SB 763, as amended, Fuller. State Water Resources Control Board: underground storage tanks.
(1) Existing law provides for the regulation of underground storage tanks by the State Water Resources Control Board. Existing law, until January 1, 2016, requires the board to conduct a loan and grant program to assist small businesses in upgrading, replacing, or removing tanks meeting applicable local, state, or federal standards (UST upgrade program). Under existing law, the interest rate for loans is set at the rate earned by the Surplus Money Investment Fund at the time of the loan commitment. Existing law establishes the Petroleum Underground Storage Tank Financing Account (financing account) and, upon appropriation by the Legislature, requires moneys in the account to be used by the board to make loans and grants for purposes of the UST upgrade program. Existing law requires interest earned from the investment of the moneys in the account to be deposited into a subaccount, available upon appropriation by the Legislature for administrative expenses of the board. Existing law requires the board annually to make available not more than 33% of the available funds from the account for the purposes of providing grants.
This bill would extend the operation of the loan and grant program until
begin delete the board determines the moneys in the financing account are exhausted and would repeal the program on the subsequent January 1 of the date the board makes that determinationend delete, except as specified with regard to certain authority.
The bill would revise loan eligibility and grant award requirements. The bill would require the board to annually make available not more than 25% of the available funds from the account for the purposes of providing grants. The bill would set the interest rate for loans at the rate equal to 1⁄2 of the most recent general obligation rate obtained by the office of the Treasurer at the time of commitment. The bill would instead require interest earned from moneys in the financing account to be deposited into that account and would eliminate the subaccount. The bill would require loan fees and various other moneys received in the implementation of the loan and grant program to be deposited into the financing account. The bill would specify that moneys in the financing account are permitted to be used, in addition to making loans and grants, to service loans, to recover defaulted loan moneys, to protect the state’s position as a lender creditor, and for administration costs, as specified. The bill would additionally authorize the board to provide grants and loans for the purposes of compliance with performance standards for the control of gasoline vapor emissions during gasoline marketing operations.
(2) Existing law establishes the Underground Storage Tank Cleanup Fund in the State Treasury and requires specified moneys to be deposited into the fund, including charges imposed upon owners of underground storage tanks. Under existing law, moneys in the fund may be expended by the board, upon appropriation by the Legislature, for various purposes, including for the Barry Keene Underground Storage Tank Cleanup Trust Fund Act of 1989 and for transfer to the financing account.
This bill would transfer $8,000,000 of a specified portion of those charges from the fund to the financing account and appropriate these funds for the purpose of making grants and loans and administering specific provisions, as prescribed.
(3) This bill would also make technical, nonsubstantive changes to various provisions.
Vote: majority. Appropriation: yes. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 25284.1 of the Health and Safety Code
2 is amended to read:
(a) The board shall take all of the following actions
4with regard to the prevention of unauthorized releases from
5petroleum underground storage tanks:
6(1) On or before June 1, 2000, initiate a field-based research
7program to quantify the probability and environmental significance
8of releases from underground storage tank systems meeting the
91998 upgrade requirements specified in Section 25284, as that
10section read on January 1, 2002. The research program shall do
11all of the following:
12(A) Seek to identify the source and causes of releases and any
13deficiencies in leak detection systems.
14(B) Include single-walled, double-walled, and hybrid tank
15systems, and avoid bias towards known leaking underground
16storage tank systems by including a statistically valid sample of
17all operating underground storage tank systems.
18(C) Include peer review.
19(2) Complete the research program on or before June 1, 2002.
20(3) Use the results of the research program to develop
21appropriate changes in design, construction, monitoring, operation,
22and maintenance requirements for tank systems.
23(4) On or before January 1, 2001, adopt regulations to do all of
25(A) (i) Require underground storage tank owners, operators,
26service technicians, installers, and inspectors to meet minimum
27industry-established training standards and require tank facilities
28to be operated in a manner consistent with industry-established
29best management practices.
P4 1(ii) The board shall implement an outreach effort to educate
2small business owners or operators on the importance of the
3regulations adopted pursuant to this subparagraph.
