**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

1 **P ART**  **280**
**-- TECHNICAL STANDARDS AND CORRECTIVE ACTION**  **REQUIREMENTS FOR OWNERS AND OPERATORS OF UNDERGROUND STORAGE TANKS (UST)**  **Subpart A**

**– Program Scope and Interim Prohibition**  Sec. 280 .10 Applicability

. 280.11 I nterim p rohibition for deferred UST s ys tems

. 280.12 Definitions. **Subpart B**

**– UST Systems: Design, Construction, Installation and Notification**  280.20 Performance standards for new UST s ys tems. 280.21 Upgrading of existing UST s ys tems. 280.22 Notification requirements. **Subpart C**

**– General Operating Requirements**  280.30 Spill and overfill control. 280.31 Operation and maintenance of corrosion protection. 280.32 Compatibility

. 280.33 Repairs allowed. 280.34 Reporting and recordkee ping. 280.35 Periodic t esting of s pill and o verfill p revention e quipment

. 280.36 Periodic t esting of s econdary c ontainment

. 280.37 Periodic operation and maintenance walkthrough i nspections

. **Subpart D**

**– Release Detection**  280.40 General requirements for all UST s ys tems. 280.41 Requirements for petroleum UST sy stems. 280.42 Requirements for hazardous substance UST sy stems. 280.43 Methods of release detection for tanks. 280.44 Methods of release detection for piping. 280.45 Release detection recordkeeping. 280.46 Alternative methods of release detection for field

- constructed tanks. 280.47 Alternative methods of release detection for bulk piping. **Subpart E**

**– Release Reporting, Investigation, and Confirmation**  280.50 Reporting of suspected releases. 280.51 In vestigation due to off

- site impacts. 280.52 Release investigation and confirmation steps. 280.53 Reporting and cleanup of spills and overfills.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

2 **Subpart F**

**– Release Response and Corrective Action for UST Systems Containing**  **Petroleum or Hazardous Substanc es**  280.60 General. 280.61 I nitial response. 280.62 I nitial abatement measures and site check. 280.63 I nitial site characterization. 280.64 Free product removal. 280.65 I nvestigations for soil and ground

- water cleanup. 280.66 Corrective action plan. 280.67 Public participation. **Subpart G**

**– Out** 
**- of** 

**- Service UST Systems and Closure**  280.70 Temporary

closure. 280.71 Permanent closure and changes

- in

- service. 280.72 Assessing the site at closure or change

- in

- service. 280.73 Applicability

to previously

close d UST s ys tems. 280.74 Closure records. **Subpart H**

**– Financial Responsibility**  280.90 Applicability

. 280.91 Compliance dates. 280.92 Definition of terms. 280.93 Amount and scope of required financial responsibility

. 280.94 Allowable mechanisms and combinati ons of mechanisms. 280.95 Financial test of self

- insurance. 280.96 Guarantee. 280.97 I nsurance and risk retention group coverage. 280.98 Surety

bond. 280.99 Letter of credit. 280.100 Use of state

- required mechanism. 280.101 State fund or other state assurance. 280.102 Trust fund. 280.103 Standby

trust fund. 280.104 L ocal government bond rating test. 280.105 L ocal government financial test. 280.106 L ocal government guarantee. 280.107 L ocal government fund. 280.108 Substitution of financial assurance mechanisms by owner or operator. 280.109 Cancellation or nonrenewal b y a provider or financial assurance. 280.110 Reporting b y owner or operator. 280.111 Recordkeeping. 280.112 Drawing on financial assurance mechanisms. 280.113 Release from the requirement s.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

3 280.114 Bankruptcy

or other incapacity

of owner or operator or provider of financial assurance. 280.115 Replenishment of guarantees, letters of credit, or suret y bonds. 280.116 Suspension of enforcement. [Reserved] **Subpart I**

**– Lender Liability**  280.200 Definitions. 280.210 Participation in management. 280.220 Ownership of an underground storage tank or underground storage tank sy stem or facility or property

on which an underground storage tank or underground storage tank s ys tem is located. 280.30 Operating an underground storage tank or underground storage tank sy stem. **Subpart J**

**– Operator Training**  280.240 General requirement for all UST sy stems. 280.241 Designation of operators. 280.242 Requirements for operator training. 280.243 Timing of operator training. 280.244 Retraining. 280.245 Documentation. **Appendices to Part 280** Appendix Ito Part 280

– Notification for Underground Storage Tanks (Form) Appendix II to Part 280

– Notification of Ownership Change for Underground Storage Tanks (Form) Appendix III to Part 280

– Statement for Shipping Tickets and Invoices Authority : 42 USC 6912, 6991, 6991(a), 6991(b), 6991(c), 6991(d), 699 1(e), 6991(f), 6991(g), 6991(h) , 6991(i)

.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

4 **Subpart A**
**-- Program Scope and Interim Prohibition**  **§ 280.10 Applicability.** (a) The requirements of this p art apply to all owners and operators of an UST sy stem as defined in § 280.12 except as otherwise provided in paragraphs (b) and (c) of this section. (1) Previously deferred UST systems

. UST sy stems previously deferred from s ubparts B, C, D, E, G and H (airport hy drant fuel distribution sy stems , UST s ys tems with field

- constructed tanks , and wastewater treatment tank sy stems) and UST sy stems previousl y deferred from s ubpart D (UST s ys tems that store fuel solel y for use by emergency power generators) must begin meeting the requirements of this p art as follows: (i) UST sy stems installed on or before [effective date of r ule ] must meet the schedule in the following table.
**Type Of**  **UST S**  **ystem Subpart**  **Or Section Effective Date**  UST sy stem s that store fuel solely for use b y emergency power generators D [ 1 Year after effective date of rule ] Airport hy drant fuel distribution sy stems ; UST sy stems with field

- constructed tanks ; and w astewater treatment tank s ys tems B (except § 280.22) and C [3 Year s after effective date of rule ] D S ee the phase in s chedule in §

280.4 0(c) § 280.22 of subpart B, E, G

and H [ effective date of rule ]
(ii) UST sy stems installed after [effective date of rule ] must meet all requirements at installation. (2) An y UST s ys tem listed in paragraph (c) of this section must meet the requirements of § 280.11. (b) The following UST sy stems are excluded from the requirements o f this p art: (1) An y UST s ys tem holding hazardous wastes listed or identified under Subtitle C of the Solid Waste Disposal Act, or a mixture of such hazardous waste and other regulated substances. (2) An y wastewater treatment tank system that is part of a wastewater treatment facility regulated under Section 402 or 307(b) of the Clean Water Act. (3) Equipment or machinery that contains regulated substances for operational purposes such as h ydraulic lift tanks and electrical equipment tanks. (4) An y UST s ys tem whose capacity is 110 gallons or less.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

5 (5) An y UST s ys tem that contains a de minimis concentration of regulated sub stances. (6) An y emergency

spill or overflow containment UST sy stem that is expeditiously emptied after use. (c) Deferrals . S ubparts B, C, D, E, and G of this part do not apply to : (1) A boveground tanks associated with : (i) A irport h ydrant fuel distribution sy stems ; and (ii) UST sy ste ms with field

- constructed tanks ; (2) An y UST s ys tems containing radioactive material that are regulated under the Atomic Energy Act of 1954 (42 USC 2011 and following); and (3) An y UST s ys tem that is part of an emergency generator sy stem at nuclear power generation facilities regulated b y the Nuclear Regulatory Commission under 10 CFR p art 50

. **§ 280.11 Interim**  **p rohibition for deferred**  **UST systems.** (a) No person may

install an UST sy stem listed in § 280.10(c) for the purpose of storing regulated substances unless the UST sy stem (whether of single

- or double

- wall construction): (1) Will prevent releases due to corrosion or structura l failure for the operational life of the UST sy stem; (2) Is cathodicall y protected against corrosion, constructed of noncorrodible material, steel clad with a noncorrodible material, or designed in a manner to prevent the release or threatened release of any

stored substance; and (3) Is constructed or lined with material that is compatible with the stored substance. (b) Notwithstanding paragraph (a) of this section, an UST sy stem without corrosion protection may

be installed at a site that is dete rmined by a corrosion expert not to be corrosive enough to cause it to have a release due to corrosion during its operating life. Owners and operators must maintain records that demonstrate compliance with the requirements of this paragraph for the remain ing life of the tank.
Note to paragraphs (a) and (b) : The following codes of practice may be used as guidance for compl yi ng with this section: (A) NACE International Recommended Practice RP 02 85, " Corrosion Control of Underground Storage Systems by Cathodic Protection ” ;**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

6 (B) NACE International Standard Practice SP 0169, “Control of External Corrosion on Underground or Submerged Metallic Piping Sy stems”; (C) American Petroleum Institute Recommended Practice 1632, "Cathodic Protection of Underground Petroleum Storage Tanks and Piping S ys tems"; or (D) Steel Tank Institute R ecommended Practice R892, “Recommended Practice for Corrosion Protection of Underground Piping Networks Associated with Liquid Petroleum Storage and Dis pensing Sy stems”

. **§ 280.12 Definitions.** Aboveground release means any release to the surface of the land or to surface water. This includes, but is not limited to, releases from the above

- ground portion of an UST sy stem and aboveground releases associated with overfills and transfer operations as the regulated su bstance moves to or from an UST sy stem. Airport hydrant fuel distribution system means an UST sy stem that is a combination of one or more tanks directly

connected to underground hy drant piping used to fuel aircraft. These sy stems do not have a dispenser at the end of the piping run, but rather have a hy drant (fill stand). If an aboveground storage tank ( AST ) is feeding an intermediary tank or tanks, this definition does not include the AST , but does include all underground piping entering and leaving the intermediary

tank ( s ) and the intermediary tank(s)

. Intermediary tanks are those tanks directly connected to the hy drant piping. Ancillary equipment means any devices including, but not limited to, such devices as piping, fittings, flanges, valves, and pumps used to distribute, meter, or control the flow of regulated substances to and from an UST. Belowground release means any release to the subsurface of the land and to ground water. This includes, but is not limited to , releases from the belowground portions of an underground storage tank s ys tem and belowground releases associated with overfills and transfer operations as the regulated substance moves to or from an underground storage tank.
Be neath the surface of the ground means beneath the ground surface or otherwise covered with earthen materials. Cathodic protection is a technique to prevent corrosion of a metal surface by making that surface the cathode of an electrochemical cell. For example, a tank s ys tem can be cathodicall y protected through the application of either galvanic anodes or impressed current. Cathodic protection tester means a person who can demonstrate an understanding of the principles and measurements of all common ty pes of cathodic protectio n systems as applied to buried or submerged metal piping and tank s ys tems. At a minimum, such persons must have education and experience in soil resistivity , stray current, structure

- to

- soil potential, and component electrical isolation measurements of buried metal piping and tank sy stems.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

7 CERCLA means the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended. Class A operator means the individual who has primary responsibility

to operate and maintain the UST sy stem in accordance with applicable requirements established by the implementing agency . The Class A operator ty pically manages resources and personnel, such as establishing wo rk assignments, to achieve and maintain compliance with regulatory requirements. Class B operator means the individual who has day

- to

- day responsibility

for implementing applicable regulatory

requirements established by the implementing agency. The Class B operator t ypically implements in

- field aspects of operation, maintenance, and associated recordkeeping for the UST sy stem. Class C operator means the employee responsible for initially addressing emergencies presented b y a spill or release from an UST s ys tem. The Class C operator ty picall y controls or monitors the dispensing or sale of regulated subst ances. Compatible means the ability of two or more substances to maintain their respective phy sical and chemical properties upon contact with one another for the design life of the tank sy stem under conditions likely to be encountered in the UST.
C onnected piping means all underground piping including valves, elbows, joints, flanges, and flexible connectors attached to a tank s ys tem through which regulated substances flow. For the purpose of determining how much piping is connected to an y individua l UST sy stem, the piping that joins two UST sy stems should be allocated equally between them. Consumptive use with respect to heating oil means consumed on the premises. Corrosion expert means a person who, b y reason of thorough knowledge of the phy sic al sciences and the principles of engineering and mathematics acquired b y a professional education and related practical experience, is qualified to engage in the practice of corrosion control on buried or submerged metal piping s ys tems and metal tanks. S uch a person must be accredited or certified as being qualified by the National Association of Corrosion Engineers or be a registered professional engineer who has certification or licensing that includes education and experience in corrosion control of bu ried or submerged metal piping s ys tems and metal tanks. Dielectric material means a material that does not conduct direct electrical current. Dielectric coatings are used to electrically isolate UST sy stems from the surrounding soils. Dielectric bushings are used to electrically isolate portions of the UST sy stem (e.g., tank fr om piping). Dispenser s

ystem means equipment located aboveground that meters the amount of regulated substances transferred to a point of use outside the UST sy stem, such as a motor**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

8 vehicle. This sy stem includes the equipment necessary to connect the dispenser to the underground storage tank sy stem. Electrical equipment means underground equipment that contains dielectric fluid that is necessary for the operation of equipment such as transforme rs and buried electrical cable.
Excavation zone means the volume containing the tank sy stem and backfill material bounded by

the ground surface, walls, and floor of the pit and trenches into which the UST sy stem is placed at the time of installation. Existing tank system means a tank sy stem used to contain an accumulation of regulated substances or for which installation has commenced on or before December 22, 1988. Installation is considered to have commenced if: (a) the owner or operator has ob tained all federal, state, and local approvals or permits necessary to begin phy sical construction of the site or installation of the tank sy stem; and if, (b)(1) either a continuous on

- site phy sical construction or installation program has begun; or, (2) the owner or operator has entered into contractual obligations

-- which cannot be cancelled or modified without substantial loss

-- for phy sical construction at the site or installation of the tank s ys tem to be completed within a reasonable time.
Farm tank is a tank located on a tract of land devoted to the production of crops or raising animals, including fish, and associated residences and improvements. A farm tank must be located on the farm property

. Farm includes fish hatcheries, rangeland and nurseries with growing operations. Flow

- through process tank is a tank that forms an integral part of a production process through which there is a steady, variable, recurring, or intermittent flow of materials during the operation of the process. Flow

- th rough process tanks do not include tanks used for the storage of materials prior to their introduction into the production process or for the storage of finished products or b y - products from the production process. Free product refers to a regulated subs tance that is present as a nonaqueous phase liquid (e.g., liquid not dissolved in water.) Gathering lines means any pipeline, equipment, facility , or building used in the transportation of oil or gas during oil or gas production or gathering operations. Hazardous substance UST system means an underground storage tank s ys tem that contains a hazardous substance defined in section 101(14) of the Comprehensive Environmental Response, Compensation and L iability Act of 1980 (but not including any substance r egulated as a hazardous waste under subtitle C) or any mixture of such substances and petroleum, and which is not a petroleum UST system.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

9 Heating oil means petroleum that is No. 1, No. 2, No. 4

-- light, No. 4

-- heavy , No. 5

-- light, No. 5

-- heavy , and No. 6 technical grades of fuel oil; other residual fuel oils (including Navy Special Fuel Oil and Bunker C); and other fuels when used as substitutes for one of these fuel oils. Heating oil is ty

pically used in the operation of heating equipment, boilers, or furnaces. Hydraulic lift tank means a tank holding h ydraulic fluid for a closed

- loop mechanical sy stem that uses compressed air or hy draulic fluid to operate lifts, elevators, and other similar devices. Implementing agency means EPA, or, in the case of a state with a program approved under section 9004 (or pursuant to a memorandum of agreement with EPA), the designated state or local agency

responsible for carry ing out an approved UST program. Liquid trap means sumps, well cellars, and other traps use d in association with oil and gas production, gathering, and extraction operations (including gas production plants), for the purpose of collecting oil, water, and other liquids. These liquid traps may temporaril y collect liquids for subsequent dispositio n or reinjection into a production or pipeline stream, or may collect and separate liquids from a gas stream.
Maintenance means the normal operational upkeep to prevent an underground storage tank sy stem from releasing product. Motor fuel means petr oleum or a petroleum

- based substance that is ty pically used in the operation of a motor engine, such as motor gasoline, aviation gasoline, No. 1 or No. 2 diesel fuel, or an y blend containing one or more of these substances (for example: motor gasoline blended with alcohol)

. New tank system means a tank sy stem that will be used to contain an accumulation of regulated substances and for which installation has commenced after December 22, 1988. ( See also Existing Tank System

. ) Noncommercial pur

poses with respect to motor fuel means not for resale. On the premises where stored with respect to heating oil means UST s ys tems located on the same property

where the stored heating oil is used. Operational life refers to the period beginning when installation of the tank sy stem has commenced until the time the tank s ys tem is properly closed under s ubpart G. Operator means an y person in control of, or having responsibility for, the daily

operation of the UST sy stem. Overfill release is a release that occurs when a tank is filled bey ond its capacity , resulting in a discharge of the regulated substance to the environm ent.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

10 Owner means: (a) in the case of an UST s ys tem in use on November 8, 1984, or brought into use after that date, any person who owns an UST sy stem used for storage, use, or dispensing of regulated substances; and (b) in the case of an y UST sy stem in use before November 8, 1984, but no longer in use on that date, an y person who owned such UST immediately before the discontinuation of its use.
Person means an individual, trust, firm, joint stock company , federal agency , corporation, state, municipalit y, commission, political subdivision of a state, or an y interstate bod y. "Person" also includes a consortium, a joint venture, a commercial entit y, and the United States Government. Petroleum UST system means an underground storage tank s ys tem that cont ains petroleum or a mixture of petroleum with de minimis quantities of other regulated substances. Such sy stems include those containing motor fuels, jet fuels, distillate fuel oils, residual fuel oils, lubricants, petroleum solvents, and used oils. Pip e or Piping means a hollow cy linder or tubular conduit that is constructed of non

earthen materials. Pipeline facilit ies (including gathering lines) are new and existing pipe rights

- of

- way and any associated equipment, facilities, or buildings. Regula ted substance means (a) any substance defined in section 101(14) of the Comprehensive Environmental Response, Compensation and L iability Act (CERCL A) of 1980 (but not including an y substance regulated as a hazardous waste under subtitle C), and (b) p etroleum, including crude oil or an y fraction thereof that is liquid at standard conditions of temperature and pressure (60 degrees Fahrenheit and 14.7 pounds per square inch absolute). The term "regulated substance" includes but is not limited to petrole um and petroleum

- based substances comprised of a complex blend of hy drocarbons , such as motor fuels, jet fuels, distillate fuel oils, residual fuel oils, lubricants , petroleum solvents, and used oils. Release means any

spilling, leaking, emitting, discharging, escaping, leaching or disposing from an UST into ground water, surface water or subsurface soils. Release detection means determining whether a release of a regulated substance has occurred from the UST system into the environment or into the interstitial space between the UST sy stem and its secondary barrier or secondary

containment around it. Repai r means to restor e a tank , pipe, spill prevention equipment, overfill prevention equipment, corrosion protection equipment, release detection equipment or other UST sy stem component that has caused a release or a suspected release of product from the UST sy stem or has failed to function properly

.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

11 R eplaced means (a) for a tank

- to remove a tank and install another tank. (b) for p iping

- to remove 50 percent or more of piping and install other piping , excluding connectors, connected to a single tank. For tanks with multiple piping runs, th is definition applies independentl y to each piping run. Residential tank is a tank located on propert y used primarily for dwelling purposes.
SARA means the Superfund Amendments and Reauthorization Act of 1986. Secondary c ontainment or S econdarily contained means a release prevention and release detection sy stem for a tank and/or piping . These sy stems hav e an inner and outer barrier with an interstitial space that is monitored for leak s
. Septic tank is a water

- tight covered receptacle designed to receive or process, through liquid separation or biological digestion, the sewage discharged from a building sewer. The effluent from such receptacle is distributed for disposal through the soil and settled solids and scum from the tank are pumped out periodicall y and hauled to a treatment facility.
Storm

- water or wast ewater collection system means piping, pumps, conduits, and any other equipment necessary to collect and transport the flow of surface wate r run - off resulting from precipitation, or domestic, commercial, or industrial wastewater to and from retention areas or an y areas where treatment is designated to occur. The collection of storm water and wastewater does not include treatment except where incidental to convey ance. Surface impoundment is a natural topographic depression, man

- made excavation, or diked area formed primarily

of earthen materials (although it may be lined with man

- made materials) that is not an injection well. Tank is a sta tionary

device designed to contain an accumulation of regulated substances and constructed of non

- earthen materials (e.g., concrete, steel, plastic) that provide structural support. Training program means any program established by

the implementing agenc y that provides information to and evaluates the knowledge of a Class A, Class B, or Class C operator regarding requirements for UST sy stems. Under

- dispenser containment or UDC means c ontainment underneath a dispenser sy stem designed to prevent dispenser sy stem leaks from reaching soil or groundwater. Underground area means an underground room, such as a basement, cellar, shaft or vault, providing enough space for phy sical inspection of the exterior of the tank situated on or above the surface of the floor.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

12 Underground release means any belowground release. Underground storage tank or UST means an y one or combination of tanks (including underground pipes connected thereto) that is used to contain an accumulation of regulated substances, and the volume of which (including the volume of underground pipes connected thereto) is 10 percent or m ore beneath the surface of the ground. This term does not include an y: (a) Farm or residential tank of 1,100 gallons or less capacit y used for storing motor fuel for noncommercial purposes; (b) Tank used for storing heating oil for consumptive use on the premises where stored; (c) Septic tank; (d) Pipeline facilit y (including gathering lines) : (1) Which is regulated under U.S.C. 49 chapter s 601 and 603 , or (2) Which is an intrastate pipeline facility regulated under state laws as provided in U.S.C. 49 chapter s 601 and 603 ,

and which is determined by the Secretary

of Transportation to be connected to a pipeline , or to be operated or intended to be capable of operating at pipeline pressure , or as an integral part of a pipeline ; (e) Surface impoundment, pit, pond, or lagoon; (f) Storm

- water or wastewater collection sy stem; (g) Flow

- through process tank; (h) L iquid trap or associated gathering lines directly related to oil or gas production and gathering operations; or (i) Storage tank situated in an underground area (such as a basement, cellar, mineworking, drift, shaft, or tunnel) if the storage tank is situated upon or above the surface of the floor. The term underground storage tank or UST does not include an y pipes connected to an y tank which is described in paragraphs (a) through (i) of this definition. Upgrade means the addition or retrofit of some s ystems such as cathodic protection, lining, or spill and overfill controls to improve the abilit y of an underground storage tank s ys tem to prevent the release of product. UST system or Tank system means an underground storage tank, connected underground piping, underground ancillary equipment, and containment sy stem, if an y.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

13 Wastewater treatmen t tank means a tank that is designed to receive and treat an influent wastewater through ph ys ical, chemical, or biological methods. **Subpart B**
**-- UST Systems: Design, Construction, Installation and Notification**  **§ 280.20 Performance standards for new US T systems.**  In order to prevent releases due to structural failure, corrosion, or spills and overfills for as long as the UST sy stem is used to store regulated substances, all owners and operators of new UST sy stems must meet the following requirements. (a) Tanks

. Each tank must be properl y designed and constructed, and an y portion underground that routinely contains product must be protected from corrosion, in accordance with a code of practice developed b y a nationally recognized association or indep endent testing laboratory

as specified in paragraph s (a)(1) through ( a )(5) of this section . In addition, all new or replaced tanks where installation began after [ effective date of rule ] must b e secondar il y contain ed in accordance with paragraph (a)( 6) of this section : (1) The tank is constructed of fiberglass

- reinforced plastic; or
Note to paragraph (a)(1) : The following codes of practice may be used to comply

with paragraph (a)(1) of this section: (A) Underwriters Laboratories Standard 1316, " Glass

- Fiber

- Reinforced Plastic Underground Storage Tanks for Petroleum Products , Alcohols, and Alcohol

- Gasoline Mixtures "; or (B) Underwriter's Laboratories of Canada S615 , "Standard for Reinforced Plastic Underground Tanks for Flammable and Combustible L iquids "

.

(2) The tank is constructed of steel and cathodically protected in the following manner: (i) The tank is coated with a suitable dielectric material; (ii) Field

- installed cathodic protection s ys tems are designed by a corrosion expert; (iii) I mpressed current sy stems are designed to allow determination of current operating status as required in § 280.31(c); and (iv) Cathodic protection sy stems are operated and maintained in ac cordance with § 280.31 or according to guidelines established by the implementing agency ; or**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

14 Note to paragraph (a)(2) : The following codes of practice may be used to comply

with paragraph (a)(2) of this section: (A) Steel Tank Institute Specification " sti

- P3 ® Specification and Manual for External Corrosion Protection of Underground Steel Storage Tanks"; (B) Underwriters Laboratories Standard 1746, " Standard for External Corrosion Protection Sy stems for Steel Underground Storage Tanks"; (C) Underwriters Laboratories of Canada S603 , "Standard for Steel Underground Tanks for Flammable and Combustible L iquids," and S6 03.1 , "Standard for External Corrosion Protection Sy stems for Steel Underground Tanks for Flammable and Combustible L iquids," and S631 , " Standard for Isolating Bushings for Steel Underground Tanks Protected with External Corrosion Protection Sy stems"; (D) Steel Tank Institute Standard F841 , "Standard for Dual Wall Underground Steel Storage Tanks"; or (E) NACE International Recommended Practice RP 02 85, " Corrosion Control of Underground Storage Systems by Cathodic Protection ," and Underwriters Laboratories Standard 58, "Standard for Steel Underground Tanks for Flammable and Combustible L iquids "

. (3) The tank is constructed of steel and c lad or jacketed with a non

- corrodible material ; or Note to paragraph (a)(3) : The following codes of practice may be used to comply

with paragraph (a)(3) of this section: (A) Underwriters Laboratories Standard 1746, " Standard for External Corrosion Protection Sy stems for Steel Underground Storage Tanks " ; (B) Steel Tank Institute Specification F894 , “ACT

- 100 ® Specification for External Corrosion Protection of FRP Composite Steel USTs”; (C) Steel Tank Institute Specification F961 , “ACT

- 100

- U® Specification for External Corrosion Protection of Composite Steel Underground Storage Tanks ”; or (D) Steel Tank Institute Specification F922 , “ Steel Tank Institute Specification for Permatank® ”

. (4) The tank is constructed of metal without additional corrosion protection measures provided that: (i) The tank is installed at a site that is determined by a corrosion expert not to be corrosive enough to cause it to have a release due to corrosion during its operating life; and**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

15 (ii) O wners and operators maintain records that demonstrate compliance with the requirements of paragraph (a)(4)(i) of this section for the remaining life of the tank; or (5) The tank construction and corrosion protection are determined by the implementing ag ency to be designed to prevent the release or threatened release of any stored regulated substance in a manner that is no less protective of human health and the environment than paragraphs (a)(1) through (4) of this section ; or ( 6 ) The tank is secondar il y containe d

. Secondary containment must be periodically tested in accordance with § 280.36. Secondar il y containe d tanks must meet the following: (i) Be able to c ontain regulated substances leaked from the primary containment until they are detected and removed ; and (ii) Be able to p revent the release of regulated substances to the environment at any time during the operational life of the UST sy stem

. Note to paragraph (a)(6) : T he following codes of practice may be used to comply

with paragraph (a)( 6 ) of this section: (A) Underwriters Laboratories Standard 58, "Standard for Steel Underground Tanks for Flammable and Combustible L iquids" ; (B) Underwriters Laboratories Standard 1316, "Glass

- Fiber

- Reinforced Plastic Underground Storage Tanks for Petroleum Products, Alcohols, and Alcohol

- Gasoline Mixtures"; (C) Underwriters Laboratories Standard 1746, "Standard for External Corrosion Protection Sy stems for Steel Underground Storage Tanks"; ( D ) Steel Tank Institute Standard F841, "Standard for Dual Wall Underground Steel Storage Tanks"; or ( E ) Steel Tank Institute Specification F922 , “ Steel Tank Institute Specification for Permatank® ”

. (b) Piping

. The piping that routinely contains regulated substances and is in contact with the ground must be properly designed, constructed, and protected from corrosion in accordance with a code of practice developed b y a nationally recognized association or indep endent testing laboratory

as specified in paragraph s (b)(1) through (b)(4) of this section

. In addition, except for suction piping that meets the requirements of 280.41(b)( 1 ) (ii) ( A ) through ( E ) and piping associated with field

- constructed tanks and airport hy drant fuel distribution sy stems , all new or replaced piping where installation began after [ effective date of rule ] must be secondar il y containe d in accordance with paragraph (b)(5) of this section

. The entire piping run must be replaced w hen 50 percent or more of a piping run is replaced. (1) The piping is constructed of a non - corrodible material ; or**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

16 Note to paragraph (b)(1) : The following codes of practice may be used to comply

with paragraph (b)(1) of this section: (A) Underwriters Laboratories Standard 971, " Standard for Non

- Metal lic Underground P iping for Flammable Liquids "; or ( B ) Underwriters Laboratories of Canada Standard S660 , " Standard for Non

- Metallic Underground Piping for Flammable Liquids "

. (2) The piping is constructed of steel and cathodically protected in the following manner: (i) The piping is coated with a suitable dielectric material; (ii) Field

