21 ELR 10136 | Environmental Law Reporter | copyright © 1991 | All rights reserved

Underground Storage Tanks: The Federal Program Matures

Katherine S. Yagerman

Editors' Summary: There are an estimated 300,000 leaking underground storage tanks (USTs) in the United States today. These tanks are believed to be a leading cause of groundwater pollution. To address this situation, Congress enacted Subtitle I of the RCRA, Regulation of Underground Storage Tanks. Subtitle I, and the regulations promulgated by EPA, address aspects of UST use from notification of tank existence to performance standards for new tanks to corrective action and tank closure. The author examines each aspect of the UST program, focusing on which tanks are regulated, who is responsible for them, and what substances they contain. The author examines the program's emphasis on state responsibility for detailed regulation and its adoption of total quality management techniques to foster creativity. The author concludes with observations on using the UST program as a model for other federal programs.

Ms. Yagerman is a staff attorney with the U.S. Environmental Protection Agency's Office of Regional Counsel, Region II. She is the staff attorney primarily responsible for EPA's enforcement of Subtitle I of the Resource Conservation and Recovery Act. The views expressed are those of the author and do not necessarily represent the views of the U.S. EPA.

[21 ELR 10136]

In 1984, Congress enacted Subtitle I of the Resource Conservation and Recovery Act (RCRA), Regulation of Underground Storage Tanks (the UST program),1 to address contamination of groundwater and the subsurface environment from leaking underground storage tanks (USTs). The UST program, which addresses an aspect of environmental pollution previously regulated only by states and localities, incorporates the "new federalism," whereby states are delegated authority to implement programs designed at the national level and receive federal funds and technical support as long as they maintain the federal standards.2

The UST program anticipates and promotes diverse regional and local approaches more than any other federal environmental program.3 By design, the regulations governing federal approval of state programs contain few substantive requirements, setting forth in general terms the technical requirements that a state UST program must include.4

The UST program also incorporates a management style new to the Environmental Protection Agency (EPA): Total Quality Management (TQM).5 Management and staff using TQM focus on improving the processes used to reach an end product, rather than on traditional numerical standards of productivity. TQM is meant to foster creativity and involvement of staff at all levels in realizing the organization's goals. EPA's Office of Underground Storage Tanks (OUST) director, Ron Brand, has invoked the TQM approach within OUST.6

This Article describes the federal UST program and its genesis, structure, accomplishments, and problems. It briefly describes USTs and their potential environmental harm, defining certain technical terms and distinguishing UST leakage from other types of pollution. It then describes the components of the federal regulatory program, including state program approval, highlighting noteworthy issues. It assesses the program's state-federal division of responsibility and its TQM approach. Finally, it comments on the significance that the program, and these two features in particular, may have for other federal programs.

Leaking USTs: A Background

Petroleum products or other hazardous substances have been placed in USTs, primarily for safety reasons,7 since the 1950s.8 Early UST systems were typically made of bare steel9 and often installed by contractors with no UST installation [21 ELR 10137] training. As a result of these and other careless practices, there are an estimated 300,000 leaking USTs in the United States today.10

The primary components of a UST system are the tank, and the piping necessary for filling it, for removing product, and for venting. Pumps for removing product are placed either inside the tank (creating a pressurized piping system that forces product up and out) or at an above-ground dispenser (creating a system of suction piping that draws product out). Suction piping works well only in low-volume delivery systems where few dispensers are used. Because the pump pulls product at below-atmospheric pressure, a breach in the piping usually causes the system to draw air, with product in the piping falling back into the tank and remaining there, rather than leaking into the subsurface environment.11 In contrast, pressurized piping may push large quantities of product out through a breach unless the leak is detected and the system shut down. EPA characterizes such release potential as catastrophic.12 Approximately 95 percent of new retail motor fuel system installations use pressurized piping.13

The top of the UST usually has a row of openings, called bung holes, where piping can be attached; unused bung holes are closed with screw-on caps and then sealed. Certain components located above the top of the tank, including the bung holes, vent pipe, fill pipe, and manifold piping,14 are called nonoperational components because releases do not occur at these points during normal operations,15 but instead result from "spills" (i.e., releases at the fill pipe from the delivery truck's hose) and "overfills" (i.e., releases through nonoperational components occurring when the tank is filled beyond capacity).16 The tanks and delivery piping constitute the "operational" portions of the UST system.

A properly installed UST system is surrounded by backfill material that separates the system from the naturally occurring soil. Proper quality and placement of backfill are important in maintaining the structural integrity of the tank and associated piping; backfill supports the system and prevents damage from heaving.17

EPA estimates that there are over two million UST systems located at over 700,000 facilities nationwide.18 Approximately 25 percent of these systems are nontight19 and at least 15 percent are believed to leak during normal operating conditions.20 Although most releases are caused by spills and overfills,21 in terms of volume other types of releases can be much more damaging. Piping leaks twice as often as the tanks. The four major causes of failure for piping are corrosion, poor installation techniques and workmanship, accidents, and natural events (e.g., frost heaves).22

Tank leaks are most commonly caused by corrosion, although structural failures can result from improper installation or defects in the tanks.23 The failure rate for unprotected steel tanks due to corrosion depends largely on the age of the tank. EPA estimates that breakthrough from corrosion in a typical unprotected steel tank is likely to begin when it is between 10 and 20 years old.24 This source of leakage can be avoided through use of higher quality tanks made of fiberglass, fiberglass-coated steel (composite tanks), or steel coated with a corrosion-resistant material and cathodically protected.25 EPA estimates that 20 to 25 percent of existing USTs are protected from corrosion, and that many of these have been in the ground for over 20 years. Failures of such tanks are extremely rare.26

Tank and piping leakage can also be prevented (and detected) through the use of secondary containment. Secondary containment can consist of either double-walled tanks, with interstitial monitoring for leaks, or some sort of impermeable lining of the excavation that contains the tank and piping, with a monitoring system installed at the lowest point of the lining.27

Finally, inferior-quality USTs already in the ground can be upgraded by installation of interior linings and/or addition of a cathodic protection device to prevent corrosion.28

The primary goal of UST regulation is to protect groundwater. [21 ELR 10138]29 Over one-half of the U.S. population relies on groundwater for drinking,30 and leaking USTs are believed to be a leading cause of groundwater pollution.31 EPA has reported that a leak of one-half gallon per day of certain substances can contaminate the water supply for 50,000 people.32 Gasoline, the most commonly stored substance in USTs, is extremely toxic and persistent when it contaminates groundwater.

According to one of EPA's groundwater remediation experts, "We have learned most of what we know about [underground] gasoline transport and fate in only the last seven to ten years."33 Because technology in this field is developing rapidly, with many new advances not yet commercially available,34 EPA structured a high degree of flexibility into the regulatory program.

The Federal UST Program: Statutory and Regulatory Framework

At the time Subtitle I was enacted, some states and localities already had regulatory programs for underground tanks.35 Congress intended that, with some modification, many of these programs would eventually function under the Subtitle I umbrella. Currently, two states, Mississippi and New Mexico, have received final state program approval pursuant to § 9004 of RCRA.

In states with EPA-approved UST programs, the state program requirements are applicable in lieu of federal requirements.36 In states without Subtitle I UST programs, the federal standards are effective in addition to any independent state and local programs.37 Thus, in areas with dual programs, the federal requirements establish only a part of the total regulatory picture. Moreover, a state may implement a partial Subtitle I program, obtaining state program approval from EPA for regulation of only some types of tanks.38 The components of the federal program described below are relevant, therefore, only insofar as they have not been supplanted by state requirements pursuant to formal state program approval for some or all types of USTs.

The federal standards address eight regulatory categories: (1) notification of tank existence;39 (2) leak detection; (3) records maintenance; (4) release reporting; (5) corrective action; (6) tank closure; (7) financial responsibility,40 and (8) performance standards for new tanks.41 For a state program to be approved in lieu of a federal one, the requirements of the state program must be no less stringent than the federal standards in each of these categories.42 In states with approved programs, a state agency designated in the program approval application becomes the Subtitle I "implementing agency"; in all other states, EPA remains the implementing agency.43

Subtitle I and the regulations promulgated pursuant to it provide for different effective dates for different components of the program, distinguishing between USTs containing petroleum products and USTs containing hazardous substances,44 and categorizing tanks by age45 and by size.46 In addition, the statute established an interim prohibition against installation of unprotected (bare steel) USTs, which was effective from May 7, 1985, until final promulgation of detailed new tank standards in December 1988.47

The eight categories of regulatory concern have been addressed by EPA principally in four rules. The first, promulgated on November 8, 1985, addressed only the notification requirement. By statute, the state or local agency, not EPA, must be notified. Other technical requirements — including leak detection, records maintenance, release reporting, corrective action, tank closure, and new tank performance standards — were addressed in a second rule, promulgated on September 23, 1988.48 Regulations governing state program approval were also promulgated on this date.49 Financial responsibility requirements concerning petroleum USTs were added one month later.50

Scope of Regulation

The scope of Subtitle I regulations is defined by the three [21 ELR 10139] principal questions that they address: which tanks are regulated, who is responsible for them, and what substances do they contain.51 The answers to these questions distinguish the UST program from Subtitle C of RCRA (Hazardous Waste Management)52 and from the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or Superfund).53 However, in certain cases, the UST program does overlap with these two federal programs.