4(B) (i) Except as provided in clauses (ii) and (iii), require testing
5of the secondary containment components, including
6under-dispenser and pump turbine containment components, upon
7initial installation of a secondary containment component and
8periodically thereafter, to ensure that the system is capable of
9containing releases from the primary containment until a release
10is detected and cleaned up. The board shall consult with the
11petroleum industry and local government to assess the appropriate
12test or tests that would comply with this subparagraph.
13(ii) Secondary containment components that are part of an
14emergency generator tank system may be tested using enhanced
15leak detection, if the test is performed at the frequency specified
16by the board for testing of secondary containment pursuant to
17Section 2644.1 of Title 23 of the California Code of Regulations.
18If the results of the enhanced leak detection test indicate that any
19component of the emergency generator tank system is leaking
20liquid or vapor, the owner or operator shall take appropriate actions
21to correct the leakage, and the owner or operator shall retest the
22 system using enhanced leak detection until the system is no longer
23leaking liquid or vapor.
24(iii) Any tank or piping that is part of an emergency generator
25tank system and located within a structure as described in paragraph
26(2) of subdivision (a) of Section 25283.5 is exempt from the
27secondary containment testing required by clause (i), if the owner
28or operator conducts visual inspections of tank or piping each time
29the tank system is operated, but no less than monthly, and maintains
30a log of inspection results for review by the local agency. This
31clause is not applicable if the board adopts regulations pursuant
32to Section 25299.3 that address the design, construction, upgrade,
33and monitoring of unburied tanks that are part of an emergency
34generator tank system.
35(C) Require annual testing of release detection sensors and
36alarms, including under-dispenser and pump turbine containment
37sensors and alarms. The board shall consult with the petroleum
38industry and local government to assess the appropriate test or
39tests that would comply with this subparagraph.
P5 1(5) (A) Require an owner or operator of an underground storage
2tank installed after July 1, 1987, if a tank is located within 1,000
3feet of a public drinking water well, as identified pursuant to the
4state GIS mapping database, to have the underground storage tank
5system fitted, on or before July 1, 2001, with under-dispenser
6containment or a spill containment or control system that is
7approved by the board as capable of containing any accidental
9(B) Require all underground storage tanks installed after January
101, 2000, to have the tank system fitted with under-dispenser
11containment or a spill containment or control system to meet the
12requirements of subparagraph (A).
13(C) Require an owner or operator of an underground storage
14tank that is not otherwise subject to subparagraph (A), and not
15subject to subparagraph (B), to have the underground storage tank
16system fitted to meet the requirements of subparagraph (A), on or
17before December 31, 2003.
18(D) On and after January 1, 2002, no person shall install, repair,
19maintain, or calibrate monitoring equipment for an underground
20storage tank unless that person satisfies both of the following
22(i) The person has fulfilled training standards identified by the
23board in regulations adopted pursuant to this section.
24(ii) The person possesses a tank testing license issued by the
25board pursuant to Section 25284.4, or a Class “A” General
26Engineering Contractor License, C-10 Electrical Contractor
27License, C-34 Pipeline Contractor License, C-36 Plumbing
28Contractor License, or C-61 (D40) Limited Specialty Service
29Station Equipment and Maintenance Contractor License issued by
30the Contractors’ State License Board.
31(E) Loans and grants for the installation of under-dispenser
32containment or a spill containment or control system shall be made
33available pursuant to Chapter 6.76 (commencing with Section
35(6) Convene a panel of local agency and regional board
36representatives to review existing enforcement authority and
37procedures and to advise the board of any changes that are needed
38to enable local agencies to take adequate enforcement action against
39owners and operators of noncompliant underground storage tank
40facilities. The panel shall make its recommendations to the board
P6 1on or before September 30, 2001. Based on the recommendations
2of the panel, the board shall also establish effective enforcement
3procedures in cases involving fraud.
