Report suggests raising fuel tax for underground tank cleanup

RALEIGH, N.C. — A legislative report issued Monday found that North Carolina's program to clean leaking gasoline and oil from underground storage tanks won't finish for another 25 years at the current rate.

The General Assembly's Program Evaluation Division recommended raising the state fuel tax to help pay for an accelerated clean-up program and requiring new tank owners to get private insurance coverage to help pay for future clean-up efforts.

"We're sensitive to the state's current fiscal climate, but (raising taxes) was the only way, short of taking the brakes off that we put on the program in 2004, to adjust the backlog," said Sean Hamel, an evaluator with the Program Evaluation Division.

The underground tank program began in 1985 in response to a federal mandate and concerns that petroleum was entering groundwater from old gas stations. The state created a trust fund to pay for much of the cleanup.

The state has removed 16,172 commercial and non-commercial tanks in the last 21 years, according to the report presented to lawmakers Monday. But removing the 8,610 tanks that remain will cost the state $549 million, the report said.

"There's more work out there than the state can pay for," said Grover Nicholson, chief of the Underground Storage Tank section in the state Division of Waste Management.

North Carolina has about three underground tanks per 1,000 residents, ranking the state ninth in the U.S. The majority of those tanks are located in Wake, Guilford and Mecklenburg counties.

Lawmakers expressed skepticism toward the recommendation for high fuel taxes.

"I don't see it happening in the short session. I just don't see that taking place," said Rep. Nelson Cole, D-Rockingham. "With the economy the way it is, ... now is not the time to be doing anything like that."

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Until now it has been the industry only that pays fees for cleanup of groundwater contamination resulting from their business activities. Sure, some of this cost has been passed down to the consumer. Maybe an additional tax would remind consumers that the products they use and waste cause health-related problems that has to be cleaned up. According to environmental watch organizations the true cost of a gallon of gasoline (to society) is more than $15. This includes cleanup, health issues, and cost of war engauged to secure oil supplies. A tax like this puts consumers more into the "loop" of responsibility. Those who use more gasoline will pay more for cleanup of the mess they cause.

real earth
November 11, 2009 10:32 a.m.

Maybe if the general assembly would quit taking money from the fund to balance the money they could complete the job. Of course the answer was to allow the state to close the sites with no further action with contamination left in place and NO WAY LETTING THE PUBLIC KNOW WHERE THIS CONTAMINATION IS! And the big companies are the only ones you can trust to have the resources to operate the tanks properly. The biggest contamination has come from the small mom and pop owners that, even thought they didn't mean to, even though they had the best intentions, have cost this state the millions of dollars in cleanup. just look at the compliance records.

SS67
November 10, 2009 11:41 a.m.

Old Pirate 2: You should have written this article, Thanks.

coolwill43
November 9, 2009 5:44 p.m.

Hey cool. the state has a program but has placed requirements that simply ate the funds up. The oil companies you refer to are small companies throughout NC. Not the big boys... Keep passing on taxes and fees to wholesalers and you will see only a hand full of stations left and thousands out of jobs. Contrary to the thinking of some, tank owners don't like leaking tanks either. The truth is however many of these tanks needed to be removed from service without spending thousands to "clean up"what can't be cleaned up. Tank fund money should have only been used for real hazadous sites... Bottom line my friend, it will be passed on to the motorist oneway or the other. The big oil are no longer in retail of fuel for the obvious reason they couldn't make a living and they saw what was coming with tanks and clean up.

OLD PIRATE 2
November 9, 2009 4:41 p.m.

I have a car that need a new fuel pump, since my car burned gas that was tax, how do I get some gas tax money for the repairs. Who has been paying for theses cleanup (the tax payers’), it should have been the responsibility of the gas companies and why can’t this state have not seen this coming a long time ago and had put that insurance program in affect decades ago.

coolwill43
November 9, 2009 3:15 p.m.