Definition of UST. The statute defines an "underground storage tank" as a tank that holds an "accumulation of regulated substances"54 and has 10 percent or more of its volume (including piping) beneath the ground surface.55 Certain tanks (e.g., small farm or residential motor fuel tanks, certain heating oil tanks, septic tanks, and surface impoundments) are excluded.56

One type of statutorily excluded tank is a "flow-through process tank," which is

a tank that forms an integral part of a production process through which there is a steady, variable, recurring, or intermittent flow of materials during the operation of the process. Flow-through process tanks do not include tanks used for the storage of materials prior to their introduction into the production process or for the storage of finished products or by-products from the production process.57

EPA has noted that the scope of this regulation has been one of the most difficult to define and has raised some of the most controversial interpretive issues.58

EPA initially proposed limiting this exclusion to tanks that were part of a manufacturing process.59 It subsequently proposed to broaden the definition to include tanks forming an integral part of an industrial or commercial process,60 and finally compromised, limiting the exclusion to tanks forming an integral part of a production process.61 Although one commenter complained that "'production' implies a tangible good is produced, and thus a 'production process' is no different than a 'manufacturing process'"62 EPA maintained that according to its definition, "any process at manufacturing, commercial, or industrial facilities where a tangible good or service is produced or performed may be considered a production process."63 As EPA has noted, the significance of the term "process" is that, unrestricted, it could be interpreted to include virtually all tanks within the flow-through process tank exclusion.

A related concern was whether to limit the exclusion to tanks having an uninterrupted flow. Because many commenters pointed out that some manufacturing processes, such as batch processes, necessarily entail interrupted flows but are nevertheless legitimately characterized as flow-through process tanks, EPA in its final rule expanded the exclusion to include tanks with nonsteady flows. Its earlier concern that such expansion of the exclusion could be read to encompass virtually any UST, including those located at gasoline service stations,64 was addressed by the "production process" limitation.65

Finally, in its struggle to delineate the proper scope of flow-through process tanks, EPA reversed its initial proposal not to exclude tanks storing intermediate products. The Agency ultimately agreed with commenters who argued that such tanks are often a necessary part of batch-operated processes, for safety and other reasons.66

The outcome of this strained definitional process remains to be tested. EPA has attempted to provide guidance by giving examples of excluded and nonexcluded tanks. Holding tanks, pulse tanks, feed tanks, mixing tanks, tanks that hold material being cut in concentration, and other tanks in the process stream are flow-through process tanks;67 tanks in dry cleaning machines, because they store regulated substances prior to their introduction to the cleaning process, are not.68

The distinction between the dry cleaning tanks, on the one hand, and holding tanks or feed tanks, on the other, is obscure. One source of confusion is the definition of "production process." EPA has stated that, just as the dry cleaning tanks' function precedes the "production process," other kinds of tanks, such as wastewater treatment tanks, function after such process, without contributing to production. Such tanks are not excluded, even though they may be governmentally required and thus arguably are a necessary component of the production process, in a practical sense.69 As the UST program develops and enforcement becomes a higher priority, the need to clarify this critical definition may become compelling.

Persons regulated. The second aspect of Subtitle I regu- [21 ELR 10140] lation that defines its scope is the determination of a UST's "owners" and "operators,"70 the persons against whom the regulations are enforceable. Significant potential liabilities underscore the importance of the definitions that identify these persons. Owners may be liable for up to $ 10,000 per tank for knowingly violating the tank notification requirement;71 both owners and operators may be liable for up to $ 10,000 per tank per day for failure to comply with the technical requirements, including the interim prohibition.72 Moreover, owners and operators may be subject to corrective action requirements under the technical regulations or to cost recovery under § 9003(h), in instances where Leaking Underground Storage Tank (LUST) Trust Fund monies73 have been spent for cleanup. In the context of real estate transfers, persons included in these definitions may be responsible for abandoned or out-of-service USTs.

Subtitle I defines "operator" as "any person in control of, or having responsibility for, the daily operation of the underground storage tank."74 "Daily operation," which suggests ongoing and deliberate management, seems to exclude unconscious control or passive operation.

The definition of "owner" is less straightforward. "Owner" is defined differently depending on whether the tank was "in use" before or after November 8, 1984. For tanks in use before that date and no longer in use on that date, an owner is "any person who owned such tank immediately before the discontinuation of its use." The owner of a tank in use on November 8, 1984, or brought into use thereafter, is "any person who owns an underground storage tank used for the storage, use, or dispensing of regulated substances."75

The definition of owner seems to hinge on the concept of use, a term the regulations do not define. Two examples illustrate the lack of clarity here.

Assume that an empty tank is taken out of service in 1978, with the intention that it will be put back into service in the future. It is left in the ground and never permanently closed. Assume also that the land on which the tank is situated changes hands. None of the owners decides to put the tank back into service; however, none of them undertakes tank closure, either. Who is the owner: the party who discontinued active use or the present land owner? At what point did "use" cease? What if the tank had been abandoned?

In the second example, assume that a tank in use after November 8, 1984, changes hands one or more times. In 1990, it is determined to have been leaking for several years. Who is the responsible party: is it only the current owner or all of the owners who have held title to the land since the tank was put in service, or since it began leaking?

Although the definition is stated in the present tense (i.e., "any person who owns"), a literal interpretation creates problems. A tank owner apprehensive of liability for corrective action might sell a tank for a nominal amount, or simply abandon it, and no longer qualify as the "person who owns" the tank. And, if the tank was taken out of service (i.e., no longer "used for the storage, use, or dispensing"), the present real estate owner is arguably not the tank owner either, because the tank is not being used at present. In that situation, it seems, there is no owner.76

These questions of liability have not yet arisen in a contested setting. Thus far the UST program has emphasized tank notification and state program approval. Experience under the Subtitle C or Superfund programs is unlikely to settle these issues. Subtitle I definitions of owner and operator differ from those in Subtitle C. As a practical matter, enforcement against the most available parties, or the "deep pockets," may make the most sense. Whether the statute or regulations support such an approach would depend on the facts relating to real estate ownership and tank use in each case.

Substances regulated. The third aspect of Subtitle I regulation defining its scope is the identification of the substances regulated. The Subtitle I program encompasses two categories of substances: petroleum and hazardous substances, excluding any substance regulated as a hazardous waste under Subtitle C. These two categories are collectively referred to as "regulated substances."77 "Hazardous substance" is defined in CERCLA and incorporated by reference into the Subtitle I definition of regulated substance.

Petroleum is expressly excluded from the scope of response under CERCLA.78 Hence, Subtitle I in its corrective action authority covers a vast area of contamination outside the ambit of Superfund. It is estimated that 96 percent of the USTs regulated by Subtitle I consists of petroleum USTs; hazardous substance USTs account for the other four percent.79 On the other hand, hazardous substance releases are addressed by both CERCLA and Subtitle I. However, CERCLA does not authorize regulation of hazardous substance storage, one of the primary functions of Subtitle I.

The UST corrective action program also overlaps with corrective action under RCRA Subtitle C. Despite the clear exclusion of Subtitle C hazardous wastes from the Subtitle [21 ELR 10141] I definition of regulated substance, both programs provide for corrective action, under certain circumstances, when hazardous substances are released from a UST. When a hazardous substance is released from a UST into the environment, it arguably becomes a hazardous waste.80 It is then subject to Subtitle C corrective action if the UST is located at a RCRA-permitted facility81 (or at a facility with Subtitle C interim status82). In addition, Subtitle C corrective action can be required for hazardous waste.83

UST regulations are not intended to duplicate other regulations. If corrective action may be taken pursuant to RCRA § 3004(u) (i.e., corrective action at permitted facilities), no corrective action under Subtitle I is intended.84 Confusion may arise if the corrective action is to be taken at a facility with interim status or at one that has lost interim status,85 or if the release is from a petroleum UST located at a RCRA-permitted facility.

