# FILED
March 8, 1996 Cecil W. Crowson Ap pellate Cou rt Clerk IN THE COURT OF AP PEALS OF

TENNESSEE, WESTE RN SECTION AT NASHVILL E

_______________________________________________________ ) RON CHRISTIAN, ) Davidson County Chancery Court ) Ru le N o. 9 4-2 785 -II Petitioner

/Appella nt. )

) VS. ) C. A. No. 01A01-9508-CH-00368 ) TENNESSEE PETROLEUM ) UNDERGROUND STORAGE TANK ) BOARD and J. W. LUNA, as ) COMMISSION

ER OF TENN

ESSEE ) DEPARTMENT OF ENVIRONMENT ) AND CONSER

VATION , ) ) Responde

nts/Appellees. ) )

______________________________________________________________________________ From the Chancery

Court of Davidson County at Nashville. Honorable C. Allen High, Chancellor
Margaret Jane Powers , Crossville, Tennessee Attorney for Petiti oner/Ap

pellant.

Charles W. Burson , Attorney Gene ral & Reporter Elizabeth P. McCarter , Senior Counsel Sharon O. Jac

obs , Assistant Attorney Gene ral Attorney s for Resp ondents/A ppellee s.

OPINI ON FIL

ED: AFFI RMED FARMER, J.
CRAWFORD, P.J., W.S. : (Concur s) CANTRELL, J. : (Concur s)1 The Commiss ioner of the Tennessee D epartme nt of Envir

onment and Conserv ation is also an appellee.

2 The record indicates that this appeal relates to a second petition for review filed by Christian with the chancery court during pendency

of the first appeal to this Court. The second petition related to matters not originally tried. For a second time we address this matter which concerns Appellant

Ron C hrist ian's eligibility for assistance

from the petroleum underground storag e tank fu

nd, estab lished in

T.C.A. § 68-215-110. The Tennessee Petroleum Undergr ound Storage Tank Board (B oard), anappelle e in this action, 1 found Christian ineligib le for a ssistance due to his f

ailure to reesta blish fund eligibil ity by, inter alia , failing

to conduct a

site che ck of his p

roperty . Upon review in

the chancery

court, the Board's decision was upheld. For reasons hereinafter set forth, we a ffirm.

These parties were be fore us previously in Christian v. T ennessee Petroleum Undergroun d

Storage Tank Board , No. 01A01-9410-CH-00489 (Tenn. App. April 26, 1995). 2 We reitera te here that

Chri stian is th e owner and op erator of fou r petr oleum under ground stora ge tanks (USTs) l ocated a

t the "Cou

ntry Corner Ma

rket" in Williamson County . The USTswere duly registered with the Tennessee De partment of Environment and Conservation (TDEC). Christian , slip op. at 1. The issue in Christian was limited to a determination of whether the chancer y court
correctly affirmed the Boa

rd's de cision th at Appellan

t lost fund e

ligibility due to the

untimely payment of his annua

l registration fees, required under T.C.A. § 68-215-109 and the Board's rules and regulat

ions promul gated thereunder. We affirmed, concluding that "[o]ne could still be considered

fund ineligible for the time period in which the fees wer e not paid as sched uled." Id . at 6. T he present ap peal concerns whether the appellee s may lawfully impose other conditions as prerequisites to the restoration o f C hristian's fund eligibility , in addition to the payment of annual fees and late penalties.

The Boa rd's fi nal orde r contains the following f indings o f fact:
[Christian] paid

annual tank fee s on April 1 0, 1991 and paid the late penalties on June 3, 1991, for fee y ear 3.

. . . . [Christian] sold

petroleum products from these underground stora ge tank sy stems during th e time frame o f Jul y, 1988 t hroughJu ly, 1990 andcontinue s to sell petr oleum pro ducts fr

om these ta

nks. In the interim between[Christian's] payment of tank fee s for fee year 3 a

nd the assessment and pay ment of the late penalties thereon, the Division issued [Christian] a letter dated Ap ril 26, 1991, dire cting him to conduct a "site check" in accor dance with the enclosed"Site Che ck Policy " (which was not e nclosed) , furth e r concluding that [Christ

ian] was r equired to document

that the si

te is no t c on ta mi na te d i n o rd er to [r ee st ab li sh ] F un d e li gi bi li ty. On or about September 9, 1991, the Division of Underground Stor age Tanks (herein after the "Divi sion") gene rated and mailed corres p ondence to Country Corner Marke t which announced the December