4(b) On or before July 1, 2001, the Contractors’ State License
5Board, in consultation with the board, the petroleum industry, air
6pollution control districts, air quality management districts, and
7local government, shall review its requirements for petroleum
8underground storage tank system installation and removal
9contractors and make changes, where appropriate, to ensure these
10contractors are qualified.
Section 25299.51 of the Health and Safety Code is
12amended to read:
The board may expend the money in the fund for
14all the following purposes:
15(a) In addition to the purposes specified in subdivisions (c), (d),
16and (e), for the costs of implementing this chapter and for
17implementing Section 25296.10 for a tank that is subject to this
19(b) To pay for the administrative costs of the State Board of
20Equalization in collecting the fee imposed by Article 5
21(commencing with Section 25299.40).
22(c) To pay for the reasonable and necessary costs of corrective
23action pursuant to Section 25299.36, up to one million five hundred
24thousand dollars ($1,500,000) per occurrence. The Legislature
25may appropriate the money in the fund for expenditure by the
26board, without regard to fiscal year, for prompt action in response
27to any unauthorized release.
28(d) To pay for the costs of an agreement for the abatement of,
29and oversight of the abatement of, an unauthorized release of
30hazardous substances from underground storage tanks, by a local
31agency, as authorized by Section 25297.1 or by any other provision
32of law, except that, for the purpose of expenditure of these funds,
33only underground storage tanks, as defined in Section 25299.24,
34shall be the subject of the agreement.
35(e) To pay for the costs of cleanup and oversight of unauthorized
36releases at abandoned tank sites. The board shall not expend more
37than 25 percent of the total amount of money collected and
38deposited in the fund annually for the purposes of this subdivision
39and subdivision (h).
40(f) To pay claims pursuant to Section 25299.57.
P7 1(g) To pay, upon order of the Controller, for refunds pursuant
2to Part 26 (commencing with Section 50101) of Division 2 of the
3Revenue and Taxation Code.
4(h) To pay for the reasonable and necessary costs of corrective
5action pursuant to subdivision (f) of Section 25296.10, in response
6to an unauthorized release from an underground storage tank
7subject to this chapter.
8(i) To pay claims pursuant to Section 25299.58.
9(j) To pay for expenditures by the board associated with
10discovering violations of, and enforcing, or assisting in the
11enforcement of, the requirements of Chapter 6.7 (commencing
12with Section 25280) with regard to petroleum underground storage
14(k) For transfer to the Petroleum Underground Storage Tank
15Financing Account, for purposes of Chapter 6.76 (commencing
16with Section 25299.100).
Section 25299.81 of the Health and Safety Code is
18amended to read:
(a) Except as provided in subdivisions (b) and (c),
20this chapter shall remain in effect only until January 1, 2016, and
21as of that date is repealed, unless a later enacted statute, which is
22enacted before January 1, 2016, deletes or extends that date.
23(b) Notwithstanding subdivision (a), Article 1 (commencing
24with Section 25299.10), Article 2 (commencing with Section
2525299.11), and Article 4 (commencing with Section 25299.36)
26shall not be repealed and shall remain in effect on January 1, 2016.
27(c) The repeal of certain portions of this chapter does not
28terminate any of the following rights, obligations, or authorities,
29or any provision necessary to carry out these rights and obligations:
30(1) The filing and payment of claims against the fund, including
31the costs specified in subdivisions (c), (e), and (h) of Section
3225299.51, claims filed under Section 25299.50.3, and claims for
33commingled plumes, as specified in Article 11 (commencing with
34Section 25299.90), until the moneys in the fund are exhausted.
35Upon exhaustion of the fund, any remaining claims shall be invalid.
36(2) The repayment of loans, outstanding as of January 1, 2016,
37due and payable to the board.
38(3) The recovery of moneys reimbursed to a claimant to which
39the claimant is not entitled, or the resolution of any cost recovery
P8 1(4) The collection of unpaid fees that are imposed pursuant to
2Article 5 (commencing with Section 25299.40), as that article read
3on December 31, 2015, or have become due before January 1,
42016, including any interest or penalties that accrue before, on, or
5after January 1, 2016, associated with those unpaid fees.