Thus, the Subtitle I program, though unique in establishing technical requirements for the ongoing installation and operation of petroleum and hazardous substance USTs, duplicates certain existing requirements of corrective action under CERCLA and RCRA Subtitle C. The program under which corrective action is ultimately taken may depend on the fortuities of program staffing and priorities within individual EPA regional offices, as well as whether the release has occurred at a facility with a final Subtitle C permit. However, owners and operators of regulated USTs should look primarily to the Subtitle I technical and financial responsibility regulations for guidance in their everyday operations.

Federal UST Technical Requirements

The first portion of Subtitle I to take effect was the "interim prohibition" against installation of substandard tanks pending creation of technical standards for new tanks. Recognizing that EPA would need considerable time to promulgate a final rule creating such technical standards, Congress enacted § 9003(g) as a stopgap measure.86 This section simply prohibits the installation of new tanks not designed to prevent releases caused by corrosion or structural failure. It requires that a tank be made of materials compatible with the substance to be stored in it.87 EPA's rule interpreting § 9003(g) stressed that the interim prohibition was three-pronged: corrosion protection, structural integrity, and compatibility of stored substances. Each of the three requirements must be met for the operational life of the tank.88 Moreover, EPA notified the regulated community that the phrase "no person may install" included owners and operators, as well as tank installers.89

The interim prohibition has been largely superseded by new tank performance standards.90 These standards require owners and operators to certify that tanks and piping have been properly installed,91 equip their UST systems with spill and overfill prevention devices,92 use only tanks and piping that are protected from corrosion,93 and equip their systems with leak detection.94

The technical standards also address the upgrading of existing tanks. Under the regulations, all existing USTs are required to be upgraded by December 22, 1998, through installation of spill and overfill prevention devices and corrosion protection for steel piping and tanks.95 In addition, leak detection is to be implemented on a schedule determined by the age of the tank, the latest date being December 22, 1993.96

As of the effective date of the technical regulations, all tanks, new and existing, are subject to certain operating requirements. These include spill and overfill control practices, [21 ELR 10142] proper operation and maintenance of corrosion protection, proper performance of repairs, and certain reporting and recordkeeping requirements.97

Finally, the technical regulations specify requirements for temporary and permanent closure of USTs.98 Substandard USTs may be temporarily closed for up to 12 months. They must then be either closed in place or removed from the ground, with corrective action taken as needed.99

Corrective Action

Although the Subtitle I corrective action program overlaps with the CERCLA and RCRA Subtitle C programs in certain ways,100 it differs radically from them, particularly from Superfund, in at least three ways: (1) it is, at least partially, "self-implementing;" (2) it deliberately avoids the "propose-and-review" document approach mandated under CERCLA101 in favor of a quick-action "triage" approach; and (3) it mandates site-specific cleanup target levels, rather than uniform, national standards for long-term remediation.

Studies by EPA's OUST have shown that the gap between the number of confirmed releases from underground tanks and the number of completed corrective actions is widening.102 Historically, site investigation alone at UST sites has taken from 67 to 141 weeks.103 Excessive delay can result in loss of valuable groundwater resources, as well as loss of public confidence in the government's ability to protect human health and the environment.

Faced with this situation,104 OUST has attempted to create a corrective action regulatory scheme that promotes action over deliberation.105 Finding that the majority of UST releases (about 70 percent) are relatively small, only requiring free product recovery and limited soils management,106 EPA has implemented a corrective action scheme that divides remediation into discrete short- and long-term phases.107 The short-term, or self-implementing, steps are to be taken by the owner or operator, acting without prior governmental involvement or approvals.108 Long-term corrective action, if required, entails traditional governmental oversight, with public participation.109

The self-implementing aspect of UST corrective action was developed to allow responsible owners and operators to prevent off-site migration of contaminants and potentially to reduce the time and money needed for cleanup. Labelled "at risk" cleanup, the implementing agency may require modifications of approach later.110

In addition, OUST has adopted a "triage" approach to corrective action.111 In the context of UST release response, triaging requires avoidance of unnecessary complexity. Efforts are made to eliminate anything that makes a process more complicated without adding quality to the cleanup or that prevents swift actions.112 Thus, the corrective action process under the UST regulations is nearly devoid of cumbersome review and approval steps, and lacks specific requirements for cleanup technologies or levels.113

The focus is on the spirit of the law and not merely on step-by-step detailed procedure.114 Anticipating changes in methodologies,115 EPA structured the corrective action rules to foster innovation and use of the newest, most efficient technology; thus the regulations do not require the use of [21 ELR 10143] any specific technology. Instead, guidelines that can evolve quickly along with the technology are intended to provide specificity for the regulated community. In areas where the population is not dependent on the groundwater and where significant contamination already exists,116 extensive groundwater cleanup may not be required.117 The object is to avoid debate of cleanup standards and instead to focus resources to remove contamination early, following up as needed to prevent harmful exposures.118

Financial Responsibility Requirements and the LUST Trust Fund

As originally enacted, Subtitle I did not impose financial responsibility requirements on owners or operators119 or provide funding for cleanups performed by the government. In the Superfund Amendment and Reauthorization Act of 1986 (SARA),120 Congress addressed these two deficiencies by mandating financial responsibility for all owners or operators of USTs121 and by creating a trust fund for use in cleaning up releases of petroleum.122

These amendments use the RCRA Subtitle I program to close a significant gap in CERCLA: the exclusion from CERCLA of petroleum as a "hazardous substance."123 Hence, the changes to Subtitle I made by SARA are largely limited to petroleum USTs.124

Two significant features of the financial responsibility requirement are the statutory requirement of $ 1 million per occurrence for insurance coverage and the absence of a limit on liability regardless of the size or sophistication of the owner or operator. Although the House of Representatives version of SARA had included a $ 3 million cap on liability for all owners and operators, this item was deleted in the final bill.125

The statute provides for mechanisms by which owners and operators can comply with the financial responsibility requirements. These include insurance, guarantee, surety bond, letter of credit, qualification as a self-insurer, or any other method satisfactory to theAdministrator.126 In the regulations, EPA has suggested several additional mechanisms that would be satisfactory to the Administrator, including reliance on a state fund. Generally, state funds provide financial assurance (in varying degrees of coverage) for USTs that meet certain minimum criteria. Funding is usually achieved through licensing fees, registration fees, or special taxes. Funding can be controversial if the state fund is perceived as a government subsidy to owners and operators of USTs. As of May 1990, only nine states had EPA-approved funds, but many more were developing them.127

Although § 9003(c) mandates financial responsibility for both petroleum and hazardous substance USTs, EPA has published regulations implementing only the financial responsibility requirement for petroleum USTs;128 proposal of financial responsibility requirements for nonpetroleum USTs has been deferred.129 The financial responsibility rule for petroleum USTs has been extremely controversial. Many tank owners complain that they will be forced out of business if the regulations are applied to them.

The regulations create four categories of tank owners and operators, with a phased-in compliance schedule. The largest entities, petroleum marketers130 with more than 1,000 [21 ELR 10144] USTs and nonmarketers with more than $ 20 million in assets (Category I), were required to comply by January 1989. Intermediate-size marketers, those with 100 to 999 USTs (Category II), were required to comply by October 1989. Owners or operators in the final two categories have been granted extensions due to uncertainty on the availability of insurance or other means of complying.131 Petroleum marketers with 13 to 99 USTs at more than one facility (Category III) must comply by April 1991. The smallest owners and operators, those with 1 to 12 USTs, or less than 100 USTs at one facility, local governmental entities, and nonmarketers with a net worth of less than $ 20 million (Category IV), have until October 1991 to comply.

The debate over financial responsibility requirements continues. Tank owners, many of whose tanks are uninsurable due to their age or other underwriting criteria, have argued that the money spent on insurance premiums could be better spent on upgrading tanks.132 EPA has rejected this argument, noting that SARA mandated financial responsibility. In the preamble to the financial responsibility rules for petroleum USTs, the Agency stressed that Congress did not enact these amendments as alternatives to technical specifications. It asserted that neither the technical nor the financial requirements alone would totally prevent harm to the public health or the environment; however, together they would assure a high degree of protection.133

Insurers generally will not insure inferior tank systems. One commentator has argued that "incentives engendered by financial responsibility requirements under RCRA … could provide badly needed reinforcement of regulatory controls," and "[a]reas in which rapid technical change outpaces regulatory adjustments, such as … chemical engineering, may be particularly appropriate fields in which to supplement regulation with insurance-based incentives."134 EPA has stressed that the phased compliance approach, whereby the smallest UST owners and operators need not immediately comply with financial responsibility requirements, adequately addresses the tension between upgrading tanks and financial responsibility.135

The LUST Trust Fund created by SARA136 is often discussed in connection with financial responsibility because it too provides a source of money for corrective action. However, EPA rejected proposals to allow use of the trust fund to partially satisfy obligations under the financial responsibility requirements. In the preamble to its final rule for petroleum UST financial responsibility, EPA observed that "the LUST Trust Fund … was created to provide cleanup of UST releases in particular circumstances. Congress did not authorize its use as a financial assurance mechanism. Rather the fund is intended to 'stand behind' the owner or operator who has obtained financial responsibility in the required amounts."137