- installed cathodic protection s ys tems are designed by a corrosion expert; (iii) I mpressed current sy stems are designed to allow determination of current operating status as required in § 280.31(c ); and (iv) Cathodic protection sy stems are operated and maintained in accordance with § 280.31 or guidelines established by the implementing agency ; or Note to paragraph (b)(2 ) : The following codes of practice may be used to comply

wit h paragraph (b)(2) of this section: ( A ) American Petroleum I nstitute Recommended Practice 1632, "Cathodic Protection of Underground Petroleum Storage Tanks and Piping S ys tems"; ( B ) Underwriters Laboratories S ubject 971A, " Outline of Investigation for Metallic Underground Fuel Pip e " ; ( C ) Steel Tank Institute R ecommended Practice R892 , “Recommended Practice for Corrosion Protection of Underground Piping Networks Associated with Liquid Petroleum Storage and Dispensing Sy stems”; (D) NACE International Standard Practice S P 01 69, "Control of External Corrosion on Underground or Submerged Metallic Piping Sy stems " ; or ( E ) NACE International Recommended Practice RP 0285, "Corrosion Control of Underground Storage Sy stems by Cathodic Protection "

. (3) The piping is constructed of metal without additional corrosion protection measures provided that: (i) The piping is installed at a site that is determined by a corrosion expert to not be corrosive enough to cause it to have a release due to corrosion during its operating life; and**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

17 (ii) Owners and operators maintain records that demonstrate compliance with the requirements of paragraph (b)(3)(i) of this section for the remaining life of the piping; or
(4) The piping construction and corrosion protection are determined b y the implementing agency to be designed to prevent the release or threatened release of any stored regulated substance in a manner that is no le ss protective of human health and the environment than the requirements in paragraphs (b)(1) through (3) of this section ; or ( 5 ) The piping is secondar il y containe d

. Secondary containment must be periodicall y tested in accordance with § 280.36. Secondar il y containe d piping must meet the following: (i) Be able to c ontain regulated substances leaked from the primary containment until they are detected and removed; and (ii) Be able to p revent the release of regulated substances to the environment at any time during the operational life of the UST sy stem

. Note to paragraph (b)(5) : T he following codes of practice may be used to comply

with paragraph (b)(5) of this section: (A) Underwriters Laboratories Standard 971, "Standard for Non

- Metallic Underground Piping for Flammable Liquids"; or (B) Underwriters Laboratories Subject 971A, "Outline of Investigation for Metallic Underground Fuel Pipe ”

. (c) Spill and overfill prevention equipment

. (1) Except as provided in paragraph s (c)(2) and (c)(3) of this section, to prevent spilling and overfilling associated with product transfer to the UST sy stem, owners and operators must use the following spill and overfill prevent ion equipment: (i) Spill prevention equipment that will prevent release of product to the environment when the transfer hose is detached from the fill pipe (for example, a spill catchment basin); and (ii) Overfill prevention equipment that will: (A ) Automaticall y shut off flow into the tank when the tank is no more than 95 percent full; or (B) Alert the transfer operator when the tank is no more than 90 percent full by restricting the flow into the tank or triggering a high

- level alarm; or**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

18 (C) Restrict flow 30 minutes prior to overfilling, alert the transfer operator with a high level alarm one minute before overfilling, or automatically shut off flow into the tank so that none of the fittings located on top of the tank are exposed to product due to overfilling. (2) Owners and operators are not required to use the spill and overfill prevention equipment specified in paragraph (c)(1) of this section if: (i) Alternative equipment is used that is determined by the implementing agency to be no less protective of human health and the environment than the equipment specified in paragraph (c)(1)(i) or (ii) of this section; or (ii) The UST s ys tem is filled by transfers of no more than 25 gallons at one time. (3) Flow restrictors used in vent lines may not be used to comply

with paragraph (c)(1) (i i ) of this section when overfill pr evention is installed or replaced after [ effective date of rule ]

. (4) Spill and overfill prevention equipment must be periodicall y tested in accord ance with § 280.3 5

. (d) Installation. All tanks and piping must be properly installed in accordance with a code of practice developed b y a nationally recognized association or independent testing laboratory and in accordance with the manufacturer's instructions.
Note to paragraph (d) : Tank and piping s ys tem installation practices and procedures described in the following codes of practice may be used to comply

with the requirements of paragraph (d) of this section: ( A ) American Petroleum I nstitute Publication 1615, "Installation of Underground Petroleum Storage Sy stem"; ( B ) Petroleum Equipment Institute Publication RP100, "Recommended Practices for Installation of Underground L iquid Storage S ys tems"; or ( C ) National Fire Protection Association Standard 30, "Flammable and Combustible Liquids Code" and Standard 30A, “ Code for Motor Fuel Dispensing Facili ti es and Repair Garages”

. (e) Certification of installation

. All owners and operators must ensure that one or more of the following methods of certification, tes ting, or inspection is used to demonstrate compliance with paragraph (d) of this section by providing a certification of compliance on the UST notification form in accordance with § 280.22. (1) The installer has been certified b y the tank and piping manufacturers; or (2) The installer has been certified or licensed b y the implementing agency; or**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

19 (3) The installation has been inspected and certified by a registered professional engineer with education and experience in UST s ys tem installation; or (4) The installation has been inspected and approved by the implementing agency ; or (5) All work listed in the manufacturer's installation checklists has been completed; or (6) The owner and operator have complied with another method for ensuring compliance with paragraph (d) of this section that is determined by the implementing agency to be no less protective of human health and the environment. ( f ) Dispenser Systems

. Each UST s ys tem must be equipped with under

- dispenser containment for an y new dispenser s ys tem installed

. (1) A dispenser sy stem is considered new when both the dispenser and the equipment needed to connect the dispenser to the underground storage tank s ys tem are installed at an UST facility . The equipment necessary to connect the dispenser to the underground storage tank sy stem includes check valves, shear valves, unburied risers or flexible connectors, or other transitional components that are beneath the dispenser and connect the dispenser to the underground piping. (2) Under

- dispenser containment must be liquid

- tight on its sides, bottom, and at an y penetrations. Under

- dispenser containment must allow for visual inspection and access to the components in the containment sy stem or be continuously monitored for leaks from the dispenser s ys tem.
**§ 280.21 Upgrading of existing UST systems.** In accordance with subpart G of this part, owners and operators must permanentl y close an y UST sy stem that does not meet the new UST sy stem performance standards in § 280.20 or has not been upgraded in accordance with paragraphs (b) through (d) of this section. This does not apply to previously

deferred UST sy stems de scribed in paragraph (e) of this section and where an upgrade is determined to be appropriate b y the implementing agency

. (a) Alternatives allowed

. A ll existing UST sy stems must comply with one of the following requir ements: (1) New UST s ys tem performance standards under § 280.20; (2) The upgrading requirements in paragraph s (b) through (d) of this section; or (3) Closure requir ements under s ubpart G of this p art, including applicable requiremen ts for corrective action under s ubpart F.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

20 (b) Tank upgrading requirements

. Steel tanks must be upgraded to meet one of the following requirements in accordance with a code of practice developed by a nationally recognized association or independent testing l aboratory : (1) Interior lining

. T ank s upgraded b y internal lining must meet the following : (i) The lining wa s installed in accordance with the requirements of § 280.33, and (ii) Within 10 y ears after lining, and every 5 y ears thereafter, the lined tank is internally inspected and found to be structurall y sound with the lining still performing in accordance with original design specifications. If the internal lining is no longer performing in accordance with original design spe cifications and cannot be repaired in accordance with a code of practice developed b y a nationally recognized association or independent testing laboratory, then the lined tank must be permanently closed in accordance with s ubpart G of this part

. (2) Ca thodic protection

. T ank s upgraded b y cathodic protection must meet the requirements of § 280.20(a)(2)(ii), (iii), and (iv) and the integrit y of the tank must have been ensured using one of the following methods: (i) The tank was internally inspected and assessed to ensure that the tank was structurall y sound and free of corrosion holes prior to installing the cathodic protection sy stem; or (ii) The tank ha d b een installed for less than 10 ye ars and is monitored monthly for releases in accordance with § 280.43(d) through ( i ); or (iii) The tank ha d been installed for less than 10 y ears and was assessed for corrosion holes by conducting two tightness tests that meet the requirements of § 280.43(c). The first tightness test must have been conducted prior to installing the cathodic protection sy stem. The second tightness test must have been conducted between three and six months f ollowing the first operation of the cathodic protection sy stem; or (iv) The tank was assessed for corrosion holes b y a method that is determined by the implementing agency

to prevent releases in a manner that is no less protective of human health and the environment than paragraphs (b)(2)(i) through (iii) of this section. (3) Internal lining combined with cathodic protection

. T ank s upgraded b y both internal lining and cathodic protection must meet the following : (i) The lining was installed in accordance with the requirements of § 280.33; and (ii) The cathodic protection sy stem meets the requirements of § 280.20(a)(2)(ii), (iii), and (iv).
Note to paragraph ( b ) : The following historical codes of practice were listed as options for comply ing with paragraph b of this section:**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

21 (A) American Petroleum I nstitute Publication 1631, "Recommended Practice for the Interior Lining of Existing Steel Underground Storage Tanks"; (B) National Leak Prevention Association Standard 631, "Spill Prevention, Minimum 10 Year Life Extension of Existing Steel Underground Tanks by Li ning Without the Addition of Cathodic Protection"; (C) National Association of Corrosion Engineers Standar d RP

- 02

- 85, "Control of External Corrosion on Metallic Buried, Partially Buried, or Submerged Liquid Storage Sy stems"; and (D) American Petroleum I nstitute Publication 1632, "Cathodic Protection of Underground Petroleum Storage Tanks and Piping Sy stems "

. Note to paragraph b(1)(ii): The following codes of practice may be used to comply

with the periodic lining inspection requirement of this section: (A) American Petroleum I nstitute Recommended Practice 1631, "Interior Lining and Periodic Inspection of Underground Storage Tanks"; (B) National Leak Prevention Association Standard 631, "Entry , Cleaning, Interior Inspection, Repair, and Lining of Underground Storage Tanks"; or (C) Ken Wilcox Associates Recommended Practice, “Recommended Practice fo r Inspecting Buried Lined Steel Tanks Using a Video Camera ”

. (c) Piping upgrading requirements

. Metal piping that routinel y contains regulated substances and is in contact with the ground must be cathodically protected in accordance with a code of practice developed by a nationall y recognized association or independent testing laboratory

and must meet the requirements of § 280.20(b)(2)(ii), (iii), and (iv).
Note to paragraph (c) : The codes of practice listed in the note following § 280.20(b)(2) may be used to compl y with this requirement. (d) Spill and overfill prevention equipment

. To prevent spilling and overfilling associated with product transfer to the UST sy stem, all existing UST s ys tems must comply with new UST sy stem spill and overfill prevention equipment requirements specified in § 280.20(c). (e) Upgrade requirements for previously deferred UST systems

. P reviously deferred wastewater treatment tank sy stems, airport hy drant fuel distribution sy stems, and UST sy stems with field

- constructed tanks where installation commenced on or before [ effective date of rule ] must meet the following requirements according to the time table in s ubpart A or be permanentl y closed pursuant to s ubpart G of this part

. (1) Corrosion protection . UST sy stem components in contact with the ground that routinely contain regulated substances must meet one of the following:**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

22 (i) The n ew UST sy stem performance standards for tanks at § 280.20 (a) and for piping at § 280.20(b); or (ii) Be constructed of metal and cathodic ally protect ed according to a code of practice developed b y a nationally recognized association or independent testing laboratory and meets the following: (A) Cathodic protection must meet the requirements of § 280.20( a )(2)(ii), (iii) and (iv) for tanks, and § 280.20(b)(2)(ii), (iii), and (iv) for piping. (B) Tanks greater than 10 ye ars old without cathodic protection must be assessed to ensure the tank is structurally sound and free of corrosion holes prior to adding cathodic protection. The assessment m ust be by internal inspection or another method determined b y the implementing agency

to adequatel y assess the tank for structural soundness and corrosion holes.
Note to paragraph (e) : The following codes of practice m ay be used to comply

with this paragraph : (A) NACE International Recommended Practice RP 0285, "Control of Underground Storage Tank S ys tems by Cathodic Protection"; (B) NACE International Standard Practice SP 0169, “Control of External Corrosion on Underground or Submerged Metallic Piping Sy stems” ; ( C ) National Leak Prevention Association Standard 631, "Entry , Cleaning, Interior Inspection, Repair, and Lining of Underground Storage Tanks" ; or (D) American Societ y for Testing and Materials Standard G158, “Standard Guide for Three Methods of Assessing Buried Steel Tanks ”

. (2) Spill and overfill prevention equipment

. To prevent spilling and overfilling associated with product transfer to the UST sy stem, all previously deferred UST s ys tems must comply with new UST sy stem spill and overfill prevention equipment requirements specified in § 280.20(c). **§ 280.22**  **Notification requirements.** (a) After May

8, 1986, an owner must submit notice of a tank s ys tem’s existence to the implementing agency

within 30 day s of bringing the underground storage tank sy stem into use. Owners must use the form in Appendix Iof this part.
Note to paragraph (a) : Owners and operators of UST sy stems that were in the ground on or after May 8, 1986, unless taken out of operation on or before Jan uary 1, 1974, were required to notify the designated state or local agency in accordance with the Hazardous and Solid Waste Amendments of 1984, Public L aw 98

- 616, on a form published by EPA on November 8, 1985 (50 FR 46602) unless notice was given pursuant to section 103(c) of CERCLA. Owners and**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

23 operators who have not complied with the notification requirements may use portions I through VI of the notification form c ontained in Appendix Iof this p art. (b) Within 30 day s of acquisition, any person who assumes ownership of a regulated underground storage tank sy stem, except as described in paragraph (a) of this section, must submit a notice of the ownership change to the implementing agency , using the form in Appendix II of this p art. ( c ) In states where state law, regulations, or procedures require owners to use forms that differ from those set forth in Appendix I and Appendix I I of this p art to fulfill the requirements of this section, the state forms may be submitted in lieu of the forms set forth in Appendix I and Appendix I I of this p art. If a state requires that its form be used in lieu of the form presented in Appendix I and Appendix II of this p art , such form must , at a minimum, collect the information prescribed in Appendix Iand Appendix I I of this p art. ( d ) Owners required to submit notices under paragraph (a) or (b) of this section must provide notices to the appropriate implementing agenc y for each tank they own. Owners may provide notice for several tanks using one notification form, but owners who own tanks located at more than one place of operation must file a separate notification form for each separate place of operation. (e) All owners and operators of new UST s ys tems must certify in the notification form compliance with the following requirements: (1) Installation of tanks and piping under § 280.20(e); (2) Cathodic protection of steel tanks and piping under § 280.20(a) and (b); (3) Financial responsi bility under subpart H of this p art; and (4) Release detection under §§ 280.41 and 280.42. (f) All owners and operators of new UST s ys tems must ensure that the in staller certifies in the notification form that the methods used to install the tanks and piping complies with the requirements in § 280.20(d). (g) Beginning October 24, 1988, any person who sells a tank intended to be used as an underground storage tan k must notify the purchaser of such tank of the owner's notification obligations under paragraph (a) of this section. The statement provided in Appendix III of this part , when used on shipping tickets and invoices, may be used to compl y with this requirement. (h) Within 30 day s of [ effective date of rule ], all owners of previously deferred UST sy stems must submit a notice of tank s ys tem existence to the implementing agency , using the form in Appendix Iof this part.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

24 **Subpart C**
**-- General Operating Requirements**  **§ 280.30 Spill and overfill control.** (a) Owners and operators must ensure that releases due to spilling or overfilling do not occur. The owner and operator must ensure that the volume available in the tank is greater than the volume of product to be transferred to the tank before the transfer is made and that the transfer operation is monitored constantly to prevent overfilling and spilling. Note: The transfer procedures described in National Fire Protection Association Standard 385 , “Standard for Tank Vehicles for Flammable and Combustible L iquids” or American Petroleum Institute Recommended Practice 1007, “L oading and Unloading of MC 306/DOT 406 Cargo Tank Motor Vehicles ” may be used to comply

with paragraph (a) of this section. Further guidance on spill and overfill prevention appears in American Petroleum Institute Recommended Practice 1621, " Bulk L iquid Stock Control at Retail Outlets "

. (b) The owner and operator must report, investigate, and clean up an y spills and overfills in accordance with § 280.53. **§ 280.31 Operation and maintenance of corrosion protection.** All owners and operators of metal UST sy stems with corrosion protection must comply with the following requirements to ensure that releases due to corrosion are prevented until the UST sy stem is permanently closed or undergoes a change

- in

- service pursuant to § 280.71 : (a) All corrosion protection sy stems must be operated and maintained to continuously pro vide corrosion protection to the metal components of that portion of the tank and piping that routinely contain regulated substances and are in contact with the ground. (b) All UST sy stems equipped with cathodic protection sy stems must be inspected for proper operation b y a qualified cathodic protection tester in accordance with the following requirements: (1) Frequency

. All cathodic protection s ys tems must be tested within 6 months of installation and at least every 3 y ears thereafter or according to another reasonable time frame established by

the implementing agency ; and (2) Inspection criteria

. The criteria that are used to det ermine that cathodic protection is adequate as required b y t his section must be in accordance with a code of practice developed b y a nationally

recognized association.
Note to paragraph (b) : The following codes of practice may be used to comply

with paragraph (b) of this section: (A) NACE International Test Method TM 0101, “Measurement Techniques Related to Criteria for Cathodic Protection on Underground or Submerged Metallic Tank Sy stems ” ;**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

25 (B) NACE International Test Method TM0497, “ Measurement Techniques Related to Criteria for Cathodic Protection on Underground or Submerged Metallic Piping Sy stems ”; (C) Steel Tank Institute Recommended Practice R051, “Cathodic Protecti o n T esting Procedures for sti

- P3 USTs ” ; ( D ) NACE International Recommended Practice RP 02 85, "Control of Underground Storage Tank Sy stems by Cathodic Protection " ; or ( E ) NACE Inte rnational Standard Practice S P 0169, “ Control of External Corrosion on Underground or Submerged Metallic Piping Sy stems ”

. (c) UST s ys tems with impressed current cathodic protection s ys tems must also be inspected every

60 day s to ensure the equipment is running properl y. (d) For UST sy stems using cathodic protection, records of the operation of the cathodic protection must be maintained (in accordance with § 280.34) to demonstrate compliance with the performance standards in this section. These records must provide the following: (1) The results of the last three inspections required in paragraph (c) of this section; and (2) The results of testing from the last two inspections required in paragraph (b) of this section. **280.32 Compatibility.** (a) Owners and operators must use an UST sy stem made of or lined with materials that are compatible with the substance stored in the UST system.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

26 (b) Owners and operators storing an y regulated substance containing greater than 10 percent ethanol or greater than 20 percent biodiesel, or an y other regulated substance identified by the implementing agency , must u se one or more of the following methods to demonstrate UST sy stem compatibility with these regulated substances: (1) Certification or listing of UST sy stem components by a nationally

recognized, independent testing laboratory for use with the regulated substance stored; (2) Equipment or component manufacturer approval. The manufacturer’s approval must be in writing, indicate an affirmative statement of compatibility , specify the range of biofuel blends the component is compatible with, and be from the eq uipment or component manufacturer; or (3) Another method determined by the implementing agency to be no less protective of human health and the environment than the methods listed in paragraphs (b)(1) or (b)(2) of this section. (c) Owners and operators must maintain the following records (in accordance with § 280.34) for the life of the equipment or component: (1) Documentation of compliance with paragraph (b) of this section, as applicable; and (2) Records of all equipment or components installed or replaced after [effective date of rule]. At a minimum, each record must include the date of installation or replacement, manufacturer, and model.
**§ 280.33 Repairs allowed.** Owners and operators of UST sy stems must ensure that repairs will prevent releases due to structural failure or corrosion as long as the UST system is used to store regulated substances

. The repairs must meet the fol lowing requirements: (a) Repairs to UST sy stems must be properly conducted in accordance with a code of practice developed b y a nationally recognized association or an independent testing laboratory

. Note to paragraph (a) : The following codes of practice may be used to com ply

with paragraph (a) of this section: ( A ) National Fire Protection Association Standard 30, "Flammable and Combustible Liquids Code"; ( B ) American Petroleum Institute Recommended Practice RP 2200, "Repairing Crude Oil, Liquified Petroleum Gas, and Product Pipelines"; ( C ) American Petroleum Institute Recommended Practice RP 1631, " Interior L ining and Periodic Inspection of Underground Storage Tanks"; (D) National Fire Protection Association Standard 326, “Safeguarding of Tanks and Containers for Entry , Cleaning, or Repair”;**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

27 ( E ) National Leak Prevention Association Standard 631, " Entry , Cleaning, Interior Inspection, Repair, and Lining of Underground Storage Tanks " ; ( F ) Steel Tank Institute Recommended Practice R 972, “Recommended Practice for the Addition of Supplemental Anodes to sti

- P3 ® Tanks” ; (G) NACE International Recommended Practice RP 0285, "Control of Underground Storage Tank S ys tems by Cathodic Protection" ; or ( H ) Fiberglass Tank and Pipe I nstitute Recommended Practice T

- 95

- 02, “Remanufacturing of Fiberglass Reinforced Plastic (FRP) Underground St orage Tanks ”

. (b) Repairs to fiberglass

- reinforced plastic tanks may be made by

the manufacturer's authorized representatives or in accordance with a code of practice developed by a nationall y recognized associat ion or an independent testing laboratory

. (c) Metal pipe sections and fittings that have released product as a result of corrosion or other damage must be replaced. Non

- corrodible pipes and fittings may be repaired in accordance with the manufacturer's specifications. (d) Repaired tanks and piping must be tightness tested in accordance with § 280.43(c) and § 280.44(b) within 30 day s following the date of the completion of the repair except as provided in paragraphs (d)(1) through ( 4 ), of this section: (1) The repaired tank is internally inspected in accordance with a code of practice developed b y a nationally recognized association or an independent testing laboratory; or (2) The repaired portion of the UST sy stem is monitored mon thly for releases in accordance with a method specified in § 280.43(d) through ( i ); (3) UST sy stems with secondary containm ent must be test ed as specified in § 280.3 6 within 30 day s following the completion of any repair . Tanks using interstitial sensors must be test ed using a vacuum, pressure , or liquid method in accordance with one of the criteria listed in § 280.3 6 (a)( 1)(ii) following an y repair ; or ( 4 ) Another test method is used that is determined by the implementing agency to be no less protective of human health and the environment than those listed above. (e) Within 6 months following the repair of an y cathodically protected UST system, the cathodic protection sy stem must be tested in accordance with § 280.31(b) and (c) to ensure that it is operating prop erly

. (f) Within 30 day s following an y repair to spill or overfill prevention equipment, the repaired spill or overfill prevention equipment must be tested in accordance with § 280. 3 5 to ensure it is operating properly

.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

28 ( g ) UST sy stem owners and operators must maintain records (in accordance with § 280.34) of each repair until the UST sy stem is permanently closed or undergoes a change

- in

service pursuant to § 280.71

. **§ 280.34 Reporting and recordkeeping.** Owners and operators of UST sy stems must cooperate full y with inspections, monitoring and testing conduc ted b y the implementing agency, as well as requests for document submission, testing, and monitoring by the owner or operator pursuant to section 9005 of Subtitle I of the Solid Waste Disposal Act, as amended. (a) Repor ting. Owners and operators must submit the following information to the implementing agency : (1) Notification for all UST sy stems (§ 280.22), which includes certification of installation for new UST sy stems (§ 280.20(e)) and notification when an y perso n assumes ownership of an UST sy stem (§ 280.22 (b) ) ; (2) Reports of all releases including suspected releases (§ 280.50), spills and overfills (§ 280.53), and confirmed releases (§ 280.61); (3) Corrective actions planned or taken including initial abatement measures (§ 280.62), initial site characterization (§ 280.63), free product removal (§ 280.64), investigation of soil and ground

- water cleanup (§ 280.65), and corrective action plan (§ 280.66); and (4) A notification before permanent closure o r change

- in

- service (§ 280.71). (b) Recordkeeping. Owners and operators must maintain the following information: (1) A corrosion expert's anal ys is of site corrosion potential if corrosion protection equipment is not used (§ 280.20(a)(4); § 280.20(b) (3)). (2) Documentation of operation of corrosion protection equipment (§ 280.31 (d) ); (3) Documentation of compatibility for UST Sy stem s (§ 280.32( c )); (4) Records for all UST sy stem equipment installed or replaced after [ effective date of rule ] ( § 280.32(c)); ( 5 ) Documentation of UST sy stem repairs (§ 280.33( g )); (6) Documentation of compliance for spill and overfill prevention equipment (§ 280.35 (c) );**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

29 (7) Documentation of compliance for tanks, piping , and containment sumps using interstitial monitoring (§ 280.36 (c) ); ( 8 ) Documentation of periodic walkthrough inspections (§ 280.37 (b) ) ; ( 9 ) Recent compliance with release detection requirements (§ 280.45); ( 10 ) Results of the site investigation conducted at permanent closure (§ 280.74) ; and (11) Documentation of operator training (§ 280.24 5 ). (c) Availability and Maintenance of Records . Owners and operators must keep the records required either: (1) At the UST site and immediately available for inspection by the implementing agency ; or (2) At a readil y available alternative site and be provided for inspection to the implementing agency

upon request. (3) In the case of permanent closure rec ords required under § 280.74, owners and operators are also provided with the additional alternative of mailing closure records to the implementing agency

if they cannot be kept at the site or an alternative site as indicated above.
**§ 280.3 5**  **Periodic t**  **esting of s**  **pill and o**  **verfill p**  **revention e**  **quipment**
**.** (a) Owners and operators of UST sy stems with spill and overfill prevention equipment must meet the following requirements to ensure the equipment is operating properl y and will prevent releases to the environment: (1) Spill prevention equipme nt (such as a catchment basin , spill bucket , or other spill containment device ) must prevent releases to the environment by meeting one of the following: (i) The spill prevention equipment has two walls and the space be tween the walls is monitored continuously to ensure the integrit y of the inner and outer walls is maintained ; or (ii) The spill prevention equipment is tested at insta llation and at least once every 12 months to ensure the spill prevention equipment is liquid tight by using vacuum, p ressure , or liquid testing in accordance with one of the following criteria : (A) Requirements developed by the manufacturer (Note: Owners and operators may use this option only

if the manufacturer has developed testing requirements); (B) Code of practice developed by a nationall y recognized association or independent testing laboratory ; or**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

30 (C) Requirements determined by the implementing agency to be no less protective of human health and the environment than the requirements listed in paragraphs (a)(1)(ii) ( A) and (B) of this section ; and (2) Overfill prevention equipment must be tested at installation and at least once every three ye ars . At a minimum, testing must ensure that overfill prevention equipment is set to activate at the correct level specified in § 280.20(c) and will activate when regulated substance reaches that level . Testing must be conducted in accordance with one of the criteria in paragraph (a)(1)(ii) of this section

. (b) Owners and operators must begin meeting these requirements as follows: (1) For UST sy stems in use on or before [ effective date of rule ] : ( i ) N ot later than [ one ye ar after effective date of rule ] for spill prevention equipment ; and (ii ) For overfill prevention equipment , n ot later than the phase

- in schedule in the following table :

**Phase**
**- In Schedule**  **F or Overfill Pr**  **even tion**  **Equipment Testing**  **Criteria Date**  **B y**  **W hich**  **F irst**  **T est**  **M ust**  **B e**  **C onducted**  One or more USTs at the facility were installed on or before 12/ 22 / 1988 [1 y ear after effective date of rule]
No USTs at the facility

were installed on or before 12/ 22 / 1988 and at least one UST at the facility

was installed on or before 12/22/ 1998 [2 y ear s after effective date of rule]

All USTs at th e facility we re installed after 12/22/ 1998 [ 3 year s after effective date of rule]
(2) For UST sy stems brought into use after [ effective date of rule ] , these requirements apply at installation

. (c) Owners and operators must maintain the following records (in accordance with § 280.34) for spill and overfill prevention equipment: (1) All r ecord s of spill prevention equipment testing and overfill prevention equipment testing must be maintained for three ye ar s ; and ( 2 ) For spill prevention equipment not tested every 12 months, d ocumentation showing that the spill prevention equipment has two walls and is monitored continuously

. Owners and operators must maintain this documentation for as long as the spill prevention equipment is monitored continuously , and for three additional years after continuous monitoring ends

.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

31 Note to paragraphs (a)(1)(ii) and (a)(2) : T he following codes of practice may be used to co mply with paragraphs (a)(1)(ii) and (a)(2) of this section: PL ACEHOLDER

– PEIDeveloping Std that might be appropriate **§ 280.3 6**  **Periodic t**  **esting of s**  **econdary c**  **ontainment**
**.** (a) Owners and operators of UST sy stems with secondary containment using interstitial monitoring must ensure the integrity of all interstitial areas (including all containment sumps used for interstitial monitoring). (1) Tanks must meet one of the following: (i) The interstitial space is continuously monitored; or (ii) The interstitial space is not continuously monitored and the integrity of the interstitial space is ensured at least once every three y ears by using vacuum, pressure , or liquid t esting in accordance with one of the following criteria : (A) Requirements developed by the manufacturer (Note: Owners and operators may use this option only

if the manufacturer has developed integrit y testing requirements); (B) Code of practice developed by a nationall y recognized association or independent testing laboratory ; or (C) Requirements determined by the implementing agency to be no less protective of human health and the environment than the requirements listed in paragr aph s (a)(1)(ii) (A) and (B) of this section ;
(2) Piping must meet one of the following: (i) The interstitial space is continuously monitored using vacuum, pressure, or a liquid

filled interstitial space; or (ii) The interstitial space is monitored using an interstitial monitoring method not listed in paragraph (a)(2)(i) of this section and the integrity of the interstitial space is ensured at least once every three y ears by

using vacuum, pressure , or liquid t esting in accordance with one of the criteria listed in paragraph (a)(1)(ii) of this section ; and (3) Containment sumps must meet one of the following: (i) The containment sump has two walls and the space between the walls is continuously monitored; or (ii) The containment sump is tested at least every three ye ars to ensure the containment**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

