DAR File No. 38766

Environmental Quality, Environmental Response and Remediation

Section R311-206-11

Environmental Assurance Fee Rebate Program

Notice of Proposed Rule

(Amendment)

DAR File No.: 38766
Filed: 08/14/2014 02:55:46 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The proposed section implements a change to the Utah Underground Storage Tank (UST) Act made in the 2014 General Legislative Session in H.B. 138. Subsection 19-6-410.5(5)(d) of the UST Act, to be effective 01/01/2015, mandates that the Division of Environmental Response and Remediation shall, by 01/01/2015, create a model for assessing the risk profile of each UST facility participating in the Environmental Assurance Program, and create a rebate schedule listing the amount of the Environmental Assurance Fee an UST owner/operator can receive as a rebate, based on the risk profile.

Summary of the rule or change:

The proposed section specifies that each UST facility participating in the Environmental Assurance Program shall receive a risk value for purposes of determining the amount of Environmental Assurance Fee that the facility may receive as a rebate. The section incorporates by reference two tables that show the risk factors, the formula used to create the risk profile, and the rebate available to facilities in the different risk tiers. The rule specifies that to be considered as secondarily contained, tanks, piping, and containment sumps must be tested to document that the secondary containment is tight.

State statutory or constitutional authorization for this rule:

• Section 19-6-403
• Section 19-6-105
• Section 19-6-428
• Section 19-6-410.5

This rule or change incorporates by reference the following material:

• Adds Environmental Assurance Program Risk Factor Table and Calculation, published by DERR, 06/02/2014
• Adds Environmental Assurance Fee Rebate Table, published by DERR, 06/02/2014

Anticipated cost or savings to:

the state budget:

The statutory increase in the Environmental Assurance Fee from 1/2 cent per gallon to 13/20 cent per gallon takes effect 01/01/2015. It is estimated that this change will increase revenue to the Petroleum Storage Tank fund by approximately $550,000 for the remainder of fiscal year 2015. Under the proposed rule approximately $416,500 of the statutory increase will be returned to UST owner/operators as rebates, based on currently-available facility risk and throughput information. This would result in a net increase to the PST Fund of $133,500 for fiscal year 2015.

local governments:

It is anticipated that the proposed rule will result in increased revenue to the regulated UST community of approximately $416,500 for the last six months of fiscal year 2015, from rebates of the Environmental Assurance Fee. A local government that is an owner/operator of a UST could receive a portion of these rebates, which would depend on the risk value and throughput of the UST facility. The proposed rule requires that to be considered as secondarily contained for purposes of the risk value determination, tank interstitial spaces, piping interstitial spaces, and containment sumps must be tested for tightness. The testing would cost approximately $750 for a typical double-walled UST with double-walled piping, containment at the submersible pump, and under-dispenser containment. The aggregate cost would depend on the number of tanks tested.

small businesses:

It is anticipated that the proposed rule will result in increased revenue to the regulated UST community of approximately $416,500 for the last six months of fiscal year 2015, from rebates of the Environmental Assurance Fee. A small business that is an owner/operator of a UST could receive a portion of these rebates, which would depend on the risk value and throughput of the UST facility. The proposed rule requires that to be considered as secondarily contained for purposes of the risk value determination, tank interstitial spaces, piping interstitial spaces, and containment sumps must be tested for tightness. The testing would cost approximately $750 for a typical double-walled UST with double-walled piping, containment at the submersible pump, and under-dispenser containment. The aggregate cost would depend on the number of tanks tested.

persons other than small businesses, businesses, or local governmental entities:

It is anticipated that the proposed rule will result in increased revenue to the regulated UST community of approximately $416,500 for the last six months of fiscal year 2015, from rebates of the Environmental Assurance Fee. An owner/operator of a UST could receive a portion of these rebates, which would depend on the risk value and throughput of the UST facility. The proposed rule requires that to be considered as secondarily contained for purposes of the risk value determination, tank interstitial spaces, piping interstitial spaces, and containment sumps must be tested for tightness. The testing would cost approximately $750 for a typical double-walled UST with double-walled piping, containment at the submersible pump, and under-dispenser containment. The aggregate cost would depend on the number of tanks tested. Non-fiscal impacts--The proposed rule should encourage UST owner/operators to upgrade their higher-risk facilities to improve the facility's risk value and receive a larger rebate. The upgrading of UST systems and monitoring devices should result in fewer petroleum releases and less severe releases.