22, 1991 deadline for beginning leak de tection on all tanks installed between 1970 and 1974. Enclosed with the letter was a form for reporting to the Division the method of leak detection utilized at the site. [Christian] failed to report u sing any method of

releas e de te ct io n a t t hi s f ac il it y. On or about February

27, 1 992, the Division received a complaint of a possible contam ina ted spring in Thompson Station, Tennessee. . . . Laboratory analysis of wate

r samples collected

during this investigation confirm ed the presence of benzene and total petroleum

hyd rocarb ons in

concentrations abovethe clea n-up leve ls set forth in th

e Under ground Storage Tank Prog

ram Rule s (1200-1- 15) for one of the springs that was sampled. On or about M arch 4, 1 992, Div ision p ersonnel sent correspondence

to [Christia

n] in formin g him of the discovery of petroleum

contamin ation and

requiring that a systems test be conducted . . . and results to be submitted to the Division . . . . On or about Jul

y 7, 1992, Divi sion pers onnel collected s oil samples at the Country Corner Market approximately 20 feet from the tank pit. L

aborato ry analy sis confir

med the pr

esence of BTX . . . in concentrations above the clean up levels . . . .

. . . . On or about S ept ember 30, 1992, [Christian] performed sys tems tests at Country

Corner Ma

rket. A 3 000 gallon gaso lin e [UST] system was discovered to have a le ak. . . .

. . . . Division personn e l notified, by certified le tter dated November

30, 1992, [Christian] of the requirements he must follow in response to a confirmed release of pe troleum. . . .

. . . . On or about January 20, 1993, the Division rec eived an Initial Site Characterization Report from [Chri sti an]. Howe ver, this document did not con

tain resu lts of a site c

heck as r equired by R ule 1200-1-15-.06(4)(a)3.

. . . . [Christian] has not conducted a site check on this petroleum site.3 We note that Appellant lists some 7 issues on appeal and has chosen to rearg ue many of the issues decided by this Court in Christian . We will not readdress those issues here.

4 The rules identify " division" as that designated by the Commissioner of the Department of Health and Environment as the agency to implement the "Unde rground Storage Tank Prog ram in Tennessee." Program Rule 1200-1-15- .09(2)(j). This responsibility is now that of the TDEC. See Christian , slip op. at 1 n. 2.

. . . . [Christian] has not conducted an environ mental assessment of his petroleum site nor initiated corre ctive action to address the confirmed release from his tank.

The Board concluded that Christian failed to restore f und eli gibility

by f ailing " to provide evidence of leak detection, failure to pay annual tank fees in fee y

ear 2, failure to timely

pay annual tankfees in y

ear 3, a nd failur e to condu ct a site c

heck." The Boa

rd order ed Christ ian t o conduct an envir onmental assessme nt and, up on appro val, to implementa corrective action plan.

As heretofore stated, we determined in Christian that Appellant lost fund elig ibility for failure to make timely pa yment of his annual re gistration fees. Whether or not he m

ust under go
a sit e chec k in addition to paying all fees and late penalties to reestablish his fund eligibility is at issue here. T

hus, we mu st determ

ine wheth

er the B oard' s decisio n in this re sp ect p rejudices Christian 's rig

hts beca use it is:
(1) I n violation

of constitutional or

statutory provision s; (2 ) In ex ce ss of

th e s ta tu to ry a ut ho ri ty o f t he ag en cy; (3) Made upon unlawful procedure; (4) Arbitrary or

capricious or chara

ct erized by abuse of discretion or clearly

unwarranted exercise of discretion; or (5) Unsupported by evide nce w hich is both substantial and material in the light of the entire record.

See T.C.A. § 4-5-322(h). 3

On appeal, Christi an asserts that Appellees failed to comply with the Uniform Administrative Procedures Act (UAPA) "in not promulgating rules enc ompassing the 'site c heck' .

. . provisi ons which t hey erratically require of some t ank owners." Christian apparently re fers to the Divi sion 's 4 use of a "guidance memora ndum" in ordering Christian to conduct a site check.The April 26, 1991 letter to Christia

n from TD EC, in reg ard to re storation of his fund eligibil ity, states:
Dear UST Owner/Operator: If you wish to reesta blish eligibility

to the State Fund . . . you must take e ach of th

e following steps : 1. You must make sure all tanks are pro perly registered. 2. You must make sure all curr ent and pa st due fees and late charg es are paid. 3. You must conduct a s ite c heck in ac co rd an ce wi th th e e nc lo se d S it e C he ck Po li cy. Once these thin gs have been done and it has been documented that the site isnot conta

minated, you

will ree stablish F

und elig ibility

. . . .