32 sump is liquid tight by

using vacuum, pressure , or liquid testing in accordance with one of the criteria listed in paragraph (a)(1)(ii) of this section

. (b) Owners an d operators of UST sy stems using interstitial monitoring must begin meeting this requirement as follows: ( 1 ) For UST sy stems in use on or before [ effective date of rule ] , not later than the phase

in schedule in the following table :

**Phase**
**- In Schedule**  **F or**  **Interstitial Area**  **Testing Criteria**  **Date B**  **y W**  **hich F**  **irst T**  **est M**  **ust B**  **e C**  **onducted** One or more USTs at the facility were installed on or before 12/22/1988 [1 y ear after effective date of rule] No USTs at the facility

were installed on or before 12/22/1988 and at least one UST at the facilit y was installed on or before 12/22/1998 [2 y ears after effective date of rule]

All USTs at the facility

were installed after 12/22/1998 [3 y ears after effective date of rule]
( 2 ) For UST sy s tems brought into use after [ effective date of rule ] , these requirements apply at installation

. (c) Owners and operators must maintain the following records (in accordance with § 280.34) for the time frames indicated for each tank, piping , and containment sump that uses interstitial monitoring: ( 1 ) R ecord s of interstitial space test ing must be maintained for three ye ars ; or ( 2 ) As appropriate, records demonstrating : the tank is using continuous interstitial monitoring ; the piping is using continuous interstitial monitoring with vacuum, pressure, liquid

filled interstitial space; and the containment sump has two walls and uses continuous interstitial monitoring

. Owners and operators mu st maintain th e s e records for as long as the tank, piping , or conta inment sump uses one of these continuous methods of interstitial monitoring , and for three additional ye ars after continuous monitoring ends

. Note to paragraphs (a)(1)(ii), (a)(2)(ii), and (a)(3)(ii) : T he following codes of practice may be used to comply

with paragraphs (a)(1)(ii) , (a)(2)(ii), and (a)(3)(ii) of this section: ( A ) Steel Tank Institute Recommended Practice R012, “Recommended Practice for Interstitial Tightness Testing of Existing Unde rground Double Wall Steel Tanks ” ; or (B) Fiberglass Tank and Pipe I nstitute Protocol , “Field Test Protocol for Testing the Annular Space of Installed Underground Fiberglass Double and Triple

- Wall Tanks with Dry Annular Space ”

.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

33 **§ 280.37 Periodic o**  **peration and m**  **aintenance w**  **alkthrough i**  **nspections**
**.** (a) To properl y operate and maintain UST sy stems, owners and operators must meet one of the following: (1) Conduct a walkthrough inspection at least once every 30 day s that, at a minimum and as appropriate to the facility , check s the following equipment as specified : (i) Spill p revention e quipment

- open and visuall y check for an y damage; remove an y liquid or debris; check each fill cap to make sure it is securel y on the fill pipe; and for spill prevention equipment with continuous i nterstitial monitoring, check for a leak in the interstitial area, (ii) Sumps

- open an d visually check for an y damage , leak s to the containment area , or releases to the environment; remove an y liquid (in contained sumps) or debris; and for sumps with continuous interstitial monitoring, check for a leak in the interstitial area, (iii) Dispenser c abinets

- open an d visually check for any

damage , leaks to the containment area , or releases to the environment; remove any liquid (in dispenser s with under

- dispenser containment ) or debris; and for under

- dispenser containment with continuous interstitial monitoring, check for a leak in the interstitial area, (iv) Monitoring/ o bservation w ells

- check covers to make sure they are secured, (v) Cathodic p rotection

- check to make sure impressed current cathodic protection rectifiers are on and operating ; and ensure records of three ye ar cathodic protection testing and 60 day impressed current sy stem inspections are reviewed and current , and (vi) Release d etection s ystems

- check to make sure the release detection sy stem is on and operating with no alarm s or other unusual operating conditions present ; check an y devices such as tank gauge sticks, groundwater bailers , and hand

- held vapor monitoring devices for operability

and serviceability ; and e nsure records of release detection testing are reviewed monthly and current ; or (2) Conduct operation and m aintenance walkthrough inspections at least once every 30 day s according to a standard code of practice developed by a nationall y recognized association or independent testing laboratory that are comparable to (a)(1) of this section; or (3) Conduct operation and maintenance walkthrough inspections developed by the implementing agency

that are comparable to paragraph (a)(1) of this section. (b) Owners and operators must maintain records (in accordance with § 280.34) of operation and maintenance walkthrough inspections for one ye ar . The record must include a listing of each area checked, whether each area checked was acceptable or needed to have an y action taken , and a description of any actions taken to correct an issue.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

34 Note to p aragraph (a)(2) : the following code of practice may be used to comply

with paragraph (a)( 2 ) of this section: (A) Petroleum Equipment I nstitute Recommended Practice RP 900, “Recommended Practices for the Inspection and Maintenance of UST Sy stems”

. **Subpart D**
**-- Release Detection**  **§ 280.40 General requirements for all UST systems.** (a) Owners and operators of UST sy stems must provide a method, or combination of methods, of release detection that: (1) Can detect a release from any portion of the tank and the connected underground piping that routinel y contains product; (2) Is installed and calibrated in accordance with the manufacturer's instructions ; (3) Beginning on [ one year after effective date of r ule ] , i s operated and maintained, and electronic and mechanical components are tested for proper operation, in accordance with one of the following: manufacturer’s instructions; a code of practice developed by a nationally recognized association or independent testing laboratory ; or requirements developed by the implementing agency . A test of the proper operation must be performed at least annuall y an d, at a minimum and as applicable to the facility , cover the following components and criteria: (i) Automatic tank gauge and other controllers: test alarm; verify s ys tem configuration; test battery

backup; (ii) Probes and sensors: inspect for residu al buildup, ensure floats move freely ; ensure shaft is not damaged; ensure cables are free of kinks, bends , and breaks; test alarm operability and communication with controller; (iii) L ine leak detector: test operation to meet criteria in § 280.44 (a) by simulating a leak ; inspect leak sensing o

- ring; and (iv) Vacuum pumps and pressure gauges: ensure proper communication with sensors and controller. ( 4 ) Meets the performance requirements in § 280.43 , § 280.44, § 280.46, or § 280.47 , as applicable, with an y performance claims and their manner of determination described in writing by the equipment manufacturer or installer. In addition, the methods listed in § 280.43(b); § 280.43(c); § 280.43(d); § 280.43(h ); § 280.43(i ); § 280.44(a); § 280.44(b); §280.46; and § 280.47 , must be capable of detecting the leak rate or quantity spe cified for that method in the corresponding section of the rule with a probability of detection of 0.95 and a probability of false alarm of 0.05.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

35 (b) When a release detection method operated in accordance with the performance standards in § 280.43 , § 280.44 , § 280.46, or § 280.47 indicates a release may have occurred, owners and operators must notify the implemen ting agen cy in accordance with s ubpart E. (c) Owners and operators of Airport h ydrant fuel distribution sy stems , UST sy stems with field

- constructed tanks , and w astewater treatment tank sy stems must comply with the release detection requirements of this Subpart according to the following table: Schedule for Phase

- in of Release Detection for Airport Hy drant Fuel Distribution S ys tems , UST Sy stems with F iel d

- Con structed T anks , and Wastewater Treatment Tank S ystems Ty pe of UST Sy stem Time Frame (after [effective date of rule ] ) Description of Requirement

Bulk piping associated with airport h ydrant fuel distribution sy stems and field

- constructed tanks using § 280.47(a) for piping release detection Within three y ears Conduct one bulk piping tightness test according to § 280.47(a) using the maximum detectable leak rates for semiannual testing. For bulk piping segments not capable of meeting the 3.0 gallon per hour leak rate, owners and operators may use a leak rate of up to 6.0 gallons per hour. Between ye ars three and six

Between ye ars six and seven Conduct one bulk piping tightness test according to § 280.47(a) using the maximum detectable leak rates for semiannual testing. After ye ar seven Conduct bulk piping tightness testing according to § 280.47(a). Bulk piping associated with a irport h ydrant fuel distribution sy stems and field

- constructed tanks not using § 280.47(a) for piping release detection Within three y ears Perform release detection according to thi s subpart.
Underground tanks associated with h ydrant fuel distribution sy stems and field

- constructed tanks Within three y ears Perform release detection according to this subpart.
Wastewater treatment tank sy stems Within three y ears Perform release detection according to this subpart. (d) An y UST s ys tem that cannot appl y a method of release detection that complies with the requirements of this s ubpart must comp lete the closure procedures in s ubpart G

. For previously

deferred UST sy stems described in s ubpart A , this requirement applies after the effective date for subpart D described in § 280. 10(a)(1)

.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

36 **§ 280.41 Requirements for petroleum UST systems.** Owners and operators of petroleum UST sy stems mus t provide release detection for tanks and piping as follows: (a) Tanks. Tanks must be monitored for releases as follows : (1) Tanks installed on or before [ effective date of rule ] must be monitored for releases at least every 30 day s using one of the methods listed in § 280. 43(d) through (i) except that : ( i ) UST sy stems that meet the performance standards in § 280.20 or § 280.21, and the monthly inventory

control requirements in § 280.43(a) or (b), may use tank tightness testing (conducted in accordance with § 280.43(c)) at least every 5 y ears until 10 years after the tank wa s installed or upgraded under § 280.21(b), whichever is later ; ( ii ) Tanks with capacit y of 550 gallons or less and tanks with a capacity of 551 to 1 , 000 gallons that meet the tank diameter criteria in § 280.43 (b) may use manual tank gauging (conducted in accordance with § 280.43(b)) ; (iii) Field

- constructed tanks greater than 50,000 gallons m ay use the alternative release detection requirements in § 280.46; and ( iv ) Tanks using § 280.43(e) or § 280.43(f) to monitor for releases, must begin using one of the methods listed in § 280.43(d), (g), (h) or (i) not later than [five y ears after effective date of r ule ]

. ( 2 ) T anks installed after [ effective date of rule ] must be monitored for releases at least every 30 day s in accordance with § 280.43(g). (b) Piping. Underground piping that routinel y contains regulated substances must be monitored for releases in a manner that meets one of the following requirements: (1) Piping installed on or before [ effective date of rule ] must meet one of the following: ( i ) Pressurized piping . Underground piping that convey s regulated substances under pressure must: ( A ) Be equipped with an automatic line leak detector conducted in accordance with § 280.44(a); and ( B ) Have an annual line tightness test conducted in accordance with § 280.44(b) or have monthly monitoring conducted in accordance with § 280.44(c). ( ii ) Suction piping

. Underground piping that convey s regulated substances under suction must either have a line tightness test conducted at least every 3 y ears and in accordance with § 280.44(b), or use a monthly monitoring method conduct ed in accordance with § 280.44(c). N o**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

37 release detection is required for suction piping that is designed and constructed to meet the following standards: ( A ) The below

- grade piping operates at less than atmospheric pressure; ( B ) The below

- grade piping is sloped so that the contents o f the pipe will drain back into the storage tank if the suction is released; ( C ) Only one check valve is included in each suction line; ( D ) The check valve is located directly below and as close as practical to the suction pump; and ( E ) A me thod is provided that allows compliance with paragraphs (b)(2)(ii)

- (iv) of this section to be readily

determined. ( iii ) Bulk piping . Underground piping associated with airport hy drant fuel distribution sy stems and field

- constructed tanks must meet one of the following release detection requirements: (A) The requirements in paragraphs (b) (1)(i) or (ii ) of this section ; or (B) The alternative release detection requirements in § 280.47. (2) Piping installed or replaced after [ effective date of rule ] must meet one of the following: (i) Pressurized piping must be monitored for releases at least every 30 day s in accordance with § 280.43(g) and be equipped with an automatic line leak detector in accordance with § 280.4 4(a) (ii) S uction piping must be monitored for releases at least every 30 day s in accordance with § 280.43(g) . No release detection is required for suction piping that meets paragraph s (b)( 1 )( ii)(A) through (E) of this section. (iii) Underground b ulk piping associated with airport hy drant fuel distribution sy stems and f ield

- constructed tanks must meet the requirements in paragraph (b)(1) of this section

. **§ 280.42 Requirements for hazardous substance UST systems.** Owners and operators of hazardous substance UST sy stems must provide containment that meets the following requirements and monitor these sy stems using § 280.43(g) at least every 30 day s : ( a ) Secondary

containment sy stems must be designed, constructed and installed to:**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

38 ( 1 ) Contain regulated substances leaked from the primary containment until they are detected and removed; ( 2 ) Prevent the release of regulated substances to the environment at an y time during the operational life of the UST sy stem ; and ( 3 ) Be checked for evidence of a release at least every 30 day s. Note to paragraph (a) : The provisions of 40 CFR 265.193 , Containment and Detection of Releases, may

be used to comply

with these requirements for tanks installed on or before [ effective date of rule ]

. ( b ) Double

- walled tanks must be designed, constructed, and installed to: ( 1 ) Contain a release from any portion of the inner tank within the outer wall; and ( 2 ) Detect the failure of the inner wall. ( c ) External liners (including vaults) must be designed, constructed, and installed to : ( 1 ) Contain 100 percent of the capacit y of the largest tank within its boundary ; ( 2 ) Prevent the interference of precipitation or ground

- water intrusion with the ability to contain or detect a release of regulated substances; and ( 3 ) Surround the tank completely (i.e., it is capable of preventing lateral as well as vertical migration of regulated substances). ( d ) Underground piping must be equipped with secondary containment that satisfies the requirements of th is section (e.g., trench liners, double

- walled pipe). In addition, underground piping that convey s regulated substances under pressure must be equipped with an automatic line leak detector in accordance with § 280.44(a). ( e ) For hazardous substance UST s ys tems installed on or before [effective date of rule ] o ther methods of release detection may be used if owners and operators: ( 1 ) Demonstrate to the implementing agency that an alternate method can detect a release of the stored substance as effectivel y as an y of the methods allowed in §§ 280.43(b) through ( i ) can detect a release of petroleum; ( 2 ) Provide information to the implementing agency on effective corrective action technologies, health risks, and chemical and phy sical properties of the stored substance, and the characteristics of the UST site; and, ( 3 ) Obtain approval from the implementing agency to use the alternate release detection method before the installation and operation of the new UST s ys tem.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

39 **§ 280.43 Methods of release detection for tanks.** Each method of release detection for tanks used to meet the requirements of § 280.41 , except field

- constructed tanks installed on or before [ effective date of rule ] with capacities greater than 50,000 gallons that meet § 280.46, must be conducted in accordance with the following: (a) Inventory control. Product inventory control (or another test of equivalent performance) must be conducted monthly to detect a release of at least 1.0 percent of flow

through plus 130 gallons on a monthly basis in the following manner: (1) Inventory

volume measurements for regulated substance inputs, withdrawals, and the amount still remaining in the tank are recorded each operating day ; (2) The equipment used is c apable of measuring the level of product over the full range of the tank's height to the nearest one

- eighth of an inch; (3) The regulated substance inputs are reconciled with delivery receipts by

measurement of the tank inventory

volume before and after delivery ; (4) Deliveries are made through a drop tube that extends to within one foot of the tank bottom; (5) Product dispensing is metered and recorded within the local standards for meter calibration or an accuracy of 6 cubic inches for every 5 gallons of product withdrawn; and (6) The measurement of any water level in the bottom of the tank is made to the nearest one - eighth of an inch at least once a month.
Note to paragraph (a) : Practices described in the American Petroleum Institute Recommended Practice RP 1621, " Bulk Liquid Stock Control at Retail Outlets " may be used, where applicable, as guidance in meeting the requirements of this paragraph. (b) Manual tank gauging. Manual tank gauging must meet the following requirements: (1) Tank liquid level measurements are taken at the beginning and ending of a period of at least 36 hours during which no liquid is added to or removed from the tank; (2) Level measurements are based on an average of two consecutive stick readings at both the beginning and ending of the period; (3) The equipment used is capable of measuring the level of product over the full range of the tank's height to the nearest one

- eighth of an inch;**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

40 (4) A release is suspected and subject to the requirements of s ubpart E if the variation between beginning and ending measurements exceeds the weekl y or monthly standards in the following table:

**Nominal T**  **ank C**  **apacity Minimum**  **D uration**  **O f**  **T est**  **Weekly S**  **tandard (**  **O ne**  **T est)**  **Monthly S**  **tandard**

**( F**  **our T**  **est A**  **verage)** 550 gallons or less 36 hours 10 gallons 5 gallons 551

- 1,000 gallons (when tank diameter is 64”) 44 hours 9 gallons 4 gallons 551

- 1,000 gallons (when tank diameter is 48”) 58 hours 12 gallons 6 gallons 551

- 1,000 gallons (also requires periodic tank tightness testing) 36 hours 13 gallons 7 gallons 1,001

- 2,000 gallons (also requires periodic tank tightness testing) 36 hours 26 gallons 13 gallons
(5) T anks of 550 gallons or less nominal capacity and tanks with a nominal capacity of 551 to 1 , 000 gallons that meet the tank diameter criteria in the table in paragraph (b)(4) of this section may

use this as the sole method of release detection. All other t anks with a nominal capacity of 551 to 2,000 gallons may use the method in place of inventory control in § 280.43(a). Tanks of greater than 2,000 gallons nominal capacity may not use this method to meet the requirements of this subpart. (c) Tank tightness testing. Tank tightness testing (or another test of equivalent performance) must be capable of detecting a 0.1 gallon per hour leak rate from any portion of the tank that routinely

contains product while accounting for the effects of thermal ex pansion or contraction of the product, vapor pockets, tank deformation, evaporation or condensation, and the location of the water table. (d) Automatic tank gauging. Equipment for automatic tank gauging that tests for the loss of product and conducts i nventory control must meet the following requirements: (1) The automatic product level monitor test can detect a 0.2 gallon per hour leak rate from an y portion of the tank that routinely contains product; and (2) The t est m ust be pe r formed with the sy stem operating in one of the following modes: (i) In

- tank static testing conducted on a periodic basis; or (ii) Continuous in

- tank leak detection operating on an uninterrupted basis or operating w ithin a process that allows the sy stem to gather incremental measurements to determine the leak status of the tank at least once every 30 day s
.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

41 (e) Vapor monitoring. Testing or monitoring for vapors within the soil gas of the excavation zone must meet the following requirements: (1) The materials used as backfill are sufficientl y porous (e.g., gravel, sand, crushed rock) to readily allow diffusion of vapors from r eleases into the excavation area; (2) The stored regulated substance, or a tracer compound placed in the tank sy stem, is sufficiently

volatile (e.g., gasoline) to result in a vapor level that is detectable by the monitoring devices located in the excavation zone in the event of a release from the tank; (3) The measurement of vapors by the monitoring device is not rendered inoperative b y the ground water, rainfall, or soil moisture or other known interferences so that a release could go undetected for more than 30 day s; (4) The level of background contamination in the excavation zone will not interfere with the method used to detect releases from the tank; (5) The vapor monitors are designed and operated to detect an y significant increase in conce ntration above background of the regulated substance stored in the tank sy stem, a component or components of that substance, or a tracer compound placed in the tank sy stem; (6) In the UST excavation zone, the site is assessed to ensure compliance with the requirements in paragraphs (e)(1) through (4) of this section and to establish the number and positioning of monitoring wells that will detect releases within the excavation zone from any portion of the tank that routinely contains product; and (7) Monitoring wells are clearl y marked and secured to avoid unauthorized access and tampering. (f) Ground

- water monitoring. Testing or monitoring for liquids on the ground water must meet the following requirements: (1) The regulated substance stored is immiscible in water and has a specific gravit y of less than one; (2) Ground water is never more than 20 feet from the ground surface and the hy draulic conductivity

of the soil(s) between the UST s ys tem and the monitoring wells or devices is no t less than 0.01 cm/sec (e.g., the soil should consist of gravels, coarse to medium sands, coarse silts or other permeable materials); (3) The slotted portion of the monitoring well casing must be designed to prevent migration of natural soils or filter pack into the well and to allow entry of regulated substance on the water table into the well under both high and low ground

- water conditions; (4) Monitoring wells shall be sealed from the ground surface to the top of the filter pack;**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

42 (5) Monitoring wells or devices intercept the excavation zone or are as close to it as is technicall y feasible; (6) The continuous monitoring devices or manual methods used can detect the presence of at least one

- eighth of an inch of free product on top of the groun d water in the monitoring wells; (7) Within and immediately below the UST s ys tem excavation zone, the site is assessed to ensure compliance with the requirements in paragraphs (f)(1) through (5) of this section and to establish the number and positioning of monitoring wells or devices that will detect releases from any portion of the tank that routinely contains product; and (8) Monitoring wells are clearl y marked and secured to avoid unauthorized access and tampering.
(g) Interstitial monitoring. In terstitial monitoring between the UST sy stem and a secondary barrier immediately

around or beneath it may be used, but only

if the sy stem is designed, constructed and installed to detect a leak from an y portion of the tank that routinely con tains product and also meets one of the following requirements: (1) For double

- walled UST sy stems, the sampling or testing method can detect a release through the inner wall in any portion of the tank that routinely contains product; (2) For UST sy stems with a secondary barrier with in the excavation zone, the sampling or testing method used can detect a release between the UST sy stem and the secondary barrier; (i) The secondary

barrier around or beneath the UST sy stem consists of artificially constructed material that is sufficien tly thick and impermeable (at least 10 - 6 cm/sec for the regulated substance stored) to direct a release to the monitoring point and permit its detection; (ii) The barrier is compatible with the regulated substance stored so that a release from the UST sy stem will not cause a deterioration of the barrier allowing a release to pass through undetected; (iii) For cathodicall y protected tanks, the secondary barrier must be installed so that it does not interfere with the pro per operation of the cathodic protection sy stem; (iv) The ground water, soil moisture, or rainfall will not render the testing or sampling method used inoperative so that a release could go undetected for more than 30 days; (v) The site is assessed t o ensure that the secondary barrier is alway s above the ground water and not in a 25

- ye ar flood plain, unless the barrier and monitoring designs are for use under such conditions; and, (vi) Monitoring wells are clearly marked and secured to avoid unauth orized access and tampering.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

43 (3) For tanks with an internall y fitted liner, an automated device can detect a release between the inner wall of the tank and the liner, and the liner is compatible with the substance stored. (4) F or UST sy stems using continuous vacuum, pressure , or liquid

- filled methods of interstitial monitoring, the method must be capable of detecting a breach in both the inner and outer walls of the tank and/or piping. ( h ) Statistical i nventory r econciliation

. Statistically based testing or monitoring methods must meet the following requirements: (1) Report a quantitative result with a calculated leak rate; (2) B e capable of detecting a leak rate of 0.2 gallon per hour ; and ( 3 ) Use a threshold that does not exceed one

- half the minimum detectible leak rate. ( i ) Other methods. An y other ty pe of release detection method, or combination of methods, can be used if: (1) It can detect a 0.2 gallon per hour leak rate or a release of 150 gallons with in a month with a probability

of detection of 0.95 and a probability of false alarm of 0.05; or (2) The implementing agency may approve another method if the owner and operator can demonstrate that the method can detect a release as effectively as any of the methods allowed in paragraphs (c) through (h) of this section. In comparing methods, the implementing agency shall consider the size of release that the method can detect and the frequency and reliability

with which it can be detected. If the method is approved, the owner and operator must comply with any conditions imposed by

the implementing agency on its use to ensure the protection of human health and the environment. **§ 280.44 Methods of release detection for piping.** Each method of release detection for piping used to meet the requirements of § 280.41 , except bulk piping that meet s § 280.47, must be conducted in accordance with the following: (a) Automatic line leak detectors. Methods which alert the operator to the presence of a leak b y restricting or shutting off the flow of regulated substances through piping or triggering an audible or visual alarm may be used onl y if they detect leaks of 3 gallons per hour at 10 pounds per square inch line pressure within 1 hour. An annual t est of the operation of the leak detector must be conducted in accordance with § 280.40(a)(3 )

. (b) Line tightness testing. A periodic test of piping may be conducted only if it can detect a 0.1 gallon per hour leak rate at one and one

- half times the operating pressure.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

44 (c) Applicable tank methods. Except as described in § 280.41(a), any of the methods in § 280.43(e) through ( i ) may be used if they

are designed to detect a release from any portion of the underground piping that routinely contains regulated substances. **§ 280.45 Release detection recordkeeping.** All UST sy stem owners and operators must maintain records in accordance with § 280.34 demonstrating compliance with all a pplicable requirements of this s ubpart. These records must include the following: (a) All written performance claims pertaining to any release detection sy stem used, and the manner in which these claims have been justified or tested b y the equipment manufacturer or installer, must be mai ntained for 5 ye ars, or for another reasonable period of time determined b y the implementing agency, from the date of installation; (b) The results of an y sampling, testing, or monitoring must be maintained for at least 1 ye ar, or for another reasonable period of time determined by the implementing agency , except as follows: ( 1 ) The results of annual operation tests conducted in accordance with § 280.40(a)(3) must be maintained for three ye ars
. At a minimum, the results must list each component tested, indicate whether each component tested meets criteria in § 280.40(a)(3) or need s to have action taken , and descri be an y action taken to correct an issue; and ( 2 ) T he results of tank tightness testing or bulk tank tightness testing conducted in accordance with § 280.43(c) or § 280.4 6 must be retained until the next test is conducted; and (c) Written documentation of all calibration, maintenance, and repair of release detection equipment permanentl y l ocated on

- site must be maintained for at least one y ear after the servicing work is completed, or for another reasonable time period determined by the implementing agency . Any schedules of required calibration and maintenance provided by the release detection equipment manufacturer must be reta ined for 5 y ears from the date of installation. **§ 280.46 Alternative methods of release detection**  **for field**
**- constructed tanks.**  Owners and operators of field

- constructed tanks with a capacity greater than 50,000 gallons may

use one or a combination of the following alternative methods of release detection: (a) Conduct an annual bulk tank tightness test that can detect a 0.5 gallon per hour leak rate; (b) Use an automatic tank gauging s ys tem to perform release detection at least every 30 day s that can detect a leak rate less than or equal to one gallon per hour. This method must be combined with a bulk tank tightness test that can detect a 0. 2 gallon per hour leak rate performed at least every

three ye ars;**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

45 (c) Use an automatic tank gauging s ys tem to perform release detection at least every 30 day s that can detect a leak rate less than or equal to two gallons per hour. This method must be combined with a bulk tank tightness test that can detect a 0. 2 gallon per hour leak rate performed at least every

two y ears ; or (d) A nother method approved by the implementing agency if the owner and operator can demonstrate that the method can detect a release as effec t ively as an y of the methods allowed in paragraph s (a) through (c) of this section

. In comparing methods, the implementing agency shall consider the size of release that the method can detect and the frequency and reliability of detection . If the method is approved, the owner and operator must compl y with any conditions imposed by

the implementing agency on its use. **§ 280.47 Alternative methods of release detection**  **for bulk piping** 
**.** Owners and operators of underground piping associated with airport h ydrant fuel distribution sy stems and field

- constructed tanks may use one or a combination of the following alternative methods of release detection: (a) Perform a semiannual or annual bulk line tightness test at or above operating pressure in accordance with the table below. Bulk piping segments ≥ 100,000 gallons not capable of meeting the maximum 3.0 gallon per hour leak rate for the semiannual test may be tested at a leak rate up to 6.0 gallons per hour according to the schedule in §280.40(c):

**Maximum Detectable Leak Rate Per Test Section Volume** 

**Test Section Volume (Gallons)**  **Semiannual Test Maximum**  **Detectable Leak Rate (Gallons Per**  **Hour) Annual**  **Test**

**Maximum Detectable Leak**  **Rate (Gallons Per Hour)**  < 50,000 1.0 0.5 ≥ 50,000 to < 75,000 1.5 0.75 ≥ 75,000 to < 100,000 2.0 1.0 ≥ 100,000 3.0 1.5 (b) Perform continuous interstitial monitoring designed to detect a release from any portion of the underground piping that routinel y contains product in accordance with §280.43(g); (c) Use an automatic line leak detector that alerts the operator to the presence of a leak b y restricting or shutting off flow of regulated substances through piping or tr iggering an audible or visual alarm. This method may be used onl y if it can detect a leak of three gallons per hour at 10 pounds per square inch line pressure within one hour or equivalent. When using this method, the following must also be met:**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

46 (1) P erform interstitial monitoring, designed to detect a release from an y portion of the underground piping that routinely contains product, in accordance with § 280.43(g) at least every three months; and (2) Conduct an annual test of the operation of the l eak detector in accordance with § 280.40(a)(3); or (d) Another method approved by the implementing agency if the owner and operator can demonstrate that the method can detect a release as effectively as any of the methods allowed in paragraphs (a) thro ugh (c) of this section. In comparing methods, the implementing agency shall consider the size of release that the method can detect and the frequency and reliability

of detection. If the method is approved, the owner and operator must compl y with any co nditions imposed by

the implementing agency on its use.