6(5) (A) The filing of an application for funds from, and the
7making of payments from, the Underground Storage Tank
8Petroleum Contamination Orphan Site Cleanup Fund pursuant to
9Section 25299.50.2, any action for the recovery of moneys paid
10pursuant to Section 25299.50.2 to which the recipient is not
11entitled, and the resolution of that cost recovery action.
12(B) Upon liquidation of funds in the Underground Storage Tank
13Petroleum Contamination Orphan Site Cleanup Fund, the obligation
14to make a payment from the Underground Storage Tank Petroleum
15Contamination Orphan Site Cleanup Fund is terminated.
16(d) The board shall continuously post and update on its Internet
17Web site, but at a minimum, annually on or before September 30,
18information that describes the status of the fund and shall make
19recommendations, when appropriate, to improve the efficiency of
Section 25299.102 of the Health and Safety Code is
23amended to read:
The board shall only make loan funds available to
25loan applicants that meet all of the following eligibility
27(a) The loan applicant is a small business, either as defined in
28Section 632 of Title 15 of the United States Code, and in the federal
29regulations adopted to implement that section, as specified in Part
30121 (commencing with Section 121.101) of Chapter I of Title 13
31of the Code of Federal Regulations, or employs fewer than 500
32full-time and part-time employees, is independently owned and
33operated, and is not dominant in its field of operation. In either
34case, the principal office of the small business shall be domiciled
35in the state, and the officers of the small business shall be domiciled
36in this state. The board shall give priority to awarding loans to
37small businesses that meet the definition of small business specified
38in subdivision (d) of Section 14837 of the Government Code.
39(b) The loan applicant owns or operates a project tank.
P9 1(c) The loan applicant demonstrates the ability to repay the loan,
2and the availability of adequate collateral to secure the loan.
3(d) All tanks owned and operated by the loan applicant are
4subject to compliance with Chapter 6.7 (commencing with Section
525280), and the regulations adopted pursuant to that chapter.
6(e) The loan applicant has complied, or will comply, with the
7financial responsibility requirements specified in Section 25299.31
8and the regulations adopted pursuant to this section.
Section 25299.103 of the Health and Safety Code is
11amended to read:
(a) A complete loan application shall include all
13of the following:
14(1) Evidence of eligibility.
15(2) An environmental audit, as specified in Section 5260 of Title
1610 of the California Code of Regulations.
17(3) Financial and legal documents necessary to demonstrate the
18applicant’s ability to repay and provide collateral for the loan. The
19board shall develop a standard list of documents required of all
20applicants, and may also request from individual applicants
21additional financial and legal documents not provided on this list.
22(4) An explanation of the reasons why the project tank is not in
23compliance with applicable local, state, or federal standards, and
24evidence that tanks not included in the list of project tanks are
25currently in compliance with applicable local, state, or federal
27(5) A detailed cost estimate of the tasks that are required to be
28completed in order for the project tanks to comply with applicable
29local, state, or federal standards.
30(6) Any other information that the board determines to be
31necessary to include in an application form.
32(b) Notwithstanding paragraph (4) of subdivision (a), the board
33may not refuse to grant a loan to an applicant solely because the
34applicant has failed to obtain a permit pursuant to the requirements
35of Chapter 6.7 (commencing with Section 25280).
Section 25299.104 of the Health and Safety Code is
38amended to read:
(a) The minimum amount that the board may loan
40an applicant is ten thousand dollars ($10,000), and the maximum
P10 1amount that the board may loan an applicant is seven hundred fifty
2thousand dollars ($750,000).
3(b) The term of the loan shall be for a maximum of 20 years if
4secured by real property, and for 10 years if not secured by real
5property. The interest rate for loans shall be set at the rate equal
6to one-half of the most recent general obligation bond rate obtained
7by the office of the Treasurer at the time of the loan commitment.
