Environmental Protection: Improved Inspections and Enforcement	 
Would Ensure Safer Underground Storage Tanks (01-NOV-01,	 
GAO-02-176T).							 
								 
Studies have shown that tanks that leak hazardous substances,	 
such as methyl tertiary butyl ether, contaminate the soil or	 
water and can pose health risks ranging from nausea to kidney or 
liver damage or even cancer. In 1984, Congress created the	 
Underground Storage Tank (UST) program to protect the public from
potential leaks. Under the program, the Environmental Protection 
Agency required tank owners to install new leak detection	 
equipment, new spill-, overfill-, and corrosion-prevention	 
equipment. GAO found that about 1.5 million tanks had been	 
permanently closed since the program was created, and over half  
of the states do not inspect all of their tanks frequently enough
to meet the minimum rate recommended by EPA--at least once every 
three years. Finally, states reported that even tanks with the	 
required leak prevention and detection equipment installed	 
continue to leak, although the full extent of the problem is not 
known.								 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-02-176T					        
    ACCNO:   A02349						        
  TITLE:     Environmental Protection: Improved Inspections and       
Enforcement Would Ensure Safer Underground Storage Tanks	 
     DATE:   11/01/2001 
  SUBJECT:   Hazardous substances				 
	     Tanks (containers) 				 
	     State-administered programs			 
	     Environmental monitoring				 
	     EPA Underground Storage Tank Program		 
	     Leaking Underground Storage Tank Fund		 

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GAO-02-176T
     
Testimony Before the Subcommittee on Oversight and Investigations, Committee
on Energy and Commerce, House of Representatives

United States General Accounting Office

GAO For Release on Delivery Expected at 10: 00 a. m. EST, Thursday, November
1, 2001 ENVIRONMENTAL

PROTECTION Improved Inspections and Enforcement Would Ensure Safer
Underground Storage Tanks

Statement of John Stephenson, Director, Natural Resources and Environment

GAO- 02- 176T

Page 1 GAO- 02- 176T Environmental Protection

Mr. Chairman and Members of the Subcommittee: I am here today to discuss our
recent report on the Environmental Protection Agency?s (EPA) Underground
Storage Tank (UST) program. 1 The program is relevant to today?s hearing
because studies have shown that tanks that leak hazardous substances, such
as methyl tertiary butyl ether (MTBE), contaminate the soil or water and can
pose health risks ranging from nausea to kidney or liver damage or even
cancer. Indeed, leaks of MTBE- a fuel additive for reducing emissions and
raising octane, but also a suspected carcinogen- have been found in drinking
water sources and pose a very serious health risk and costly cleanup burden.

In 1984, the Congress created the UST program to protect the public from
potential leaks from the then more than 2 million tanks located across the
nation, mostly at gas stations. Under the program, EPA required tank owners
to install new leak detection equipment by the end of 1993 and new spill-,
overfill-, and corrosion- prevention equipment by the end of 1998. If these
conditions were not met, owners had to close or remove their tanks. In
general, EPA has granted states the authority to implement the program with
agency oversight and monitoring, or states operate their own program under
state law with limited EPA oversight. EPA has provided states funding (about
$187, 000 per state) for doing so. EPA retains authority for a small number
of tanks primarily located on Indian lands. In addition, the Congress
created a trust fund in 1986 to help EPA and the states cover tank cleanup
costs that owners and operators could not afford or were reluctant to pay.
The fund is replenished partly through a $ .001/ gallon tax on gasoline and
other fuels. At the end of fiscal year 2000, the fund had a balance of about
$1.5 billion.

Because the states are primarily implementing the provisions of the program,
we conducted a survey of all 50 states and the District of Columbia to
determine whether tanks are complying with program requirements, how EPA and
the states are inspecting tanks and enforcing the requirements, and whether
upgraded tanks still leak. The findings we are discussing today and that
were included in our report are based primarily on the survey results, as
well as on visits to the three EPA regions with the largest number of tanks
to monitor. In summary, we found that:

1 Environmental Protection: Improved Inspections and Enforcement Would
Better Ensure the Safety of Underground Storage Tanks (GAO- 01- 464, May 4,
2001).

