03/28/1994 09:00 AM Senate FIN

  CSSB 295(JUD): An Act relating  to financial assistance  for                 
                 certain  owners  or operators  of underground                 
                 petroleum storage tank systems; and providing                 
                 for an effective date.                                        
                                                                               
                 John  Barnett,  Executive Director,  Board of                 
                 Storage  Tank  Assistance, Division  of Spill                 
                 Prevention   and   Response,   Department  of                 
                 Environmental Conservation, and  Mike Conway,                 
                 Director, Division of  Spill Preven-tion  and                 
                 Response,  Department  of  Environmental Con-                 
                 servation,  spoke  in  support of  the  bill.                 
                 Discussion  was  had  by  Senators  Kerttula,                 
                 Sharp,  and  Co-chair  Frank,  regarding  the                 
                 Underground  Storage  Tank   Program  as   it                 
                 related to bigger  businesses, fees, and  the                 
                 bush  and rural  areas.   CSSB  295(JUD)  was                 
                 REPORTED  OUT  of  committee with  individual                 
                                                                               
                                                                               
                 recommendations,  and  zero fiscal  notes for                 
                 the Department of Environmental Conservation,                 
                 and  the  Department  of  Transportation  and                 
                 Public Facilities.                                            
                                                                               
  CS FOR SENATE BILL NO. 295(JUD):                                             
                                                                               
       An  Act relating  to financial  assistance for  certain                 
       owners or  operators of  underground petroleum  storage                 
       tank systems; and providing for an effective date.                      
                                                                               
  Co-chair  Pearce  announced  that  SB  295  was  before  the                 
  committee.                                                                   
                                                                               
  JOHN  BARNETT, Executive  Director,  Board  of Storage  Tank                 
  Assistance,  Division  of  Spill  Prevention  and  Response,                 
  Department  of  Environmental Conservation  (DEC), testified                 
  that  SB 295  was requested  by the Alaska  Underground Tank                 
  Owners and Operators Association.  The Board of Storage Tank                 
  Assistance worked in  cooperation with  DEC to administer  a                 
  grant   and  loan  program   for  underground   tank  owners                 
  throughout the state.   The Board  acted as an appeal  Board                 
  and  the  first section  of  the bill  clarified  the appeal                 
  authority of  the Board.   Currently only tank  owners could                 
  appeal if DEC determined that  certain costs were ineligible                 
  for reimbursement.   This clarification allowed tank  owners                 
  to  appeal  if  they had  been  determined  ineligible.   At                 
  present  there  were 152  applications  which DEC  said were                 
  totally  ineligible  and had  no appeal  rights.   This bill                 
  would provide a  forum for and  give the Board authority  to                 
  hear those appeals.  The second section of the bill gave the                 
                                                                               
                                                                               
  closure and upgrade program a statutory deadline of December                 
  31, 1994.                                                                    
                                                                               
  Senator Kerttula asked  if that date  needed to be  extended                 
  because of rural problems.   Mr. Barnett felt that  the bush                 
  was always a  challenge, but  public workshops and  outreach                 
  had been  done in  the fall  of 1990  throughout the  state.                 
  Media advertising  had been done  and a newsletter  had gone                 
  out  to  all   known  tank  owners  listed  in   a  database                 
  established in 1986.  He felt  most of the rural areas  were                 
  aware of the program.   Senator Kerttula asked for assurance                 
  that all rural areas and river communities had been noticed.                 
                                                                               
  MIKE  CONWAY,  Director,  Division  of  Spill  Prevention  &                 
  Response, Department of  Environmental Conservation,  stated                 
  that most river communities used  above ground storage tanks                 
  and this legislation  targeted underground  tanks.  He  said                 
  there  were problems with  above ground tanks  too but there                 
  was no state program  to deal with it if the  tank held less                 
  than 10,000 barrels.                                                         
                                                                               
  Mr. Barnett  said very few small communities  had applied to                 
  this program.   He went  on to  explain that  the Board  was                 
  working  with the  Rural Bulk  Fuel Task Force to share what                 
  it had learned  in order to  address some the problems  they                 
  faced.                                                                       
                                                                               
  Co-chair Frank  felt that SB 295  was a good bill  and asked                 
  Mr. Barnett  or Conway  to speak  to the  concern that  this                 
  program somehow benefited large companies.                                   
                                                                               
  Mr.  Barnett  thanked Co-chair  Frank  for bringing  up this                 
  issue.   He  said that  at the  beginning of  the program  a                 
  registration fee was paid to defer some  of the costs, and a                 
  ranking system was established using a score.  Fifty percent                 
  was scored if  the tank related  to a public health  threat.                 
  The  other  half the  score related  to  the distance  to an                 
  alternate fuel source, including details how many tanks were                 
  owned  with  higher  points for  fewer  tanks  owned (giving                 
  smaller businesses the  advantage).   Twenty percent of  the                 
  score was  insurability.  If a person was not self-insurable                 
  they  would  receive 20  points.   This  definitely targeted                 
  small mom and  pop businesses.   There were large  companies                 
  that  belonged  to   this  program   but  they  paid   large                 
  registration fees each year and waited  for a longer time to                 
  receive funding.  He estimated the  program to take at least                 
  10 years to complete.                                                        
                                                                               
  Co-chair Frank asked  Mr. Barnett  to provide the  committee                 
  with the latest funding  and criteria for the program.   Mr.                 
  Barnett  said  that  information  was  available from  their                 
  annual report and funding was in the $4-5M range.                            
                                                                               
  End SFC-94 #51, Side 2                                                       
                                                                               
                                                                               
  Begin SFC-94 #55, Side 1                                                     
                                                                               
  In answer  to  Senator Sharp,  Mr.  Barnett said  that  DEC,                 
  DOT&PF, and the Board of  Storage Tank Assistance, supported                 
  SB 295.   He said that the  position paper should be  in the                 
  members' files.  Mr. Barnett restated that about 400 upgrade                 
  and closure applicants  were on  a waiting  list for  funds.                 
  What this bill provided for those applicants, already on the                 
  list and acting in good faith,  was eligibility for clean up                 
  after the clean  up program  deadline closed.   He said  the                 
  bill would allow an extra six  months to do outreach for the                 
  closure and  upgrade  list and  those people  would also  be                 
  eligible for the clean up program.  After December 31, 1994,                 
  there would be a finite list of all applicants outlining the                 
  scope of the problem.                                                        
                                                                               
  Mr.  Conway  said that  DEC was  in  support of  the program                 
  because it was  a prevention  program.  It  kept owners  and                 
  operators involved in the clean-ups,  helped the rural areas                 
  stay  in business,  and, if  not funded,  the response  fund                 
  would have to be used "after  the fact" at a bigger  expense                 
  to the  state.  There also  could be health problems  if the                 
  program was not in place.                                                    
                                                                               
  In  answer  to  Senator  Sharp,  Mr. Conway  said  that  DEC                 
  continued to get federal funds  for the technical assistance                 
  part of  the program.  He stated it was a state fund with no                 
  other assistance.                                                            
                                                                               
  Co-chair Frank MOVED for passage of CSSB  295 from committee                 
  with individual recommendations.   No objection being heard,                 
  it   was  REPORTED   OUT   of  committee   with  "individual                 
  recommendations," and  zero fiscal notes for  the Department                 
  of Transportation & Public Facilities  and the Department of                 
  Environmental  Conservation.    Co-chair   Pearce,  Senators                 
  Rieger,  Kerttula,  and  Sharp signed  "no  recommendation."                 
  Senator Jacko and Co-chair Frank signed "do pass."