**Subpart E**
**-- Release Reporting, Investigation, and Confirmation**  **§ 280.50 Reporting of suspected releases.** Owners and operators of UST sy stems must report to the implementing agency within 24 hours, or another reasonable time period specified by the implementing agency , and follow the procedures in § 280.52 for an y of the following conditions: (a) The discovery

by owners and operators or others of released regulated substances at the UST si te or in the surrounding area (such as the presence of free product or vapors in soils, basements, sewer and utility lines, and nearby

surface water). (b) Unusual operating conditions observed by owners and operators (such as the erratic behavior of pro duct dispensing equipment, the sudden loss of product from the UST sy stem, an unexplained presence of water in the tank , or water or product in the interstitial space of secondaril y contained s ystems ), unless sy stem equipment is found to be defective but not leaking, and is immediately repaired or replaced

. (c) Monitoring results , including alarms, from a release detection method required under § 280.41 and § 280.42 that indicate a release may have occurred unless: (1) The monitoring device is found to be defective, and is immediately repaired, recalibrated or replaced, and additional monitoring does not confirm the initial result; or (2) In the case of inventory control, a second month of data does not confirm the initial result. **§ 280.51 Investigation due to off**
**- site impacts.** **Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

47 When required b y the implementing agency , owners and operators of UST sy stems must follow the procedures in § 280.52 to determine if the UST sy stem is the source of off

- site impacts. These impacts include the discovery of regulated substances (such as the presence of free product or vapors in soils, basements, sewer and utility lines, and nearby

surface and drinking waters) that has been observed b y the implementing agency or brought to its attention by an other party

. **§ 280.52 Release investigation and confirmation steps.** Unless corrective action i s initiated in accordance with s ubpart F, owners and operators must immediately

investigate and confirm all suspected releases of regulated substances requir ing reporting under § 280.50 within 7 day s, or another reasonable time period specified by the implementing agency, using either the following steps or another procedure approved b y the implementing agency : (a) System test

. Owners and operators must c onduct tests (according to the requirements for tightness testing in § 280.43(c) and § 280.44(b) or, for UST s ys tems with secondary containment and interstitial monitoring , the integrity testing specified in § 280.3 6 ) that determine whether a leak exists i n that portion of the tank that routinely contains product, the attached delivery piping, or a breach of the interst it ial space
. (1) If the s ys tem test confirms a leak, o wners and operators must repair, replace , upgrade , or close the UST s ys tem . In addition , owners and operators must begin correc tive action in accordance with s ubpart F if the test results for the sy stem, tank, or delivery piping indicate that a release exists. (2) Further investigation is not required if the test results for the s ys tem, tank, and delivery piping do not indicate that a release exists and if environmental contamination is not the basis for suspecting a release. (3) Owners and operators must conduct a site check as described in paragraph (b) of this section if the test results for the s ys tem, tank, and delivery piping do not indicate that a release exists but environmental contamination is the basis for suspe cting a release. (b) Site check. Owners and operators must measure for the presence of a release where contamination is most likely to be present at the UST site. I n selecting sample ty pes, sample locations, and measurement methods, owners and operato rs must consider the nature of the stored substance, the t yp e of initial alarm or cause for suspicion, the ty pe of backfill, the depth of ground water, and other factors appropriate for identify ing the presence and source of the release. (1) If the test results for the excavation zone or the UST site indicate that a release has occurred, owners and operators must begin correc tive action in accordance with s ubpart F; (2) If the test results for the excavation zone or the UST site do not indicate that a release has occurred, further investigation is not required.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

48 **§ 280.53 Reporting and cleanup of spills and overfills.** (a) Owners and operators of UST sy stems must contain and immediately clean up a spill or overfill and report to the implementing agen cy within 24 hours, or another reasonable time period specified b y the implementing agency , and begin correc tive action in accordance with s ubpart F in the following cases: (1) Spill or overfill of petroleum that results in a release to the environment that exceeds 25 gallons or another reasonable amount specified by the implementing agency , or that causes a sheen on nearb y surface water; and (2) Spill or overfill of a hazardous substance that results in a release to the environment that equals or ex ceeds its reportable quantity under CERCL A (40 CFR 302). (b) Owners and operators of UST sy stems must contain and immediately clean up a spill or overfill of petroleum that is less than 25 gallons or another reasonable amount specified b y the implementi ng agency , and a spill or overfill of a hazardous substance that is less than the reportable quantity . If cleanup cannot be accomplished within 24 hours, or another reasonable time period established by the implementing agency , owners and operators must im mediately notify the implementing agency

. [Note: Pursuant to 302.6 and 355.40, a release of a hazardous substance equal to or in excess of its reportable quantity must also be reported immediately (rather than within 24 hours) to the National Response Center under sections 102 and 103 of the Comprehensive Environmental Response, Compensation, and L iability Act of 1980 and to appropriate state and local authorities under Title III of the Superfund Amendments and Reauthorization Act of 1986.] **Subpart F**
**-- Release Response and Corrective Action for UST Systems Containing**  **Petroleum or Hazardous Substances § 280.60 General.**  Owners and operators of petroleum or hazardous substance UST s ys tems must, in response to a confirmed release from the UST sy stem, comply with the requirements of this subpart except for USTs excluded under § 280.10(b) and UST s ystems subject to RCRA Subtitle C corrective action requirements under section 3004(u) of the Resource Conservation and Recovery Act, as amended. **§ 280.61 I nitial response.**  Upon confirmation of a release in accordance with § 280.52 or after a release from the UST sy stem is identified in any other manner, owners and operators must perform the following initial response actions within 24 hours of a release or within another reasonable period of time determined b y the implementing agency : (a) Report the release to the implementing agency (e.g., by telephone or electronic mail);**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

49 (b) Take immediate action to prevent an y further release of the regulated subs tance into the environment; and (c) Identify

and mitigate fire, explosion, and vapor hazards. **§ 280.62 Initial abatement measures and site check.** (a) Unless directed to do otherwise b y the implementing agency , owners and operators must perform the following abatement measures: (1) Remove as much of the regulated substance from the UST sy stem as is necessary to prevent further release to the environment; (2) Visuall y inspect an y aboveground releases or exposed belowground releases and prevent further migration of the released substance into surrounding soils and ground water; (3) Continue to monitor and mitigate an y additional fire and safet y hazards posed by vapors or free product that have migrated from the UST excavation zone and entered into subsurface structures (such as sewers or basements); (4) Remed y hazards posed by contaminated soils that are excavated or exposed as a result of release confirmation, site investigation, abatement, or corrective action activities. I f these remedie s include treatment or disposal of soils, the owner and operator must comply with applicable state and local requirements; (5) Measure for the presence of a release where contamination is most likely to be present at the UST site, unless the presence an d source of the release have been confirmed in accordance with the site check required by § 280.52(b) or the closure site assessment of § 280.72(a). In selecting sample t ypes, sample locations, and measurement methods, the owner and operator must consider the nature of the stored substance, the ty pe of backfill, depth to ground water and other factors as appropriate for identify ing the presence and source of the release; and (6) Investigate to determine the possible presence of free product, and begin f ree product removal as soon as practicable and in accordance with § 280.64. (b) Within 20 day s after release confirmation, or within another reasonable period of time determined b y the implementing agency , owners and operators must submit a report to the implementing agency

summarizing the initial abatement steps taken under paragraph (a) of this section and an y resulting information or data.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

50 **§ 280.63 Initial site characterization.** (a) Unless directed to do otherwise b y the implementing agency , o wners and operators must assemble information about the site and the nature of the release, including information gained while confirming the release or completing the initial abatement measures in § 280.60 and § 280.61. This information must include, but is not necessaril y limited to the following: (1) Data on the nature and estimated quantity of release; (2) Data from available sources and/or site investigations concerning the following factors: surrounding populations, water qualit y, use and appr oximate locations of wells potentially

affected by

the release, subsurface soil conditions, locations of subsurface sewers, climatological conditions, and land use; (3) Results of the site check required under § 280.62(a)(5); and (4) Results of the f

ree product investigations required under § 280.62(a)(6), to be used by owners and operators to determine whether free product must be recovered under § 280.64. (b) Within 45 day s of release confirmation or another reasonable period of time determined b y the implementing agency , owners and operators must submit the information collected in compliance with paragraph (a) of this section to the implementing agency in a manner that demonstrates its applicability and technical adequacy , or in a format and acc ording to the schedule required by the implementing agency

. **§ 280.64 Free product removal**

. At sites where investigations under § 280.62(a)(6) indicate the presence of free product, owners and operators must remove free product to the maximum extent pra cticable as determined b y the implementing agency while continuing, as necessary , any actions initiated under §§ 280.61 through 280.63, or preparing for actions required under §§ 280.65 through 280.66. I n meeting the requirements of this section, owners and operators must: (a) Conduct free product removal in a manner that minimizes the spread of contamination into previously

uncontaminated zones by using recovery

and disposal techniques appropriate to the hy drogeologic conditions at the site, and that p roperl y treats, discharges or disposes of recovery by products in compliance with applicable local, state and federal regulations; (b) Use abatement of free product migration as a minimum objective for the design of the free product removal sy stem; (c) Handle an y flammable products in a safe and competent manner to prevent fires or explosions; and**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

51 (d) Unless directed to do otherwise b y the implementing agency , prepare and submit to the implementing agency, within 45 day s after confirming a release, a free product removal report that provides at least the following information: (1) The name of the person(s) responsible for implementing the free product removal measures; (2) The estimated quantity , t ype, and thickness of free product observed or measured in wells, boreholes, and excavations; (3) The t ype of free product recovery s ys tem used; (4) Whether an y discharge will take place on

- site or off

- site during the recovery

operation and where this discharge will be located; (5) The t ype o f treatment applied to, and the effluent quality expected from, any discharge; (6) The steps that have been or are being taken to obtain necessary permits for any discharge; and (7) The disposition of the recovered free product. **§ 280.65 Investiga tions for soil and ground** 
**- water cleanup.**  (a) In order to determine the full extent and location of soils contaminated by the release and the presence and concentrations of dissolved product contamination in the ground water, owners and operators must con duct investigations of the release, the release site, and the surrounding area possibly affected b y the release if any of the following conditions exist: (1) There is evidence that ground

- water wells have been affected b y the release (e.g., as found dur ing release confirmation or previous corrective action measures); (2) Free product is found to need recovery in compliance with § 280.64; (3) There is evidence that contaminated soils may be in contact with ground water (e.g., as found during conduct of the initial response measures or investigations required under §§ 280.60 through 280.64); and (4) The implementing agency requests an investigation, based on the potential effects of contaminated soil or ground water on nearb y surface water and ground

- water resources. (b) Owners and operators must submit the information collected under paragraph (a) of this section as soon as practicable or in accordance with a schedule established by the implementing agency

.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

52 **§ 280.66 Corrective action pl an.**  (a) At an y point after reviewing the information submitted in compliance with § 280.61 through § 280.63, the implementing agency may require owners and operators to submit additional information or to develop and submit a corrective action plan for responding to contaminated soils and ground water. If a plan is required, owners and operators must submit the plan according to a schedule and format established by the implementing agency . Alternatively , owners and operators may , after fulfilling the r equirements of § 280.61 through § 280.63, choose to submit a corrective action plan for responding to contaminated soil and ground water. In either case, owners and operators are responsible for submitting a plan that provides for adequate protection of human health and the environment as determined by the implementing agency , and must modify

their plan as necessary

to meet this standard. (b) The implementing agency will approve the corrective action plan only after ensuring that implementation of the p lan will adequately protect human health, safety , and the environment. In making this determination, the implementing agency should consider the following factors as appropriate: (1) The ph ys ical and chemical characteristics of the regulated substance, including its toxicity , persistence, and potential for migration; (2) The h ydrogeologic characteristics of the facility and the surrounding area; (3) The proximity , quality , and current and future uses of nearby surface water and ground water; (4) The potential effects of residual contamination on nearby surface water and ground water; (5) An exposure assessment; and (6) An y information assembled in compliance with this subpart. (c) Upon approval of the corrective action plan or as directed b y the implementing agency , owners and operators must implement the plan, including modifications to the plan made by the implementing agency . They must monitor, evaluate, and report the results of implementing the plan in accordance with a schedule and in a format established by the implementing agency

. (d) Owners and operators may , in the interest of minimizing environmental contamination and promoting more effective cleanup, begin cleanup of soil and ground water before the corrective action plan is approved provided that they : (1) Notify

the implementing agency of their intention to begin cleanup;**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

53 (2) Comply

with an y conditions imposed by the implementing agency , including halting cleanup or mitigating adverse consequences from cleanu p activities; and (3) Incorporate these self

- initiated cleanup measures in the corrective action plan that is submitted to the implementing agency for approval. **§ 280.67 Public participation.** (a) For each confirmed release that requires a correctiv e action plan, the implementing agency must provide notice to the public by means designed to reach those members of the public directly

affected by

the release and the planned corrective action. This notice may include, but is not limited to, public noti ce in local newspapers, block advertisements, public service announcements, publication in a state register, letters to individual households, or personal contacts by

field staff. (b) The implementing agency must ensure that site release information and decisions concerning the corrective action plan are made available to the public for inspection upon request. (c) Before approving a corrective action plan, the implementing agency may hold a public meeting to consider comments on the proposed correctiv e action plan if there is sufficient public interest, or for an y other reason. (d) The implementing agency must give public notice that complies with paragraph (a) of this section if implementation of an approved corrective action plan does not achieve the established cleanup levels in the plan and termination of that plan is under consideration by the implementing agency

. **Subpart G**
**-- Out** 
**- of** 

**- Service UST Systems and Closure**  **§ 280.70 Temporary closure.** (a) When an UST s ys tem is temporarily closed, owners and operators must continue operation and maintenance of corrosion protection in accordance with § 280.31, and an y releas e detection in accordance with s ubpart D. Subparts E and F must be complied with if a release is suspected or confirmed. Howev er, release detection is not required as long as the UST sy stem is empty . The UST sy stem is empty when all materials have been removed using commonly employ ed practices so that no more than 2.5 centimeters (one inch) of residue, or 0.3 percent b y weight o f the total capacity of the UST sy stem, remain in the sy stem. (b) When an UST s ys tem is temporarily closed for 3 months or more, owners and operators must also comply with the following requirements: (1) Leave vent lines open and functioning; and ( 2) Cap and secure all other lines, pumps, manways, and ancillary equipment.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

54 (c) When an UST s ys tem is temporarily closed for more than 12 months, owners and operators must permanently close the UST s ys tem if it does not meet either performance standard s in § 280.20 for new UST sy stems or the upgrading requirements in § 280.21, except that the spill and overfill equipment requirements do not have to be met. Owners and operators must permanently

close the substandard UST s ys tems at the end of this 12

- mon th period in accordance with §§ 280.71

- 280.74, unless the implementing agency provides an extension of the 12

- month temporary

closure period. Owners and operators must complete a site assessment in accordance with § 280.72 before such an extension can be applied for. **§ 280.71 Permanent closure and changes** 
**- in** 
**- service.**  (a) At least 30 day s before beginning either permanent closure or a change

- in

- service under paragraphs (b) and (c) of this section, or within another reasonable time period determined by the implementing agency , owners and operators must notify the implementing agency of their intent to permanently

close or make the change

- in

- service, unless such action is in response to corrective action. The required assessment of the excavation zone un der § 280.72 must be performed after notifying the implementing agency but before completion of the permanent closure or a change

- in

- service. (b) To permanentl y close a tank, owners and operators must empty and clean it by removing all liquids and accumulated sludges. All tanks taken out of service permanentl y must also be either removed from the ground or filled it with an inert solid material. (c) Continued use of an UST sy stem to store a non

- regulated substance is considered a change

- in

- service. Before a change

- in

- service, owners and operators must empty and clean the tank by removing all liquid and accumulated sludge and conduct a site assessment in accordance with § 280.72. [Note: The following cleaning and closure procedures may be used to comply

with this section: (A) American Petroleum I nstitute Recommended Practice RP 1604, " Closure of Underground Petroleum Storage Tanks"; (B) American Petroleum Institute Standard 2015, " Requirements for Safe Entry and Cleaning of Petroleum Storage Tanks"; (C) American Petroleum Institute Recommended Practice 201 6 , " Guidelines and Procedures fo r Ent ering and Cleaning Petroleum Storage Tanks"; ( D ) American Petroleum I nstitute Recommended Practice RP 1631, "Interior L ining and Periodic Inspection of Underground Storage Tanks," may be used as guidance for compliance with this section;**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

55 (E) National Fire Protection Association Standard 326, “Safeguarding of Tanks and Containers for Entry , Cleaning, or Repair”; and ( F ) The National Institute for Occupational Safety and Health Publication 80

- 106, "Criteria for a Recommended Standard...W orking in Confined Space" may be used as guidance for conducting safe closure procedures at some hazardous substance tanks.] **§ 280.72 Assessing the site at closure or change** 
**- in** 
**- service.**  (a) Before permanent closure or a change

- in

- service is completed, owners and operators must measure for the presence of a release where contamination is most likely to be present at the UST site. I n selecting sample t ypes, sample locations, and measurement methods, owners and operators must consider the method of closure, the nature of the stored substance, the t ype of backfill, the depth to ground water, and other factors appropriate for identify ing the presence of a release. The requirements of this section are satisfied if one of the external release detection metho ds allowed in § 280.43(e) and (f) is operating in accordance with the requirements in § 280.43 at the time of closure, and indicates no release has occurred. (b) If contaminated soils, contaminated ground water, or free product as a liquid or vapor is d iscovered under paragraph (a) of this section, or by any other manner, owners and operators must begin correc tive action in accordance with s ubpart F. **§ 280.73 Applicability to previously closed UST systems.**  When directed b y the implementing agency , the owner and operator of an UST sy stem permanentl y closed before December 22, 1988 must assess the excavation zone and close the UST sy stem in accordance with this s ubpart if releases from the UST may , in the judgment of the implementing agency , pose a current or potential threat to human health and the environment. **§ 280.74 Closure records.**  Owners and operators must maintain records in accordance with § 280.34 that are capable of demonstrating compliance with c losure requirements under this s ubpart. The results of the excavation zone assessment required in § 280.72 must be maintained for at least 3 y ears after completion of permanent closure or change

- in

- service in one of the following way s: (a) By the owners and operators who took the UST sy stem out of service; (b) By the current owners and operators of the UST sy stem site; or (c) By mailing these records to the implementing agency if they cannot be maintained at the closed facility

. **Subpart H**

**– -**  **Financial Responsibility Draft Internal EPA Document Do Not Cite, Quote or Distribute** 

**October 2011**

56 **§ 280.90 Applicability.** (a) This subpart applies to owners and operators of all petroleum underground storage tank (UST) s ys tems except as otherwise provided in this section. (b) Owners and operators of petroleum UST s ys tems are subject to these requirements in accordance with § 280.91. (c) State and Federal government entities whose debts and liabilities are the debts and liabilities of a state or the United States are exempt from the requirements of this subpart. (d) The requirements of this subpart do not apply to owners and operator s of any UST sy stem described in § 280.10 (b) , (c)(2) or (c) (3)

. (e) If the owner and operator of a petroleum underground storage tank are separate persons, only

one person is required to demonstrate financial responsibility ; however, both parties are li able in event of noncompliance. **§ 280.91 Compliance dates.** Owners of petroleum undergr ound storage tanks must comply with the requirements of this subpart

. Previously

deferred UST s ys tems must comply with the requirements of this s ubpart according to the schedule in § 280.10.
**§ 280.92 Definition of terms.** When used in this subpart, the following terms shall have the meanings given below: Accidental release means any sudden or nonsudden release of petroleum arising from operating an underground storage tank that results in a need for corrective action and/or compensation for bodil y injury or propert y damage neither expected nor intended b y the tank owner or operator. Bodily injury shall have the meaning given to this term by applicable state law; however, this term shall not include those liabilities which, consistent with standard insurance industry practices, are excluded from coverage in liability insurance policies for bodily injury

. Chief Financial Officer , in the case of local government owners and operators, means the individual with the overall authority and responsibility

for the collection, disbursement, and use of funds b y the local government. Controlling interest means direct ownership of at least 50 percent of the voting stock of another entit y.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

57 Director of the Implementing Agency means the EPA Regional Administrator, or, in the case of a state with a program approved under section 9004, the Director of the designated state or local agency

responsible for carry ing out an approved UST program. Financial reporting year means the latest consecutive twelve

- month period for wh ich an y of the following reports used to support a financial test is prepared: (1) a 10

- K report submitted to the SEC; (2) an annual report of tangible net worth submitted to Dun and Bradstreet; or (3) annual reports submitted to the Energy I nformation Administration or the Rural Utilities Service

. “Financial reporting ye ar” may thus comprise a fiscal or a calendar ye ar period. Legal defense cost is an y expense that an owner or operator or provider of financial assurance incurs in defending against claims or actions brought, (1) By EPA or a state to require corrective action or to recover the costs of corrective action; (2) By

or on behalf of a third part y for bodil y injury or property damage caused by an accidental release; or (3) By any person to enforce the terms of a financial assurance mechanism. Local government shall have the meaning given this term by applicable state law and includes Indian tribes. The term is generally intended to include: (1) Counties, municipalities, townships, separatel y chartered and operated special districts (including local government public transit sy stems and redevelopment authorities), and independent schoo l districts authorized as governmental bodies b y state charter or constitution; and (2) Special districts and independent school districts established by counties, municipalities, townships, and other general purpose governments to provide essential servic es. Occurrence means an accident, including continuous or repeated exposure to conditions, which results in a release from an underground storage tank. Note: This definition is intended to assist in the understanding of these regulations and is not intended either to limit the meaning of “occurrence” in a way that conflicts with standard insurance usage or to prevent the use of other standard insurance terms in place of “occurrence.” Owner or operator , when the owner or operator are separate partie s, refers to the party that is obtaining or has obtained financial assurances. Petroleum marketing facilities include all facilities at which petroleum is produced or refined and all facilities from which petroleum is sold or transferred to other petrole um marketers or to the public.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

58 Petroleum marketing firms are all firms owning petroleum marketing facilities. Firms owning other ty

pes of facilities with USTs as well as petroleum marketing facilities are considered to be petroleum marketing firms.
Pro perty damage shall have the meaning given this term by applicable state law. This term shall not include those liabilities which, consistent with standard insurance industry practices, are excluded from coverage in liability insurance policies for property damage. However, such exclusions for property damage shall not include corrective action associated with releases from tanks which are covered b y the policy. Provider of financial assurance means an entity that provides financial assurance to an owner or operator of an underground storage tank through one of the mechanisms listed in §§ 280.95

- 280.10 7 , including a guarantor, insurer, risk retention group, suret y, issuer of a letter of credit , issuer of a state

- required mechanism, or a state. Substantial business relationship means the extent of a business relationship necessary under applicable state law to make a guarantee contract issued incident to that relationship valid and enforceable . A guarantee contract is issued “incident to that relationship” if it arises from and depends on existing economic transactions between the guarantor and the owner or operator. Substantial governmental relationship means the extent of a governmental rel ationship necessary under applicable state law to make an added guarantee contract issued incident to that relationship valid and enforceable. A guarantee contract is issued “incident to that relationship” if it arises from a clear commonality of interest in the event of an UST release such as coterminous boundaries, overlapping constituencies, common ground

- water aquifer, or other relationship other than monetary compensation that provides a motivation for the guarantor to provide a guarantee. Tangible n et worth means the tangible assets that remain after deducting liabilities; such assets do not include intangibles such as goodwill and rights to patents or roy alties. For purposes of this definition, “assets” means all existing and all probable future eco nomic benefits obtained or controlled b y a particular entity as a result of past transactions.
Termination under § 280.97(b)(1) and § 280.97(b)(2) means onl y those changes that could result in a gap in coverage as where the insured has not obtained subst itute coverage or has obtained substitute coverage with a different retroactive date than the retroactive date of the original policy

. **§ 280.93 Amount and scope of required financial responsibility.**  (a) Owners or operators of petroleum underground storage tanks must demonstrate financial responsibility

for taking corrective action and for compensating third parties for bodil y injury and propert y damag e caused b y accidental releases arising from the operation of petroleum underground storage tanks in at least the following per

- occurrence amounts:**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

59 (1) For owners or operators of petroleum underground storage tanks that are located at petroleum marketing facilities, or that handle an average of more than 10,000 gallons of petroleum per month based on annual throughput for the previous calendar y ear; $1 million. (2) For all other owners or operators of petroleum underground storage tanks; $500,000. (b) Owners or operators of petroleum underground storage tanks must demonstrate financial responsibility

for taking corrective action and for compensating third parties for bodil y injury and propert y damage caused b y accidental releases arising from the operation of petroleum underground storage tanks in at least the following annual aggregate amounts: (1) For owners or operators of 1 to 100 petroleum underground storage tanks, $1 million; and (2) For owners or operators of 101 or more petroleum undergroun d storage tanks, $2 million. (c) For the purposes of paragraphs (b) and (f) of this section, only , “a petroleum underground storage tank” means a single containment unit and does not mean combinations of single containment units. (d) Except as provided in paragraph (e) of this section, if the owner or operator uses separate mechanisms or separate combinations of mechanisms to demonstrate financial responsibility

for: (1) Taking corrective action; (2) Compensating third parties for bodil y injury and propert y damage caused by sudden accidental releases; or (3) Compensating third parties for bodil y injury and propert y damage caused by nonsudden accidental releases, the amount of assurance provided b y each mechanism or combination of mechanisms must be in the full amount specified in paragraphs (a) and (b) of this section. (e) If an owner or operator uses separate mechanisms or separate combinations of mechanisms to demonstrate financial responsibility for different petroleum underground storage tanks , the annual aggregate required shall be based on the number of tanks covered b y each such separate mechanism or combination of mechanisms. (f) Owners or operators shall review the amount of aggregate assurance provided whenever additional petroleum unde rground storage tanks are acquired or installed. If the number of petroleum underground storage tanks for which assurance must be provided exceeds 100, the owner or operator shall demonstrate financial responsibility in the amount of at least $2 million of annual aggregate assurance b y the anniversary of the date on which the mechanism demonstrating financial responsibility became effective. If assurance is being demonstrated by a**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

60 combination of mechanisms, the owner or operator shall demonstrate financial responsibility in the amount of at least $2 million of annual aggregate assurance b y the first

- occurring effective date anniversary

of any one of the mechanisms combined (other than a financial test or guarantee) to provide assurance. (g) The amounts of assurance required under this section exclude legal defense costs. (h) The required per

- occurrence and annual aggregate coverage amounts do not in any way limit the liability

of the owner or operator. **§ 280.94 Allowable mechanisms and combinations of mechanisms.**  (a) Subject to the limitations of paragraphs (b) and (c) of this section, (1) An owner or operator, including a local government owner or operator, may use an y one or combination of the mechanisms listed in §§ 280.95 through 280.10 7 to demonstrate financial responsibility

under this subpart for one or more underground storage tanks, and (2) A local government owner or operator may use any one or combination of the mechanisms listed in §§ 280.104 through 28 0.107 to demonstrate financial responsibility under this subpart for one or more underground storage tanks. (b) An owner or operator may use a guarantee under § 280.96 or surety bond under § 280.98 to establish financial responsibility onl y if the Attorn ey (s) General of the state(s) in which the underground storage tanks are located has (have) submitted a written statement to the implementing agency

that a guarantee or suret y bond executed as described in this section is a legally valid and enforceable ob ligation in that state. (c) An owner or operator may use self

- insurance in combination with a guarantee onl y if, for the purpose of meeting the requirements of the financial test under this rule, the financial statements of the owner or operator are not consolidated with the financial statements of the guarantor.
**§ 280.95 Financial test of self**
**- insurance.**  (a) An owner or operator, and/or guarantor, may satisfy the requirements of § 280.93 by passing a financial test as specified in this section. To pass the financial test of self

- insurance, the owner or operator, and/or guarantor must meet the criteria of paragraph (b) or (c) of this section based on year - end financial statements fo r the latest completed fiscal ye ar. (b)(1) The owner or operator, and/or guarantor, must have a tangible net worth of at least ten times: (i) The total of the applicable aggregate amount required by § 280.93, based on the number of underground storage tanks for which a financial test is used to demonstrate financial**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

61 responsibility

to EPA under this section or to a state implementing agency under a state program approved b y EPA under 40 CFR part 281; (ii) The sum of the corrective action cost estimates, the current closure and post

- closure care cost estimates, and amount of liability coverage for which a financial test is used to demonstrate financial responsibility to EPA under 40 CFR 264.101, 264.143 , 264.145, 265.143, 2 65.145, 264.147, and 265.147 or to a state implementing agency under a state program authorized by

EPA under 40 CFR part 271; and (iii) The sum of current plugging and abandonment cost estimates for which a financial test is used to demonstrate financial responsibility to EPA under 40 CFR 144.63 or to a state implementing agency

under a state program authorized by EPA under 40 CFR part 145. (2) The owner or operator, and/or guarantor, must have a tangible net worth of at least $10 million. (3) The owner or operator, and/or guarantor, must have a letter signed b y the chief financial officer worded as specified in paragraph (d) of this section. (4) The owner or operator, and/or guarantor, must either: (i ) File financial statements annually with the U.S. Securities and Exchange Commission, the Energy

I nformation Administration, or the Rural Utilities Service ; or (ii) Report annuall y the firm's tangible net worth to Dun and Bradstreet, and Dun and Bradstreet must have assigned the firm a financial strength rating of 4A or 5A. (5) The firm's ye ar - end financial statements, if independentl y audited, cannot include an adverse auditor's opinion, a disclaimer of opin ion, or a “going concern” qualification. (c)(1) The owner or operator, and/or guarantor must meet the financial test requirements of 40 CFR 264.147(f)(1), substituting the appropriate amounts specified in § 280.93 (b)(1) and (b)(2) for the “amount of liability coverage” each time specified in that section. (2) The fiscal year - end financial statements of the owner or operator, and/or guarantor, must be examined by

an independent certified public accountant and be accompanied by the accountant's r eport of the examination. (3) The firm's ye ar - end financial statements cannot include an adverse auditor's opinion, a disclaimer of opinion, or a “going concern” qualification. (4) The owner or operator, and/or guarantor, must have a letter signed b y the chief financial officer, worded as specified in paragraph (d) of this section. (5) If the financial statements of the owner or operator, and/or guarantor, are not submitted annually

to the U.S. Securities and Exchange Commission, the En ergy I nformation**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

62 Administration or the Rural Utilities Service , the owner or operator, and/or guarantor, must obtain a special report b y an independent certified public accountant stating that: (i) He has compared the data that the letter fro m the chief financial officer specifies as having been derived from the latest y ear - end financial statements of the owner or operator, and/or guarantor, with the amounts in such financial statements; and (ii) I n connec tion with that comparison, no matters came to his attention which caused him to believe that the specified data should be adjusted. (d) To demonstrate that it meets the financial test under paragraph (b) or (c) of this section, the chief financial of ficer of the owner or operator, or guarantor, must sign, within 120 day s of the close of each financial reporting y ear, as defined by the twelve

- month period for which financial statements used to support the financial test are prepared, a letter worded ex actly as follows, except that the instructions in brackets are to be replaced b y the relevant information and the brackets deleted:

Letter from Chief Financial Officer
I am the chief financial officer of [insert: name and address of the owner or operator, or guarantor]. This letter is in support of the use of [insert: “the financial test of self

- insurance,” and/or “guarantee”] to demonstrate financial responsibility for [insert: “taking corrective action” and/or “compensating third parties for bodily injury and propert y damage”] caused b y [insert:

“ sudden accident al releases” or “nonsudden accident al releases” or “accidental releases” ] in the amount of at least [insert: dollar amount] per occurrence and [insert: dollar amount] annual aggregate arising from operating (an) underground storage tank(s). Underground storage tanks at the following facilities are assured b y this financial test or a financial test under an authorized State program by this [insert: “owner or operator,” and/or “guarantor”]: [L ist for each facilit y: the name and address of the facilit y where tanks assured b y this financial test are located, and whether tanks are assured b y this financia l test or a financial test under a State program approved under 40 CFR part 281. If separate mechanisms or combinations of mechanisms are being used to assure an y of the tanks at this facility, list each tank assured b y this financial test or a financial t est under a State program authorized under 40 CFR part 281 b y the tank identification number provided in the notification submitted pursuant to 40 CFR 280.22 or the corresponding State requirements.] A [insert: “financial test,” and/or “guarantee”] is also used by this [insert: “owner or operator,” or “guarantor”] to demonstrate evidence of financial responsibility in the following amounts under other EPA regulations or state programs authorized by EPA under 40 CFR parts 271 and 145:
EPA Regulations Amount Closure (§§ 264.143 and 265.143)............

