Leaking Underground Storage Tanks: EPA Should Take Steps to Better Ensure the Effective Use of Public Funding for Cleanups
GAO-07-152
Published: Feb 08, 2007. Publicly Released: Feb 22, 2007.
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Highlights
Underground storage tanks that leak hazardous substances can contaminate nearby groundwater and soil. Under the Resource Conservation and Recovery Act (RCRA), tank owners and operators are primarily responsible for paying to clean up releases from their tanks. They can demonstrate their financial responsibility by using, among other options, publicly funded state financial assurance funds. Such funds function like insurance and are intended to ensure timely cleanup. These funds also pay to clean up releases from tanks without a viable owner, as does the federal Leaking Underground Storage Tank (LUST) Trust Fund. GAO was asked to report on (1) states' estimates of the public costs to clean up known releases, (2) states' primary sources of cleanups funding and their viability, and (3) federal sources to address these releases. GAO surveyed all states and discussed key issues with EPA and selected state officials.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Environmental Protection Agency | The Administrator, EPA, should ensure that states verify, on a regular basis, that tank owners and operators are maintaining adequate financial responsibility coverage, as required by RCRA. | The Energy Policy Act of 2005 requires EPA or states, as appropriate, to conduct on-site inspections of USTs every three years to determine compliance with requirements imposed by Subtitle I of the Solid Waste Disposal Act. In April of 2007, EPA issued a grant guideline to states for implementing the inspection provisions of the EPAct. This guideline requires, as a condition of funding, that states conduct on-site inspections of all regulated underground storage tanks that have not been permanently closed at least once every three years. In addition, the guideline specifies the minimum criteria that states must use when conducting the on-site inspection. One of these criteria is to... assess compliance with financial responsibility. By requiring this, EPA is ensuring that states are verifying, on a regular basis, that tank owners and operators are maintaining adequate financial responsibility.
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| Environmental Protection Agency | The Administrator, EPA, should improve the agency's oversight of the solvency of state assurance funds to ensure that they continue to provide reliable financial responsibility coverage for tank owners. |
In response to our recommendation, EPA developed its "Guidance for Regional Office Review of State Underground Storage Tank Financial Assurance Funds," which was finalized in January 2012. This guidance provides EPA regions with recommended procedures and factors to consider for monitoring the soundness of these funds. The guidance instructs EPA regions to perform an annual review of state funds to achieve the goal of helping to ensure the adequacy of state funds.
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| Environmental Protection Agency | The Administrator, EPA, should assess, in coordination with the states, the relative effectiveness of public and private options for financial responsibility coverage to ensure that they provide timely funding for the cleanup of releases. | Late this summer(2011), the Office of Underground Storage Tanks (OUST) will complete its study of the nation's backlog of open, unaddressed releases from leaking underground storage tanks. The study has sought detailed information from 14 states to understand characteristics of open releases within these states and the pace of LUST cleanups. As part of this study, the Agency sought, where possible, to examine differences in the pace of cleanups comparing releases with different types of financial responsibility mechanisms. Unfortunately, detailed data exploring different financial mechanisms was not readily available, especially with respect to privately funded cleanups, although limited...
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| Environmental Protection Agency | The Administrator, EPA, should better focus how EPA distributes program resources to states, including LUST Trust Fund money, by ensuring that states are reporting information in their semiannual activity reports that is consistent with EPA's definitions; encouraging states to review their databases to ensure that only data on the appropriate universe of underground storage tanks are being reported in their semiannual activity reports; and gathering available information from states on releases attributed to tanks without a viable owner and taking this information into account in distributing LUST Trust Fund money to states. | EPA continues to pursue quality control on the information it collects to support its distribution of program resources to States. While discussions with Regions and states to clarify definitions of reported measures have been on-going, the implementation of the Recovery Act and the adoption of certain existing measures for that purpose (i.e., cleanups initiated and cleanups completed) have led to an enhanced vigilance in the accuracy of such performance measures. Such oversight and improvements in quality control are reflected in the lessons learned memorandum issued over these past two years. In addition, EPA has implemented a new on-line tool to collect reports from states and EPA...
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Topics
Environmental cleanupsEnvironmental monitoringFederal aid to statesstate relationsFunds managementFuture budget projectionsGrant monitoringGroundwaterGroundwater contaminationHazardous substancesPollution controlProgram evaluationState-administered programsTanks (containers)Cost estimates