Buried Residential Oil Tanks

Buried Residential Oil Tanks

Written By:
Bill Gallagher
President, Superior School of Real Estate

Since oil heat was very popular for many years in North Carolina and many homeowners have converted their heating system to gas or heatpump, the buried oil tank sometimes still remains buried in the ground. Sellers ask real estate agents if the buried oil tank should be dug up, filled with sand or foam, or left alone. Also, some buyers are asking to have the soil tested to see if oil has leaked from the oil bank into the ground.

Having received so many questions regarding these situations on The Charlotte Observer “Ask The Expert” (www.charlotte.com), let’s address the situation in a question and answers format based upon information from the North Carolina Department of Environment and Natural Resources (http://portal.ncdenr.org/).

Question: Are residential home heating oil tanks exempt from the technical criteria and standards that apply to commercial regulated underground storage tanks?
Answer: Yes. Commercial regulated underground storage tanks follow different criteria than residential oil tanks.

Question: If a homeowner is no longer using a home heating oil tank, is the homeowner required under federal or state regulations to close it (i.e., remove it from the ground or fill it with a solid inert material such as sand, and analyze soil samples for possible contamination?
Answer: A homeowner is NOT required under federal or state regulations to remove it from the ground or fill it with a solid inert material.

Question: If a homeowner or buyer discovers signs of a leak, spill, or contamination (such as stains on the soil, strong petroleum odors, puddles of oil), is the homeowner required to notify the Division of Waste Management UST Section regional office immediately?
Answer: Yes.

Question: Although it’s not a requirement to close old heating oil tanks, do lending institutions sometimes are reluctant to make loans unless soil samples are collected from below the tank and are analyzed for possible contamination?
Answer: Yes. Various lenders have different requirements regarding the issue of buried oil tanks. A buyer should always check with their lending institution before making an offer on a property with a buried oil tank to make sure the buyer understands the lender requirements, if any.

Question: If a lender requires information regarding the buried oil tank, where do you find the names of companies who can perform the services required?
Answer: North Carolina Department of Environment and Natural Resources recommend that you retain a qualified professional (licensed geologist or professional engineer) to collect and analyze soil samples and submit the sampling results to the lending institution in a report. Typically, a qualified professional can be found in the yellow pages of a telephone book under “Environmental Consultants”. When choosing a company, it’s recommended that you obtain several estimates and references.

Question: What sampling procedures does NC Department of Environment and Natural Resources recommend?
Answer: One soil sample should be collected from below the tank (near the bottom of the tank if it was closed-in-place) if it is less than 6 feet long and two samples if the tank is greater than 6 feet long. These samples should be taken no deeper than two feet into the native soil. In addition, this sample should be taken no deeper than two feet into the native soil. Samples should be analyzed for a total petroleum hydrocarbons (TPH) using modified EPPA Method 8015 (California GC-FID Method) with a 5030 and 3550 sample preparation. Sample results equal to or greater than 10 mg/kg would be considered a kevel requiring notification to the Division of Waster Management UST Section.

Question: In the event you discover a leak, spill, or possible contamination and it is necessary to perform some cleanup activities, could a homeowner seek financial assistance through the Noncommercial Leaking Petroleum Underground Storage Tank Cleanup Fund (State Trust Fund)?
Answer: Yes. Individual need to “apply” to seek financial assistance, if any. Homeowners should contact the Department of Waste Management, DENR-UST, 1637 Mail Service Center, Raleigh, NC 27699-1637 or call 919-733-8486.

Question: What are the requirements if the leak is from an above ground home heating oil tank?
Answer: If a leak from an above ground tank is discovered, it must be reported to your regional Division of Water Quality (DWQ) office immediately. If cleanup is required, your regional DWQ office will tell you how to proceed. North Carolina’s cleanup fund does not cover releases from above ground storage tanks.

Question: How am I going to pay for a problem with a leaking tank?
Answer: North Carolina has a Non-commercial Leaking Petroleum UST Cleanup Fund that will pay up to $1 million for reasonable and necessary costs directly related to the cleanup of a petroleum release from your underground storage tank. The cleanup fund will not pay for attorney fees, tank removal costs, or for excessive or unnecessary work. In the case of a home heating oil tank, this fund is available with a zero deductible to “statutory tank owners” and with a $5,000 deductible to landowners that do not meet the definition of an owner/operator. This fund does NOT cover above ground storage tanks.

Question: Who is responsible for cleanup of contamination?
Answer: Primarily, the “statutory tank owner” is responsible for cleaning up the contamination. Who the “statutory tank owner” is depends upon when the tank was last used. If it was last used before November 8, 1984, then the last party who used the UST is considered the tank owner (even if the party no longer owns the property). However, if the tank was used on or after November 8, 1984, anyone that owned the tank would be considered the tank owner even if that person never used it.

If you have additional questions regarding buried residential oil tanks, please e-mail me at “Ask The Expert” on www.charlotte.com or bgallagher@ssore.com. I can also be reached toll free at 1-877-944-4260.