Abandoned Gas Station Cleanup Fund Established in Ohio

Thursday, December 3, 2015

A common problem that communities and developers encounter when attempting to redevelop properties in small towns and older neighborhoods of larger cities is the presence of former gas station properties that are either abandoned or for which the owner does not have the financial resources to remove the underground storage tanks (USTs) or clean up contamination.  These abandoned gas station properties can prevent a redevelopment plan from going forward because the entities wishing to implement the plan are wary of the potential costs for assessing and remediating a potential petroleum release that might be associated with such properties.

Recognizing the potential impediments to redevelopment that abandoned gas station sites represent, the State of Ohio included an abandoned gas station cleanup fund in the budget bill passed by the legislature at the end of June 2015.  The fund will be administered by the Ohio Development Services Agency (ODSA) and consists of $20 million from remaining Clean Ohio funds (a fund formerly used to clean up brownfields in the state).   

To be eligible for a grant from the new fund, a property must be publicly owned land that has been designated a Class C UST site by the Bureau of Underground Storage Tank Regulations (BUSTR) in the Ohio Department of Commerce State Fire Marshall’s office.  A Class C UST site is one at which a release of petroleum has occurred or could occur from a BUSTR-regulated UST system and for which the owner of the UST system cannot be identified or for which the owner does not have the financial resources to complete a UST closure and/or release assessment in accordance with BUSTR guidelines.  The State of Ohio maintains a list of known Class C UST sites, which can be viewed by using this link.

At the time of writing of this article, there were more than 540 releases included in this list.  If a particular property is not currently on the Class C list, a request to review the site for such a designation may be submitted to BUSTR.

Under the terms of the cleanup fund as described in the budget document, grants of up to $100,000 will be available for sampling to identify and delineate a potential regulated petroleum release and up to $500,000 for cleanup of contamination identified as the result of such a release. 

Applications for grant funds are to be submitted to the ODSA.  Parties eligible to apply for cleanup grants are political subdivisions (cities, counties, townships, villages, etc.) that own the affected properties.  Initial information has indicated that organizations that have entered into an agreement with a political subdivision for redevelopment of publicly owned land may also be eligible to apply for the funds.  It is assumed that this situation will be clarified in the guidance when it becomes available.  The parties that caused or contributed to the contamination on a property will not be eligible to apply. 

As stated earlier, the fund was included in the state budget passed at the end of June.  Current information indicates that implementation of the fund and publishing of guidance is scheduled for late 2015.  As described earlier, there are currently more than 540 releases included on the known Class C UST list.  Given this large number of known releases, it is considered likely that the $20 million set aside for the cleanup fund could be allocated very quickly.  Therefore, we believe that it would be advisable for any locality or developer for which an abandoned UST site is a potential concern to determine whether the subject property is already on the Class C UST list and, if not, to submit a request to BUSTR for a determination.  If the property is already on the list or can be designated a Class C site by BUSTR, the locality or developer should then be ready to move as quickly as possible to apply for a grant from the cleanup fund once it is implemented.