................ .. $

______ Post

- Closure Care (§§ 264.145 and 265.145).....

......... $

______ Liability Coverage (§§ 264.147 and 265.147)

......... .. $

_____ _**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

63 Corrective Action (§§ 264.101(b))..............

................ $

______ Plugging and Abandonment (§ 144.63).........

........... ... $

______ Closure......................................

................................. .. $

______ Post

- Closure Care..............................

.......................... $

______ Liability Coverage...

................................................... $

______ Corrective Action..................

...................................... $

______ Plugging and A bandonme nt........................................ $

______ Total.............

........................................................... $

______ This [insert: “owner or operator,” or “guarantor”] has not received an adverse opinion, a disclaimer of opinion, or a “going concern” qualification from an independent auditor on his financial statements for the latest completed fiscal y ear. [Fill in the information for Alternative I if the criteria of paragraph (b) of § 280.95 are being used to demon strate compliance with the financial test requirements. Fill in the information for Alternative II if the criteria of paragraph (c) of § 280.95 are being used to demonstrate compliance with the financial test requirements.]

A lternative I 1. Amount of annual UST aggregate coverage being $

______ assured b y a financial test, and/or guarantee 2. Amount of corrective action, closure and post

- $

______ closure care costs, liability coverage, and plugging and abandonment costs covered b y a financial test, and/or guarantee 3. Sum of lines 1 and 2 $

______ 4. Total tangible assets $

______ 5. Total liabilities [if any of the amount reported $

______ on line 3 is included in total liabilities, y ou may deduct that amount from this line and add that amount to line 6] 6. Tangible net worth [subtract line 5 from line 4] $

______ Yes No 7. Is line 6 at least $10 million?
___ __ 8. Is line 6 at least 10 times line 3?
___ __ 9. Have financial statements for the latest fiscal
___ __ ye ar been filed with the Securities and Exchange Commission? 10. Have financial statements for the latest fiscal
___ __ ye ar been filed with the Energy I nformation Administration? 11. Have financial statements for the la test ___ __ fiscal year been filed with the Rural Utilities Service ? 12. Has financial information been provided to Dun
___ __**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

64 and Bradstreet, and has Dun and Bradstreet provided a financial strength rating of 4A or 5A? [Answer “Yes” only if both criteria have been met.]

Alternative II 1. Amount of annual UST aggregate coverage being $

______ assured b y a test, and/or guarantee 2. Amount of corrective actio n, closure and post

- $

______ c losure care costs, liability coverage, and plugging and abandonment costs covered b y a f inancial test, and/or guarantee 3. Sum of lines 1 and 2 $

______ 4. Total tangible assets $

______ 5. Total liabilities [if any of the amount $

______ reported on line 3 is included in total liabilities, y ou may

deduct that amount from this line and add that amount to line 6] 6. Tangible net worth [subtract line 5 from line 4] $

______ 7. Total assets in the U.S. [required only if less $

______ than 90 percent of assets are located in the U.S.]
Yes No 8. Is line 6 at least $10 million?
___ __ 9. Is line 6 at least 6 times line 3?
___ __ 10. Are at least 90 percent of assets located in
___ __ the U.S.? [I f “No,” complete line 11.] 11. I s line 7 at least 6 times line 3?
___ __ [Fill in either lines 12

- 15 or lines 16

- 18:] 12. Current assets $

______ 13. Current liabilities $

______ 14. Net working capital [subtract line 13 from line 12] $

______ Yes No 15. I s line 14 at least 6 times line 3?
___ __ 16. Current bond rating of most recent bond issue
___ __ 17. Name of rating service
___ __ 18. Date of maturit y of bond
___ __ 19. Have financial statements for the latest fiscal
___ __ ye ar been filed with the SEC, the Energy In formation Administration, or the Rural Utilities Service ?**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

65 [I f “No,” please attach a report from an independent cert ified public accountant certify ing that there are no material differences between the data as reported in lines 4

- 18 above and the financial statements for the latest fiscal ye ar.] [For both Alternative I and Alternative II complete the certification w ith this statement.] I hereb y certify

that the wording of this letter is identical to the wording specified in 40 CFR part 280.95(d) as such regulations were constituted on the date shown immediatel y below. [Signature] [Name] [Title] [Date] (e) If an owner or operator using the test to provide financial assurance finds that he or she no longer meets the requirements of the financial test based on the y ear - end financial statements, the owner or operator must obtain alternative cov erage within 150 day s of the end of the y ear for which financial statements have been prepared. (f) The Director of the implementing agency may require reports of financial condition at any time from the owner or operator, and/or guarantor. If the Di rector finds, on the basis of such reports or other information, that the owner or operator, and/or guarantor, no longer meets the financial test requirements of § 280.95(b) or (c) and (d), the owner or operator must obtain alternate coverage within 30 day s after notification of such a finding. (g) If the owner or operator fails to obtain alternate assurance within 150 day s of finding that he or she no longer meets the requirements of the financial test based on the y ear - end financial statements, or w ithin 30 day s of notification by the Director of the implementing agency that he or she no longer meets the requirements of the financial test, the owner or operator must notify

the Director of such failure within 10 day s. **§ 280.96 Guarantee.** (a) An ow ner or operator may satisfy the requirements of § 280.93 by obtaining a guarantee that conforms to the requirements of this section. The guarantor must be: (1) A firm that (i) possesses a controlling interest in the owner or operator; (ii) possesses a controlling interest in a firm described under paragraph (a)(1)(i) of this section; or, (iii) is controlled through stock ownership b y a common parent firm that possesses a controlling interest in the owner or operator; or, (2) A firm engaged in a substantial business relationship with the owner or operator and issuing the guarantee as an act incident to that business relationship. (b) Within 120 day s of the close of each financial reporting y ear the guarantor must demonstrate that it meets th e financial test criteria of § 280.95 based on ye ar - end financial statements for the latest completed financial reporting ye ar b y completing the letter from the chief financial officer described in § 280.95(d) and must deliver the letter to the owner or**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

66 op erator. If the guarantor fails to meet the requirements of the financial test at the end of an y financial reporting ye ar, within 120 day s of the end of that financial reporting y ear the guarantor shall send by

certified mail, before cancellation or nonrene wal of the guarantee, notice to the owner or operator. If the Director of the implementing agency notifies the guarantor that he no longer meets the requirements of the financial test of § 280.95 (b) or (c) and (d), the guarantor must notify

the owner or o perator within 10 day s of receiving such notification from the Director. In both cases, the guarantee will terminate no less than 120 day s after the date the owner or operator receives the notification, as evidenced b y the return receipt. The owner or oper ator must obtain alternative coverage as specified in § 280.11 4 ( e ). (c) The guarantee must be worded as follows, except that instructions in brackets are to be replaced with the relevant information and the brackets deleted:

Guarantee Guarantee made this [date] by [name of guaranteeing entity ], a business entity organized under the laws of the state of [name of state], herein referred to as guarantor, to [the state implementing agency ] and to any

and all third p arties, and obligees, on behalf of [owner or operator] of [business address]. Recitals. (1) Guarantor meets or exceeds the financial test criteria of 40 CFR 280.95 (b) or (c) and (d) and agrees to compl y with the requi rements for guarantors as specified in 40 CFR 280.96(b). (2) [Owner or operator] owns or operates the following underground storage tank(s) covered by this guarantee: [L ist the number of tanks at each facilit y and the name(s) and address(es) of the facility (ies) where the tanks are located. If more than one instrument is used to assure different tanks at an y one facility, for each tank covered b y this instrument, list the tank identification number provided in the notification submitted pursuant to 4 0 CFR 280.22 or the corresponding state requirement, and the name and address of the facility .] This guarantee satisfies 40 CFR part 280, subpart H requirements for assuring funding for [insert: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage caused b y” either “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases”; if coverage is different for different tanks or locations, indicate the ty pe of coverage applicable to each t ank or location] arising from operating the above

- identified underground storage tank(s) in the amount of [insert dollar amount] per occurrence and [insert dollar amount] annual aggregate. (3) [I nsert appropriate phrase: “On behalf of our subsidiary ” ( if guarantor is corporate parent of the owner or operator); “On behalf of our affiliate” (if guarantor is a related firm of the owner or operator); or “Incident to our business relationship with” (if guarantor is providing the guarantee as an incident to a substantial business relationship with owner or operator)] [owner or operator], guarantor guarantees to [implementing agency ] and to any and all third parties that: Inthe event that [owner or operator] fails to provide alternative coverage within 60 day s after receipt of a notice of cancellation of this guarantee and the [Director of the implementing agency ] has determined or suspects that a release has occurred at an underground storage tank covered b y this guarantee, the guarantor, upon instructions from the [Director], shall fund a**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

67 standby trust fund in accordance with the provisions of 40 CFR 280.1 12 , in an amount not to exceed the coverage limits specified above. Inthe event that the [Director] determines that [owner or operator] has failed to perform corrective action for releases arising out of the operation of the above

- identified tank(s) in accordance with 40 CFR part 280, subpart F, the guarantor upon written instructions from the [Director] shall fund a standby trust in accordance with the provisions of 40 CFR 280.1 12 , in an amount not to exceed the coverage limits specified above. If [owner or operator] fails to satisfy a judgment or award based on a determination of liability for bodily injury or property

damage to third parties caused b y [“sudden” and/or “nonsudden”] accident al releases arising from the operation of the above

- identified tank(s), or fails to pay an amount agreed to in settlement of a claim arising from or alleged to arise from such injury or damage, the guaranto r, upon written instructions from the [Director], shall fund a standby trust in accordance with the provisions of 40 CFR 280.1 12 to satisfy such judgment(s), award(s), or settlement agreement(s) up to the limits of coverage specified above. (4) Guarantor agrees that if, at the end of any fiscal y ear before cancellation of this guarantee, the guarantor fails to meet the financial test criteria of 40 CFR 280.95 (b) or (c) and (d), guarantor shall send within 120 day s of such failure, by certified mail, notice to [owner or operator]. The guarantee will terminate 120 day s from the date of receipt of the notice by [owner or operator], as evidenced by the return receipt. (5) Guarantor agrees to notify [owner or operator] by

certified mail of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy), U.S. Code naming guarantor as debtor, within 10 day s after commencement of the proceeding. (6) Guarantor agrees to remain bound under this guarantee notwithstanding an y modification or alteration o f any

obligation of [owner or operator] pursuant to 40 CFR part 280. (7) Guarantor agrees to remain bound under this guarantee for so long as [owner or operator] must comply

with the applicable financial responsibility requirements of 40 CFR part 280, subpart H for the above

- identified tank(s), except that guarantor may cancel this guarantee b y sending notice b y certified mail to [owner or operator], such cancellation to become effective no earlier than 120 day s after receipt of such notice by [owner or operator], as evidenced b y the return receipt. (8) The guarantor's obligation does not appl y to any of the following: (a) An y obligation of [insert owner or operator] under a workers' compensation, disability benefits, or unemplo ym ent compensation law or other similar law; (b) Bodil y injury

to an employ ee of [insert owner or operator] arising from, and in the course of, employ

ment by [insert owner or operator]; (c) Bodily

injury or property

damage arising from the ownership, maintenance, us e, or entrustment to others of any aircraft, motor vehicle, or watercraft; (d) Propert y damage to any propert y owned, rented, loaded to, in the care, custod y, or control of, or occupied b y [insert owner or operator] that is not the direct result of a r elease from a petroleum underground storage tank; (e) Bodily

damage or propert y damage for which [insert owner or operator] is obligated to pay damages b y reason of the assumption of liability in a contract or agreement other than a contract or agreeme nt entered into to meet the requirements of 40 CFR 280.93. (9) Guarantor expressly

waives notice of acceptance of this guarantee by [the implementing agency ], by

any or all third parties, or by

[owner or operator].**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

68 I hereb y certify

that the wording of this guarantee is identical to the wording specified in 40 CFR 280.96(c) as such regulations were constituted on the effective date shown immediately below. Effective date:_________________________________________________________ [Name of guarantor] [A uthorized signature for guarantor] [Name of person signing] [Title of person signing] Signature of witness or notary :

________________________________________________________________________ (d) An owner or operator who uses a guarantee to satisfy the r equirements of § 280.93 must establish a standby

trust fund when the guarantee is obtained. Under the terms of the guarantee, all amounts paid by the guarantor under the guarantee will be deposited directly into the standby

trust fund in accordance with in structions from the Director of the implementing agency under § 280.1 12 . This standby trust fund must meet the requirements specified in § 280.103. **§ 280.97 Insurance and risk retention group coverage.** (a) An owner or operator may satisfy the requirements of § 2 8 0.93 by obtaining liability insurance that conforms to the requirements of this section from a qualified insurer or risk retention group. Such insurance may be in the form of a separate insurance policy or an endorsement to an existing insurance policy

. (b) Each insurance policy must be amended by

an endorsement worded as specified in paragraph (b)(1) of this section, or evidenced b y a certificate of insurance worded as specified in paragraph (b)(2) of this section, except that instru ctions in brackets must be replaced with the relevant information and the brackets deleted: (1) Endorsement Name: [name of each covered location]

________________________________________________________________________

____________________________ ____________________________________________ Address: [address of each covered location]

________________________________________________________________________

________________________________________________________________________ Policy Number:_______

___________________________ _ ________________________ Period of Coverage: [current policy period]

________________________________________________________________________

________________________________________________________________________ Name of [I nsurer or Risk Retention Group]:

________________________________________________________________________**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

69 ________________________________________________________________________ Address of [Insurer or Risk Retention Group]:

______________________________ __________________________________________

________________________________________________________________________ Name of Insured:__________________________________

__ ______________________ Address of Insured:__________________________________

___ _________

__________

________________________________________________________________________

________________________________________________________________________

Endorsement: 1. This endorsement certifies that the policy to which the endorsement is attached provides liability insurance covering the following underground storage tanks: [L ist the number of tanks at each facility and the name(s) and address(es) of the faci lity (ies) where the tanks are located. If more than one instrument is used to assure different tanks at any one facilit y, for each tank covered b y this instrument, list the tank identification number provided in the notification submitted pursuant to 40 CF R 280.22, or the corresponding state requirement, and the name and address of the facilit y.] for [insert: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage caused by” either “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases”; in accordance with and subject to the limits of liability , exclusions, conditions, and other terms of the policy ; if coverage is different for different tanks or locations, indicate the ty pe of cove rage applicable to each tank or location] arising from operating the underground storage tank(s) identified above. The limits of liability

are [insert the dollar amount of the “each Occurrence” and “annual aggregate” limits of the Insurer's or Group's liability ; if the amount of coverage is different for different t ypes of coverage or for different underground storage tanks or locations, indicate the amount of coverage for each ty pe of coverage and/or for each underground storage tank or location], exc lusive of legal defense costs, which are subject to a separate limit under the policy . This coverage is provided under [policy number]. The effective date of said policy

is [date]. 2. The insurance afforded with respect to such occurrences is subject t o all of the terms and conditions of the policy ; provided, however, that any provisions inconsistent with subsections (a) through (e) of this Paragraph 2 are hereb y amended to conform with subsections (a) through (e); a. Bankruptcy

or insolvency

of the insured shall not relieve the [“Insurer” or “Group”] of its obligations under the policy to which this endorsement is attached. b. The [“Insurer” or “Group”] is liable for the pay ment of amounts within any deductible applicable to the policy

to the p rovider of corrective action or a damaged third

- part y, with a right of reimbursement b y the insured for an y such payment made b y the [“Insurer” or “Group”]. This provision does not apply

with respect to that amount of any deductible for which coverage is d emonstrated under another mechanism or combination of mechanisms as specified in 40 CFR 280.95

- 280.102. c. Whenever requested by [a Director of an implementing agency ], the [“Insurer” or “Group”] agrees to furnish to [the Director] a signed duplicate o riginal of the policy and all endorsements. d. Cancellation or an y other termination of the insurance b y the [“Insurer” or “Group”], except for non

- pay

ment of premium or misrepresentation by the insured, will be effective onl y upon**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

70 written notice and o nl y after the expiration of 60 days after a cop y of such written notice is received b y the insured. Cancellation for non

- payment of premium or misrepresentation by the insured will be effective only upon written notice and only after expiration of a minimu m of 10 day s after a copy

of such written notice is received by the insured. [I nsert for claims

- made policies: e. The insurance covers claims otherwise covered by the policy

that are reported to the [“Insurer” or “Group”] within six months of the e ffective date of cancellation or non

- renewal of the policy except where the new or renewed policy has the same retroactive date or a retroactive date earlier than that of the prior policy , and which arise out of any covered occurrence that commenced after the policy retroactive date, if applicable, and prior to such policy renewal or termination date. Claims reported during such extended reporting period are subject to the terms, conditions, limits, including limits of liability , and exclusions of the polic y.] I hereb y certify

that the wording of this instrument is identical to the wording in 40 CFR 280.97(b)(1) and that the [“I nsurer” or “Group”] is [“licensed to transact the business of insurance or eligible to provide insurance as an excess or surplus lines insurer in one or more states”]. [Signature of authorized representative of Insurer or Risk Retention Group] [Name of person signing] [Title of person signing], Authorized Representative of [name of Insurer or Risk Retention Group] [Address of Repre sentative] (2) Certificate of Insurance Name: [name of each covered location]

________________________________________________________________________

________________________________________________________________________ Address: [address of each co vered location]

________________________________________________________________________

________________________________________________________________________ Policy Number:_________________________________

_ _________________________ Endorsement (if applicable):_________________________

_____ ___________________ Period of Coverage: [current policy period]

________________________________________________________________________ Name of [Insurer or Risk Retention Group]:

__________________________________ ______________________________________

________________________________________________________________________ Address of [Insurer or Risk Retention Group]:

________________________________________________________________________

_________________________ _______________________________________________ Name of Insured:____________________________________

__ ____________________ Address of Insured:

________________________________________________________________________

________________________________________ ________________________________

________________________________________________________________________

Certification:**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

71 1. [Name of Insurer or Risk Retention Group], [the “Insurer” or “Group”], as identified above, hereb y certifies that it has issued liability insurance covering the following underground storage tank(s): [L ist the number of tanks at each facility and the name(s) and address(es) of the facility (ies) where the tanks are located. If more than one instrum ent is used to assure different tanks at an y one facilit y, for each tank covered b y this instrument, list the tank identification number provided in the notification submitted pursuant to 40 CFR 280.22, or the corresponding state requirement, and the name and address of the facilit y.] for [insert: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage caused by” either “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases”; in ac cordance with and subject to the limits of liability , exclusions, conditions, and other terms of the policy ; if coverage is different for different tanks or locations, indicate the ty pe of coverage applicable to each tank or location] arising from operatin g the underground storage tank(s) identified above. The limits of liability

are [insert the dollar amount of the “each occurrence” and “annual aggregate” limits of the Insurer's or Group's liability ; if the amount of coverage is different for different ty

pes of coverage or for different underground storage tanks or locations, indicate the amount of coverage for each t ype of coverage and/or for each underground storage tank or location], exclusive of legal defense costs, which are subject to a separate l imit under the policy

. This coverage is provided under [policy number]. The effective date of said policy is [date]. 2. The [“Insurer” or “Group”] further certifies the following with respect to the insurance described in Paragraph 1: a. Bankruptcy or insolvency of the insured shall not relieve the [“Insurer” or “Group”] of its obligations under the policy to which this certificate applies. b. The [“Insurer” or “Group”] is liable for the pay ment of amounts within any deductible applicable to the policy

to the provider of corrective action or a damaged third

- part y, with a right of reimbursement b y the insured for an y such payment made b y the [“Insurer” or “Group”]. This provision does not apply

with respect to that amount of any deductible for whi ch coverage is demonstrated under another mechanism or combination of mechanisms as specified in 40 CFR 280.95

- 280.102. c. Whenever requested by [a Director of an implementing agency ], the [“Insurer” or “Group”] agrees to furnish to [the Director] a si gned duplicate original of the policy and all endorsements. d. Cancellation or an y other termination of the insurance b y the [“Insurer” or “Group”], except for non

- pay

ment of premium or misrepresentation by the insured, will be effective onl y upon writ ten notice and onl y after the expiration of 60 days after a cop y of such written notice is received b y the insured. Cancellation for non

- payment of premium or misrepresentation by the insured will be effective only upon written notice and only after expira tion of a minimum of 10 day s after a copy

of such written notice is received by the insured. [I nsert for claims

- made policies: e. The insurance covers claims otherwise covered by the policy

that are reported to the [“Insurer” or “Group”] within six months of the effective date of cancellation or non

- renewal of the policy except where the new or renewed policy has the same retr oactive date or a retroactive date earlier than that of the prior policy , and which arise out of any covered occurrence that commenced after the policy retroactive date, if applicable, and prior to such policy renewal or termination date. Claims reported d uring such extended reporting period are subject to the terms, conditions, limits, including limits of liability , and exclusions of the policy .]**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

72 I hereb y certify

that the wording of this instrument is identical to the wording in 40 CFR 280.97(b)(2) and that the [“Insurer” or “Group”] is [“licensed to transact the business of insurance, or eligible to provide insurance as an excess or surplus lines insurer, in one or more states”]. [Signature of authorized representative of Insurer] [Ty pe name] [Title], Authorized Representative of [name of Insurer or Risk Retention Group] [Address of Representative] (c) Each insurance policy must be issued by an insurer or a risk retention group that, at a minimum, is licensed to transact the business of insurance or eligible to provide insurance as an excess or surplus lines insurer in one or more states.
**§ 280.98 Surety bond.** (a) An owner or operator may satisfy the requirements of § 280.93 by obtaining a suret y bond that conforms to the requirements of this section. The surety company issuing the bond must be among those listed as acceptable sureties on federal bonds in the latest Circular 570 of the U.S. Department of the Treasury

. (b) The surety

bond must be worded as follows, except that instructions in brackets must be replaced with the relevant information and the brackets deleted:

Performance Bond Date bond executed:___________________

___ _______________

___________________ Period of coverage:_____________________________________

____ ________________ Principal: [legal name and business address of owner or operator]

________________________________________________________________________ Ty pe of organization : [insert “individual,” “joint venture,” “partnership,” or “corporation”]

________________________________________________________________________ State of incorporation (if applicable):

_____________________________________________________________________ ___ Surety (ies): [name(s) and business address(es)]

________________________________________________________________________ Scope of Coverage: [L ist the number of tanks at each facility and the name(s) and address(es) of the facility (ies ) where the tanks are located. If more than one instrument is used to assure different tanks at an y one facility, for each tank covered b y this instrument, list the tank identification number provided in the notification submitted pursuant to 40 CFR 280.22 , or the corresponding state requirement, and the name and address of the facility . List the coverage guaranteed b y the bond: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage caused b y” either “sudden acci dental releases” or “nonsudden accidental releases” or “accidental releases” “arising from operating the underground storage Tank”].**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

73 Penal sums of bond: Per occurrence $________________________________________________________ Annual aggregate $___________

___________________________________________ Surety 's bond number:_____________________________________

_ ______________ Know All Persons by

These Presents, that we, the Principal and Suret y(i es), hereto are firml y bound to [the implementing agency ], in the above penal sums for the pay ment of which we bind ourselves, our heirs, executors, administrators, successors, and assigns jointly and severally ; provided that, where the Surety (ies) are corporations acting as co

- sureties, we, the Sureties, bind oursel ves in such sums jointly and severall y onl y for the purpose of allowing a joint action or actions against an y or all of us, and for all other purposes each Suret y binds itself, jointly and severall y with the Principal, for the payment of such sums only as is set forth opposite the name of such Suret y, but if no limit of liability is indicated, the limit of liability shall be the full amount of the penal sums. Whereas said Principal is required under Subtitle I of the So lid Waste Disposal Act , as amended, to provide financial assurance for [insert: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage caused by” either “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases”; if coverage is different for different tanks or locations, indicate the ty pe of coverage applicable to each tank or location] arising from operating the underground storage tanks identified above, and Whe reas said Principal shall establish a standby trust fund as is required when a surety bond is used to provide such financial assurance; Now, therefore, the conditions of the obligation are such that if the Principal shall faithfully [“take corrective a ction, in accordance with 40 CFR part 280, subpart F and the Director of the state implementing agency's instructions for,” and/or “compensate injured third parties for bodil y injury and propert y damage caused b y” either “sudden accidental releases ” or “no nsudden accidental releases ” or “ accidental releases ”] arising from operating the tank(s) indentified above, or if the Principal shall provide alternate financial assurance, as specified in 40 CFR part 280, subpart H , within 120 day s after the date the notice of cancellation is received by the Principal from the Suret y(ies), then this obligation shall be null and void; otherwise it is to remain in full force and effect. Such obligation does not apply to an y of the following: (a) An y obligation of [insert owner or operator] under a workers' compensation, disability benefits, or unemplo ym ent compensation law or other similar law; (b) Bodil y injury

to an employ ee of [insert owner or operator] arising from, and in the course of, employ

ment by [insert owner or operator]; (c) Bodily

injury or property

damage arising from the ownership, maintenance, use, or entrustment to others of any aircraft, motor vehicle, or watercraft; (d) Propert y damage to any prope rt y owned, rented, loaned to, in the care, custod y, or control of, or occupied b y [insert owner or operator] that is not the direct result of a release from a petroleum underground storage tank; (e) Bodily

injury or property

damage for which [insert ow ner or operator] is obligated to pay damages b y reason of the assumption of liability in a contract or agreement other than a contract or agreement entered into to meet the requirements of 40 CFR 280.93.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

74 The Suret y(ies) shall become liable on this bond obligation only when the Principal has failed to fulfill the conditions described above. Upon notification by

[the Director of the implementing agency ] that the Principal has failed to [“take corrective action, in accordance with 40 CFR part 280, subp art F and the Director's instructions,” and/or “compensate injured third parties”] as guaranteed b y t his bond, the Surety (ies) shall either perform [“corrective action in accordance with 40 CFR part 280 and the Director's instructions,” and/or “third

- part y liability compensation”] or place funds in an amount up to the annual aggregate penal sum into the standby trust fund as directed by

[the Regional Administrator or the Director] under 40 CFR 280.1 12

. Upon notification by

[the Director] that the Prin cipal has failed to provide alternate financial assurance within 60 day s after the date the notice of cancellation is received by the Principal from the Suret y(ies) and that [the Director] has determined or suspects that a release has occurred, the Suret y( ies) shall place funds in an amount not exceeding the annual aggregate penal sum into the standby trust fund as directed by [the Director] under 40 CFR 280.1 12

. The Suret y(ies) hereb y waive(s) notification of amendments to applicable laws, statutes, rules, and regulations and agrees that no such amendment shall in any way alleviate its (their) obligation on this bond. The liability

of the Surety (ies) shall not be discharged by an y pay ment or succession of pay ments hereunder, unless and until such pay ment or pay

ments shall amount in the annual aggregate to the penal sum shown on the face of the bond, but in no event shall the obligation of the Surety (ies) hereunder exceed the amount of said annual aggregate penal sum. The Suret y(ies) may cancel the bond b y sending notice of cancellation by certified mail to the Principal, provided, however, that cancellation shall not occur during the 120 day s beginning on the date of receipt of the notice of cancellation b y the Principal, as evidenced by the return receipt. The Principal may

terminate this bond by

sending written notice to the Surety (ies). InWitness Thereof, the Principal and Suret y(ies) have executed this Bond and have affixed their seals on the date set forth above. The persons who se signatures appear below hereby certify that they are authorized to execute this surety

bond on behalf of the Principal and Surety (ies) and that the wording of this suret y bond is identical to the wording specified in 40 CFR 280.98(b) as such regulations were constituted on the date this bond was executed.

