The NJDEP has adopted rules, effective April 6, 1998, to administer the funding portions of the Underground Storage Tank Finance Act (the "Act"), which was passed in 1997. The Act requires NJDEP to adopt regulations to implement the Petroleum Underground Storage Tank Systems Remediation, Upgrade and Closure Fund (the "Fund"). These rules set forth the application requirements for a loan or grant from the Fund.
The Fund is intended to provide assistance in financing costs of necessary upgrade or closure of petroleum underground storage tank systems and for remediating discharges from those systems. State and federal regulations require that regulated underground storage tank systems be upgraded with corrosion protection and spill prevention systems by December 22, 1998. Because of this deadline, many businesses and individuals are likely to close or upgrade underground storage tank systems during 1998, and many will not have the financial ability to pay for the closure or upgrade themselves. In addition, the Department is concerned that many entities that cannot afford to close or upgrade tanks or to remediate discharges from tank systems may delay or avoid proper closure or remediation. NJDEP hopes that the Fund will allow those who otherwise could not afford to close or upgrade tanks or remediate discharges to do so with the assistance of the Fund. The Department anticipates that up to 25,000 businesses, homeowners and other entities may require financial assistance from the Fund in order to properly close or remediate underground storage tank systems. Owners of both regulated and non-regulated petroleum underground storage tanks, including home heating oil tanks, are eligible for financial assistance from the Fund; however, home heating oil tanks and other unregulated tanks are eligible for funding only to remediate a discharge of petroleum products.
An eligible applicant wishing to apply for a loan or grant from the Fund must submit an application pursuant to the regulatory requirements. While most of the application requirements are fairly standard, such as providing information about the tank system, the work to be performed with monies from the Fund, and cost estimates for the necessary work, the applicant also must show that it has been unable to secure funding from a bank, insurance company or other financial institution, and must provide annual financial statements to demonstrate the applicant's net worth. NJDEP will review the applicant's financial data to determine its ability to repay a loan or to meet the eligibility requirements for a conditional hardship grant, as set forth in the Act. When NJDEP approves funding for closure or remediation of a tank system, it will require the owners and operators to enter into a Memorandum of Agreement ("MOA") requiring that NJDEP review and approve all activities financed by monies from the Fund.
The Fund should prove useful to those parties who want to address petroleum underground storage tank discharges, closures or upgrades but lack the financial ability to do so. Generally, "eligible" owners or operators under the Act are those with a net worth of less than $2 million; however, there is no net worth restriction imposed upon owners or operators of underground storage tanks used for residential heating oil or upon public entities.