LUST Trust Fund money may only be spent on cleanup of petroleum releases. It may be used (1) when no responsible party can be found, (2) when the situation requires prompt action, (3) when the cost of corrective action exceeds the amount of coverage required under the financial responsibility rule, and additional expenditures are necessary for "effective" corrective action,138 or (4) when the owner or operator fails or refuses to comply with a corrective action order.139 The statute grants the states, as well as the federal government, authority to use money from the fund to cleanup petroleum releases. The money may also be used by states, whether or not they have approved UST programs.140

Once trust fund monies have been spent, the appropriate government (i.e., state or federal) may recover costs from the owner or operator. Notably, the standard of liability in such actions is not the same as in Superfund cost recoveries. In a Superfund action, the third-party defense is very narrow.141 In a Subtitle I action, the more liberal third-party defense to oil and hazardous substance liability under the Federal Water Pollution Control Act (FWPCA) applies.142

The insertion of this language caused some consternation [21 ELR 10145] in the House, which first considered it. As the House Report explains,

The major goal of CERCLA's revision [to the FWPCA's third-party defense] was to prevent polluters from contriving to contract away their liability to third parties with whom they have ongoing business relationships…. Congress recognized that if polluters were allowed to escape liability in such an easy fashion, they would have little incentive to prevent pollution by their suppliers, franchisees, employees or other third parties with whom they have ongoing relationships which can directly affect the safety of their daily management of toxic substances…. The [use of the FWPCA standard of liability] represents a clear effort to turn the clock back…. 143

At least one of these concerns, that powerful entities might contract away liability to less sophisticated parties, appears to have been addressed in § 9003(h)(6)(C) of Subtitle I. It provides:

No indemnification, hold harmless, or similar agreement or conveyance shall be effective to transfer from the owner or operator of any UST or from any person who may be liable for a release or threat of release under this subsection, to any other person the liability imposed under this subsection….144

However, the practical ramifications of including the FWPCA standard of liability in Subtitle I have yet to be tested.

As indicated above, § 9003(h) provides concurrent authority to federal and state governments to use LUST Trust Fund monies or to require UST owners or operators to undertake corrective actions if the state meets certain conditions. Under a LUST Trust Fund Cooperative Agreement,145 EPA can provide money for state corrective action of a petroleum release and the state may initiate § 9003(h)(6) cost-recovery actions against responsible parties. State authority under § 9003(h) exists independently of the broader authority granted under § 9004 for federally approved state programs. Authority under § 9004 may operate in lieu of the federal Subtitle I program.146

State Program Approval and the Federal Role

According to EPA, "[t]he 'national' UST program [is] primarily a network of state and local programs, with EPA providing leadership and assistance, and enforcement backup as necessary."147 This statement summarizes the distinction between UST state program approval148 and state program authorizations under other federal environmental programs, such as the RCRA Subtitle C hazardous waste program.149 Whereas state hazardous waste programs must be "equivalent" to the federal program and must be "consistent" with the federal or state programs applicable in other states,150 the Subtitle I state program approval requires only that the state program be "no less stringent" than the federal program.151 The state program approval regulations152 articulate objectives for each of the eight program areas addressed by the federal technical regulations; for EPA approval, the state program need only satisfy the objectives and is not directly compared with the federal program. Thus, any federal tendency to require uniformity between the state and federal programs is substantially eliminated; holistic objectives are the standard against which state program adequacy is determined.153 By this mechanism, EPA intends "[t]o encourage a wide range of State UST programs … reflecting the unique environmental characteristics and governmental institutions of each state."154

EPA cites three reasons for the unique approach taken in the UST program: the extremely large number of regulated facilities; the nature of the regulated community, which includes many small, locally owned businesses; and the nature of the regulatory work, which, because it "must address every phase of the lifecycle of a storage tank system," requires "close and constant checks" on compliance.155 Hence, state and local control is viewed as essential to successful regulation.

An additional reason for the federal acceptance (and even encouragement) of state and local diversity, and independent state control of UST programs, is that at the time the federal statute was enacted many states and municipalities already had viable UST regulatory programs of which Congress approved.156 Congress enacted Subtitle I "to establish a constructive federal role to aid the states … [and to] help to ensure consistency between state programs and tank standards and measured progress toward [its] goal of protecting ground water …"157 It intended to pull together the state programs under one federal umbrella and to create incentive for state without programs to develop them.

In explaining its view of the unique federal/state relationship that Subtitle I creates, EPA's OUST has compared this relationship to that between a franchisor and its franchisees.158 "[T]he franchisee [the state] is free to operate an [21 ELR 10146] independent business having reached agreement with the franchisor [EPA Headquarters] over certainoperating procedures…. Under OUST's model, the franchisor concentrates on providing those services requested by the franchisee (e.g., training, public outreach tools)."159 Thus, under this model, "the states are directly responsible for customer service," the customers being tank owners and operators, as well as the general public. The EPA regional offices are the "field representatives — the primary liaison between the States (franchisees) and [EPA Headquarters] (franchisor)" who are responsible for "promoting OUST's program implementation themes to the States…."160

This analogy distinguishes the UST state/federal relationship from the state/federal relationships in other programs, which have too often been characterized by ongoing tension and state resentment of federal intrusion.161 In the Subtitle C program, for instance, EPA has characterized federal oversight of state-authorized programs as "micro-management,"162 conceding that poorly defined roles and poorly communicated expectations have led to numerous areas of friction and have seriously eroded the working relationship between EPA and the states.163

The UST program seeks to avoid the problems in other delegated programs. The franchise language is intended to communicate a concrete model, acceptable to states and EPA alike, that will steer them into a healthy long-term relationship. Whether it will actually do so remains to be seen.164

The federal UST program, standing alone, could be criticized as weak.165 It relies heavily on state initiative and voluntary compliance, resting to a larger degree than in other federal programs on the good faith of the regulated community.166 Giving the states and the regulated community a greater number of possible pathways to compliance diminishes the ease with which a violation can be defined and an enforcement action taken.167 Flexibility is achieved at the expense of stringency and enforceability. And, despite EPA's urging states to develop stringent and specific programs, EPA concedes that about one-half of the states that have developed UST regulations since enactment of Subtitle I have adopted the federal technical regulations with little or no change.168

The Federal Program: Management Style

EPA has set a goal of nationwide replacement or upgrading of existing USTs by 1998.169 This goal perhaps appears unrealistically optimistic to those whose spirit of enthusiasm for environmental regulation has been jaded by experience. Nevertheless, the EPA UST program managers intend to achieve this 1998 target, in part through utilization of TQM concepts borrowed from the private sector.

TQM is a management style whose origin is generally attributed to a statistician named W. Edwards Deming. Deming worked with Japanese industries during the post-World War II era to help them become competitive in world markets.170 Managers using Deming's techniques focus on end-product quality and on improving the processes used to reach the end product. TQM proposes a holistic, preventive approach, which more fully involves employees at all levels of the organization in contributing to realization of the organization's goals.171

TQM stands in contrast to the more traditional management-by-results approach, which defines objectives in terms of quotas and emphasizes control implemented through a hierarchical chain of command.172 In such a system, job performance is measured almost exclusively through achievement of numerical goals.

EPA's OUST director, Ron Brand, is committed to a TQM approach within OUST.173 For example, the new approach [21 ELR 10147] to corrective action in the UST program174 resulted from the TQM process applied to the problem of achieving expedient cleanups. TQM was also a significant force in the decision to allow states the flexibility to adopt technical standards for UST systems.175

Observations

The Subtitle I program's model for a state/federal partnership and its use of TQM make it unique among federal programs. Although the UST program is relatively new and its successes and failures are not yet apparent, these two aspects of the program merit close observation as the program matures. Appropriately applied, they could be useful in developing or improving other federal programs.

It would be naive to conclude that these features should be imposed across the board in other environmental program areas. First, as stated, there is very little data to support the expansion of its methods to other areas. Second, each environmental program area is different, with special issues and possible regulatory approaches. Some program areas — like air, water, and hazardous waste — are interstate in scope. In these areas, a stronger federal presence would seem essential. Varying levels of technological complexity and technological advancement, costs, and differences in the size and character of the regulated community in the different program areas might also dictate different balances of state and federal authority.

Perhaps more appropriate would be a program-by-program reevaluation of the federal/state partnership. The specific issues and failures of each program area could be identified and assessed in light of existing and potential allocations of state and federal authority, with the experience of the UST program, as it proceeds, providing a concrete point of reference.