Principal [Signature(s)] [Names(s)] [Title(s)] [Corporate seal] Corporate Surety (ies) [Name and address] [State of Incorporation :

________ ] [L iability limit: $

________ ] [Signature(s)]**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

75 [Names(s) and title(s)] [Corporate seal] [For every

co - surety , provide signature(s), corporate seal, and other information in the same manner as for Suret y above.] Bond premium: $

________ (c) Under the te rms of the bond, the suret y will become liable on the bond obligation when the owner or operator fails to perform as guaranteed b y the bond. In all cases, the surety 's liability is limited to the per

- occurrence and annual aggregate penal sums. ( d) The o wner or operator who uses a suret y bond to satisfy the requirements of § 280.93 must establish a standby

trust fund when the surety bond is acquired. Under the terms of the bond, all amounts paid by the suret y under the bond will be deposited directly into the standb y trust fund in accordance with instructions from the Director under § 280.1 12 . This standby trust fund must meet the requirements specified in § 280.103. **§ 280.99 Letter of credit.** (a) An owner or operator may satisfy the requirements of § 280.93 by obtaining an irrevocable standb y letter of credit that conforms to the requirements of this section. The issuing institution must be an entity that has the authority

to issue letters of credit in each state where used and whose letter

- of

- credit operations are regulated and examined by a federal or state agency
. (b) The letter of credit must be worded as follows, except that instructions in brackets are to be replaced with the relevant information and the brackets deleted:

Irrevocable Standby Letter of Credit [Name and address of issuing institution] [Name and address of Director(s) of state implementing agency (ies)] Dear Sir or Madam: We hereb y establish our Irrevocable Standb y Letter of Credit No.

_ ____ in y our favor, at the request and for the account of [owner or operator name] of [address] up to the aggregate amount of [in words] U.S. dollars ($[insert dollar amount]), available upon presentation [insert, if more than one Director of a state imple menting agency is a beneficiary , “by any one of y ou”] of (1) your sight draft, bearing reference to this letter of credit, No.

_____ , and (2) your signed statement reading as follows: “I certify that the amount of the draft is payable pursuant to regulations issued under authority of Subtitle Iof the Solid Waste Disposal Act , as amended.” This letter of credit may be drawn on to cover [insert: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage caused by” either “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases”] arising from**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

76 operating the underground storage tank(s) identified below in the amount of [i n words] $[insert dollar amount] per occurrence and [in words] $[insert dollar amount] annual aggregate: [L ist the number of tanks at each facility and the name(s) and address(es) of the facility (ies) where the tanks are located. If more than one instrument is used to assure different tanks at any one facilit y, for each tank covered b y this instrument, list the tank identification number provided in the notification submitted pursuant to 40 CFR 280.22, or the corresponding state requirement, and the name and address of the facilit y.] The letter of credit may not be drawn on to cover an y of the following: (a) An y obligation of [insert owner or operator] under a workers' compensation, disability benefits, or unemplo ym ent compensation law or othe r similar law; (b) Bodil y injury

to an employ ee of [insert owner or operator] arising from, and in the course of, employ

ment by [insert owner or operator]; (c) Bodily

injury or property

damage arising from the ownership, maintenance, use, or entrus tment to others of any aircraft, motor vehicle, or watercraft; (d) Propert y damage to any propert y owned, rented, loaned to, in the care, custod y, or control of, or occupied b y [insert owner or operator] that is not the direct result of a release from a petroleum underground storage tank; (e) Bodily

injury or property

damage for which [insert owner or operator] is obligated to pay damages b y reason of the assumption of liability in a contract or agreement other than a contract or agreement entered i nto to meet the requirements of 40 CFR 280.93. This letter of credit is effective as of [date] and shall expire on [date], but such expiration date shall be automaticall y extended for a period of [at least the length of the original term] on [expirati on date] and on each successive expiration date, unless, at least 120 day s before the current expiration date, we notify [owner or operator] by

certified mail that we have decided not to extend this letter of credit bey ond the current expiration date . In the event that [owner or operator] is so notified, any unused portion of the credit shall be available upon presentation of yo ur sight draft for 120 day s after the date of receipt by [owner or operator], as shown on the signed return receipt. When ever this letter of credit is drawn on under and in compliance with the terms of this credit, we shall duly

honor such draft upon presentation to us, and we shall deposit the amount of the draft directly

into the standby

trust fund of [owner or operator] i n accordance with your instructions. We certify

that the wording of this letter of credit is identical to the wording specified in 40 CFR 280.99(b) as such regulations were constituted on the date shown immediately below. [Signature(s) and title(s) of official(s) of issuing institution] [Date] This credit is subject to [insert “the most recent edition of the Uniform Customs and Practice for Documentary

Credits, published and copy righted by

the International Chamber of Commerce,” or “the Uniform Commercial Code”].**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

77 (c) An owner or operator w ho uses a letter of credit to satisfy the requirements of § 280.93 must also establish a standby trust fund when the letter of credit is acquired. Under the terms of the letter of credit, all amounts paid pursuant to a draft b y the Director of the implemen ting agency

will be deposited by

the issuing institution directly into the standby

trust fund in accordance with instructions from the Director under § 280.1 12 . This standby trust fund must meet the requirements specified in § 280.103. (d) The letter of credit must be irrevocable with a term specified b y the issuing institution. The letter of credit must provide that credit be automaticall y renewed for the same term as the original term, unless, at least 120 day s before the current expiration da te, the issuing institution notifies the owner or operator b y certified mail of its decision not to renew the letter of credit. Under the terms of the letter of credit, the 120 day s will begin on the date when the owner or operator receives the notice, as evidenced by the return receipt.
**§ 280.100 Use of state**
**- required mechanism.**  (a) For underground storage tanks located in a state that does not have an approved program, and where the state requires owners or operators of underground storage tanks to demonstrate financial responsibility for taking corrective action and/or for compensating third parties for bodil y injury

and propert y damage, an owner or operator may use a state

- requi red financial mechanism to meet the requirements of § 280.93 if the Regional Administrator determines that the state mechanism is at least equivalent to the financial mechanisms specified in this subpart. (b) The Regional Administrator will evaluate the equivalency of a state

- required mechanism principall y in terms of: certainty of the availability of funds for taking corrective action and/or for compensating third parties; the amount of funds that will be made available; and the ty pes of costs covere d. The Regional Administrator may also consider other factors as is necessary
. (c) The state, an owner or operator, or an y other interested party may submit to the Regional Administrator a written petition requesting that one or more of the state

- required mechanisms be considered acceptable for meeting the requirements of § 280.93. The submission must include copies of the appropriate state statutory and regulatory

requirements and must show the amount of funds for corrective action and/or for compens ating third parties assured b y the mechanism(s). The Regional Administrator may require the petitioner to submit additional information as is deemed necessary to make this determination. (d) An y petition under this section may be submitted on behalf of all of the state's underground storage tank owners and operators. (e) The Regional Administrator will notify the petitioner of his determination regarding the mechanism's acceptability in lieu of financial mechanisms specified in this subpart. Pen ding this determination, the owners and operators using such mechanisms will be deemed to be in**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

78 compliance with the requirements of § 280.93 for underground storage tanks located in the state for the amounts and t ypes of costs covered b y such mechanisms.
**§ 280.101 State fund or other state assurance.** (a) An owner or operator may satisfy the requirements of § 280.93 for underground storage tanks located in a state, where EPA is administering the requirements of this subpart, which assures that monies will be available from a state fund or state assurance program to cover costs up to the limits specified in § 280.93 or otherwise assures that such costs will be paid if the Regional Administrator det ermines that the state's assurance is at least equivalent to the financial mechanisms specified in this subpart. (b) The Regional Administrator will evaluate the equivalency of a state fund or other state assurance principally in terms of: Certainty of the availability of funds for taking corrective action and/or for compensating third parties; the amount of funds that will be made available; and the ty pes of costs covered. The Regional Administrator may also consider other factors as is necessary
. (c) The state must submit to the Regional Administrator a description of the state fund or other state assurance to be supplied as financial assurance, along with a list of the classes of underground storage tanks to which the funds may be applied. The Regional Administrator may require the state to submit additional information as is deemed necessary to make a determination regarding the acceptability of the state fund or other state assurance. Pending the determination by

the Regional Administrator, the owner or operator of a covered class of USTs will be deemed to be in compliance with the requirements of § 280.93 for the amounts and types of costs covered b y the state fund or other state assurance. (d) The Regional Administrator will notify the state of his determination regarding the acceptability

of the state's fund or other assurance in lieu of financial mechanisms specified in this subpart. Within 60 day s after the Regional Administrator notifies a state that a state fund or other state assurance is acceptable, the state must provide to each owner or operator for which it is assuming financial responsibility a letter or certificate describing the nature of the state's assumption of responsibility . The letter or certificate from the state must include, or have attached to it, the following information: the facility 's name and address and the amount of funds for corrective action and/or for compensating third parties that is assured b y the state. The owner or operator must maintain this letter o r certificate on file as proof of financial responsibility in accordance with § 280.1 11 (b)( 8 ). **§ 280.102 Trust fund.** (a) An owner or operator may satisfy the requirements of § 280.93 by establishing a trust fund that conforms to the requirements of this section. The trustee must be an entity that has the authority to act as a trustee and whose trust operations are regulated and examined by a federal agency or an agency

of the state in which the fund is established.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

79 (b) The wording of the trust agreement must be identical to the wording specified in § 280.103(b)(1), and must be accompanied b y a formal certification of acknowledgement as specified in § 280.103(b)(2). (c) The trust fund, when established, must be funded for the full required amount of coverage, or funded for part of the required amount of coverage and used in combination with other mechanism(s) that provide the remaining required coverage. (d) If the value of the trust fund is greater than the required amount of coverage , the owner or operator may

submit a written request to the Director of the implementing agency for release of the excess. (e) If other financial assurance as specified in this subpart is substituted for all or part of the trust fund, the owner or op erator may submit a written request to the Director of the implementing agency

for release of the excess. (f) Within 60 day s after receiving a request from the owner or operator for release of funds as specified in paragraph (d) or (e) of this sectio n, the Director of the implementing agency will instruct the trustee to release to the owner or operator such funds as the Director specifies in writing. **§ 280.103 Standby trust fund.** (a) An owner or operator using an y one of the mechanisms authorized by § § 280.96, 280.98, or 280.99 must establish a standby trust fund when the mechanism is acquired. The trustee of the standb y trust fund must be an entity that has the authorit y to act as a trustee and whose trust operations are regulated and examined by a Federal agency or an agency

of the state in which the fund is established. (b)(1) The standb y trust agreement, or trust agreement, must be worded as follows, except that instructions in brackets are to be replaced with the relevant information and the brackets deleted: Trust Agreement Trust agreement, the “Agreement,” entered into as of [date] by and between [name of the owner or operator], a [name of state] [insert “corporation,” “partnership,” “association,” or “proprietorship”], the “Grantor,” and [name of corporate trustee], [in sert “Incorporated in the state of

_____ “ or “a national bank”], the “Trustee.” Whereas, the United States Environmental Protection Agency , “EPA,” an agency of the United States Government, has established certain regulations applicable to the Grantor, requiring that an owner or operator of an underground storage tank shall provide assurance that funds will be available when needed for corrective action and third

- party compensation for bodily injury and property

damage caused by

sudden and nonsudden acc idental releases arising from the operation of the underground storage tank. The attached Schedule A lists the number of tanks at each facility

and the name(s) and address(es) of the facility (ies) where the tanks are**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

80 located that are covered by the [insert “standby ” where trust agreement is standby trust agreement] trust agreement. [Whereas, the Grantor has elected to establish [insert either “a guarantee,” “suret y bond,” or “letter of credit”] to provide all or part of such financial assurance for the underground storage tanks identified herein and is required to establish a standby trust fund able to accept pay ments from the instrument (This paragraph is only applicable to the standby trust agreement.)]; Whereas, the Grantor, acting thr ough its dul y authorized officers, has selected the Trustee to be the trustee under this agreement, and the Trustee is willing to act as trustee; Now, therefore, the Grantor and the Trustee agree as follows: Section 1. Definitions As used in thi s Agreement: (a) The term “Grantor” means the owner or operator who enters into this Agreement and an y successors or assigns of the Grantor. (b) The term “Trustee” means the Trustee who enters into this Agreement and an y successor Trustee. Sectio n 2. I dentification of the Financial Assurance Mechanism This Agreement pertains to the [identify the financial assurance mechanism, either a guarantee, suret y bond, or letter of credit, from which the standby trust fund is established to receive pay

m ents (This paragraph is only applicable to the standby trust agreement.)]. Section 3. Establishment of Fund The Grantor and the Trustee hereb y establish a trust fund, the “Fund,” for the benefit of [implementing agency ]. The Grantor and the Trustee intend that no third party have access to the Fund except as herein provided. [The Fund is established initially as a standby

to receive pay ments and shall not consist of any propert y.] Payments made b y the provider of financial assurance pursuant to [the Director of the implementing agency 's ] instruction are transferred to the Trustee and are referred to as the Fund, together with all earnings and profits thereon, less any pay ments or distributions made by the Trustee pursuant to this Agreement. The Fund shall be held b y the Trustee, IN TRUST, as hereinafter provided. The Trustee shall not be responsible nor shall it undertake an y responsibility for the amount or adequacy of, nor any

dut y to collect from the Grantor as provider of financial assurance, an y pay ments necessary

to discharge any liability of the Grantor established by [the state implementing agency ] Section 4. Pay

ment for [“Corrective Action” and/or “ Third

- Part y Li ability Claims”] The Trustee shall make pay ments from the Fund as [the Dire ctor of the implementing agency ] shall direct, in writing, to provide for the pay ment of the costs of [insert: “taking corrective action” and/or “ compensating third parties for bodily injury and propert y damage caused b y” either “sudden accidental releases ” or “nonsudden accidental Releases” or “accidental releases”]**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

81 arising from operating the tanks covered b y the financial assurance mechanism identified in this Agreement. The Fund may

not be drawn upon to cover an y of the following: (a) An y obligat ion of [insert owner or operator] under a workers' compensation, disability benefits, or unemplo ym ent compensation law or other similar law; (b) Bodil y injury

to an employ ee of [insert owner or operator] arising from, and in the course of employ

ment by [insert owner or operator]; (c) Bodily

injury or property

damage arising from the ownership, maintenance, use, or entrustment to others of any aircraft, motor vehicle, or watercraft; (d) Propert y damage to any propert y owned, rented, loaned to, in the care, custod y, or control of, or occupied b y [insert owner or operator] that is not the direct result of a release from a petroleum underground storage tank; (e) Bodily

injury or property

damage for which [insert owner or operator] is obligated to pay damages b y reason of the assumption of liability in a contract or agreement other than a contract or agreement entered into to meet the requirements of 40 CFR 280.93. The Trustee shall reimburse the Grantor, or other persons as specified by [the Director], from the Fund for corrective action expenditures and/or third

- part y liability claims in such amounts as [the Director] shall direct in writing. In addition, the Trustee shall ref und to the Grantor such amounts as [the Director] specifies in writing. Upon refund, such funds shall no longer constitute part of the Fund as defined herein. Section 5. Pay

ments Comprising the Fund Pay ments made to the Trustee for the Fund shall co nsist of cash and securities acceptable to the Trustee. Section 6. Trustee Management The Trustee shall invest and reinvest the principal and income of the Fund and keep the Fund invested as a single fund, without distinction between principal and i ncome, in accordance with general investment policies and guidelines which the Grantor may communicate in writing to the Trustee from time to time, subject, however, to the provisions of this Section. In investing, reinvesting, exchanging, selling, and man aging the Fund, the Trustee shall discharge his duties with respect to the trust fund solely in the interest of the beneficiaries and with the care, skill, prudence, and diligence under the circumstances then prevailing which persons of prudence, acting in a like capacit y and familiar with such matters, would use in the conduct of an enterprise of a like character and with like aims; except that: (i) Securities or other obligations of the Grantor, or any other owner or operator of the tanks, or an y of their affiliates as defined in the Investment Company Act of 1940, as amended, 15 U.S.C. 80a

- 2(a), shall not be acquired or held, unless they are securities or other obligations of the federal or a state government; (ii) The Trustee is authorized to inv est the Fund in time or demand deposits of the Trustee, to the extent insured by

an agency

of the federal or state government; and (iii) The Trustee is authorized to hold cash awaiting investment or distribution uninvested for a reasonable time and without liability for the pay

ment of interest thereon.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

82 Section 7. Commingling and Investment The Trustee is expressly

authorized in its discretion: (a) To transfer from time to time any or all of the assets of the Fund to any common, commingled, or collective trust fund created b y the Trustee in which the Fund is eligible to participate, subject to all of the provisions thereof, to be commingled with the assets of other trusts participating therein; and (b) To purchase shares in any investment c ompany

registered under the Investment Company Act of 1940, 15 U.S.C. 80a

- 1 et seq., including one which may be created, managed, underwritten, or to which investment advice is rendered or the shares of which are sold b y the Trustee. The Trustee may vote s uch shares in its discretion. Section 8. Express Powers of Trustee Without in any

way limiting the powers and discretions conferred upon the Trustee b y the other provisions of this Agreement or b y l aw, the Trustee is expressly authorized and empower ed: (a) To sell, exchange, convey , transfer, or otherwise dispose of an y property held b y it, by public or private sale. No person dealing with the Trustee shall be bound to see to the application of the purchase money

or to inquire into the validity o r expediency

of an y s uch sale or other disposition; (b) To make, execute, acknowledge, and deliver an y and all documents of transfer and convey ance and any

and all other instruments that may be necessary

or appropriate to carry

out the powers herein gr anted; (c) To register an y s ecurities held in the Fund in its own name or in the name of a nominee and to hold any

securit y in bearer form or in book entry, or to combine certificates representing such securities with certificates of the same issue hel d by the Trustee in other fiduciary capacities, or to deposit or arrange for the deposit of such securities in a qualified central depository even though, when so deposited, such securities may be merged and held in bulk in the name of the nominee of such depository with other securities deposited therein by another person, or to deposit or arrange for the deposit of an y securities issued by the United States Government, or any agency or instrumentality

thereof, with a Federal Reserve bank, but the books an d records of the Trustee shall at all times show that all such securities are part of the Fund; (d) To deposit an y cash in the Fund in interest

- bearing accounts maintained or savings certificates issued b y the Trustee, in its separate corporate capacity, or in any other banking institution affiliated with the Trustee, to the extent insured by an agency of the federal or state government; and (e) To compromise or otherwise adjust all claims in favor of or against the Fund. Section 9. Taxes and Expenses All taxes of any

kind that may

be assessed or levied against or in respect of the Fund and all brokerage commissions incurred b y the Fund shall be paid from the Fund. All other expenses incurred b y the Trustee in connection with the administration of this Trust, including fees for legal services rendered to the Trustee, the compensation of the Trustee to the extent not paid**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

83 directly by the Grantor, and all other proper charges and disbursements of the Trustee shall be paid from the Fund. Section 10. Advice of Counsel The Trustee may

from time to time consult with counsel, who may be c ounsel to the Grantor, with respect to an y questions arising as to the construction of this Agreement or any action to be taken hereunder. The Trustee shall be full y protected, to the extent permitted by law, in acting upon the advice of counsel. Sectio n 11. Trustee Compensation The Trustee shall be entitled to reasonable compensation for its services as agreed upon in writing from time to time with the Grantor. Section 12. Successor Trustee The Trustee may

resign or the Grantor may replace the Trustee, but such resignation or replacement shall not be effective until the Grantor has appointed a successor trustee and this successor accepts the appointment. The successor trustee shall have the same powers and duties as those conferred upon the T rustee hereunder. Upon the successor trustee's acceptance of the appointment, the Trustee shall assign, transfer, and pay over to the successor trustee the funds and properties then constituting the Fund. If for any reason the Grantor cannot or does not ac t in the event of the resignation of the Trustee, the Trustee may appl y to a court of competent jurisdiction for the appointment of a successor trustee or for instructions. The successor trustee shall specify

the date on which it assumes administration of the trust in writing sent to the Grantor and the present Trustee b y certified mail 10 days before such change becomes effective. Any expenses incurred by

the Trustee as a result of any of the acts contemplated by this Section shall be paid as provided in S ection 9. Section 13. Instructions to the Trustee All orders, requests, and instructions by the Grantor to the Trustee shall be in writing, signed by such persons as are designated in the attached Schedule B or such other designees as the Grantor ma y designate by amendment to Schedule B. The Trustee shall be fully protected in acting without inquiry

in accordance with the Grantor's orders, requests, and instructions. All orders, requests, and instructions by [the Director of the implementing agency ] to the Trustee shall be in writing, signed by [the Director], and the Trustee shall act and shall be fully protected in acting in accordance with such orders, requests, and instructions. The Trustee shall have the right to assume, in the absence of written notice to the contrary , that no event constituting a change or a termination of the authorit y of an y person to act on behalf of the Grantor or [the director] hereunder has occurred. The Trustee shall have no duty to act in the absence of such orders, requ ests, and instructions from the Grantor and/or [the Director], except as provided for herein. Section 14. Amendment of Agreement**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

84 This Agreement may

be amended b y an instrument in writing executed by the Grantor and the Trustee, or b y the Trustee and [the Director of the implementing agency ] if the Grantor ceases to exist. Section 15. Irrevocability and Termination Subject to the right of the parties to amend this Agreement as provided in Section 14, this Trust shall be irrevocable and shall continue until terminated at the written direction of the Grantor and the Trustee, or by the Trustee and [the Director of the implementing agency ], if the Grantor ceases to exist. Upon termination of the Trust, all remaining trust propert y, less final trust administration expenses, shall be delivered to the Grantor. Section 16. I mmunity

and I ndemnification The Trustee s hall not incur personal liability of any nature in connection with any act or omission, made in good faith, in the administration of this Trust, or in carrying out an y directions by the Grantor or [the Director of the implementing agency ] issued in accordance with this Agreement. The Trustee shall be indemnified and saved harmless b y the Grantor, from and against an y personal liability to which the Trustee may be subjected by

reason of any

act or conduct in its official capacity , including all expenses reas onably incurred in its defense in the event the Grantor fails to provide such defense. Section 17. Choice of Law This Agreement shall be administered, construed, and enforced according to the laws of the state of [insert name of state], or the Compt roller of the Currency in the case of National Association banks. Section 18. Interpretation As used in this Agreement, words in the singular include the plural and words in the plural include the singular. The descriptive headings for each section of this Agreement shall not affect the interpretation or the legal efficacy of this Agreement. InWitness whereof the parties have caused this Agreement to be executed by their respective officers dul y authorized and their corporate seals (if applicabl e) to be hereunto affixed and attested as of the date first above written. The parties below certify that the wording of this Agreement is identical to the wording specified in 40 CFR 280.103(b)(1) as such regulations were constituted on the date written a bove. [Signature of Grantor] [Name of the Grantor] [Title]
Attest: [Signature of Trustee]**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

85 [Name of the Trustee] [Title] [Seal] [Signature of Witness] [Name of the Witness] [Title] [Seal] (2) The standb y trust agreement, or trust agreement must be accompanied by a formal certification of acknowledgement similar to the following. State requirements may differ on the proper content of this acknowledgment. State of_______________________________________

_ _____________________ ____ County of_______________________________________________________________ On this [date], before me personall y came [owner or operator] to me known, who, being b y me duly sworn, did depose and say that she/he resides at [address], that she/he is [title] of [corporation], the corporation described in and which executed the above instrument; that she/he knows the seal of said corporation; that the seal affixed to such instrument is such corporate seal; that it was so affixed by

order of the Board of Directors of said corporation; and that she/he signed her/his name thereto by like order. [Signature of Notary

Public] [Name of Notary

Public] (c) The Director of the implementing agency will instruct the trustee to refund the balance of the standb y trust fund to the provider of financial assurance if the Director determines that no additional corrective action costs or third

- party liabilit y claims will occur as a result of a release covered b y the financial assurance mechanism for which the standby trust fund was established. (d) An owner or operator may establish one trust fund as the depository mechanism for all funds assured in compliance with this rule.
**§ 280.104 Local government bond rating test.**  (a) A general purpose local government owner or operator and/or local government serving as a guarantor may satisfy the requirements of § 280.93 by having a currently outstanding issue or issues of general obligation bonds o f $1 million or more, excluding refunded obligations, with a Moody's rating of Aaa, Aa, A, or Baa, or a Standard & Poor's rating of AAA, AA, A, or BBB. Where a local government has multiple outstanding issues, or where a local government's bonds are rated by both Moody 's and Standard and Poor's, the lowest rating must be used to determine eligibility . Bonds that are backed by credit enhancement other than**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

86 municipal bond insurance may not be considered in determining the amount of applicable bonds outstandin g. (b) A local government owner or operator or local government serving as a guarantor that is not a general

- purpose local government and does not have the legal authority to issue general obligation bonds may

satisfy the requirements of § 280.93 by having a currently outstanding issue or issues of revenue bonds of $1 million or more, excluding refunded issues , and b y also having a Mood y's rating of Aaa, A a , A, or Baa, or a Standard & Poor's rating of AAA, AA, A, or BBB as the lowest rating for an y ra ted revenue bond issued by the local government. Where bonds are rated b y both Moody 's and Standard & Poor's, the lower rating for each bond must be used to determine eligibility . Bonds that are backed by credit enhancement may not be considered in determi ning the amount of applicable bonds outstanding. (c) The local government owner or operator and/or guarantor must maintain a copy of its bond rating published within the last 12 months by Mood y's or Standard & Poor's. (d) To demonstrate that it meets the local government bond rating test, the chief financial officer of a general purpose local government owner or operator and/or guarantor must sign a letter worded exactly

as follows, except that the instructions in brackets are to be replaced by the relevant information and the brackets deleted:

Letter from Chief Financial Officer
I am the chief financial officer of [insert: name and address of local government owner or operator, or guarantor]. This letter is in support of the use of the bond rating test to demonstrate financial responsibility

for [insert: “taking corrective act ion” and/or “compensating third parties for bodily injury and property

damage”] caused by

[insert: “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases” ] in the amount of at least [insert: dollar amount] per occurrence and [insert: dollar amount] annual aggregate arising from operating (an) underground storage tank(s). Underground storage tanks at the following facilities are assured b y this bond rating test: [L ist for each facility : the name and address o f the facility where tanks are assured by the bond rating test]. The details of the issue date, maturity , outstanding amount, bond rating, and bond rating agency of all outstanding bond issues that are being used b y [name of local government owner or o perator, or guarantor] to demonstrate financial responsibility are as follows: [complete table]

___________________________________________________________________________ Is sue date Maturity date Outstanding amount Bond rating Rating agency

___________________________________________________________________________ [Moody 's or Standard & Poor's]

_____________________________________ ______________________________________ The total outstanding obligation of [insert amount], excluding refunded bond issues, exceeds the minimum amount of $1 million. All outstanding general obligation bonds issued by this government that have been rat ed b y Mood y's or Standard & Poor's are rated as at least**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

87 investment grade (Moody's Baa or Standard & Poor's BBB) based on the most recent ratings published within the last 12 months. Neither rating service has provided notification within the last 12 month s of downgrading of bond ratings below investment grade or of withdrawal of bond rating other than for repay ment of outstanding bond issues. I hereb y certify

that the wording of this letter is identical to the wording specified in 40 CFR Part 280.104(d ) as such regulations were constituted on the date shown immediately below. [Date]__________________________________________________________________ [Signature]______________________

_ _______________________________________ [Name]___________________________

______________________________________ [Title]__________________________

_ _______________________________________ (e) To demonstrate that it meets the local government bond rating test, the chief financial officer of local government owner or operator and /or guarantor other than a general purpose government must sign a letter worded exactly as follows, except that the instructions in brackets are to be replaced b y the relevant information and the brackets deleted:

Letter from Chief Financial Officer
I am the chief financial officer of [insert: name and address of local government owner or operator, or guarantor]. This letter is in support of the use of the bond rating test to demonstrate financial responsibility

for [insert: “taking corrective action” and/or “compensating third parties for bodily injury and property

damage”] caused by

[ insert : “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases” ] in the amount of at least [insert: dollar amoun t] per occurrence and [insert: dollar amount] annual aggregate arising from operating (an) underground storage tank(s). This local government is not organized to provide general governmental services and does not have the legal authority under state law or constitutional provisions to issue general obligation debt. Underground storage tanks at the following facilities are assured b y this bond rating test: [L ist for each facility : the name and address of the facility where tanks are assured by the bond r ating test]. The details of the issue date, maturity , outstanding amount, bond rating, and bond rating agency of all outstanding revenue bond issues that are being used by [name of local government owner or operator, or guarantor] to demonstrate financ ial responsibility are as follows: [complete table]