Page 2 GAO- 02- 176T Environmental Protection

 About 1.5 million tanks had been permanently closed since the program was
created, leaving about 693,000 tanks subject to UST requirements. Based on
the states? responses to our survey, we estimated that about 89 percent of
these tanks had the required protective equipment installed, but that almost
30 percent of them- more than 200,000 tanks- were not being operated and
maintained properly, thus, increasing the chance of leaks. For example, 19
states reported frequent problems with corrosionprevention equipment and 15
states reported that leak detection equipment was frequently turned off or
improperly maintained. The states and EPA attributed these operation and
maintenance problems primarily to poorly trained staff. Of the remaining 11
percent, or 76,000, tanks that we estimated had not been retrofitted with
the required equipment, EPA and the states speculated that the tanks were
probably inactive and empty. Nevertheless, it is important to address them
because experience has shown that they may have leaked in the past, but the
contamination, which poses health risks, is not discovered until the tank is
dug up for removal. However, most states and EPA do not know if all inactive
tanks are empty- and we could not verify the accuracy and completeness of
the compliance data they reported- because they do not physically inspect
all tanks.

 In fact, over half of the states do not inspect all of their tanks
frequently enough to meet the minimum rate recommended by EPA -at least once
every 3 years. In addition, 27 states lack the authority to prohibit fuel
deliveries to stations with problem tanks- one of the most effective tools
for ensuring compliance with program requirements- relying instead on
issuing citations and fines. States said that they did not have the money,
staff, or, authority to conduct more inspections or more strongly enforce
tank compliance.

 Finally, states reported that even tanks with the required leak prevention
and detection equipment installed continue to leak, although the full extent
of the problem is not known. In response to our survey, 14 states reported
some tank leaks, 17 states said their tanks seldom or never leaked, and 20
states did not know if leaks occurred before the tanks were upgraded. EPA
and some localities have studies underway to obtain better data on leaks
from upgraded tanks. EPA, as part of a set of four program initiatives it
announced in October 2000, is also considering whether it needs to set new
tank requirements, such as double- walled tanks, to prevent further leaks.

To address these problems, our report recommends that EPA work with the
states to determine training needs and ways to fill them, and to more
specifically address the estimated 76,000 tanks that have not yet been
upgraded, closed, or removed as required. Our report also contains

Page 3 GAO- 02- 176T Environmental Protection

recommendations to EPA and suggestions to the Congress on ways to promote
better inspections and enforcement and to address related resource
shortfalls by expanding the use of the $1.5 billion trust fund designated
for tank cleanup to also cover additional inspection and enforcement
activities.

Based on state responses to our survey, we estimated that nearly 617,000, or
about 89 percent of the approximately 693,000 regulated tanks, had been
upgraded with the federally required equipment by the end of fiscal year
2000. EPA data showed that about 70 percent of the total number of tanks
that its regions regulate on tribal lands had also been upgraded.

With regard to the approximately 76,000 tanks that we estimated have not
been upgraded, closed, or removed as required, 17 states and the 3 EPA
regions we visited reported that they believed that most of these tanks were
either empty or inactive. However, another five states reported that at
least half of their non- upgraded tanks were still in use. EPA and states
assume that the tanks are empty or inactive and therefore pose less risk. As
a result, they may give them a lower priority for resources. However, states
also reported that they generally did not discover tank leaks or
contamination around tanks until the empty or inactive tanks were removed
from the ground during replacement or closure. Consequently, unless EPA and
the states address these non- compliant tanks in a more timely manner, they
may be overlooking a potential source of soil and groundwater contamination.

Even though most tanks have been upgraded, we estimated from our survey data
that more than 200,000 of them, or about 29 percent, were not being properly
operated and maintained, increasing the risk of leaks. The extent of
operations and maintenance problems varied across the states, as figure 1
illustrates. Most Tanks Have

Been Upgraded, but Many Are Not Properly Operated and Maintained

Page 4 GAO- 02- 176T Environmental Protection

Figure 1: Compliance With Federal Equipment Requirements Varies Among States
(total active tanks per state)

Source: GAO?s estimates based on responses to a survey of tank program
managers in all 50 states and the District of Columbia.

Note: EPA implements the federal tank program in Idaho and enforces certain
requirements in New York because these states lack some or all of the
necessary laws.