Given the enormous challenge of the contemporary environmental crisis, and the problems that have plagued other federal programs, an approach that stimulates creative problem solving and grassroots effort, as well as constructive partnership between state and federal government, merits close attention. Other toxic regulatory and cleanup programs, in particular the Superfund program, have seen an apparent inability of government ever to move forward with real cleanup. Contaminated soils and groundwater are subject to assessments, feasibility studies, hearings, and argument over cleanup goals that drag out the process of remediation through a period of years, while plumes of underground pollution spread, further threatening human health and the environment. Scarce funds are depleted by the process prior to meaningful site activity.176

Excessive federal control has discouraged solutions tailored to specific problems. The federal UST program, with its emphasis on TQM and state-generated solutions meeting minimum federal standards, may serve as model for other federal programs.

1. 42 U.S.C. §§ 6991-6991i, ELR STAT. RCRA 042-047. The UST program was originally proposed as an amendment to the Safe Drinking Water Act. It was added to the solid waste program when it became apparent that passage of a RCRA amendment was more likely. H.R. CONF. REP. NO. 1133, 98th Cong., 2d Sess. 123 (1984) [hereinafter HSWA CONF. REP.]; M. Williams, Remarks at USEPA UST Orientation Training (July 17-19, 1990)[hereinafter Orientation Training]. The acronym for the program was originally "LUST," was changed to "RUST" (regulation of underground storage tanks), and was finally changed to "UST" to avoid negative connotations. For further background on the passage of Subtitle I, see Miller & Taylor, The Enemy Below: EPA Plans Action on Leaking Underground Storage Tanks, 15 ELR 10135 (May 1985).

2. See, e.g., authorized state hazardous waste programs pursuant to RCRA Subtitle C, RCRA § 3006, 42 U.S.C. § 6926, ELR STAT. RCRA 019; state pollution discharge elimination system permits (SPDES) pursuant to the Federal Water Pollution Control Act (FWPCA) § 402(b), 33 U.S.C. § 1342(b), ELR STAT. FWPCA 054; and state implementation plans pursuant to the Clean Air Act § 110, 42 U.S.C. § 7410, ELR STAT. CAA 008.

3. OFFICE OF UNDERGROUND STORAGE TANKS (OUST), U.S. ENVIRONMENTAL PROTECTION AGENCY (EPA), STATE PROGRAM APPROVAL HANDBOOK, OSWER DIR. 9690.8, at 4 (1989)[hereinafter SPA HANDBOOK].

4. 40 C.F.R. pt. 281.

5. The origin of TQM is generally attributed to a statistician named W. Edwards Deming, who worked with Japanese industries during the post-World War II era. See SCHOLTES, THE TEAM HANDBOOK, HOW TO USE TEAMS TO IMPROVE QUALITY (1988)[hereinafter, THE TEAM HANDBOOK]. Deming has been called "the Father of the New Industrial Age and the founder of the New Economic Era." Id. at I-3; see also infra notes 169-75 and accompanying text.

6. R. Brand, Remarks at Orientation Training, supra note 1.

7. The safety reasons relate to fire and explosion hazards. Obviously, environmental contamination from leakage was overlooked as a safety concern.

8. T. Schruben, Remarks at Orientation Training, supra note 1.

9. Preamble to federal technical regulations, 53 Fed. Reg. 37082, 37088 (Sept. 23, 1988). An estimated 80 percent of existing USTs are made of bare steel. M. Williams, Remarks at Orientation Training, supra note 1.

10. 53 Fed. Reg. at 37088. "Petroleum industry experts estimate that as many as 75,000 to 100,000 underground tanks are leaking and that 350,000 may develop leaks within the next five years." HSWA CONF. REP., supra note 1, at 128. At the Orientation Training, supra note 1, OUST representative Mike Williams stated that "a lot of [the UST technical requirements] are common sense stuff that people hadn't been doing; a lot of it is in the fire codes."

11. 53 Fed. Reg. at 37089.

12. Id.

13. Id.

14. Manifold piping is piping that connects one or more tanks.

15. 53 Fed. Reg. at 37082, 37090.

16. These terms are defined in 40 C.F.R. § 280.20(c) (1989).

17. "Backfill material should be a clean, washed, well-granulated, free-flowing noncorrosive, inert material: sand, crushed rock, or pea gravel…. It should be free of debris, rock, ice, snow, or organic material, all of which could damage the tank or its coating and adversely affect compaction." Recommended Practices for Installation of Underground Liquid Storage Systems 7 (Petroleum Equipment Institute Publication 100-87).

18. 53 Fed. Reg. at 37083. Owners and operators of UST systems include gasoline marketers, airports, schools, bus terminals, car rental fleets, police departments, and transit authorities. M. Williams, Remarks at Orientation Training, supra note 1. When small tanks and other tanks not regulated under Subtitle I are included, the total is closer to six million USTs nationwide. N.Y. Times, July 29, 1990, at E4, col. 1.

19. A nontight system fails a "tightness test." Tightness tests to detect breaches in the system are performed by filling the tank and measuring for changes in volume, or using acoustic sensors to listen for bubbling while the system is out of service. M. Scoggins, Remarks at Orientation Training, supra note 1.

20. 53 Fed. Reg. at 37088. In 1988, EPA predicted that "because a relatively high proportion of UST facilities (10 to 30 percent) already have had a leak, or will soon leak unless measures are taken to upgrade them, the average number of leaking UST systems may range from 1,400 to 4,200 per state in the near future." Id. at 37095.

21. Id. EPA notes that "[t]hese surface releases are at least twice as numerous as tank or piping releases." Id. at 37090.

22. Id. at 37088.

23. T. Schruben, Remarks at Orientation Training, supra note 1.

24. 53 Fed. Reg. at 37088.

25. Id. at 37089. Cathodic protection is a mechanism whereby the tendency to corrode, caused by low-level electrical current in the ground, is diverted toa piece of metal attached to the tank; this metal is then sacrificed instead of the tank.

26. 53 Fed. Reg. at 37089.

27. M. Scoggins, Remarks at Orientation Training, supra note 1. Systems with secondary containment generally cost significantly more than systems without it. Id.

28. 53 Fed. Reg. at 37089 (Sept. 23, 1988).

29. HSWA CONF. REP., supra note 1, at 128.

30. Miller & Taylor, supra note 1, at 10136.

31. Id. at 10135.

32. Id. at 10136.

33. I. Goodman, Remarks at Orientation Training, supra note 1; accord, Hodge & Roman, Ground-water Protection Policies: Myths and Alternatives, 28 GROUND WATER 498, 499 (1990).

34. I. Goodman, Remarks at Orientation Training, supra note 1; see also Freeze & Cherry, What Has Gone Wrong, 27 GROUND WATER 458 (1989).

35. As of September 1988, when the final technical regulations were published, at least 18 states and over 100 cities had put UST regulatory programs into place. 53 Fed. Reg. at 37215.

36. EPA, however, retains authority to enforce the provisions of the state program. RCRA § 9006(a)(2), 42 U.S.C. § 6991e(a)(2), ELR STAT. RCRA 046. The "in lieu of" language appears at RCRA § 9004(d)(2), 42 U.S.C. § 6991c(d)(2), ELR STAT. RCRA 045.

37. Partial state programs are authorized by RCRA § 9004(a), 42 U.S.C. § 6991c(a), ELR STAT. RCRA 045; temporary state programs are authorized by RCRA § 9004(b), 42 U.S.C. § 6991c(b), ELR STAT. RCRA 045, and by 40 C.F.R. § 281.11 (1989).

38. 40 C.F.R. § 281.12 (1989).

39. 42 U.S.C. § 6991a, ELR STAT. RCRA 042.

40. Regulations pertaining to leak detection, records maintenance, release reporting, corrective action, tank closure, and financial responsibility are required pursuant to 42 U.S.C. § 6991b(c), ELR STAT. RCRA 043.

41. 42 U.S.C. § 6991b(e), ELR STAT. RCRA 043.

42. Id. § 6991c(a), (b), ELR STAT. RCRA 045.

43. 40 C.F.R. § 280.12 (1989).

44. 42 U.S.C. § 6991b(f), ELR STAT. RCRA 043.

45. A schedule for tank upgrade appears at 40 C.F.R. § 280.40 (1989).

46. A schedule for compliance with financial responsibility requirements appears at 40 C.F.R. § 280.91 (1989).

47. 42 U.S.C. § 6991b(g), ELR STAT. RCRA 043. These statutory interim standards require that new USTs be structurally sound and protected from corrosion for the operational life of the tank, and be made of materials compatible with the stored substances. For EPA's interpretative rule on the interim prohibition, along with a summary of the legislative history of this provision, see 51 Fed. Reg. 20418 (June 4, 1986). When new tank standards became effective on December 22, 1988, the interim prohibition was superseded, except for the USTs for which applicability of the new standards was deferred. See 40 C.F.R. § 280.10, .11 (1990).