___________________________________________________________________________ Issue date Maturity date Outstanding amount Bond rating Rating agency

___________________________________________________________________________ [Moody 's or Standard & Poor's]

__________________________________________________ _________________________ The total outstanding obligation of [insert amount], excluding refunded bond issues, exceeds the minimum amount of $1 million. All outstanding revenue bonds issued by this government that have been rated b y Moody 's or Standar d & Poor's are rated as at least investment grade (Moody 's Baa or Standard & Poor's BBB) based on the most recent ratings published within the last 12 months. The revenue bonds listed are not backed b y third

- part y credit enhancement or**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

88 insured by

a mun icipal bond insurance company . Neither rating service has provided notification within the last 12 months of downgrading of bond ratings below investment grade or of withdrawal of bond rating other than for repay ment of outstanding bond issues. I hereb y certify

that the wording of this letter is identical to the wording specified in 40 CFR part 280.104(e) as such regulations were constituted on the date shown immediately below. [Date]__________________________________________________________________ [S ignature]___________________________

_ __________________________________ [Name]_________________________________________________________________ [Title]_______________________________

_ __________________________________ (f) The Director of the implementing agency may require reports of financial condition at any time from the local government owner or operator, and/or local government guarantor. If the Director finds, on the basis of such reports or other information, that the local government owner or oper ator, and/or guarantor, no longer meets the local government bond rating test requirements of § 280.104, the local government owner or operator must obtain alternative coverage within 30 day s after notification of such a finding. (g) If a local gover

nment owner or operator using the bond rating test to provide financial assurance finds that it no longer meets the bond rating test requirements, the local government owner or operator must obtain alternative coverage within 150 day s of the change in status. (h) If the local government owner or operator fails to obtain alternate assurance within 150 day s of finding that it no longer meets the requirements of the bond rating test or within 30 day s of notification by

the Director of the implementing agency that it no longer meets the requirements of the bond rating test, the owner or operator must notify the Director of such failure within 10 day s.
**§ 280.105 Local government financial test.** (a) A local government owner or operator may satisfy the requirements of § 280.93 by passing the financial test specified in this section. To be eligible to use the financial test, the local government owner o r operator must have the ability and authority

to assess and levy

taxes or to freel y establish fees and charges. To pass the local government financial test, the owner or operator must meet the criteria of paragraphs (b)(2) and (b)(3) of this section based on y ear - end financial statements for the latest completed fiscal y ear. (b)(1) The local government owner or operator must have the following information available, as shown in the y ear - end financial statements for the latest completed fiscal ye ar: (i) Total revenues: Consists of the sum of general fund operating and non

- operating revenues including net local taxes, licenses and permits, fines and forfeitures, revenues from use of money and propert y, charges for services, investment earnings, sa les (property , publications, etc.), intergovernmental revenues (restricted and unrestricted), and total revenues from all other governmental funds including enterprise, debt service, capital projects, and special revenues, but**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

89 excluding revenues to funds h eld in a trust or agency capacit y. For purposes of this test, the calculation of total revenues shall exclude all transfers between funds under the direct control of the local government using the financial test (interfund transfers), liquidation of investments, and issuance of debt. (ii) Total expenditures: Consists of the sum of general fund operating and non

- operating expenditures including public safet y, public utilities, transportation, public works, environmental protection, cultural and recreational, community development, revenue sharing, emplo ye e benefits and compensation, office management, planning and zoning, capital projects, interest pay ments on debt, pay

ments for retirement of debt principal, and total expenditures from all other governmental funds including enterprise, debt service, capital projects, and special revenues. For purposes of this test, the calculation of total expenditures shall exclude all transfers between funds under the direct control of the local government using the financial test (interfund transfers). (iii) L ocal revenues: Consists of total revenues (as defined in paragraph (b)(1)(i) of this section) minus the sum of all transfers from other governmental entities, including all monies received from Federa l, state, or local government sources. (iv) Debt service: Consists of the sum of all interest and principal pay ments on all long

term credit obligations and all interest

- bearing short

- term credit obligations. I ncludes interest and principal pay

ments on general obligation bonds, revenue bonds, notes, mortgages, judgments, and interest bearing warrants. Excludes pay ments on non

- interest

- bearing short

- term obligations, interfund obligations, amounts owed in a trust or agency capacit y, and advances and co ntingent loans from other governments. (v) Total funds: Consists of the sum of cash and investment securities from all funds, including general, enterprise, debt service, capital projects, and special revenue funds, but excluding employ ee retirement funds, at the end of the local government's financial reporting ye ar. Includes Federal securities, Federal agency securities, state and local government securities, and other securities such as bonds, notes and mortgages. For purposes of this test, the cal culation of total funds shall exclude agency funds, private trust funds, accounts receivable, value of real propert y, and other non

- security assets. (vi) Population consists of the number of people in the area served by the local government. (2 ) The local government's ye ar - end financial statements, if independentl y audited, cannot include an adverse auditor's opinion or a disclaimer of opinion. The local government cannot have outstanding issues of general obligation or revenue bonds that are rated as less than investment grade. (3) The local government owner or operator must have a letter signed b y the chief financial officer worded as specified in paragraph (c) of this section.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

90 (c) To demonstrate that it meets the financial test und er paragraph (b) of this section, the chief financial officer of the local government owner or operator, must sign, within 120 days of the close of each financial reporting ye ar, as defined by the twelve

- month period for which financial statements used to support the financial test are prepared, a letter worded exactl y as follows, except that the instructions in brackets are to be replaced b y the relevant information and the brackets deleted:

Letter From Chief Financial Officer
I am the chief financial officer of [insert: name and address of the owner or operator]. This letter is in support of the use of the local government financial test to demonstrate financial responsibility

for [insert: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage”] caused b y [insert: “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases ” ] in the amount of at least [insert: dollar amount] per occurrence and [inser

t: dollar amount] annual aggregate arising from operating [an] underground storage tank[s]. Underground storage tanks at the following facilities are assured b y this financial test [L ist for each facility : the name and address of the facility where tan ks assured by

this financial test are located. If separate mechanisms or combinations of mechanisms are being used to assure an y of the tanks at this facility , list each tank assured by this financial test by

the tank identification number provided in the notification submitted pursuant to 40 CFR Part 280.22 or the corresponding state requirements.] This owner or operator has not received an adverse opinion, or a disclaimer of opinion from an independent auditor on its financial statements for the lates t completed fiscal y ear. An y outstanding issues of general obligation or revenue bonds, if rated, have a Moody 's rating of Aaa, Aa, A, or Baa or a Standard and Poor's rating of AAA, AA, A, or BBB; if rated by both firms, the bonds have a Mood y' s rating of Aaa, Aa, A, or Baa and a Standard and Poor's rating of AAA, AA, A, or BBB.

Worksheet for Municipal Financial Test
Part I : Basic Information 1. Total Revenues a. Revenues (dollars)

___ _____ Value of revenues excludes liquidation of investments and issuance of debt. Value includes all general fund operating and non

- operating revenues, as well as all revenues from all other governmental funds including enterprise, debt service, capita l projects, and special revenues, but excluding revenues to funds held in a trust or agency capacit y. b. Subtract interfund transfers (dollars)

________ c. Total Revenues (dollars)

________

2. Total Expenditures a. Expenditures (dollars)

________**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

91 Value consists of the sum of general fund operating and non

- operating expenditures including interest pay

ments on debt, pay

ments for retirement of debt principal, and total expenditures from all other governmental funds including ent erprise, debt service, capital projects, and special revenues. b. Subtract interfund transfers (dollars)

________ c. Total Expenditures (dollars)

________

3. L ocal Revenues a. Total Revenues (from 1c) (dollars)

________ b. Sub tract total intergovernmental transfers (dollars)

________ c. L ocal Revenues (dollars)

________

4. Debt Service a. Interest and fiscal charges (dollars)

________ b. Add debt retirement (dollars)

________ c. Total Debt Service (dollars)

________

5. Total Funds (Dollars)

________ (Sum of amounts held as cash and investment securities from all funds, excluding amounts held for emplo yee retirement funds, agency funds, and trust funds)

6. Pop ulation (Persons)

________ Part II: Application of Test 7. Total Revenues to Population a. Total Revenues (from 1c)

________ b. Population (from 6)

________ c. Divide 7a b y 7b

________ d. Subtract 417

________ e . Divide b y 5,212

________ f. Multiply

by 4.095

________ 8. Total Expenses to Population a. Total Expenses (from 2c)

________ b. Population (from 6)

________ c. Divide 8a b y 8b

________ d. Subtract 524

________ e. Divide b y 5,401

________ f. Multiply

by 4.095

________**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

92

9. L ocal Revenues to Total Revenues
a. L ocal Revenues (from 3c)

________ b. Total Revenues (from 1c)

________ c. Divide 9a b y 9b

________ d. Subtract .695

________ e. Divide b y .205

________ f. Mu ltiply

by 2.840

________ 10. Debt Service to Population a. Debt Service (from 4 c )

________ b. Population (from 6)

________ c. Divide 10a b y 10b

________ d. Subtract 51

________ e. Divide b y 1,038

________ f. Multiply

by

- 1.866

_____

___ 11. Debt Service to Total Revenues a. Debt Service (from 4 c )

________ b. Total Revenues (from 1c)

________ c. Divide 11a b y 11b

________ d. Subtract .068

________ e. Divide b y .259

________ f. Multiply

by

- 3.533

________ 12. Total Revenues to Total Expenses a. Total Revenues (from 1c)

________ b. Total Expenses (from 2c)

________ c. Divide 12a b y 12b

________ d. Subtract .910

________ e. Divide b y .899

________ f. Multiply

by 3.458

________ 13. Funds Balance to Total Revenues a. Total Funds (from 5)

________ b. Total Revenues (from 1c)

________ c. Divide 13a b y 13b

________ d. Subtract .891

________ e. Divide b y 9.156

________ f. Multiply

by 3.270

________ 14. Fund s Balance to Total Expenses**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

93 a. Total Funds (from 5)

________ b. Total Expenses (from 2c)

________ c. Divide 14a b y 14b

________ d. Subtract .866

________ e. Divide b y 6.409

________ f. Multiply

by 3.270

________ 15. Total Funds to Population

________ a. Total Funds (from 5)

________ b. Population (from 6)

________ c. Divide 15a b y 15b

________ d. Subtract 270

________ e. Divide b y 4,548

________ f. Multiply

by 1.866

________ 16. Add 7f + 8f + 9f + 10f + 11f + 12f + 13f + 14f + 15f + 4.937

________ I hereb y certify

that the financial index shown on line 16 of the worksheet is greater than zero and that the wording of this letter is identical to the wording specified in 40 CFR part 280.105(c) as such regulations were constituted on the date shown immediately below. [Date] [Signature] [Name] [Title] (d) If a local government owner or operator using the test to provide financial assurance finds that it no longer meets the requirements of the financial test based on the y ear - end financial statements, the owner or operator must obtain alternative coverage within 150 day s of the end of the y ear for which financial statements have been prepared. (e) The Director of the implementing agency ma y require reports of financial condition at any time from the local government owner or operator. If the Director finds, on the basis of such reports or other information, that the local government owner or operator no longer meets the financial test requi rements of § 280.105 (b) and (c), the owner or operator must obtain alternate coverage within 30 day s after notification of such a finding. (f) If the local government owner or operator fails to obtain alternate assurance within 150 day s of finding t hat it no longer meets the requirements of the financial test based on the ye ar - end financial statements or within 30 day s of notification by the Director of the implementing agency

that it no longer meets the requirements of the financial test, the owner or operator must notify

the Director of such failure within 10 day s.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

94 **§ 280.106 Local government guarantee.** (a) A local government owner or operator may satisfy the requirements of § 280.93 by obtaining a guarantee that conforms to the requirements of this section. The guarantor must be either the state in which the local government owner or operator is located or a local government having a “substantial governmental relationship” with the owner and operator and issuing t he guarantee as an act incident to that relationship. A local government acting as the guarantor must: (1) demonstrate that it meets the bond rating test requirement of § 280.104 and deliver a copy of the chief financial officer's letter as contained in § 280.104( d ) and § 280.104(e) to the local government owner or operator; or (2) demonstrate that it meets the worksheet test requirements of § 280.105 and deliver a copy of the chief financial officer's letter as contained in § 280.105(c) to the local government owner or operator; or (3) demonstrate that it meets the local government fund requirements of § 280.107(a), § 280.107(b), or § 280.107(c) and deliver a cop y of the chief financial officer's letter as contained in § 280.107 to the local government owner or operator. (b) If the local government guarantor is unable to demonstrate financial assurance under any of § § 280.104, 280.105, 280.107(a), 280.107(b), or 280.107(c), at the end of the financial reporting year, the guarantor shall send by certified mail, before cancellation or non

- renewal of the guarantee, notice to the owner or operator. The guarantee will terminate no less than 120 day s after the date the owner or operator receives the notification, as evidenced by the return receipt. The owner or operator must obtain alternative coverage as specified in § 280.114( e ). (c) The guarantee agreement must be worded as specified in paragraph (d) or (e) of this section, depending on which of the following alternative guarantee arrangements is selected: (1) If, in the default or incapacity of the owner or operator, the gu arantor guarantees to fund a standb y trust as directed b y the Director of the implementing agency, the guarantee shall be worded as specified in paragraph (d) of this section. (2) If, in the default or incapacity of the owner or operator, the guarant or guarantees to make pay ments as directed by

the Director of the implementing agency for taking corrective action or compensating third parties for bodil y injury and propert y damage, the guarantee shall be worded as specified in paragraph (e) of this sect ion. (d) If the guarantor is a state, the local government guarantee with standb y trust must be worded exactl y as follows, except that instructions in brackets are to be replaced with relevant information and the brackets deleted:
Lo cal Govern ment Guarantee With Standby Trust Made by

a State**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

95 Guarantee made this [date] by [name of state], herein referred to as guarantor, to [the state implementing agency ] and to any and all third parties, and obliges, on behalf of [local government owner or operator].

Recitals (1) Guarantor is a state. (2) [L ocal government owner or operator] owns or operates the following underground storage tank(s) covered b y this guarantee: [L ist the number of tanks at each facility and the name(s) and address(es) of the facilit y(ies) where the tanks are located. If more than one instrument is used to assure different tanks at any one facilit y, for each tank covered b y this instrument, list the tank identification number provided in the notification submitted pursuant to 40 CFR part 280 or the corresponding state r equirement, and the name and address of the facility .] This guarantee satisfies 40 CFR part 280, subpart H requirements for assuring funding for [insert: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage ca used b y” either “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases”; if coverage is different for different tanks or locations, indicate the ty pe of coverage applicable to each tank or location] arising from operating t he above

- identified underground storage tank(s) in the amount of [insert dollar amount] per occurrence and [insert dollar amount] annual aggregate. (3) Guarantor guarantees to [implementing agency ] and to any and all third parties that: Inthe even t that [local government owner or operator] fails to provide alternative coverage within 60 day s after receipt of a notice of cancellation of this guarantee and the [Director of the implementing agency ] has determined or suspects that a release has occurre d at an underground storage tank covered b y t his guarantee, the guarantor, upon instructions from the [Director] shall fund a standb y trust fund in accordance with the provisions of 40 CFR part 280.112, in an amount not to exceed the coverage limits specif ied above. Inthe event that the [Director] determines that [local government owner or operator] has failed to perform corrective action for releases arising out of the operation of the above

- identified tank(s) in accordance with 40 CFR part 280, subpart F, the guarantor upon written instructions from the [Director] shall fund a standb y trust fund in accordance with the provisions of 40 CFR part 280.112, in an amount not to exceed the coverage limits specified above. If [owner or operator] fails to satisfy a judgment or award based on a determination of liability for bodily injury or property

damage to third parties caused b y [“sudden” and/or “nonsudden”] accidental releases arising from the operation of the above

- identified tank(s), or fails to pay an amount agreed to in settlement of a claim arising from or alleged to arise from such injury or damage, the guarantor, upon written instructions from the [Director], shall fund a standb y trust in accordance with the provisions of 40 CFR part 280.112 to s atisfy such judgment(s), award(s), or settlement agreement(s) up to the limits of coverage specified above. (4) Guarantor agrees to notify [owner or operator] by

certified mail of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy), U.S. Code naming guarantor as debtor, within 10 day s after commencement of the proceeding. (5) Guarantor agrees to remain bound under this guarantee notwithstanding an y modification or alteration of an y obligation of [owner or operator] pursuant to 40 CFR p art 280. (6) Guarantor agrees to remain bound under this guarantee for so long as [local government owner or operator] must comply with the applicable financial responsibility requirements of 40**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

96 CFR part 280, subpart H for the above identified tank(s), except that guarantor may cancel this guarantee b y sending notice b y certified mail to [owner or operator], such cancellation to become effective no earlier than 120 day s after receipt of such notice by [owner or operator], as evidenced b y the return rece ipt. (7) The guarantor's obligation does not appl y to any of the following: (a) An y obligation of [local government owner or operator] under a workers' compensation, disability benefits, or unemploy

ment compensation law or other similar law; (b ) Bodil y injury

to an employ ee of [insert: local government owner or operator] arising from, and in the course of, employ ment by [insert: local government owner or operator]; (c) Bodily

injury or property

damage arising from the ownership, maintenance, use, or entrustment to others of any aircraft, motor vehicle, or watercraft; (d) Propert y damage to any propert y owned, rented, loan ed to, in the care, custody , or control of, or occupied b y [insert: local government owner or operator] that is not the direct result of a release from a petroleum underground storage tank; (e) Bodily

damage or propert y damage for which [insert owner or operator] is obligated to pay damages b y reason of the assumption of liability in a contract or agreement other th an a contract or agreement entered into to meet the requirements of 40 CFR part 280.93. (8) Guarantor expressly

waives notice of acceptance of this guarantee by [the implementing agency ], by

any or all third parties, or by

[local government owner or op erator], I hereb y certify

that the wording of this guarantee is identical to the wording specified in 40 CFR part 280.106(d) as such regulations were constituted on the effective date shown immediately

below. Effective date:____________________________

_____________________________ [Name of guarantor] [Authorized signature for guarantor] [Name of person signing] [Title of person signing] Signature of witness or notary : If the guarantor is a local government, the local government guarantee with stand by trust must be worded exactly

as follows, except that instructions in brackets are to be replaced with relevant information and the brackets deleted: Local Government Guarantee With Standby Trust Made by

a Local Government Guarantee made this [date ] by [name of guaranteeing entity ], a local government organized under the laws of [name of state], herein referred to as guarantor, to [the state implementing agency ] and to any

and all third parties, and obliges, on behalf of [local government owner or o perator]. Recitals (1) Guarantor meets or exceeds [select one: the local government bond rating test requirements of 40 CFR part 280.104, the local government financial test requirements of 40 CFR part 280.105, or the local government fund under 40 CFR part 280.107(a), 2 80.107(b), or 280.107(c)].**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

97 (2) [L ocal government owner or operator] owns or operates the following underground storage tank(s) covered b y this guarantee: [L ist the number of tanks at each facility and the name(s) and address(es) of the facilit y(ies) wh ere the tanks are located. If more than one instrument is used to assure different tanks at any one facilit y, for each tank covered b y this instrument, list the tank identification number provided in the notification submitted pursuant to 40 CFR part 280 o r the corresponding state requirement, and the name and address of the facility .] This guarantee satisfies 40 CFR part 280, subpart H requirements for assuring funding for [insert: “taking corrective action” and/or “compensating third parties for bodil y in jury and propert y damage caused b y” either “sudden accidental Releases” or “nonsudden accidental releases” or “accidental Releases”; if coverage is different for different tanks or locations, indicate the ty pe of coverage applicable to each tank or locatio n] arising from operating the above

- identified underground storage tank(s) in the amount of [insert dollar amount] per occurrence and [insert: dollar amount] annual aggregate. (3) Incident to our substantial governmental relationship with [local government owner or operator], guarantor guarantees to [implementing agency ] and to any and all third parties that: Inthe event that [local government owner or operator] fails to provide alternative coverage within 60 day s after receipt of a notice of cance llation of this guarantee and the [Director of the implementing agency ] has determined or suspects that a release has occurred at an underground storage tank covered b y t his guarantee, the guarantor, upon instructions from the [Director] shall fund a stand

by trust fund in accordance with the provisions of 40 CFR part 280.112, in an amount not to exceed the coverage limits specified above. Inthe event that the [Director] determines that [local government owner or operator] has failed to perform correcti ve action for releases arising out of the operation of the above

- identified tank(s) in accordance with 40 CFR part 280, subpart F, the guarantor upon written instructions from the [Director] shall fund a standb y trust fund in accordance with the provisions of 40 CFR part 280.112, in an amount not to exceed the coverage limits specified above. If [owner or operator] fails to satisfy a judgment or award based on a determination of liability for bodily injury or property

damage to third parties caused b y [ “sudden” and/or “nonsudden”] accidental releases arising from the operation of the above

- identified tank(s), or fails to pay an amount agreed to in settlement of a claim arising from or alleged to arise from such injury or damage, the guarantor, upon writt en instructions from the [Director], shall fund a standb y trust in accordance with the provisions of 40 CFR part 280.112 to satisfy such judgment(s), award(s), or settlement agreement(s) up to the limits of coverage specified above. (4) Guarantor agree s that, if at the end of any fiscal y ear before cancellation of this guarantee, the guarantor fails to meet or exceed the requirements of the financial responsibility mechanism specified in paragraph (1), guarantor shall send within 120 day s of such failur e, b y certified mail, notice to [local government owner or operator], as evidenced b y the return receipt. (5) Guarantor agrees to notify [owner or operator] by

certified mail of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy), U.S. Co de naming guarantor as debtor, within 10 day s after commencement of the proceeding. (6) Guarantor agrees to remain bound under this guarantee notwithstanding an y modification or alteration of an y obligation of [owner or operator] pursuant to 40 CFR par t 280. (7) Guarantor agrees to remain bound under this guarantee for so long as [local government owner or operator] must comply with the applicable financial responsibility requirements of 40 CFR part 280, subpart H for the above identified tank(s), e xcept that guarantor may cancel this guarantee b y sending notice b y certified mail to [owner or operator], such cancellation to become**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

98 effective no earlier than 120 day s after receipt of such notice by [owner or operator], as evidenced b y the return receip t. (8) The guarantor's obligation does not appl y to any of the following: (a) An y obligation of [local government owner or operator] under a workers' compensation, disability benefits, or unemploy

ment compensation law or other similar law; (b) Bodil y injury

to an employ ee of [insert: local government owner or operator] arising from, and in the course of, employ ment by [insert: local government owner or operator]; (c) Bodily

injury or property

damage arising from the ownership, maintenance, u se, or entrustment to others of any aircraft, motor vehicle, or watercraft; (d) Propert y damage to any propert y owned, rented, loaned to, in the care, custod y, or control of, or occupied b y [insert: local government owner or operator] that is not the d irect result of a release from a petroleum underground storage tank; (e) Bodily

damage or propert y damage for which [insert: owner or operator] is obligated to pay damages by

reason of the assumption of liability in a contract or agreement other than a contract or agreement entered into to meet the requirements of 40 CFR part 280.93. (9) Guarantor expressly

waives notice of acceptance of this guarantee by [the implementing agency ], by

any or all third parties, or by

[local government owner or operat or]. I hereb y certify

that the wording of this guarantee is identical to the wording specified in 40 CFR part 280.106(d) as such regulations were constituted on the effective date shown immediately

below. Effective date:_____________________________

__ _ ____________________________ [Name of guarantor] [Authorized signature for guarantor] [Name of person signing] [Title of person signing] Signature of witness or notary :

________________________________________________________________________ (e) If the guarantor is a state, the local government guarantee without standby trust must be worded exactly

as follows, except that instructions in brackets are to be replaced with relevant information and the brackets deleted:
Lo cal Government Guarantee Withou t Standby Trust Made by

a State Guarantee made this [date] by [name of state], herein referred to as guarantor, to [the state implementing agency ] and to any and all third parties, and obliges, on behalf of [local government owner or operator].

Recitals (1) Guarantor is a state. (2) [L ocal government owner or operator] owns or operates the following underground storage tank(s) covered b y this guarantee: [L ist the number of tanks at each facility and the name(s) and address(es) of the facilit y(ies) where the tanks are located. If more than one instrument is used to assure different tanks at any one facilit y, for each tank covered b y this instrument, list the tank**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

99 identification number provided in the notification submitted pursuant to 40 CFR part 280 or the corresponding state requirement, and the name and address of the facility .] This guarantee satisfies 40 CFR part 280, subpart H requirements for assuring funding for [insert: “taking corrective action” and/or “ compensating third parties for bodil y injury and propert y damage caused b y” either “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases”; if coverage is different for different tanks or locations, indicate the ty pe of cov erage applicable to each tank or location] arising from operating the above

- identified underground storage tank(s) in the amount of [insert: dollar amount] per occurrence and [insert: dollar amount] annual aggregate. (3) Guarantor guarantees to [implem enting agency] and to an y and all third parties and obliges that: Inthe event that [local government owner or operator] fails to provide alternative coverage within 60 day s after receipt of a notice of cancellation of this guarantee and the [Director of the implementing agency ] has determined or suspects that a release has occurred at an underground storage tank covered b y t his guarantee, the guarantor, upon written instructions from the [Director] shall make funds available to pay for corrective actio ns and compensate third parties for bodily injury and property

damage in an amount not to exceed the coverage limits specified above. Inthe event that the [Director] determines that [local government owner or operator] has failed to perform corrective action for releases arising out of the operation of the above

- identified tank(s) in accordance with 40 CFR part 280, subpart F, the guarantor upon written instructions from the [Director] shall make funds available to pay for corrective actions in an amou nt not to exceed the coverage limits specified above. If [owner or operator] fails to satisfy a judgment or award based on a determination of liability for bodily injury or property

damage to third parties caused b y [“sudden” and/or “nonsudden”] accide ntal releases arising from the operation of the above

- identified tank(s), or fails to pay an amount agreed to in settlement of a claim arising from or alleged to arise from such injury or damage, the guarantor, upon written instructions from the [Director] , shall make funds available to compensate third parties for bodil y injury and propert y damage in an amount not to exceed the coverage limits specified above. (4) Guarantor agrees to notify [owner or operator] by

certified mail of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy), U.S. Code naming guarantor as debtor, within 10 day s after commencement of the proceeding. (5) Guarantor agrees to remain bound under this guarantee notwithstanding an y modification or alteration of an y obl igation of [owner or operator] pursuant to 40 CFR part 280. (6) Guarantor agrees to remain bound under this guarantee for so long as [local government owner or operator] must comply with the applicable financial responsibility requirements of 40 CFR part 280, subpart H for the above identified tank(s), except that guarantor may cancel this guarantee b y sending notice b y certified mail to [owner or operator], such cancellation to become effective no earlier than 120 day s after receipt of such notice by [ owner or operator], as evidenced b y the return receipt. If notified of a probable release, the guarantor agrees to remain bound to the terms of this guarantee for all charges arising from the release, up to the coverage limits specified above, notwithstand ing the cancellation of the guarantee with respect to future releases. (7) The guarantor's obligation does not appl y to any of the following:**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

100 (a) An y obligation of [local government owner or operator] under a workers' compensation disability benefi ts, or unemploy

ment compensation law or other similar law; (b) Bodil y injury

to an employ ee of [insert local government owner or operator] arising from, and in the course of, employ ment by [insert: local government owner or operator]; (c) Bodily

in jury or property

damage arising from the ownership, maintenance, use, or entrustment to others of any aircraft, motor vehicle, or watercraft; (d) Propert y damage to any propert y owned, rented, loan ed to, in the care, custody , or control of, or occupie d by

[insert: local government owner or operator] that is not the direct result of a release from a petroleum underground storage tank; (e) Bodily

damage or propert y damage for which [insert: owner or operator] is obligated to pay damages by

reason of the assumption of liability in a contract or agreement other than a contract or agreement entered into to meet the requirements of 40 CFR part 280.93. (8) Guarantor expressly

waives notice of acceptance of this guarantee by [the implementing agency ], b y an y or all third parties, or b y [local government owner or operator]. I hereb y certify

that the wording of this guarantee is identical to the wording specified in 40 CFR part 280.106(e) as such regulations were constituted on the effective date shown immediately

below. Effective date:_________________________________________________________ [Name of guarantor] [Authorized signature for guarantor] [Name of person signing] [Title of person signing] Signature of witness or notary : If the guarantor is a local government, the local government guarantee without standby trust must be worded exactl y as follows, except that instructions in brackets are to be replaced with relevant information and the brackets deleted: Local Governmen t Guarantee Without Standby Trust Made by

a Local Government Guarantee made this [date] by [name of guaranteeing entity ], a local government organized under the laws of [name of state], herein referred to as guarantor, to [the state implementing agenc y] and to any

and all third parties, and obliges, on behalf of [local government owner or operator]. Recitals (1) Guarantor meets or exceeds [select one: the local government bond rating test requirements of 40 CFR par t 280.104, the local government financial test requirements of 40 part CFR 280.105, the local government fund under 40 CFR part 280.107(a), 280.107(b), or 280.107(c). (2) [L ocal government owner or operator] owns or operates the following underground s torage tank(s) covered b y this guarantee: [L ist the number of tanks at each facility and the name(s) and address(es) of the facilit y(ies) where the tanks are located. If more than one instrument is used to assure different tanks at any one facilit y, for ea ch tank covered by this instrument, list the tank identification number provided in the notification submitted pursuant to 40 CFR part 280 or the**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