Page 5 GAO- 02- 176T Environmental Protection

The states reported a variety of operational and maintenance problems, such
as operators turning off leak detection equipment. The states also reported
that the majority of problems occurred at tanks owned by small, independent
businesses; non- retail and commercial companies, such as cab companies; and
local governments. The states attributed these problems to a lack of
training for tank owners, installers, operators, removers, and inspectors.
These smaller businesses and local government operations may find it more
difficult to afford adequate training, especially given the high turnover
rates among tank staff, or may give training a lower priority. Almost all of
the states reported a need for additional resources to keep their own
inspectors and program staff trained, and 41 states requested additional
technical assistance from the federal government to provide such training.

To date, EPA has provided states with a number of training sessions and
helpful tools, such as operation and maintenance checklists and guidelines.
One of EPA?s tank program initiatives is also intended to improve training
and tank compliance with federal requirements, such as setting annual
compliance targets with the states. At the time of our review, the Agency
was just beginning to work out the details of how it will implement this
initiative and had set up a working group of state and EPA representatives
to begin work on compliance targets.

Page 6 GAO- 02- 176T Environmental Protection

According to EPA?s program managers, only physical inspections can confirm
whether tanks have been upgraded and are being properly operated and
maintained. However, only 19 states physically inspect all of their tanks at
least once every 3 years- the minimum that EPA considers necessary for
effective tank monitoring. Another 10 states inspect all tanks, but less
frequently. The remaining 22 states do not inspect all tanks, but instead
generally target inspections to potentially problematic tanks, such as those
close to drinking water sources. In addition, not all of EPA?s own regions
comply with the recommended rate. Two of the three regions that we visited
inspected tanks located on tribal land every 3 years. Figure 2 illustrates
the states? reported inspection practices. Most States Do Not

Meet EPA?s Recommendation to Inspect All Tanks Every 3 Years or Have the
Enforcement Tools Needed to Identify and Correct Problems

Page 7 GAO- 02- 176T Environmental Protection

Figure 2: Frequency of Inspections Varies Among States (total active tanks
per state)

Source: GAO?s estimates based on responses to a survey of tank program
managers in all 50 states and the District of Columbia.

Note: EPA implements the federal tank program in Idaho and enforces certain
requirements in New York because these states lack some or all of the
necessary laws.

Page 8 GAO- 02- 176T Environmental Protection

According to our survey results, some states and EPA regions would need
additional staff to conduct more frequent inspections. For example, under
staffing levels at the time of our review, the inspectors in 11 states would
each have to visit more than 300 facilities a year to cover all tanks at
least once every 3 years, but EPA estimates that a qualified inspector can
only visit at most 200 facilities a year. Moreover, because most states use
their own employees to conduct inspections, state legislatures would need to
provide them additional hiring authority and funding to acquire more
inspectors. Officials in 40 states said that they would support a federal
mandate requiring states to periodically inspect all tanks, in part because
they expect that such a mandate would provide them needed leverage to obtain
the requisite inspection staff and funding from their state legislatures.

In addition to more frequent inspections, a number of states stated that
they need additional enforcement tools to correct problem tanks. EPA?s
program managers stated that good enforcement requires a variety of tools,
including the ability to issue citations or fines. One of the most effective
tools is the ability to prohibit suppliers from delivering fuel to stations
with problem tanks. However, as figure 3 illustrates, 27 states reported
that they did not have the authority to stop deliveries. In addition, EPA
believes, and we agree, that the law governing the tank program does not
give the Agency clear authority to regulate fuel suppliers and therefore
prohibit their deliveries.

Page 9 GAO- 02- 176T Environmental Protection

Figure 3: Many States Lack Authority to Prohibit Fuel Deliveries to Problem
Tanks (total active tanks per state)

Source: GAO?s estimates based on responses to a survey of tank program
managers in all 50 states and the District of Columbia.

Note: EPA implements the federal tank program in Idaho and enforces certain
requirements in New York because these states lack some or all of the
necessary laws.

Page 10 GAO- 02- 176T Environmental Protection

Almost all of the states said they need additional enforcement resources and
27 need additional authority. Members of both an expert panel and an
industry group, which EPA convened to help it assess the tank program,
likewise saw the need for states to have more resources and more uniform and
consistent enforcement across states, including the authority to prohibit
fuel deliveries. They further noted that the fear of being shut down would
provide owners and operators a greater incentive to comply with federal
requirements.