48. 53 Fed. Reg. 37082 (Sept. 23, 1988) (codified at 40 C.F.R. pt. 280).

49. 53 Fed. Reg. 37212 (Sept. 23, 1988) (codified at 40 C.F.R. pt. 281).

50. 53 Fed. Reg. 43322 (Oct. 26, 1988) (codified at 40 C.F.R. pt. 280, subpt. H; 40 C.F.R. § 281.37). Financial responsibility requirements as to hazardous substance USTs have been deferred.

51. E.g., use of underground storage tanks in the natural gas industry, RCRA § 9001(1)(D), 42 U.S.C. § 6991(1)(D), ELR STAT. RCRA 042.

52. 42 U.S.C. §§ 6921-6939b, ELR STAT. RCRA 010-026.

53. 42 U.S.C. §§ 9601-9675, ELR STAT. CERCLA 001-075.

54. See discussion at infra note 86 and accompanying text.

55. RCRA § 9001, 42 U.S.C. § 6991, ELR STAT. RCRA 042. The regulations restate this definition without change, adding a second term, "UST system," meaning the tank or tanks and piping, along with "underground ancillary equipment, and containment system, if any." 40 C.F.R. § 280.12 (1989).

56. The list of excluded tanks appears at 42 U.S.C. § 6991(1), ELR STAT. RCRA 042, and 40 C.F.R. § 280.12 (1989). State programs may include tanks excluded under the federal program, however. In addition, federal regulation of certain tanks has been deferred. 40 C.F.R. § 280.10(c), (d) (1989).

57. 40 C.F.R. § 280.12 (1989). There is no definition of this term in the statute.

58. "The scope of the flow-through process tank exclusion has been one of the most difficult to define and most controversial interpretative issues, due to the lack of legislative guidance and commonly understood technical meaning, as well as the potential for the exclusions, broadly interpreted, to encompass nearly all of the UST universe." 53 Fed. Reg. at 37119.

59. Id.

60. Preamble to proposed rule, 52 Fed. Reg. 12692 (Apr. 17, 1987).

61. 40 C.F.R. § 280.12 (1989).

62. 53 Fed. Reg. at 37119.

63. Id. at 37120.

64. 52 Fed. Reg. at 12692.

65. EPA stated in the preamble to the final regulations that "by allowing variable or recurring flow, but limiting this exclusion to production processes, this concern is no longer relevant." 53 Fed. Reg. at 37120.

66. Id.

67. Id.

68. Id. EPA noted, though, that as a service industry whose processes qualify as production processes, "[t]anks that contain regulated substances that are integral to the dry cleaning process are eligible for consideration as flow-through process tanks." Id. at 37212.

69. Id. at 37120.

70. RCRA § 9003(a), 42 U.S.C. § 6991b(a), ELR STAT. RCRA 042. The existence of this issue was brought to the author's attention by Lynda Carney, Office of Regional Counsel, EPA Region IV.

71. RCRA § 9006(d)(1), 42 U.S.C. § 6991e(d)(1), ELR STAT. RCRA 046. The tank notification requirement appears at RCRA § 9002, 42 U.S.C. § 6991a, ELR STAT. RCRA 042.

72. RCRA § 9003(g), 42 U.S.C. § 6991b(g), ELR STAT. RCRA 043. Penalties are assessed on a case-by-case basis pursuant to OFFICE OF UNDERGROUND STORAGE TANKS, U.S. ENVIRONMENTAL PROTECTION AGENCY, PENALTY GUIDANCE FOR VIOLATIONS OF UST REGULATIONS (1990).

73. See infra note 136 and accompanying text.

74. RCRA § 9001(4), 42 U.S.C. § 6991(4), ELR STAT. RCRA 042.

75. RCRA § 9001(3), 42 U.S.C. § 6991(3), ELR STAT. RCRA 042. The relevant date here, November 8, 1984, should not be confused with the date used to determine whether notification pursuant to § 9002 must be given. For purposes of notification, owners of tanks taken out of operation on or before January 1, 1974, are not required to give notice. RCRA § 9002(a)(2), 42 U.S.C. § 6991a(a)(2), ELR STAT. RCRA 042.

76. This situation is perhaps partially addressed in RCRA § 9003(h)(6)(C)(i), 42 U.S.C. § 6991b(h)(6)(C)(i), ELR STAT. RCRA 044, which provides: "No … conveyance shall be effective to transfer from the owner or operator … to any other person the liability imposed under this subsection [cost recovery for corrective action undertaken by the government]."

77. RCRA § 9001(2), 42 U.S.C. § 6991(2), ELR STAT. RCRA 042.

78. CERCLA § 101(14), 42 U.S.C. § 9601(14), ELR STAT. CERCLA 007; U.S. ENVIRONMENTAL PROTECTION AGENCY, SCOPE OF THE CERCLA PETROLEUM EXCLUSION UNDER SECTIONS 101(14) AND 104(a)(2)(A) (July 31, 1987).

79. REGULATORY IMPACT ANALYSIS FOR PROPOSED TECHNICAL STANDARDS FOR UNDERGROUND STORAGE TANKS, at 3-3, 3-4 (1987).

80. RCRA § 1004(5) and (27), 42 U.S.C. § 6903(5) and (27), ELR STAT. RCRA 005; 40 C.F.R. § 261.33(d), (e), and (f) (1989). The preamble to the UST technical regulations notes that "[m]any hazardous substances regulated by the Subtitle I tank rules are currently on EPA's hazardous waste lists of commercial chemical products at 40 C.F.R. 261.33 (e) and (f). The products become hazardous wastes when discarded, including when spilled and then not cleaned up and used for their intended purpose. Soils, water, or other debris contaminated by these products are subject to regulations as hazardous waste. (see 40 CFR 261.33(d))." 53 Fed. Reg. at 37188.

81. RCRA § 3004(u) and (v), 42 U.S.C. § 6924(u) and (v), ELR STAT. RCRA 016; such corrective action may be required "beyond the facility boundary where necessary…." RCRA § 3004(u), 42 U.S.C. § 6924(u), ELR STAT. RCRA 016.

82. RCRA § 3008(h), 42 U.S.C. § 6928(h), ELR STAT. RCRA 021. Interim status under Subtitle C is defined at RCRA § 3005(e), 42 U.S.C. § 6925(e), ELR STAT. RCRA 017. EPA also considers Subtitle C corrective action to be applicable to facilities that lack interim status. United States v. Indiana Woodtreating Corp., 686 F. Supp. 218, 18 ELR 21478 (S.D. Ind. 1988).

83. RCRA § 3004(u), 42 U.S.C. § 6924(u), ELR STAT. RCRA 016. Hazardous waste constituents are listed at 40 C.F.R. pt. 261, app. II (1989).

84. 40 C.F.R. § 280.60 (1989). The regulation here refers only to Subtitle C corrective action "under section 3004(u)" of RCRA, and fails to explain the intended interface with the other Subtitle C corrective action provisions, §§ 3004(v) and 3008(h). The preamble, however, explains that for facilities without a final RCRA permit, Subtitle I corrective action standards will apply to releases from all petroleum and hazardous substance tanks covered under Subtitle I. UST corrective actions underway at facilities having interim status under RCRA may be subject to review under the RCRA corrective action program during the development of a final permit, and these ongoing corrective action activities may be incorporated into the facility's RCRA permit.

53 Fed. Reg. at 37176.

85. See RCRA § 3008(h), 42 U.S.C. § 6928(h), ELR STAT. RCRA 021; United States v. Indiana Woodtreating Corp., 686 F. Supp. at 218, 18 ELR at 21478.

86. The interim prohibition was effective from May 7, 1985, until December 22, 1988 (the effective date of the new tank standards promulgated pursuant to § 9003(e)).

87. 42 U.S.C. § 6991b(g), ELR STAT. RCRA 043. Section 9003(g)(2) does permit the installation of tanks without corrosion protection during the interim period in areas where soil resistivity meets a certain standard. 42 U.S.C. § 6991b(g)(2), ELR STAT. RCRA 043. The requirements of § 9003(g), which were effective on May 7, 1985, were initially codified in the regulations at 40 C.F.R. § 280.2 (1989), and, after promulgation of new tank standards, were recodified (as to certain deferred tanks) at 40 C.F.R. § 280.11 (1989).

88. 51 Fed. Reg. 20418 (June 4, 1986).

89. Id. at 20420.

90. 40 C.F.R. § 280.20 (1989). These standards are summarized in two EPA publications: OFFICE OF UNDERGROUND STORAGE TANKS, U.S. ENVIRONMENTAL PROTECTION AGENCY, MUSTS FOR USTS (1988), and LEAK LOOKOUT (1988).