Compliance costs for affected persons:

Cost of secondary containment testing for tanks, piping, and containment sumps is approximately $750 per UST system.

Comments by the department head on the fiscal impact the rule may have on businesses:

An UST owner can use the rebate and the new 0% interest loans to upgrade an UST system with containment, double-walled piping, etc. to get into a better risk tier and receive a higher rebate. Upgraded UST systems will result in fewer releases and releases that are less severe and less expensive to clean up, because they will be caught in secondary containment rather than entering the environment, and will be discovered more quickly by better monitoring systems.

Amanda Smith, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Environmental Quality
Environmental Response and RemediationRoom First Floor
195 N 1950 W
SALT LAKE CITY, UT 84116-3085

Direct questions regarding this rule to:

• Gary Astin at the above address, by phone at 801-536-4103, by FAX at 801-359-8853, or by Internet E-mail at gastin@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

10/01/2014

Interested persons may attend a public hearing regarding this rule:

• 09/16/2014 02:00 PM, Department of Environmental Quality, 195 N 1950 W, Room 1015, Salt Lake City, UT

This rule may become effective on:

10/10/2014

Authorized by:

Brent Everett, Director

R311. Environmental Quality, Environmental Response and Remediation.

R311-206. Underground Storage Tanks: Certificate of Compliance and Financial Assurance Mechanisms.

R311-206-11. Environmental Assurance Fee Rebate Program.

(a) To meet the requirements of Subsection 19-6-410.5(5)(d), each UST Facility participating in the Program shall receive a risk value calculated according to "Environmental Assurance Program Risk Factor Table and Calculation", which is hereby incorporated by reference. The table, dated June 2, 2014, contains risk factors and the formula for risk value calculation.

(b) The risk value for each facility participating in the Environmental Assurance Program shall be:

(1) calculated on a facility basis;

(2) valid for the calendar year;

(3) based on the facility characteristics as of December 15 of the prior calendar year; and

(4) determined, at sites with mixed equipment, by considering the highest risk-valued UST system component for each risk factor.

(c) To qualify as secondarily contained for purposes of risk calculation, tanks shall:

(1) meet the requirement for secondary containment in Section R311-203-6, and

(2) meet one of the following:

(A) have continuous interstitial monitoring, or

(B) have the interstitial space tested at least once every three years and be documented to be tight by using vacuum, pressure, or liquid testing in accordance with one of the following:

(i) Requirements developed by the manufacturer, or

(ii) A Code of Practice developed by a nationally recognized association or independent testing laboratory.

(d) To qualify as secondarily contained for purposes of risk calculation, piping shall:

(1) meet the requirements for secondary containment outlined in Section R311-203-6, and

(2) meet one of the following:

(A) have continuous monitoring of the interstice by vacuum, pressure, or liquid filled interstitial space, or

(B) use an interstitial monitoring method not listed in Subsection (d)(2)(A), and the integrity of the interstitial space is ensured at least once every three years by using vacuum, pressure, or liquid test in accordance with criteria listed in Subsection (c)(2)(B).

(e) To qualify as secondarily contained for purposes of risk calculation, piping containment sumps and under-dispenser containment shall:

(1) be double-walled with continuous monitoring of the space between the walls, or

(2) be tested at least once every three years to show the piping containment sump or under-dispenser containment is liquid tight by using vacuum, pressure, or liquid testing in accordance with one of the following:

(A) requirements developed by the manufacturer, or

(B) a code of practice developed by a nationally recognized association or independent testing laboratory.

(f) Each facility that participates in the Environmental Assurance Program may be eligible for a rebate of a portion of the Environmental Assurance Fee according to the rebate schedule in "Environmental Assurance Fee Rebate Table", which is hereby incorporated by reference. The table, dated June 2, 2014, lists risk tiers and the rebate for each tier.

(g) A facility that begins participation in the Environmental Assurance Program after January 1 of a calendar year shall have its risk value calculated for that year based on the risk factors in place at the facility on the date the facility begins participation in the Program.

 

KEY: hazardous substances, petroleum, underground storage tanks

Date of Enactment or Last Substantive Amendment: [September 14, 2012]2014

Notice of Continuation: April 10, 2012

Authorizing, and Implemented or Interpreted Law: 19-6-105; 19-6-403; 19-6-410.5; 19-6-428