Under its tank initiatives, EPA has said that it will attempt to obtain
state commitments to increase its inspection and enforcement activities, or
it may supplement state activities in some cases. EPA?s regions have the
opportunity, to some extent, to use the grants that they provide to the
states for their tank programs as a means to encourage more inspections and
better enforcement. However, the Agency does not want to limit state funding
to the point where this further jeopardizes program implementation. The
Congress may also wish to consider making more funds available to states to
improve tank inspections and enforcement. For example, the Congress could
increase the amount of funds it provides from the Leaking Underground
Storage Tank trust fund, which the Congress established to specifically
provide funds for cleaning up contamination from tanks. The Congress could
then allow states to spend a portion of these funds on inspections and
enforcement. It has considered taking this action in the past, and 40 states
said that they would welcome such funding flexibility.

In fiscal year 2000, EPA and the states confirmed a total of more than
14,500 leaks or releases from regulated tanks, although the Agency and many
of the states could not verify whether the releases had occurred before or
after the tanks had been upgraded. According to our survey, 14 states said
that they had traced newly discovered leaks or releases that year to
upgraded tanks, while another 17 states said they seldom or never detected
such leaks. The remaining 20 states could not confirm whether or not their
upgraded tanks leaked.

EPA recognizes the need to collect better data to determine the extent and
cause of leaks from upgraded tanks, the effectiveness of the current
equipment, and if there is a need to strengthen existing equipment
standards. The Agency has launched studies in several of its regions to
obtain such data, but it may have trouble concluding whether leaks occurred
after the upgrades. In a study of local tanks, researchers in Santa Clara
County, California, concluded that upgraded tanks do not provide Some Tanks
Continue

to Leak Even After They Have Been Upgraded, Although the Extent of this
Problem is Unknown

Page 11 GAO- 02- 176T Environmental Protection

complete protection against leaks, and even properly operated and maintained
tank monitoring systems cannot guarantee that leaks are detected. EPA, as
one of its program initiatives, plans to undertake a nationwide effort to
assess the adequacy of existing equipment requirements to prevent leaks and
releases and if there is a need to strengthen these requirements, such as
requiring double- walled tanks. The states and the industry and expert
groups support EPA?s actions.

In closing, the states and EPA cannot ensure that all regulated tanks have
the required equipment to prevent health risks from fuel leaks, spills, and
overfills or that tanks are safely operated and maintained. Many states are
not inspecting all of their tanks to make sure that they do not leak, nor
can they prohibit fuel from being delivered to problem tanks. EPA has the
opportunity to help its regions and states correct these limitations through
its tank initiatives, but it is difficult to determine whether the Agency?s
proposed actions will be sufficient because it is just defining its
implementation plans. The Congress also has the opportunity to help provide
EPA and the states the additional inspection and enforcement authority and
resources they need to improve tank compliance and safety.

Therefore, to better ensure that underground storage tanks meet federal
requirements to prevent contamination that poses health risks, we have
recommended to the Administrator, EPA, that the Agency

1. work with the states to address the remaining non- upgraded tanks, such
as reviewing available information to determine those that pose the greatest
risks and setting up timetables to remove or close these tanks,

2. supplement the training support it has provided to date by having each
region work with each of the states in its jurisdiction to determine
specific training needs and tailored ways to meet them,

3. negotiate with each state to reach a minimum frequency for physical
inspections of all its tanks, and

4. present to the Congress an estimate of the total additional resources the
Agency and states need to conduct the training, inspection, and enforcement
actions necessary to ensure tank compliance with federal requirements.

Page 12 GAO- 02- 176T Environmental Protection

In addition, the Congress may want to consider EPA?s estimate of resource
needs and determine whether to increase the resources it provides for the
program. For example, one way would be to increase the amount of funds it
appropriates from the trust fund and allow states to spend a limited portion
on training, inspection, and enforcement activities, as long as cleanups are
not delayed. The Congress may also want to (1) authorize EPA to require
physical inspections of all tanks on a periodic basis, (2) authorize EPA to
prohibit fuel deliveries to tanks that do not comply with federal
requirements, and (3) require that states have similar authority to prohibit
fuel deliveries.

Contact and Acknowledgments

For further information, please contact John Stephenson at (202) 512- 3841.
Individuals making key contributions to this testimony were Fran
Featherston, Rich Johnson, Eileen Larence, Gerald Laudermilk, and Jonathan
McMurray.

(360155)

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