91. 40 C.F.R. § 280.20(e) (1989).

92. Id. § 280.20(c).

93. Id. § 280.20(a), (b).

94. Id. § 280.40(c).

95. Id. § 280.21.

96. Id. § 280.40(c).

97. Id. pt. 280, subpt. C.

98. Id. pt. 280, subpt. G.

99. Id. § 280.71(b), .72(b).

100. See supra notes 87-94 and accompanying text.

101. 40 C.F.R. pt. 300 (1989).

102. I. Goodman, Remarks at Orientation Training, supra note 1. The widening gap has been documented for the period between January 1989 (just after the effective date of the regulations) and June 1990. EPA attributes the delays, which have occurred despite the promulgation of a regulatory scheme designed to avoid delays, to a "combination of states being on [a] learning curve, … staffing problems, plus 'inherited' sequence of 'propose and review' [steps] from other cleanup programs (e.g., RCRA and CERCLA)." Id.

103. Id. Elsewhere OUST notes that "it typically takes one-to-two years to begin corrective action at a site (even if that site is considered 'high priority')." Id.

104. "[T]ens of thousands of UST systems are believed to have already leaked substantial quantities of regulated substances into the environment and numerous public and private wells have already been threatened or destroyed." 53 Fed. Reg. at 37105.

105. Two leading groundwater scientists cite "unrealistic compliance goals," sometimes set at "detection levels," as one of the more significant impediments to effective groundwater regulation.

The public demand for complete remediation of contaminated ground water must be tempered with practicability to clean up sites and with the available technology to monitor performance. Laws that do not take such issues into account lead to wasteful expenditures because of lack of decision-making discipline within a context of reasonable and achievable priorities…. From a hydrogeological perspective the major outcome from the first generation of legislation has been the creation of a large suite of field laboratories in the form of large-scale remedial actions, which are essentially research experiments to see how cleanup can be accomplished and what level of cleanup is attainable.

Freeze & Cherry, supra note 34, at 460, 463.

106. I. Goodman, Remarks at Orientation Training, supra note 1. OUST also reports that "[a]nother 25% of UST releases require more extensive corrective action. For instance, above-ground and in-situ cleanup of contaminated soils [and] some control or cleanup of the ground water… The remaining 5% require integrated soil and ground water remediation." Id.

107. See 53 Fed. Reg. at 37230-01; 52 Fed. Reg. at 12751.

108. The term "self-implementing" is used in the Orientation Training materials, supra note 1. The regulations governing this phase of the response are 40 C.F.R. § 280.61-65 (1989). All activities taken pursuant to these regulations must be reported to the implementing agency. 40 C.F.R. § 280.62(b), .63(b), .64(d), .65(b) (1989).

109. 40 C.F.R. § 280.66, .67 (1989).

110. I. Goodman, Remarks at Orientation Training, supra note 1.

111. Id.

112. Id. Goodman of OUST states that "[t]here is so much work out there that we're really just trying to find ways to get at the very minimum that must be done." Remarks at Orientation Training, supra note 1. This quick-action approach is supported by congressional comments made pursuant to creation of the LUST Trust Fund corrective action program. A primary purpose of the LUST Trust Fund is to facilitate prompt response to a release. H.R. CONF. REP. NO. 962, 99th Cong., 2d Sess. 262, 266 (1986), reprinted in 1986 U.S. CODE CONG. & ADMIN. NEWS 3276 [hereinafter SARA CONF. REP].

113. The program in this regard is consistent with the recommendations of hydrogeologists Freeze and Cherry, who argue that "[a] reduction in bureaucratic review is imperative if progress is to be achieved on ground-water cleanup." Freeze & Cherry, supra note 34, at 461; see also 53 Fed. Reg. at 37106-07.

114. I. Goodman, Remarks at Orientation Training, supra note 1.

115. Id. Goodman cites several new technologies for site investigation that have just become, or soon will become, commercially available. These include "[o]n-site field measurements to identify and quantify contaminants, using active headspace techniques, … direct measurement of free product thickness in shallow, unconsolidated aquifers with free-product probe, … [and] [s]oil vapor surveying to estimate presence and location of free-product plume and of subsurface soil contamination." These techniques are in contrast to methods now widely employed that entail laboratory analysis and on-site methods capable only of gross quantitative estimates. Id. Likewise, cutting-edge technology for site remediation is expected to become widely available within the next few years. Id.

116. Id.; see also Freeze & Cherry, supra note 34, at 461. Freeze and Cherry argue that at many hazardous waste sites "the local ground water zone has terminal cancer…. The difficulty of ground water protection bodes poorly for much success unless the major protection effort is focused on those aquifers most worthy of protection. The classification and prioritizing of aquifers is a job worth pursuing with urgency." Id. at 463-64. But see Hodge & Roman, supra note 33, at 503, who argue that the interests of future generations and of the ecological integrity of the hydrologic cycle must be included in any assessment of whether particular remedial actions are worthwhile.

117. "Owners and operators must remove free product to the maximum extent practicable as determined by the implementing agency …," 40 C.F.R. § 280.64 (1989), and where a corrective action plan is called for, they must "submit[] a plan that provides for adequate protection of human health and the environment as determined by the implementing agency…." 40 C.F.R. § 280.66(a) (1989). The implementing agency, in approving a corrective action plan, must consider factors listed at 40 C.F.R. § 280.66(b) (1989), including hydrogeologic characteristics of the area, proximity and uses of nearby groundwater, exposure assessment, and other site-specific data. See also 53 Fed. Reg. at 37174.

118. I. Goodman, Remarks at Orientation Training, supra note 1.

119. Before the 1986 amendments, financial responsibility could be required at the discretion of the Administrator. RCRA § 9003(c), (d), 42 U.S.C. § 6991b(c), (d), ELR STAT. RCRA 043; see also, SARA CONF. REP., supra note 112, at 263.

120. Pub. L. No. 99-499, 100 Stat. 1613 (1986).

121. Financial responsibility must be maintained by owners or operators. They may agree between themselves as to who will satisfy the requirement. The financial responsibility is "for taking corrective action and compensating third parties for bodily injury and property damage caused by sudden and nonsudden accidental releases…." RCRA § 9003(c)(6), 42 U.S.C. § 6991b(c)(6), ELR STAT. RCRA 043.

122. RCRA § 9003(h), 42 U.S.C. § 6991b(h), ELR STAT. RCRA 043. The trust fund, called the Leaking Underground Storage Tank Trust Fund (LUST Trust Fund), was initially authorized to be financed up to $ 500 million, by a 0.1 cent per gallon tax on motor fuel. SARA CONF. REP., supra note 121, at 336. This fund ceiling was reached in 1990, and Congress increased the ceiling by another $ 500 million.

123. See H.R. REP NO. 253, 99th Cong., 2d Sess. 106, reprinted in 1986 U.S. CODE CONG. & ADMIN. NEWS 2835, 2888 [hereinafter SARA HOUSE REP.].

124. Releases from hazardous substance USTs remain subject to Superfund cleanup authority, including its funding and cost-recovery provisions, as well as to the technical corrective action requirements of the Subtitle I regulations.

125. See SARA HOUSE REP. supra, note 123, at 287.

126. RCRA § 9003(d)(1), 42 U.S.C. § 6991b(d)(1), ELR STAT. RCRA 043.

127. 55 Fed. Reg. 18567 (May 2, 1990).

128. 53 Fed. Reg. 43322 (Oct. 26, 1988). These regulations have been amended a number of times, establishing several extensions in the compliance deadlines for certain categories of USTs. See 53 Fed. Reg. 51273 (Dec. 21, 1988); 54 Fed. Reg. 5451 (Feb. 3, 1989); 54 Fed. Reg. 47077 (Nov. 9, 1989); 55 Fed. Reg. 18566 (May 2, 1990); 55 Fed. Reg. 24692 (June 18, 1990); 55 Fed. Reg. 27837 (July 6, 1990).

129. 53 Fed. Reg. 43322, 43323-24 (Oct. 26, 1988).

130. "'Petroleum marketing facilities include all facilities at which petroleum is produced or refined and all facilities from which petroleum is sold or transferred to other petroleum marketers or to the public … 'Petroleum marketing firms' are all firms owning petroleum marketing facilities." 40 C.F.R. § 280.92 (1989).

131. EPA granted these extensions after receiving substantial pressure from tank owners, trade groups, and members of Congress, the last of these apparently having forgotten that they were the ones who imposed the $ 1 million requirement. 20 Env't Rep. (BNA) 1885 (Mar. 23, 1990). Category II owners have complained that the extensions put them at a competitive disadvantage, since they have had to maintain financial assurance since October 1989. This group has recently requested a deferral of its compliance deadline. Id.