8(c) Loan funds may be used to finance up to 100 percent
9costs necessary to upgrade, remove, or replace project tanks,
10including corrective actions, to meet applicable local, state, or
11federal standards, including, but not limited to, any design,
12construction, monitoring, operation, or maintenance requirements
13adopted pursuant to Sections 25284.1, 25292.4, and 41954.
14(d) The board may charge a loan fee to loan applicants of up to
152 percent of the requested loan amount. The loan fee shall be
16deposited in the Petroleum Underground Storage Tank Financing
18(e) The inoperation or repeal of this chapter pursuant to Section
1925299.117 shall not extinguish a loan obligation and shall not
20impair the deed of trust or other collateral made pursuant to this
21chapter or the authority of the state to pursue appropriate action
Section 25299.105 of the Health and Safety Code is
25amended to read:
(a) The board shall make grant funds available
27 from the Petroleum Underground Storage Tank Financing Account
28to eligible grant applicants who meet all of the following eligibility
30(1) The grant applicant is a small business, pursuant to the
32(A) The grant applicant meets the conditions for a small business
33concern as defined in Section 632 of Title 15 of the United States
34Code, and in the federal regulations adopted to implement that
35section, as specified in Part 121 (commencing with Section
36121.101) of Chapter I of Title 13 of the Code of Federal
38(B) The grant applicant employs fewer than 20 full-time and
39part-time employees, is independently owned and operated, and
40is not dominant in its field of operation.
P11 1(2) The principal office of the grant applicant is domiciled in
2the state and the officers of the grant applicant are domiciled in
4(3) All tanks owned and operated by the grant applicant are
5subject to compliance with Chapter 6.7 (commencing with Section
625280) and the regulations adopted pursuant to that chapter.
7(4) The facility where the project tank is located has sold at
8retail less than 900,000 gallons of gasoline annually for each of
9the two years preceding the submission of the grant application.
10The number of gallons sold shall be based upon taxable sales
11figures provided to the State Board of Equalization for that facility.
12(5) The grant applicant owns or operates a tank that is in
13compliance with all of the following:
14(A) Section 41954.
15(B) Any of the following:
16(i) Section 25290.1.
17(ii) Section 25290.2.
18(iii) Section 25291.
19(iv) Subdivisions (d) and (e) of Section 25292.
20(C) Any regulation implementing the applicable sections
21required for compliance with subparagraphs (A) and (B).
22(6) The facility where the project tank is located was legally in
23business retailing gasoline after January 1, 1999.
24(b) Grant funds may only be used to pay the costs necessary to
25comply with the requirements of Section 25284.1, 25292.4,
2625292.5, or 41954.
Section 25299.106 of the Health and Safety Code is
29amended to read:
A complete grant application shall include all of
31the following information:
32(a) Evidence of eligibility.
33(b) The board shall develop a standard list of documents required
34of all applicants, and may also request from individual applicants
35additional financial and legal documents not provided on this list.
36(c) An explanation of the actions the applicant is required to
37take to comply with the requirements of Sections 25284.1 and
3825292.4 or Section 41954.
P12 1(d) A detailed cost estimate of the actions that are required to
2be completed for the project tanks to comply with applicable local,
3state, or federal standards, if applicable.
4(e) Any other information that the board determines to be
5necessary to include in an application form.
Section 25299.107 of the Health and Safety Code is
8amended to read:
(a) The minimum amount that the board may grant
10an applicant is three thousand dollars ($3,000), and the maximum
11amount that the board may grant an applicant is fifty thousand
13(b) Grant funds may be used to finance up to 100 percent of the
14costs necessary to comply with Sections 25284.1, 25292.4,
1525292.5, and 41954.
16(c) If the board received the applicant’s grant application on or
17before April 1, 2009, grant funds may be used to reimburse up to
18100 percent of the costs that the applicant incurred after the board
19received the grant application to comply with the Enhanced Vapor
20Recovery Phase II regulations.
21(d) A person or entity is not eligible to receive more than fifty
22thousand dollars ($50,000) in grant funds pursuant to this chapter.
