New UST Laws Require Pricey Upgrades

Gavin P. Smith – The Griffin Report

As if gas demand and consumption, gas taxes and gas prices are not enough, Florida’s gas stations and convenience stores face another costly hurdle between now and the end of next year.  Florida is finally tightening down on violators of legislation passed eighteen years ago requiring new USTs (underground storage tanks).  Under the current UST laws, all gas stations must upgrade their current underground storage systems.

This upgrade calls for the replacement of current single-walled storage tank systems with new double-walled storage tank systems.  While just over half have done so, there still remain a significant number of tanks that are not up to the standards set forth in current UST law.  Now, the state is clamping down, mandating that all stations convert their storage tanks by no later than December 31, 2009.

According to environmental studies, the current single-wall systems pose public health and environmental risks due to an increased likelihood of leakage.  The new double-walled systems eliminate leaks, but come with a very large price tag.

“We have a deadline of Dec. 31, 2009 to have every UST statewide upgraded to a double-wall system,” said Jim Smith, President and CEO of the Florida Petroleum Marketers and Convenience Store Association.  “The average cost (of the upgrade) is around $250 thousand dollars per site.”

This may be an easy fix for larger gas station companies and conglomerates, but there’s major concern from smaller, independent gas stations that this expensive new system may simply drive many out of business.

“There is no doubt that smaller volume rural retailers will have difficulty justifying such an expense even if they have access to a loan or some other mechanism to pay for the upgrade,” said Smith.

Just how many tanks have to be replaced?  According to the Florida Department of Environmental Protection, there are a total of 26,529 underground fuel storage tanks in the state.  As of January of this year, just over half have been upgraded, meaning that forty-three percent of all Florida underground storage tanks do not meet current legislative standards.

While the new UST laws have been in place for quite some time, many gas station owners and others do not see the need for the upgrade.

“I can tell you that as an industry we have seen a significant number of single wall fiberglass clad steel tanks that were in the same shape at removal as they were in their initial installation,” said Smith. “Those tanks should have been allowed to go to a useful life situation but Florida law does not permit such an option.”

Those with safety concerns argue that the new double-walled systems will catch leaks before they can contaminate surrounding soil and groundwater.  Officials contend that there is a significant risk that leaks could affect the state’s drinking water supplies.  Ninety percent of Florida drinking water supplies are underground.

However, Jim Smith thinks there may be politics, rather than practicality, at play for this recent enforcement of the UST law.

“With out-of-control political correctness, no suggestion of anything less than hard-core environmental rhetoric ever gets heard,” said Smith.

What’s the cost of this alleged political correctness and environmental rhetoric?  According to Smith, it will affect the small business gas station owner as well as consumer choice.

“This means less choice for Floridians who have depended on these small “mom and pop” businesses for fuel for their farms, their businesses or their commute to the big city,” said Smith.