scheduled deadlines, thereby protecting the environment. The law stipulates that an owner or operator must be in compliance at the time of discharge to qualify for the immunity regardless of the specified deadline. Some department rules have extended deadlines, such as the requirement for secondary containment in 2009. Installing devices like tanks with secondary containment earlier than required will prevent further discharge from a leaking site or eliminate a possible discharge. The department, however, was unaware of any cases where the provisions of the law have been used as a defense. Nonetheless, any attempts at early compliance resulting from the provision would seem to benefit the environment.

Owners covered by the immunity from civil actions might be more inclined to report discharges, and therefore remedial action might occur sooner. Notably, the tank regulatory rules of DEP exceed federal requirements. Consequently, any owners or operators in compliance with DEP rules have a decreased potential for harmful discharges. However, when a discharge occurs, those owners/operators in compliance and protected by the immunity may report the discharge sooner because they are less worried about third party liability. When the department is made aware of a discharge, remedial steps can be taken to prevent further environmental damage.

Dry-cleaning Contamination Cleanup Program

In 1994, the Legislature enacted the dry-cleaning contamination cleanup program which was modeled somewhat after the underground petroleum storage tank program. Unlike the underground petroleum storage tank cleanup program, the dry-cleaning site cleanup program was never designed as a reimbursement program without prior DEP approval of costs. The program is handed primarily from a 2 percent gross receipts tax which is levied on dry cleaning facilities and a $5-per-gallon tax on perchloroethylene (PERC) used by dry-cleaners.

The gross revenue from these taxes is approximately $8 million a year. These moneys are deposited into the Water Quality Assurance Trust Fund and are to be used to pay for the cleanup of contaminated dry-cleaning sites. Depending on when application for the program was made, certain deductibles apply. Applications for the program may be made through December 31, 2005. Until that time, it is difficult to determine the actual number of sites which may be ultimately eligible for cleanup under the program.

Since 1983, there has been an increased focus and dedication toward cleaning up sites contaminated by hazardous wastes, hazardous substances, and other pollutants in order to protect Florida's drinking water supply and it's fragile natural resources. The 1983 Water Quality Assurance Act established the Water Quality Assurance Trust Fund to provide a source of funding for hazardous waste contaminated sites.

In 1986, the Legislature further acknowledged that a major threat To Florida's drinking water was caused by contamination from leaking underground petroleum storage Systems. As a result, the Legislature created the Inland Protection Trust Fund to finance the clean up of petroleum contaminated Sites throughout Florida

In 1994, serious concerns were expressed regarding the contamination and potential health and environmental risks as a result of the discharge of solvents commonly used in the dry-cleaning process. Due to the nature of dry-cleaning solvents, cleanup of these types of contaminated sites was expected to be both difficult and costly. As a result, small, independent owners of dry-cleaning facilities may not have the financial resources to investigate, clean up, and monitor these sites. Dry-cleaning solvents are considered to be hazardous substances under both state and federal law; therefore, the owner or operator of a dry cleaning facility may be subject to third party liability as a result of damages resulting from discharge of dry-cleaning solvents. Dry-cleaning solvent contaminated sites were not eligible for cleanup under the underground petroleum storage tanks program, and the Water Quality Assurance Trust Fund did not have the financial resources to address the problem. As a result, the 1994 Legislature established the dry-cleaning contamination cleanup program, which was, modeled somewhat after the underground petroleum storage tank program.

PERC evaporates when exposed to air and dissolves only slightly when mixed with water. Most releases of PERC to the environment are to the air. This is why the EPA, pursuant to the Clean Air Act Amendments of 1990, regulates the emissions of PERC as one of 189 toxic chemicals. When a PERC release occurs on the ground, it does not bind well with the soil and can move through the ground and into the ground water, making cleanup costly and difficult.

The first 85 sites are now nearing the completion of the first task in the rehabilitation process. As more experience is gained cleaning up and remediating those sites, it is anticipated that both the remediation costs and the time necessary to clean up these sites will decrease. To further these efforts, the DEP needs to have clear and specific statutory direction to use innovative approaches to cleanup efforts and the authority to use RBCA principles for these sites. Although the ultimate penalty for failing to register a dry-cleaning facility with the DEP is ineligibility for the cleanup program, penalties for failure to register with the DEP should be imposed to assure that these facilities promptly register and pay the appropriate registration fees timely. The time period in which a facility may apply to the program should be shortened to December 31, 1998, in order to provide more predictability as to the number of sites requiring rehabilitation and bring some closure to the program and assure that the state is committed to cleaning up only contamination that has occurred prior to the requirements for secondary containment. The concept of gross negligence should be clarified for purposes of eligibility determinations for the program. In order to meet the legislative intent of maximizing clean-ups, additional incentives should be provided to encourage voluntary clean up. Such incentives could include tax incentives and streamlining and expediting the clean-up approval process. The DEP's staffing of the program should be realigned with the actual revenues in order to maximize the funds available.