101 corresponding state requirement, and the name and address of the facility .] This guarantee satisfies 40 CFR part 280, subpart H requirements for assuring funding for [insert: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage caused b y” either “sudden accidental releases” or “nonsudden accidental releases” or “accid ental releases”; if coverage is different for different tanks or locations, indicate the ty pe of coverage applicable to each tank or location] arising from operating the above

- identified underground storage tank(s) in the amount of [insert: dollar amount] per occurrence and [insert: dollar amount] annual aggregate. (3) Incident to our substantial governmental relationship with [local government owner or operator], guarantor guarantees to [implementing agency ] and to any and all third parties and obliges that: Inthe event that [local government owner or operator] fails to provide alternative coverage within 60 day s after receipt of a notice of cancellation of this guarantee and the [Director of the implementing agency ] has determined or suspects that a release has occurred at an underground storage tank covered b y t his guarantee, the guarantor, upon written instructions from the [Director] shall make funds available to pay for corrective actions and compensate third parties for bodily injury and prope rty

damage in an amount not to exceed the coverage limits specified above. Inthe event that the [Director] determines that [local government owner or operator] has failed to perform corrective action for releases arising out of the operation of the ab ove - identified tank(s) in accordance with 40 CFR part 280, subpart F, the guarantor upon written instructions from the [Director] shall make funds available to pay for corrective actions in an amount not to exceed the coverage limits specified above. I f [owner or operator] fails to satisfy a judgment or award based on a determination of liability for bodily injury or property

damage to third parties caused b y [“sudden” and/or “nonsudden”] accidental releases arising from the operation of the above

- ident ified tank(s), or fails to pay an amount agreed to in settlement of a claim arising from or alleged to arise from such injury or damage, the guarantor, upon written instructions from the [Director], shall make funds available to compensate third parties fo r bodil y injury and propert y damage in an amount not to exceed the coverage limits specified above. (4) Guarantor agrees that if at the end of an y fiscal year before cancellation of this guarantee, the guarantor fails to meet or exceed the requirements of the financial responsibility mechanism specified in paragraph (1), guarantor shall send within 120 day s of such failure, by certified mail, notice to [local government owner or operator], as evidenced b y the return receipt. (5) Guarantor agrees to notify [owner or operator] by

certified mail of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy), U.S. Code naming guarantor as debtor, within 10 day s after commencement of the proceeding. (6) Guarantor agrees to remain bound under thi s guarantee notwithstanding an y modification or alteration of an y obligation of [owner or operator] pursuant to 40 CFR part 280. (7) Guarantor agrees to remain bound under this guarantee for so long as [local government owner or operator] must comply w ith the applicable financial responsibility requirements of 40 CFR part 280, subpart H for the above identified tank(s), except that guarantor may cancel this guarantee b y sending notice b y certified mail to [owner or operator], such cancellation to become effective no earlier than 120 day s after receipt of such notice by [owner or operator], as evidenced b y the return receipt. If notified of a probable release, the guarantor agrees to remain bound to the terms of this guarantee for all charges arising from the release, up to the coverage**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

102 limits specified above, notwithstanding the cancellation of the guarantee with respect to future releases. (8) The guarantor's obligation does not appl y to any of the following: (a) An y obligation of [local governme nt owner or operator] under a workers' compensation disability benefits, or unemploy

ment compensation law or other similar law; (b) Bodil y injury

to an employ ee of [insert: local government owner or operator] arising from, and in the course of, employ m ent b y [insert: local government owner or operator]; (c) Bodily

injury or property

damage arising from the ownership, maintenance, use, or entrustment to others of any aircraft, motor vehicle, or watercraft; (d) Propert y damage to any propert y owned, rented, loan ed to, in the care, custody , or control of, or occupied b y [insert: local government owner or operator] that is not the direct result of a release from a petroleum underground storage tank; (e ) Bodily

damage or propert y damage for which [insert: owner or operator] is obligated to pay damages by

reason of the assumption of liability in a contract or agreement other than a contract or agreement entered into to meet the requirements of 40 CFR part 280.93. (9) Guarantor expressly

waives notice of acceptance of this guarantee by [the implementing agency ], by

any or all third parties, or by

[local government owner or operator], I hereb y certify

that the wording of this guarantee is identical t o the wording specified in 40 CFR part 280.106(e) as such regulations were constituted on the effective date shown immediately

below. Effective date:_________________________________________________________ [Name of guarantor] [Authorized signature for gua rantor] [Name of person signing] [Title of person signing] Signature of witness or notary :
**§ 280.107 Local government fund.** A local government owner or operator may satisfy the requirements of § 280.93 by establishing a dedicated fund account that conforms to the requirements of this section. Except as specified in paragraph (b), a dedicated fund may not be commingled with other funds or otherwise used in normal operations. A dedicated fund will be considered eligible if it meets one of the following requirements: (a) The fund is dedicated by state constitutional provision, or local government statute, charter, ordinance, or order to pay for taking corrective action and for compensating third parties for bodily injury an d property

damage caused by

accidental releases arising from the operation of petroleum underground storage tanks and is funded for the full amount of coverage required under § 280.93, or funded for part of the required amount of coverage and used in combi nation with other mechanism(s) that provide the remaining coverage; or (b) The fund is dedicated by state constitutional provision, or local government statute, charter, ordinance, or order as a contingency fund for general emergencies, including tak ing corrective action and compensating third parties for bodily injury and property

damage caused**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

103 by accidental releases arising from the operation of petroleum underground storage tanks, and is funded for five times the full amount of coverage required un der § 280.93, or funded for part of the required amount of coverage and used in combination with other mechanism(s) that provide the remaining coverage. If the fund is funded for less than five times the amount of coverage required under § 280.93, the amount of financial responsibility demonstrated by

the fund may not exceed one

- fifth the amount in the fund; or (c) The fund is dedicated by state constitutional provision, or local government statute, charter, ordinance or order to pay for taking correc tive action and for compensating third parties for bodily injury and property

damage caused by

accidental releases arising from the operation of petroleum underground storage tanks. A pay ment is made to the fund once every y ear for seven ye ars until the fund is fully

- funded. This seven ye ar period is hereafter referred to as the “pay

- in

period.” The amount of each pay ment must be determined by this formula:
TF

– C F Y Where TF is the total required financial assurance for the owner or operator, CF is the current amount in the fund, and Y is the number of ye ars remaining in the pay

- in

- period, and; (1) The local government owner or operator has available bonding authority, approved through voter referendum (if such approval is necessary prior to the issuance of bonds), for an amount equal to the difference between the required amount of coverage and the amount held in the dedicated fund. This bonding authorit y shall be available for taking corrective action and for compensating third parties for bodil y injury and property

damage caused by accidental releases arising from the operation of petroleum underground storage tanks, or (2) The local government owner or operator has a letter signed b y the appropriate state attorney general stating that the use of the bonding authorit y will not increase the local government's debt bey ond the legal debt ceilings established by the relevant state laws. The letter must also state that prior voter approval is not necessary before use of the bonding authorit y. (d) To demonstrate that it meets the requirements of the local government fund, the chief financial officer of the local government owner or operator and/or guarantor must sign a letter worded exactl y as follows, except that the instructions in bracket s are to be replaced by the relevant information and the brackets deleted:

Letter from Chief Financial Officer
I am the chief financial officer of [insert: name and address of local government owner or operator, or guarantor]. This letter is in support of the use of the local government fund mechanism to demonstrate financial responsibility for [insert: “taking corrective action” and/or “compensating third parties for bodil y injury and propert y damage”] caused by [insert: “sudden ac cidental releases” or “nonsudden accidental releases” or “accidental releases” ] in the amount of at least [insert: dollar amount] per occurrence and [insert: dollar amount] annual aggregate arising from operating (an) underground storage tank(s).**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

104 U nderground storage tanks at the following facilities are assured b y this local government fund mechanism: [L ist for each facility : the name and address of the facility where tanks are assured b y the local government fund]. [I nsert: “The local governmen t fund is funded for the full amount of coverage required under § 280.93, or funded for part of the required amount of coverage and used in combination with other mechanism(s) that provide the remaining coverage.” or “The local government fund is funded fo r five times the full amount of coverage required under § 280.93, or funded for part of the required amount of coverage and used in combination with other mechanisms(s) that provide the remaining coverage,” or “A pay ment is made to the fund once every y ear for seven y ears until the fund is fully

- funded and [name of local government owner or operator] has available bonding authorit y, approved through voter referendum, of an amount equal to the difference between the required amount of coverage and the am ount held in the dedicated fund” or “A pay ment is made to the fund once every y ear for seven y ears until the fund is fully

- funded and I have attached a letter signed by the State Attorney General stating that (1) the use of the bonding authority will not i ncrease the local government's debt bey ond the legal debt ceilings established by the relevant state laws and (2) that prior voter approval is not necessary before use of the bonding authorit y”]. The details of the local government fund are as follows: Amount in Fund (market value of fund at close of last fiscal year):_____ [I f fund balance is incrementally funded as specified in § 280.107(c), insert: Amount added to fund in the most recentl y completed fiscal ye ar:_____ Number of ye ars remaining in the pay

- in period:

_____ ] A cop y of the state constitutional provision, or local government statute, charter, ordinance or order dedicating the fund is attached. I hereb y certify

that the wording of this letter is identical to the wording specifi ed in 40 CFR 280.107(d) as such regulations were constituted on the date shown immediately below. [Date] [Signature] [Name] [Title]

**§ 280.108 Substitution of financial assurance mechanisms by owner or operator.** (a) An owner or operator may substitute any

alternate financial assurance mechanisms as specified in this subpart, provided that at all times he maintains an effective financial assurance mechanism or combination of mechanisms that satisfies the requirements of § 280. 93. (b) After obtaining alternate financial assurance as specified in this subpart, an owner or operator may

cancel a financial assurance mechanism by providing notice to the provider of financial assurance.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

105 **§ 280.109 Cancellation or nonrenewal by a provider of financial assurance.** (a) Except as otherwise provided, a provider of financial assurance may cancel or fail to renew an assurance mechanism by sending a notice of term ination by certified mail to the owner or operator. (1) Termination of a local government guarantee, a guarantee, a suret y bond, or a letter of credit may

not occur until 120 day s after the date on which the owner or operator receives the notice of t ermination, as evidenced b y the return receipt. (2) Termination of insurance or risk retention coverage, except for non

- payment or misrepresentation b y the insured, or state

- funded assurance may not occur until 60 day s after the date on which the own er or operator receives the notice of termination, as evidenced b y the return receipt. Termination for non

- pay ment of premium or misrepresentation by the insured may not occur until a minimum of 10 day s after the date on which the owner or operator receive s the notice of termination, as evidenced b y the return receipt. (b) If a provider of financial responsibility cancels or fails to renew for reasons other than incapacit y of the provider as specified in § 280.114, the owner or operator must obtain al ternate coverage as specified in this section within 60 days after receipt of the notice of termination. If the owner or operator fails to obtain alternate coverage within 60 day s after receipt of the notice of termination, the owner or operator must notif y t he Director of the implementing agency of such failure and submit: (1) The name and address of the provider of financial assurance; (2) The effective date of termination; and (3) The evidence of the financial assistance mechanism subje ct to the termination maintained in accordance with § 280.1 11 (b).
**§ 280.110 Reporting by owner or operator.** (a) An owner or operator must submit the appropriate forms listed in § 280.111(b) documenting current evidence of financial responsibility to the Director of the implementing agency : (1) Within 30 day s after the owner or operator identifies a release from an underground storage tank required to be reported under § 280.53 or § 280.61; (2) If the owner or operator fails to obtain alternate coverage as required by this subpart, within 30 day s after the owner or operator receives notice of: (i) Commencement of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy ), U.S. Code, naming a provider of financial assurance as a debtor,**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

106 (ii) Suspension or revocation of the authority of a provider of financial assurance to issue a financial assurance mechanism, (iii) Failure of a guarantor to meet the requirements of the financial test, (i v) Other incapacit y of a provider of financial assurance; or (3) As required b y § 280.95(g) and § 280.109(b). (b) An owner or operator must certify compliance with the financial responsibility requirements of this part as specified in the new tank notification form when notify ing the appropriate state or local agency of the installation of a new underground storage tank under § 280.22. (c) The Director of the Implementing Agency may require an owner or operator to submit evidence of finan cial assurance as described in § 280.111(b) or other information relevant to compliance with this subpart at an y time.
**§ 280.111 Recordkeeping.** (a) Owners or operators must maintain evidence of all financial assurance mecha nisms used to demonstrate financial responsibility under this subpart for an underground storage tank until released from the requirements of this subpart under § 208.113. An owner or operator must maintain such evidence at the underground storage tank sit e or the owner's or operator's place of work. Records maintained off

- site must be made available upon request of the implementing agency
. (b) An owner or operator must maintain the following t ypes of evidence of financial responsibility : (1) An owner or operator using an assurance mechanism specified in §§ 280.95 through 280.100 or § 280.102 or §§ 280.104 through 280.107 must maintain a copy of the instrument worded as specified. (2) An owner or operator using a financial test or guarantee , or a local government financial test or a local government guarantee supported by the local government financial test must maintain a copy

of the chief financial officer's letter based on y ear - end financial statements for the most recent completed financ ial reporting y ear. Such evidence must be on file no later than 120 day s after the close of the financial reporting y ear. (3) An owner or operator using a guarantee, suret y bond, or letter of credit must maintain a cop y of the signed standby trust fund agreement and copies of any amendments to the agreement.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

107 (4) A local government owner or operator using a local government guarantee under § 280.106(d) must maintain a cop y of the signed standby trust fund agreement and copies of an y amendments to the agreement. (5) A local government owner or operator using the local government bond rating test under § 280.104 must maintain a cop y of its bond rating published within the last twelve months by Moody 's or Standard & Poor's. (6) A local go vernment owner or operator using the local government guarantee under § 280.106, where the guarantor's demonstration of financial responsibility relies on the bond rating test under § 280.104 must maintain a cop y of the guarantor's bond rating published wi thin the last twelve months by

Moody 's or Standard & Poor's. (7) An owner or operator using an insurance policy or risk retention group coverage must maintain a cop y of the signed insurance policy or risk retention group coverage policy , with the end orsement or certificate of insurance and any amendments to the agreements. (8) An owner or operator covered b y a state fund or other state assurance must maintain on file a cop y of an y evidence of coverage supplied by or required b y the state under § 280.101(d). (9) An owner or operator using a local government fund under § 280.107 must maintain the following documents: (i) A cop y of the state constitutional provision or local government statute, charter, ordinance, or order dedicating the fund, and (ii) Year

- end financial statements for the most recent completed financial reporting y ear showing the amount in the fund. If the fund is established under § 280.107( c ) using incremental funding backed b y bonding authorit y, the finan cial statements must show the previous ye ar's balance, the amount of funding during the ye ar, and the closing balance in the fund. (iii) If the fund is established under § 280.107( c ) using incremental funding backed b y bonding authorit y, the owne r or operator must also maintain documentation of the required bonding authorit y, including either the results of a voter referendum (under § 280.107( c )( 1 )), or attestation by

the State Attorney

General as specified under § 280.107( c )( 2 ). (10) A local government owner or operator using the local government guarantee supported by

the local government fund must maintain a copy of the guarantor's ye ar - end financial statements for the most recent completed financial reporting ye ar showing the amount of the fund. (11)(i) An owner or operator using an assurance mechanism specified in §§ 280.95 through 280.107 must maintain an updated cop y of a certification of financial responsibility worded as follows, except that instructions in brackets are to be replaced with the relevant information and the brackets deleted:**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

108

Certification of Financial Responsibility [Owner or operator] hereb y certifies that it is in compliance with the requirements of subpart H of 40 CFR part 280. The financial assurance mechanism(s) used to demonstrate financial responsibility under subpart H of 40 CFR part 280 is (are) as follows: [For each mechanism, list the ty pe of mechanism, name of issuer, mechanism number (if applicable), amount of c overage, effective period of coverage and whether the mechanism covers “taking corrective action” and/or “compensating third parties for bodil y injury and property damage caused b y” either “sudden accidental releases” or “nonsudden accidental releases” or “accidental releases.”] [Signature of owner or operator] [Name of owner or operator] [Title] [Date] [Signature of witness or notary ] [Name of witness or notary ] [Date] (ii) The owner or operator must update this certification whenever the financial ass urance mechanism(s) used to demonstrate financial responsibility change(s).
**§ 280.112 Drawing on financial assurance mechanisms.** (a) Except as specified in paragraph (d) of this section, the Director of the implementing age ncy shall require the guarantor, suret y, or institution issuing a letter of credit to place the amount of funds stipulated by the Director, up to the limit of funds provided by the financial assurance mechanism, into the standby trust if: (1)(i) The owner or operator fails to establish alternate financial assurance within 60 day s after receiving notice of cancellation of the guarantee, suret y bond, letter of credit, or, as applicable, other financial assurance mechanism; and (ii) The Director determines or suspects that a release from an underground storage tank covered b y the mechanism has occurred and so notifies the owner or operator or the owner or operator has notified the Director pursuant to subparts E or F of a release from an undergrou nd storage tank covered b y t he mechanism; or (2) The conditions of paragraph (b)(1) or (b)(2) (i) or (ii) of this section are satisfied. (b) The Director of the implementing agency may draw on a standby

trust fund when:**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

109 (1) The Director makes a final determination that a release has occurred and immediate or long

- term corrective action for the release is needed, and the owner or operator, after appropriate notice and opportunity

to comply , has not conducted corrective action as required under 40 CFR part 280, subpart F; or (2) The Director has received either: (i) Certification from the owner or operator and the third

- part y liability claimant(s) and from attorney s representing the owner or operator and the third

- part y liability clai mant(s) that a third

- part y liability claim should be paid. The certification must be worded as follows, except that instructions in brackets are to be replaced with the relevant information and the brackets deleted: Certification of Valid Claim The undersigned, as principals and as legal representatives of [insert: owner or operator] and [insert: name and address of third

- part y cl aimant], hereb y certify that the claim of bodily

injury [and/or] property

damage caused by

an acciden tal release arising from operating [owner's or operator's] underground storage tank should be paid in the amount of $[
________ ]. [Signatures] Owner or Operator Attorney for Owner or Operator (Notary ) Date [Signatures] Claimant(s) Attorney (s) for Claimant(s) (Notary ) Date or (ii) A valid final court order establishing a judgment against the owner or operator for bodily injury or propert y damage caused b y an accidental release from an underground storage tank covered b y financial assurance under this subpart and the Director determines that the owner or operator has not satisfied the judgment. (c) If the Director of the implementing agency determines that the amount of corrective action costs and third

- party liability claims eligible for pay ment under paragraph (b) of this section may

exceed the balance of the standby trust fund and the obligation of the provider of financial assurance, the first priority for pay ment shall be corrective action costs necessary to protec t human health and the environment. The Director shall pay third

- party

liability claims in the order in which the Director receives certifications under paragraph (b)(2)(i) of this section, and valid court orders under paragraph (b)(2)(ii) of this section.**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

110 (d) A governmental entity acting as guarantor under § 280.106(e), the local government guarantee without standby trust, shall make pay ments as directed b y the Director under the circumstances described in § 280.112 (a), (b), and (c).
**§ 280.113 Release from the requirements.** An owner or operator is no longer required to maintain financial responsibility under this subpart for an underground storage tank after the tank has been permanently closed or, if corrective action is required, after corrective action has been completed and the tank has been permanentl y closed as required by 40 CFR part 280, subpart G.
**§ 280.114 Bankruptcy or other incapacity of owner or operator or provider of financial**  **assurance.** (a) Within 10 day s after commencement of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy ), U.S. Code, naming an owner or operator as debtor , the owner or operator must notify

the Director of the implementing agency by certified mail of such commencement and submit the appropriate forms listed in § 280.111(b) documenting current financial responsibility

. (b) Within 10 day s after commence ment of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy ), U.S. Code, naming a guarantor providing financial assurance as debtor, such guarantor must notify the owner or operator by certified mail of such commencement as required under the terms of the guarantee specified in § 280.96. (c) Within 10 day s after commencement of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy ), U.S. Code, naming a local government owner or operator as debtor, the local government owner or operator must notify the Director of the implementing agency by certified mail of such commencement and submit the appropriate forms listed in § 280.111(b) documenting current financial responsibility

. (d) Within 10 day s after commencement of a voluntary or involuntary

proceeding under Title 11 (Bankruptcy ), U.S. Code, naming a guarantor providing a local government financial assurance as debtor, such guarantor must notify the local government owner or operator b y certified mail of such commencem ent as required under the terms of the guarantee specified in § 280.106. (e) An owner or operator who obtains financial assurance b y a mechanism other than the financial test of self

- insurance will be deemed to be without the required financial assur ance in the event of a bankruptcy or incapacity of its provider of financial assurance, or a suspension or revocation of the authority of the provider of financial assurance to issue a guarantee, insurance policy , risk retention group coverage policy , sure ty bond, letter of credit, or state

- required mechanism. The owner or operator must obtain alternate financial assurance as specified in this subpart within 30 day s after receiving notice of such an event. If the owner or operator does not**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

111 obtain alternate coverage within 30 day s after such notification, he must notify the Director of the implementing agency. (f) Within 30 day s after receipt of notification that a state fund or other state assurance has become incapable of pay ing for assured corrective action or third

- party compensation costs, the owner or operator must obtain alternate financial assurance.
**§ 280.115 Replenishment of guarantees, letters of credit, or surety bonds.** (a) If at an y time after a standby trust is funded upon the instruction of the Director of the implementing agency

with funds drawn from a guarantee, local government guarantee with standby trust, letter of credit, or suret y bond, and the amount in the standby trust is reduced below the full amo unt of coverage required, the owner or operator shall by the anniversary date of the financial mechanism from which the funds were drawn: (1) Replenish the value of financial assurance to equal the full amount of coverage required, or (2) Acquire another financial assurance mechanism for the amount by which funds in the standby trust have been reduced. (b) For purposes of this section, the full amount of coverage required is the amount of coverage to be provided by § 280.93 of this subpart. If a combination of mechanisms was used to provide the assurance funds which were drawn upon, replenishment shall occur b y the earliest anniversary

date among the mechanisms.
**§ 280.116 Suspension of enforcement.** [Reserved] **Subpart I**

**– Lender Liability**  EPA made no changes to this subpart. **Subpart J**

**– Operator Training**  **§ 280.240 General requirement for all UST systems.**  Not later than [three ye ars after the effective date of r ule ] , all owners and operators of UST sy stems must ensure they have designated Class A, Class B, and Class C operators who meet the requirements of this s ubpart. **§ 280.241 Designation of operators.**  UST sy stem owners and operators must designate :**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

112 (a) At least one Class A and one Class B operator for each UST or group of USTs at a facility ; and (b) Each individual who meets the definition of Class C operator at the UST facility as a Class C operator. Class C operators must be employ ees of the UST s ys tem owner and operator. **§ 280.242 Requirements for operator training** 

. UST sy stem o wners and operators must ensure Class A, Class B, and Class C operators meet the requirements of this section. Any individual designated for more than one operator class must successfull y complete the required training program or comparable examination according to the operator class in which the individual is designated. (a) Class A operators

. Each designated Class A operator must either be trained in accordance with paragraphs (a)(1) and (a)(2) of this section or pass a comparable examination in accordance with paragraph ( e ) of this section. Class A operators must receive training from an independent trainer

. (1) At a minimum, the training program for the Class A operator must provide general knowledge of the requirements in this paragraph. At a minimum, the train ing must te ach the Class A operator s , as applicable , on the purpose , methods, and function of : (i) Spill and overfill prevention; (ii) Release detection; (iii) Corrosion protection; (iv) Emergency

response; (v) Product and equipment compatibility ; (vi) Financial responsibility ; (vii) Notification and storage tank registration; (viii) Temporary

and permanent closure; (ix) Related reporting and recordkeeping; (x) Environmental and regulatory consequences of releases; and (xi) T raining requirements for Class B and Class C operators. (2) At a minimum, the training program must evaluate Class A operat ors to determine the se individual s have the knowledge and skills to make informed decisions regarding compliance and determine whether appropriate individuals are fulfilling the operation,**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

113 maintenance, and recordkeeping requirements for UST sy stems in accordance paragraph (a)(1) of this section

. (b) Class B operators

. Each designated Class B operator must either receive training in accordance with paragraphs (b)(1) and (b)(2) of this section or pass a comparable examination, in accordance with paragraph ( e ) of this section. Class B operators must receive training from an independent trainer. (1) At a minimum, the training program for the Class B operator must cover either: general requirements that encompass all regulatory requirements and t ypical equipment used at UST facilities; or site

- specific requirements which address onl y the regulatory requirements and equipment specific to the facility

. A t a minimum, the training program for Class B operators must teach the Class B operator, as applicable, on the purpose, methods, and function of: (i) Operation and maintenance; (ii) Spill and overfill prevention; (iii) Release detection and related reporting; (iv) Corrosion protection and related testing; (v) Emergency

response; (vi) Product and equipment compatibility ; (vii) Reporting and recordkeeping; (viii) Environmental and regulatory consequences of releases; and (i x ) T raining requirements for Class C operator. (2 ) At a minimum, the training program must evaluate Class B operator s to determine the se individual s have the knowledge and skills to implement applicable UST regulatory requirements in the field on the components of t yp ical UST sy stems or , as applicable, site

specific equipment used at an UST facility in accordance with paragraph (b)(1) of this section

. (c) Class C operators

. Each designated Class C operator must either : be trained by a Class A or Class B operator in accordance with paragraphs (c)(1) and (c)(2) of this section; complete a training program in accordance with paragraphs (c)(1) and (c)(2) o f this section; or pass a comparable examination, in accordance with paragraph ( e ) of this section

. (1) At a minimum, the traini ng program for the Class C operator must teach the Class C operators to take appropriate actions in response to: (i ) Emergencies; and**Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

114 (ii) Alarms caused b y spills or releases from the UST sy stem. (2) At a minimum, the training program must evaluate Class C operator s to determine these individual s have the knowledge and skills to take appropriate action in response to emergencies (including situations posing an immediate danger or threat to the public or to the environment and that require immediate action) or alarms caused by spills or releases from an underground storage tank sy stem. ( d ) Training program
. Any training program must meet the minimum requirements of this section and include an evaluation through testing, a practical demonstration, or an other approach acceptable to the implementing agency

. The evaluation component of the training pro gram must be developed and administered b y a n independent organization or the implementing agency

or delegated authority

. ( e ) Comparable Examination

. A c omparable examination must, at a minimum, test the knowledge of the Class A, Class B, or Class C operators in accordance with the requirements of paragraphs (a),(b), or (c) of this section , as applicable. The examination must be developed and administered b y an independent organization or the implementing agency or delegated authorit y. **§ 280.243**  **Timing of operator training.** (a) An owner and operator must ensure that designated Class A, Class B , and Class C operators meet requirements in § 280.242 according to the following schedule:
**Phase**
**- In Schedule For Operator Training**  **Criteria Date**  **W hen**  **O perator**  **T raining**  **O r**  **C om**  **parable E**  **xamination I**  **s R**  **equired** One or more USTs at the facility were installed on or before 12/22/1988 [1 y ear after effective date of rule ] No USTs at the facility

were installed on or before 12/22/ 1988 and at least one UST at the facility

was installed on or before 12/22/ 1998 [2 y ears after effective date of rule ]

All USTs at the facility

were installed after 12/22/1998 [3 y ears after effective date of rule ]
(b) Class A and Class B operators designated after the applicable effective date indicated in the schedule above must meet requirements in § 280.242 within 30 day s of assuming duties. (c) Class C operators designated after the applicable effective date indicated in the schedule above must be trained before assuming duties of a Class C operator. **§ 280.244 Retraining.** **Draft Internal EPA Document Do Not Cite, Quote or Distribute**

**October 2011**

115 Class A and Class B operators of UST s ys tems determined by the implementing agency to be out of compliance must complete a training program or comparable examination in accordance with requirements in § 280.242. At a minimum, the training must cover the area(s) determined to be out of compliance. UST sy stem owners and operators must ensure Class A and Class B operators are re trained pursuant to this section no later than 30 day s from the date the implementing agency

determines the facility

is out of compliance except in one of the following situations: (a) Class A and Class B operators take annual refresher training. Ref resher training for Class A and Class B operators must cover all applicable requirements in § 280.242, or (b) The implementing agency , at its discretion, grants a waiver of this retraining requirement to either the Class A or Class B operator or both. **§ 280.245 Documentation** 

. Owners and operators of underground storage tank sy stems must maintain a list of designated Class A, Class B, and Class C operators and maintain record s verify ing that training and retraining, as app licable , have been completed, in accordance with § 280.34 as follows: (a) The list must : ( 1 ) I dentify

all Class A, Class B , and Class C operators at the facility over the last three ye ars; and ( 2 ) I nclude names, class of operator trained, date assumed duties, date each completed initial training , and an y retraining. (b) Records verify ing completion of training or retraining must be a paper or electronic record for Class A, Class B, and Class C operators. The record s , at a minimum, must identify name of trainee, date trained, and operator training c lass completed. Owners and operators must maintain these records for as long as Class A, Class B, and Class C operators are designated. The following requirements also ap ply to the following t ypes of training: (1 ) R ecord s from class room or field training programs or a comparable examination must, at a minimum, be signed by the trainer or examiner and list the printed name of the trainer or examiner and the company name, address , and phone number ; (2) R ecord s from computer

- based training must, at a minimum, indicate the name of the training program and web address , if Internet

- based ; and (3) R ecords of retraining must include those areas on which the Class A or Class B operator has been retrained.