The "policy" as expressed in an office correspondence memorandum

to all Division staff, requires the analytica

l work to be performed by a laboratory on the "US T Approved Laborato ry List." The work to be performed during the site che ck must b e pre-approved by the Technical Review Staff. Soil samples are required at certain specified locations near the tank a nd at cert ain depths. The sampl es are to be analyzed for certain specified chemicals depe nding on the type

of petroleum distributed.

Part

tw o o f t he UA PA sp ec if

ic al ly a dd re ss es th e r ul em ak in g p ro ce du re s o f a n a ge nc y. The UAPA def

ines a " rule" a s "each agency statemen t of general ap

plicabilit y th at implements or prescribes law or policy or de scribes the procedures or practice requirements of any a gency ." T.C.A. § 4-5-102(10). An "agency " is "each state board, commission, committee, depar tment, officer, or any other unit of state government authorized or required by any statute or constitutional provision to make rules or

to determine contested cases; ". T.C.A. § 4-5-102(2). The Tennessee Petroleum Underground

Storage Tank Act (Act) authorizes the Board to "promulgate and adopt such rules and regulations in accordance with the provisions of the [UAPA]." T.C.A. § 68-215-107(f). I n addition, the Act provides that any

person seeking r

eview of an order for cor rection may filea written petition withthe Commissioner, requesting a hearing before the B oard. The hearing is to be conducted by the Board in accordance with the UAPA. T.C.A. § 68-215-119(a)(1) and (b).Cl ea rl y, TDEC and the Division are not authorized to promulg ate rules and

regulations or

hear contested cases under the Act. See Fentress County Utility District v. Tennessee WaterQuality Control Board, No. 01A01-9406-CH-00295, slip op. at 4 (Tenn. App. January 11, 1995). Inste ad, the B oard' s rules pr ovide tha t the Divis ion is "to implement" the UST program. See Rule 1200-1-1 5-.09(j) . Thus, the y a re not " agenc ies" for pu rp os es of th e U AP A a nd th e " po li cy" reliedupon by the Division cannot be conside red a "rule," subject

to UAPA compliance. Th e p ol ic y, however , must assis t the Divis ion in its imp lementat ion of the progra m.
Program Rule 1200-1-15- .09(5 ) pertains to the "[l]oss and [r]estoration of [f]und [e]ligibility" and, as here per tinent, sta tes:
(b) If at any

time the Division determines that an owner or operator has failed to mainta

in Fund eligibility , th e Divisi on will provide notice to the owner or operator of such non-complianc e. The owner or operator shall have th irty (30) day s from receipt of such notice to pr o vide evid

ence of compliance with a

ll Fund el

igibility require ments or such ot

her time period as the Division may allow. I f, after this time period, the owner or operator fails to resolve the noncompliance, the Dire ctor sha ll issue a Notice of Fund Ineligibility and enforcement

acti ons wh ich may include pe nalty assessment may

be initiated. The owner or operator shall have 60 days fr

om receipt of Notice of Fund I

neligib ility

to place in force alterna te fin anc ial assurance . . . . (c) An ow ner o r operator that has been issued a Notice of Fund Ineligibility

must resolve the non-compliance t o the satisfact

io n of the Divisi

on for Fund el

igibility to be restor

e d . . . . It is the responsi bility of the owner or operator to provide evi d ence of compli ance to the Division. The Fund will not cover either investigative or corrective action cos ts or third pa rty liabilit y cla ims associated

with a release which occurred during the time o

f Fund ineligibility. (Emphasis added.)

We find that under

the fore going

rule, it iswithin TDEC's discretion to impose a site check requi rement to asc ertai n whet her a re lease h as occu rred du ring a pe ri od of fu nd in el ig ib il it y. The rule clearly

prohibits the application of fund monies for corrective action costs due to a rele ase occurring during the time of fundineligib ility . Without the site che ck requi

rement, how else

could "a release which occurred during the time of fund ineligibility" be discovered? Further, we do not find the record

to sugg est

that the B oard hasinconsiste ntly or arbitr arily imposed su ch requi

rement.

We concl ude th at the determ inati on of t he Boar d requ iring C hrist ian to under go a sitecheck to

reesta blish fund

eligibil ity comports with T.C.A. § 4-5-322(h). The judgment of the trial court upholding the Board's decision is, t he refore, affirmed. Costs are assesse d against Ron Ch ri st ia n, fo r w hi ch ex ec ut io n m ay i ss ue if ne ce ss ar y.

___________________________________ FAR MER , J.

______________________________ CRAWFORD, P.J., W.S. (Conc urs)

______________________________ CANTREL

L, J. (Co ncurs)