Section 25299.109 of the Health and Safety Code is
25amended to read:
(a) The Petroleum Underground Storage Tank
27Financing Account is hereby created in the State Treasury. All of
28the following moneys shall be deposited in the Petroleum
29Underground Storage Tank Financing Account:
30(1) Federal, state, and local funds transferred for deposit in the
32(2) Repayments of loans and interest and late fees on loans
33issued pursuant to this chapter.
34(3) Repayments of loans and interest and late fees on loans
35issued pursuant to former Chapter 8.5 (commencing with Section
3615399.10) of Part 6.7 of Division 3 of Title 2 of the Government
37Code, as that chapter existed on December 31, 2003.
38(4) Moneys collected pursuant to Section 25299.110 and
39subdivision (d) of Section 25299.104.
P13 1(5) Repayments of loan and grant moneys paid to a loan or grant
2applicant to which the applicant is not entitled.
3(6) Notwithstanding Section 16305.7 of the Government Code,
4all interest earned upon moneys that are deposited in the account.
5(7) All unexpended moneys in a subaccount of the account that
6is consolidated into the account by the act adding this paragraph.
7(8) All unexpended moneys in the Petroleum Financing
8Collection Account established pursuant to Section 25299.110, as
9added by Section 1 of Chapter 624 of the Statutes of 2004.
10(b) Upon appropriation by the Legislature, funds in the account
11shall be used by the board to make loans and grants, service loans,
12recover defaulted loan moneys due, protect the state’s position as
13a lender creditor, and administer this chapter.
14(c) The board shall annually make available not more than 25
15percent of the available funds from the account for the purposes
16of providing grants pursuant to this chapter.
17(d) Eight million dollars ($8,000,000) is hereby transferred from
18the portion of the fees collected pursuant to subdivisions (a) to (e),
19inclusive, of Section 25299.43 in the Underground Storage Tank
20Cleanup Fund, to the Petroleum Underground Storage Tank
21Financing Account, and is hereby appropriated for the purposes
22of making grants and loans pursuant to this chapter and
23administering this chapter.
Section 25299.110 of the Health and Safety Code is
Section 25299.110 is added to the Health and Safety
29Code, to read:
To defray the costs of the board in administering
31the loan program created pursuant to this chapter, the board may
32do all of the following:
33(a) Impose reasonable charges on all applications and impose
34the loan fee specified in subdivision (d) of Section 25299.104.
35(b) Recover collection costs from the borrower or other party.
36(c) Earn income on any asset recovered pursuant to a loan
Section 25299.111 of the Health and Safety Code is
Section 25299.113 of the Health and Safety Code is
Section 25299.117 of the Health and Safety Code is
Section 25299.117 is added to the Health and Safety
7Code, to read:
(a) This chapter shall become inoperative on the
9date when the board issues a determination that no funds remain
10in the Underground Storage Tank Cleanup Fund for the purposes
11of making grants and loans pursuant to this chapter. Upon making
12that determination, the board shall not make any further grants and
13loans and any remaining claims for the payment of grants or loans
14shall be invalid.
15(b) Upon making a determination pursuant to subdivision (a),
16the board shall notify the Secretary of State and the Office of the
17Legislative Counsel of that determination and the date of the repeal
18of this chapter, as specified in subdivision (c).
19(c) This chapter is repealed as of the
subsequent January 1 of
20the date of the notification made pursuant to subdivision (b), unless
21a later enacted statute, that is enacted on or before that January 1,
22deletes or extends that date.
23(d) Notwithstanding subdivision (c), the repeal of this chapter
24does not terminate any of the following rights, obligations, or
25authority, or any other provision necessary to carry out those rights
26or obligations, or that authority:
27(1) The repayment of loans due and payable to the board.
28(2) The resolution of any cost recovery action or the initiation
29of an action or other collection process to recover defaulted loan
30moneys due to the board or to recover grant moneys paid but to
31which the recipient is not entitled.
begin deleteThis end deletechapter is repealed as of January 1, begin delete 2016end delete, unless a later
36enacted statute that is enacted on or before January 1,
begin delete 2016end delete,
37deletes or extends that date.