132. 53 Fed. Reg. at 43363; 21 Env't Rep. (BNA) 197-98 (May 18, 1990). Some states are creating state financial assistance funds (not to be confused with state financial assurance funds) to assist owners and operators who must upgrade in order to get insurance.

133. 53 Fed. Reg. at 43363.

134. Kehne, Encouraging Safety Through Insurance-based Incentives: Financial Responsibility for Hazardous Wastes, 96 Yale L.J. 403, 425 (1986). Kehne notes that a financial responsibility requirement as a safety incentive only works if two conditions are met: "First, insurers must be able to monitor insureds' safety practices at reasonable cost. Second, applicable liability standards must allow insurers to predict liability on the basis of safety practices." Id. at 403.

135. Id.

136. In this context, the acronym "LUST" is retained because of the statutory language: "Leaking Underground Storage Tank Trust Fund." RCRA § 9003(h)(1), 42 U.S.C. § 6991b(h)(1), ELR STAT. RCRA 043.

137. 53 Fed. Reg. at 43364. The SARA House Conference Report states that "[t]he combination of an insurance requirement and a Fund to pay the costs which exceed the amount of the insurance is intended to reduce the financial uncertainty and encourage early reporting of releases." SARA CONF. REP., supra note 112, at 263, reprinted in 1986 U.S. CODE CONG. & ADMIN. NEWS at 3356.

138. As to the liability of an owner or operator for the cost of corrective action above the level of insurance maintained, see RCRA § 9003(h)(6)(B), 42 U.S.C. § 6991b(h)(6)(B), ELR STAT. RCRA 044, which provides that "[i]n determining the equities for seeking the recovery of costs … the Administrator … may consider the amount of financial responsibility required to be maintained." The SARA House Conference Report notes that this provision "is an instruction to the Administrator and the states with respect to the administration of the program and not a defense for an owner or operator …" SARA CONF. REP. supra NOTE 112, at 269, reprinted in 1986 U.S. CODE CONG. & ADMIN. NEWS at 3362.

139. RCRA § 9003(h)(2)(A)-(D), 42 U.S.C. § 6991b(h)(2)(A)-(D), ELR STAT. RCRA 044.

140. RCRA § 9003(h)(7), 42 U.S.C. § 6991b(h)(7), ELR STAT RCRA 044.

141. CERCLA § 107(b)(3), 42 U.S.C. § 9607(b)(3), ELR STAT. CERCLA 025.

142. RCRA § 9003(h)(6)(A), ELR STAT. RCRA 043. The section referred to is § 311 of the Federal Water Pollution Control Act. FWPCA § 311(f)(1); 33 U.S.C. § 1321(f)(1), ELR STAT. FWPCA 043.

143. SARA HOUSE REPT., supra note 123, at 287-88. The House bill also contained a provision that reinforced this apparent power to contract away liability: "Nothing in this subsection shall be deemed to affect or modify in any way, contracts or agreements between owners, operators or third parties." This sentence did not appear in the final bill.

144. See supra note 73 and accompanying text. The House Report on the House version of SARA asserts that "[t]he Committee intends that nothing in [this subsection] or anywhere else in the bill should be read to indicate Committee support for leases with indemnity clauses which mandate that service station dealers must indemnify their suppliers for tank leak cleanups, regardless of who was actually responsible for the leak." SARA HOUSE REP. supra note 123, at 78, reprinted in 1986 U.S. CODE CONG. & ADMIN. NEWS at 3201.

145. RCRA § 9003(h)(7)(A)(ii), 42 U.S.C. § 6991(b)(h)(7)(A)(ii), ELR STAT. RCRA 044.

146. RCRA § 9004, Approval of State Programs; see also 53 Fed. Reg. at 43365.

147. SPA HANDBOOK, supra note 3, at 9.

148. RCRA § 9004, 42 U.S.C. § 6991c, ELR STAT. RCRA 045.

149. RCRA § 3006, 42 U.S.C. § 6926, ELR STAT. RCRA 019.

150. RCRA § 3006(b), 42 U.S.C. § 6926, ELR STAT. RCRA 019.

151. Both Subtitle C and Subtitle I require that the state programs include adequate enforcement authority. RCRA §§ 3006(b), 9004(d); 42 U.S.C. §§ 6926(b), 6991c(d), ELR STAT. RCRA 019, 045.

152. 40 C.F.R. pt. 281 (1989).

153. 53 Fed. Reg. at 37221.

154. SPA HANDBOOK, supra note 3, at 4.

155. Id. at 7-9.

156. 53 Fed. Reg. at 37215. Here the EPA states that 18 states and over 100 major cities have their own UST programs.

157. Id. at 37213 (quoting Sen. Durenberger (R-Minn.), reprinted in 130 CONG. REC. 9164 (daily ed. July 25, 1984)).

158. See, e.g., SPA HANDBOOK, supra note 3, at 10.

159. M. Williams, Remarks at Orientation Training, supra note 1.

160. Id.

161. See H. Humphrey, The Federal and States Roles in Environmental Enforcement: A Proposal for a More Effective and More Efficient Relationship, 14 HARV. ENVTL. L. REV. 7, 8 (1990).

162. OFFICE OF SOLID WASTE AND EMERGENCY RESPONSE, U.S. ENVIRONMENTAL PROTECTION AGENCY, THE NATION'S HAZARDOUS WASTE PROGRAM AT A CROSSROADS, THE RCRA IMPLEMENTATION STUDY 14 (July 1990).

163. Id. at 13-14. This study asserts that changes in the RCRA program wrought by HSWA, with its stringent congressionally mandated program elements, contributed significantly to the erosion of healthy state/federal relationships.

164. This conceptual framework is consistent with the recommendations made in at least one recent critique of the federal/state relationship in the environmental arena, that of Minnesota's Attorney General, Hubert Humphrey III. Humphrey assesses the history of the state/federal relationships in the major program areas, and attributes the variations in approaches taken, which he characterizes as "haphazard," to "short-term environmental and resource problems rather than … to any set of principles concerning the appropriate role of each level of government." Humphrey, supra note 161, at 41, 44.

The set of principles that he recommends determines that the delineation of state/federal roles is not unlike the franchise model. Humphrey advocates that (1) states adopt their own regulatory and enforcement authorities to support the federal programs; (2) EPA should review and approve state enforcement strategies, in order to more effectively coordinate governmental enforcement resources; (3) EPA should not intervene in state enforcement once a state program has been authorized; (4) EPA should retain enforcement authority in interstate cases; (5) states should be able to refer cases to EPA; (6) assessments of state programs should be designed to encourage innovation; and (7) EPA must be able to withdraw authorization where the state programs are not effective. Id. at 37.43.

165. See, e.g., EPA Memorandum, FY 1989-FY 1990 Transition Strategy for the Underground Storage Tank Program, OSWER Directive 9610.5 (Apr. 13, 1988).

166. See 53 Fed. Reg. at 37083-84 (setting forth the operating principles of the UST program).

167. This point of view is argued by two groundwater experts in a response to a widely noted editorial by leading hydrogeologists Freeze and Cherry, who had argued for a flexible regulatory approach. See Freeze & Cherry, supra note 34. The writers of the response note that "[f]lexible regulation is an oxymoron. The notion that broad discretion granted to bureaucrats will automatically be converted into the 'best' social/technical solutions … is simply wrong…. When the rules are clear and rigid, there is no room for lawyers or politicians to interfere. The lawyer's ability to laugh all the way to the bank is created by ambiguity, broad discretion in regulation, and … other flexibility …" Hodge & Roman, supra note 33, at 498.

168. D. Ehlert, Remarks at Orientation Training, supra note 1.

169. 53 Fed. Reg. at 37103-04.

170. THE TEAM HANDBOOK, supra note 5, at I-3.

171. Id. at 1-8 to 1-9.

172. Id. at 1-5.

173. Brand has also received support from EPA to develop an agencywide training program that would facilitate implementation of TQM in other programs. R. Brand, Remarks at Orientation Training, supra note 1. According to Orientation Training materials, the four elements of TQM employed by OUST are (1) "[f]ocusing of the customers — those who use the organization's product or service"; (2) "[r]elying on the experts — those who do the real work"; (3) [i]mproving the processes by which work is done"; and (4) "[c]ontinuously improving." Id.

174. See supra note 102 and accompanying text.

175. See supra note 155 and accompanying text.

176. See New UST Cleanup Initiative May Serve as Model to Speed RCRA, Superfund Actions, INSIDE E.P.A. WEEKLY REP., Nov. 9, 1990, at 1.

21 ELR 10136 | Environmental Law Reporter | copyright © 1991 | All rights reserved