Fuel Cleanup Deadline Endangers Conn. Gas Stations

HARTFORD, Conn. -- The backlog in Connecticut's Underground Storage Tank Petroleum Cleanup Program could endanger hundreds of gas stations in the state if it causes the U.S. Environmental Protection Agency to cease recognizing the program as an alternative to insurance, according to a report by The Connecticut Mirror. The program was created alongside similar ones in other states after Congress created stricter regulation of leaking underground fuel tanks in 1984. It was meant to serve as an alternative for gas station owners who could not get private insurance to cover their liabilities.

Connecticut currently owes $17 million to businesses that have already been approved for aid and an additional $81.6 million worth of applications are backlogged, said Department of Energy and Environmental Protection spokesman Dennis Schain. If the typical 70 percent of those applications were approved, Connecticut would owe an additional $57 million in aid.

The program was originally funded by a percentage of receipts from its wholesale fuel tax, but the recession prompted then-Gov. Jodi Rell and other lawmakers to cancel the state's annual transfer, which averaged $9.7 million per year, according to the report.

To replace the transfer, $4.7 million in funds was allocated in 2010 and $3.2 million for 2011. Gov. Dannel Malloy and the legislature approved $1.3 million for this year and 2012-2013, with only $250,000 marked to assist businesses.

"At current funding levels, most owners and operators will not receive reimbursement in their lifetime," James T. Owens III, director of the EPA's Office of Site Remediation and Restoration, wrote to state Environmental Protection officials. "Clearly, in its current condition, the use of the state fund as a means of financial responsibility does not encourage -- or in some cases enable -- releases to be addressed promptly."

If the EPA ends its recognition of the program, gas stations would have to self-insure and raise prices to cover the costs. As many as half of Connecticut's gas stations could be forced to closed, predicted Michael J. Fox, executive director of the Stamford, Conn.-based Gasoline and Automotive Dealers Association of America.

However, the state has requested more time to resolve the situation, citing its inability to unilaterally issue new funds for the program. Additionally, legislators are already planning to work with regulators to solve the problem.

"We are working closely with all interested parties, including the EPA, the UST (oversight) board, industry representatives, the legislature and the governor's office to fashion a solution to what is a complex issue," said Schain. "We believe good progress is being made."